Agenda packet — City Council and Concurrent Authorities, June 14, 2022 (part 7 of 9)

Table B-3Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - City of MantecaEstimated Annual Property Tax Revenues (2020$) Assumption/
Item Source Formula 2025 2030 2035 2040 2050 Buildout (2060) Assessed Value of New Development Table D-2
Assessed Value of New Development in Current City Limits a $1,179,618,758 $2,170,065,092 $3,019,643,625 $3,320,572,292 $3,445,572,292 $3,506,962,292 Assessed Value of New Development in Annexation Area b $137,875,000 $345,375,000 $600,390,200 $714,067,000 $714,067,000 $714,067,000 Total Assessed Value c = a + b $1,317,493,758 $2,515,440,092 $3,620,033,825 $4,034,639,292 $4,159,639,292 $4,221,029,292 Property Tax Revenue (1% of Assessed Value) 1.0000%
Property Tax Revenue in Current City Limits d = a * 1.00% $11,796,188 $21,700,651 $30,196,436 $33,205,723 $34,455,723 $35,069,623 Property Tax Revenue in Annexation Areas e = b * 1.00% $1,378,750 $3,453,750 $6,003,902 $7,140,670 $7,140,670 $7,140,670 Total Property Tax Revenue f = d + e $13,174,938 $25,154,401 $36,200,338 $40,346,393 $41,596,393 $42,210,293 Estimated Property Tax Allocation
Property Tax Allocation in Current City Limits [1]
City of Manteca General Fund 14.2968% g = d * 14.30% $1,686,477 $3,102,498 $4,317,123 $4,747,355 $4,926,065 $5,013,833 Other Agencies/ERAF 85.7032% h = d * 85.70% $10,109,711 $18,598,153 $25,879,313 $28,458,368 $29,529,658 $30,055,790 Property Tax Allocation in Annexation Areas [2]
City of Manteca General Fund 6.6282% i = e * 6.63% $91,386 $228,921 $397,949 $473,296 $473,296 $473,296 Other Agencies/ERAF 93.3718% j = e * 93.37% $1,287,364 $3,224,829 $5,605,953 $6,667,374 $6,667,374 $6,667,374 Total City of Manteca General Fund Property Tax k = g + i $1,777,863 $3,331,419 $4,715,072 $5,220,651 $5,399,361 $5,487,129EIFD Allocation - Maximum Tax Rate EIFD Allocation Percentage [3] l 5.0% 20.0% 20.0% 20.0% 20.0% 20.0% EIFD Allocation m = k * l $88,893 $666,284 $943,014 $1,044,130 $1,079,872 $1,097,426 Net City General Fund Property Tax n - k - m $1,688,970 $2,665,135 $3,772,058 $4,176,521 $4,319,489 $4,389,703 EIFD Allocation - Variable Tax Rate
EIFD Allocation Percentage [3] l 5.0% 13.0% 9.5% 9.5% 4.5% 4.5% EIFD Allocation m = k * l $88,893 $433,084 $447,932 $495,962 $242,971 $246,921 Net City General Fund Property Tax n - k - m $1,688,970 $2,898,334 $4,267,141 $4,724,689 $5,156,390 $5,240,208 Estimated Property Tax Revenues (2020$)
City of
Manteca
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Table B-3Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - City of MantecaEstimated Annual Property Tax Revenues (2020$) Assumption/
Item Source Formula 2025 2030 2035 2040 2050 Buildout (2060) Estimated Property Tax Revenues (2020$)
City of
Manteca
Property Tax In-Lieu of Motor Vehicle In-Lieu Fee Revenue (VLF) l $9,295,356,393 $9,295,356,393 $9,295,356,393 $9,295,356,393 $9,295,356,393 $9,295,356,393 m $1,317,493,758 $2,515,440,092 $3,620,033,825 $4,034,639,292 $4,159,639,292 $4,221,029,292 n = l + m $10,612,850,151 $11,810,796,485 $12,915,390,218 $13,329,995,685 $13,454,995,685 $13,516,385,685 o = m / l 14.17% 27.06% 38.94% 43.40% 44.75% 45.41%
Total Citywide Assessed Value [4]
Total Assessed Value of ProjectTotal Assessed Value
Percent Change in AV
Property Tax In-Lieu of VLF [5] $7,228,240 p = o * $7,228,240 $1,024,507 $1,956,052 $2,815,005 $3,137,410 $3,234,612 $3,282,350 prop tax
Source: City of Manteca; San Joaquin County Auditor-Controller; EPS.[4] Reflects Assessed Valuation for FY 2019-20. Includes Citywide secured, unsecured, homeowner exemption, and public utility roll.[5] Property tax in-lieu of VLF amount derived from the City of Manteca FY 2019-20 Annual Budget. Refer to Table B-1 for details.[1] Reflects the average property tax allocation to the City's General Fund for all TRAs within the 200-year flood plain that are within the City's boundary and not included in a redevelopment area. TRAs located in Project boundary include: 002-000, 002-005, 002-006, 002-055, 002-057, 002-058, 002-060, 002-063, 002-064, 002-074, 002-076, 002-078, 002-080, 002-087, and 002-088. Project TRAs not included in theredevelopment area include: 002-000, 002-060, 002-063, and 002-088. [2] Reflects the estimated property tax allocation to the City's General Fund of TRAs anticipated to annex into the City of Manteca within the boundary of the flood basin. Refer to Table D-1 for details.[3] EIFD allocation percentage represents the portion of property tax revenues to be diverted to the EIFD. Alocation percentages are negotiated allocation amounts based on discussions between the County, the Cities of Lathrop, Stockton, and Manteca, and Project Consultants. Reflects the Initial Base Rate for the period ending 2029 and the Maximum Tax Allocation Rate for 2030 and beyond.

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Table B-4Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - City of MantecaReal Property Transfer Tax (2020$) Assumption/
Description Source 2025 2030 2035 2040 2050 Buildout (2060) Rate per $1,000 of AV $0.55
Project Assessed Value Table D-2
Low Density Residential $666,500,000 $1,435,500,000 $2,015,500,000 $2,209,500,000 $2,209,500,000 $2,209,500,000High Density Residential $93,800,000 $147,600,000 $147,600,000 $147,600,000 $147,600,000 $147,600,000Nonresidential $557,193,758 $932,340,092 $1,456,933,825 $1,677,539,292 $1,802,539,292 $1,863,929,292Total Assessed Value $1,317,493,758 $2,515,440,092 $3,620,033,825 $4,034,639,292 $4,159,639,292 $4,221,029,292 Turnover Rate
Low Density Residential 14.30%High Density Residential 6.70%Nonresidential 5.00% Annual Transfer Tax Revenue [1]
Low Density Residential $52,420 $112,902 $158,519 $173,777 $173,777 $173,777High Density Residential $3,457 $5,439 $5,439 $5,439 $5,439 $5,439Nonresidential $15,323 $25,639 $40,066 $46,132 $49,570 $51,258Total Annual Transfer Tax Revenue $71,200 $143,980 $204,024 $225,349 $228,786 $230,474 transfer
Source: City of Manteca; San Joaquin County Auditor-Controller; EPS.[1] Formula for Transfer Tax = Assessed Value/$1,000 * Rate per $1,000 of Assessed Value * Turnover rate.

Estimated Annual Property Transfer Tax Revenue (2020$)
City of
Manteca
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Table B-5Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - City of MantecaEstimated Annual Taxable Sales and Use Tax Revenue (2020$)Item Formula 2025 2030 2035 2040 2050 Buildout (2060)Estimated Annual Taxable Sales Annual Taxable Sales from Market Support (Residents and Employees) a $40,347,645 $75,445,812 $103,598,636 $113,935,379 $115,184,129 $115,797,415 Annual Taxable Sales from Onsite Commercial Uses b $121,792,711 $324,229,106 $577,848,534 $675,416,296 $755,012,084 $794,103,167 Annual Taxable Sales from New Development c = a + b $162,140,356 $399,674,918 $681,447,170 $789,351,675 $870,196,213 $909,900,582 Annual Sales Tax Revenue
Bradley Burns Local Sales Tax Revenue d = c * 1.0000% 1.0000% $1,621,404 $3,996,749 $6,814,472 $7,893,517 $8,701,962 $9,099,006 City of Manteca Prop 172 Public Safety Sales Tax Revenue [1] e = d * 2.8912% 2.8912% $46,877 $115,553 $197,018 $228,215 $251,588 $263,067 sales
Source: City of Manteca; California State Board of Equalization; EPS.

Source/
Assumptions
Annual Sales Tax Revenue
[1] Calculated as the ratio of Proposition 172 Public Safety Tax revenue to total sales tax revenue based on the FY 2020-21 Budget. Any variation in the relationship between Proposition 172 Public Safety Tax revenue and total sales tax revenue affecting the estimate of this revenue source is estimated to be nominal.

City of
Manteca
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Table B-5AMossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - City of MantecaEstimated Annual Taxable Sales from Proposed Development, Market Support Method (2020$)Annual Taxable Sales from Market Support Assumption 2025 2030 2035 2040 2050 Buildout (2060)Annual Taxable Sales from New Residents Residential Development Table A-3
Low Density Residential 1,253 2,699 3,789 4,154 4,154 4,154High Density Residential 441 694 694 694 694 694Total Residential Development 1,694 3,392 4,483 4,848 4,848 4,848 Taxable Retail Expenditures per Household [1]
Low Density Residential $24,000 $30,072,480 $64,769,760 $90,939,360 $99,692,640 $99,692,640 $99,692,640High Density Residential $15,000 $6,612,900 $10,405,800 $10,405,800 $10,405,800 $10,405,800 $10,405,800Total Taxable Retail Expenditures $36,685,380 $75,175,560 $101,345,160 $110,098,440 $110,098,440 $110,098,440 Estimated Citywide Capture from New Households [2] 80% $29,348,304 $60,140,448 $81,076,128 $88,078,752 $88,078,752 $88,078,752 Estimated Taxable Sales inside Project Area 50% $14,674,152 $30,070,224 $40,538,064 $44,039,376 $44,039,376 $44,039,376Estimated Taxable Sales outside Project Area 50% $14,674,152 $30,070,224 $40,538,064 $44,039,376 $44,039,376 $44,039,376 Annual Taxable Sales from New Employment
Taxable Sales from New Employment
Employees Table A-4 10,185 14,172 20,854 23,941 25,098 25,665 Average Daily Taxable Sales per New Employee $10.00Work Days per Year 240Taxable Sales from New Employees [3] 50%Total Taxable Sales from New Employees $12,221,490 $17,005,960 $25,025,009 $28,729,586 $30,117,086 $30,798,515 Estimated Citywide Capture from New Employees [2] 90% $10,999,341 $15,305,364 $22,522,508 $25,856,627 $27,105,377 $27,718,663 Estimated Taxable Sales inside Project Area 70% $7,699,539 $10,713,755 $15,765,756 $18,099,639 $18,973,764 $19,403,064Estimated Taxable Sales outside Project Area 30% $3,299,802 $4,591,609 $6,756,752 $7,756,988 $8,131,613 $8,315,599 Total Annual Taxable Sales from Market Support $40,347,645 $75,445,812 $103,598,636 $113,935,379 $115,184,129 $115,797,415 Taxable City Sales inside Project Area $22,373,691 $40,783,979 $56,303,820 $62,139,015 $63,013,140 $63,442,440Taxable City Sales outside Project Area $17,973,954 $34,661,833 $47,294,816 $51,796,364 $52,170,989 $52,354,975 sales a
Source: Costar; Gregory Group; Bureau of Labor Statistics; City of Manteca; EPS.[2] Represents the portion of household and employee retail expenditures estimated to take place within the City of Manteca.[3] Taxable sales from employees discounted by 50 percent to account for employees who are also residents.

Estimated Annual Taxable Sales (2020$)
City of
Manteca
Occupied Dwelling Units
Taxable Retail Expenditures
[1] For details pertaining to household taxable expenditure assumptions, refer to Table D-3.

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Table B-5BMossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - City of MantecaEstimated Annual Taxable Sales from Onsite Nonresidential (2020$) Annual
Taxable Sales
Item per Sq. Ft. [1] 2025 2030 2035 2040 2050 Buildout (2060)Taxable Sales from Commercial Development Taxable Sales Generating Occupied Commercial Development Square Feet Retail Commercial 576,113 1,576,263 2,781,107 3,239,141 3,609,141 3,790,855Total 576,113 1,576,263 2,781,107 3,239,141 3,609,141 3,790,855 Total Taxable Sales from Onsite Commercial Development
Retail Commercial $240 $138,267,165 $378,303,037 $667,465,733 $777,393,858 $866,193,858 $909,805,314 Total $138,267,165 $378,303,037 $667,465,733 $777,393,858 $866,193,858 $909,805,314 Less Total Annual Taxable Sales from Market Support (within the Project) [2] $22,373,691 $40,783,979 $56,303,820 $62,139,015 $63,013,140 $63,442,440Annual Sales Less Market Support $115,893,474 $337,519,058 $611,161,913 $715,254,843 $803,180,718 $846,362,873 Shift from
Existing Retail
Less Shift of Sales from Existing Regional and Community Retail to the Project [3] 10% $11,589,347 $33,751,906 $61,116,191 $71,525,484 $80,318,072 $84,636,287 Total Taxable Sales from Retail Commercial Uses $104,304,127 $303,767,152 $550,045,722 $643,729,358 $722,862,646 $761,726,586Occupied Nonretail Commercial Uses Office Commercial 144,028 394,066 642,205 721,332 813,832 859,261Industrial 3,353,689 3,698,325 4,918,358 5,616,055 5,616,055 5,616,055Total 3,497,717 4,092,391 5,560,562 6,337,388 6,429,888 6,475,316 Total Taxable Sales from Nonretail Commercial Uses
Office Commercial $5 $720,141 $1,970,328 $3,211,025 $3,606,661 $4,069,161 $4,296,304Industrial $5 $16,768,443 $18,491,625 $24,591,788 $28,080,277 $28,080,277 $28,080,277Total $17,488,584 $20,461,954 $27,802,812 $31,686,938 $32,149,438 $32,376,581 Total Taxable Sales from Nonretail Commercial Development $17,488,584 $20,461,954 $27,802,812 $31,686,938 $32,149,438 $32,376,581 Total Taxable Sales from Onsite Commercial Uses $121,792,711 $324,229,106 $577,848,534 $675,416,296 $755,012,084 $794,103,167 sales b
Source: U.S. Department of Labor Bureau of Labor Statistics; Urban Land Institute; EPS.[2] Estimated in Table B-5A.

City of
Manteca
Estimated Annual Taxable Sales (2020$)
[1] See Table D-4 for the taxable retail sales calculation. All retail is assumed to be community serving retail. Sales per square foot for the Retail space is based on average total sales per square foot figure derived from BizMiner and eMarketer data (escalated to 2020$) and converts total sales to taxable sales per square foot to account for a small portion of non-taxable goods sold. [3] Represents a discount factor to account for taxable sales transactions that may shift from the City's existing retail centers to those included in the Project.

Applied only to Retail uses within the Project.

Occupied Building Square Feet
Occupied Building Square Feet
Total Taxable SalesTotal Taxable Sales
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APPENDIX C:

General Fund Expenditure Analysis
Table C-1 Expenditure-Estimating Procedures Based on
City of Lathrop FY 2020-21 Budget ................................ G-16 Table C-2 Estimated Annual General Fund Expenditures .................. G-17

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Table C-1Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - City of MantecaExpenditure-Estimating Procedures Based on City of Manteca FY 2020-21 Budget (2020$) FY 2020-21 FY 2020-21 Population
Estimating Budgeted Less Offsetting Net City or Persons FY 2020-21 Adjustment Net FY 2019-20 Item Procedure Expenditures [1] Revenue Expenditures Served Avg. Cost Factor [2] Avg. Cost General Fund Expenditures
General Government
Legislation and Policy Persons Served $1,569,362 - $1,569,362 95,300 $16.47 100% $16.47Legal Services Persons Served $920,326 - $920,326 95,300 $9.66 100% $9.66 City Administration Persons Served $1,276,411 ($475,458) $800,953 95,300 $8.40 100% $8.40 Public Works Administration Persons Served $1,709,398 ($1,554,893) $154,505 95,300 $1.62 100% $1.62Non Departmental Persons Served $9,181,518 - $9,181,518 95,300 $96.34 100% $96.34 Human Resources Persons Served $1,644,221 - $1,644,221 95,300 $17.25 100% $17.25Fiscal and Revenue Management Persons Served $1,713,751 ($822,631) $891,120 95,300 $9.35 100% $9.35 Economic and Community Development Persons Served $365,978 - $365,978 95,300 $3.84 200% $7.68 Fleet Maintenance Persons Served $450,675 - $450,675 95,300 $4.73 100% $4.73 Subtotal General Government $18,831,640 ($2,852,981) $15,978,659 Public Safety
Police Protection [3] Persons Served $19,436,258 ($840,780) $18,595,478 95,300 $195.13 100% $195.13Animal Services Persons Served $450,319 ($252,635) $197,684 95,300 $2.07 100% $2.07Fire Protection [3] [4] Persons Served $10,890,170 ($1,792,064) $9,098,106 95,300 $95.47 100% $95.47Subtotal Public Safety $30,776,747 ($2,885,479) $27,891,268 Parks, Recreation, and Community Services
Parks Maintenance Per Capita $2,988,546 ($55,000) $2,933,546 84,800 $34.59 100% $34.59 Library Per Capita $133,160 - $133,160 84,800 $1.57 100% $1.57 Recreational and Senior Services Per Capita $996,298 - $996,298 84,800 $11.75 100% $11.75 Subtotal Parks, Recreation, and Community Svcs $4,118,004 ($55,000) $4,063,004 Public Utilities
Storm Drainage Persons Served $671,420 - $671,420 95,300 $7.05 100% $7.05 Subtotal Public Utilities $671,420 - $671,420
Transportation
Streets Persons Served $474,170 - $474,170 95,300 $4.98 100% $4.98 Subtotal Transportation $474,170 - $474,170
Total General Fund Expenditures $54,871,981 ($5,793,460) $49,078,521 exp
Source: City of Manteca FY 2020-21 Final Budget including Midyear Budget Amendments (Current as of March 10, 2021); EPS.[1] Includes midyear budget amendments as provided by City staff, current as of March 10, 2021.[2] An adjustment factor may be used to reflect the fact that new employees may not increase certain General Fund department expenditures at a 1:1 ratio. This analysis does not assume an adjustment at this time.

City of
Manteca
[3] Police and Fire protection expenditures included reflect only City General Fund Police expenditures and excludes any Measure M funded expenditures (Fund 320) for one-time capital expenditures included in the public safety endowment fund (Fund 330).
[4] It is anticipated that Project development would result in the need for an additional fire station to serve the Project area to the south of the City prior to development of the first phase of the Project, based on information provided by the Fire Chief. This ongoing operations of a new fire station in the initial phase of Project development (2020 - 2025).

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Table C-2Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - City of MantecaEstimated Annual General Fund Expenditures (2020$)Expenditure Category 2025 2030 2035 2040 2050 Buildout (2060) General Fund
General Government
Legislation and Policy $170,100 $291,904 $406,182 $451,421 $460,942 $465,617Legal Services $99,753 $171,182 $238,199 $264,728 $270,311 $273,053City Administration $86,814 $148,979 $207,303 $230,391 $235,250 $237,636Public Works Administration $16,747 $28,738 $39,989 $44,443 $45,380 $45,840 Non Departmental $995,169 $1,707,778 $2,376,361 $2,641,030 $2,696,729 $2,724,083Human Resources $178,214 $305,828 $425,557 $472,954 $482,929 $487,827Fiscal and Revenue Management $96,587 $165,750 $230,640 $256,328 $261,733 $264,388Economic and Community Development $79,335 $136,145 $189,445 $210,544 $214,985 $217,166Fleet Maintenance $48,848 $83,826 $116,644 $129,635 $132,369 $133,712 Subtotal General Government $1,771,567 $3,040,130 $4,230,319 $4,701,475 $4,800,628 $4,849,324 Public Safety
Police Protection $2,015,532 $3,458,790 $4,812,882 $5,348,922 $5,461,729 $5,517,131Animal Services $21,427 $36,770 $51,165 $56,863 $58,062 $58,651 Fire Protection [2] $1,700,000 $1,692,263 $2,354,772 $2,617,037 $2,672,230 $2,699,336Subtotal Public Safety $3,736,959 $5,187,822 $7,218,819 $8,022,822 $8,192,021 $8,275,118 Parks, Recreation, and Community Services
Parks Maintenance $181,171 $368,082 $492,561 $534,197 $534,197 $534,197Library $8,224 $16,708 $22,358 $24,248 $24,248 $24,248 Recreational and Senior Services $61,530 $125,009 $167,285 $181,425 $181,425 $181,425Subtotal Parks, Recreation, and Community Svcs $250,925 $509,799 $682,204 $739,871 $739,871 $739,871 Public Utilities
Storm Drainage $72,774 $124,885 $173,777 $193,132 $197,205 $199,205Subtotal Public Utilities $72,774 $124,885 $173,777 $193,132 $197,205 $199,205 Transportation
Streets $51,394 $88,196 $122,725 $136,393 $139,270 $140,682 Subtotal Transportation $51,394 $88,196 $122,725 $136,393 $139,270 $140,682 Total Annual General Fund Expenditures $5,883,619 $8,950,832 $12,427,844 $13,793,693 $14,068,994 $14,204,200 exp est
Source: City of Manteca FY 2020-21 Adopted Budget; EPS.[1] Annual expenditure estimated on a per persons served or per capita basis. Refer to Table C-1 for estimating procedure and Table A-5 for population and employment estimates.

Estimated Annual Expenditure [1]
City of
Manteca
[2] Based on information provided by the Fire Chief, it is anticipated that an additional fire station would be required to service Project development south of the City. Staffing for an additional Fire station would consist of Three Fire Captains, Three Fire engineers, Three Firefighters and two Firefighter floaters. It is estimated that staffing and operations of this station would result in annual expenditures equalling $1,700,000 annually, based on information provided by the Manteca Fire Department. The ongoingannual operational costs of a new fires station is included in the initial phase of the development. It is assumed that this cost is captured in the annual expenditures calculated using the multiplier method for all remaining phases.

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APPENDIX D:

Supporting Tables for
Revenue and Expenditure Analysis
Table D-1 Preliminary Property Tax Allocations for
Annexation Area ......................................................... G-18 Table D-2 Cumulative Assessed Valuation ..................................... G-19 Table D-3 Estimated Average Annual Household Income ................. G-20 Table D-4 Total and Taxable Retail Sales per Square Feet ................ G-21

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Table D-1Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - City of MantecaPreliminary Property Tax Allocations for Annexation Areas Tax Code Entity TRA 102-136 TRA 102-001 TRA 102-136 TRA 102-001 Total Formula a b e f g = e + f h e = d * $396,888 f = e / $1,197,578 Subject to Detachment
10001 County General 20.32600% 20.29360% $228,594 $14,804 $243,398 80% $317,510 26.51271%10527 Road District 5 3.97920% 3.97840% $44,751 $2,902 $47,653 - - 0.00000%14901 Lathrop-Manteca Rural Fire 8.83690% 8.84610% $99,384 $6,453 $105,837 - - 0.00000%40200 City of Manteca 0.00000% 0.00000% - - - 20% $79,378 6.62818% Subtotal 33.14210% 33.11810% $372,728 $24,160 $396,888 100% $396,888 33.14089% Not Subject to Detachment
10618 County Library 1.63940% 1.63910% $18,437 $1,196 $19,633 - $19,633 1.63940%12601 Manteca Unified Schools 26.94230% 26.93720% $303,000 $19,651 $322,650 - $322,650 26.94192%13001 S.J. Delta Comm College 3.64750% 3.64670% $41,021 $2,660 $43,681 - $43,681 3.64745%13201 County Office Of Education 1.28960% 1.31780% $14,501 $961 $15,463 - $15,463 1.29115% 16001 Sjc Flood Control 0.16000% 0.15990% $1,799 $117 $1,916 - $1,916 0.15997% 21901 Sjc Mosquito Abatement 0.71800% 0.71790% $8,075 $524 $8,598 - $8,598 0.71797%24601 South San Joaquin Irrigation 5.41160% 5.41660% $60,861 $3,951 $64,813 - $64,813 5.41200%41100 ERAF - Educational Revenue Augmentation Fund 27.04950% 27.04670% $304,205 $19,731 $323,936 - $323,936 27.04926% Subtotal 66.85790% 66.88190% $751,899 $48,791 $800,690 0% $800,690 66.85911% Total 100.00000% 100.00000% $1,124,627 $72,951 $1,197,578 100% $1,197,578 100.00000% TRA
Source: San Joaquin County Auditor-Controller; EPS.[1] Provided by the San Joaquin County Auditor-Controller.[2] Based on the most recent tax-sharing agreement between San Joaquin County and the City of Manteca dated November 2018 related to annexed areas to the City.

Post-ERAF
Distribution
Gross Revenue
(FY 2019-20) [1]
City of
Manteca
Property Tax
Sharing
Agreement [2]
Existing Tax Rate Area (TRA) Post Annexation Average
Post-ERAF Distribution [1] Base
Revenue
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Table D-2Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - City of MantecaCumulative Assessed Valuation (2020$)Item 2025 2030 2035 2040 2050 Buildout (2060)Development Projections in Current City Limits Residential Land Uses per Unit
Low Density Residential $500,000 $528,625,000 $1,090,125,000 $1,585,625,000 $1,779,625,000 $1,779,625,000 $1,779,625,000High Density Residential $200,000 $93,800,000 $147,600,000 $147,600,000 $147,600,000 $147,600,000 $147,600,000Subtotal Residential $622,425,000 $1,237,725,000 $1,733,225,000 $1,927,225,000 $1,927,225,000 $1,927,225,000 Nonresidential Land Uses per Sq. Ft.

Retail Commercial $250 $155,706,267 $426,016,933 $694,275,600 $779,818,533 $879,818,533 $928,930,533Office Commercial $250 $38,926,567 $106,504,233 $173,568,900 $194,954,633 $219,954,633 $232,232,633Industrial $100 $362,560,925 $399,818,925 $418,574,125 $418,574,125 $418,574,125 $418,574,125Subtotal Nonresidential $557,193,758 $932,340,092 $1,286,418,625 $1,393,347,292 $1,518,347,292 $1,579,737,292 Total All Land Uses $1,179,618,758 $2,170,065,092 $3,019,643,625 $3,320,572,292 $3,445,572,292 $3,506,962,292 Development Projections in Annexation Areas
Residential Land Uses per Unit
Low Density Residential $500,000 $137,875,000 $345,375,000 $429,875,000 $429,875,000 $429,875,000 $429,875,000Subtotal Residential $137,875,000 $345,375,000 $429,875,000 $429,875,000 $429,875,000 $429,875,000 Nonresidential Land Uses per Sq. Ft.

Retail Commercial $250 - - $57,375,000 $95,625,000 $95,625,000 $95,625,000Industrial $100 - - $113,140,200 $188,567,000 $188,567,000 $188,567,000Subtotal Nonresidential - - $170,515,200 $284,192,000 $284,192,000 $284,192,000 Total All Land Uses $137,875,000 $345,375,000 $600,390,200 $714,067,000 $714,067,000 $714,067,000 Total City of Manteca Development Projections
Residential Land Uses per Unit
Low Density Residential $500,000 $666,500,000 $1,435,500,000 $2,015,500,000 $2,209,500,000 $2,209,500,000 $2,209,500,000High Density Residential $200,000 $93,800,000 $147,600,000 $147,600,000 $147,600,000 $147,600,000 $147,600,000Subtotal Residential $760,300,000 $1,583,100,000 $2,163,100,000 $2,357,100,000 $2,357,100,000 $2,357,100,000 Nonresidential Land Uses per Sq. Ft.

Retail Commercial $250 $155,706,267 $426,016,933 $751,650,600 $875,443,533 $975,443,533 $1,024,555,533Office Commercial $250 $38,926,567 $106,504,233 $173,568,900 $194,954,633 $219,954,633 $232,232,633Industrial $100 $362,560,925 $399,818,925 $531,714,325 $607,141,125 $607,141,125 $607,141,125Subtotal Nonresidential $557,193,758 $932,340,092 $1,456,933,825 $1,677,539,292 $1,802,539,292 $1,863,929,292 Total All Land Uses $1,317,493,758 $2,515,440,092 $3,620,033,825 $4,034,639,292 $4,159,639,292 $4,221,029,292

TRUE TRUE TRUE TRUE TRUE TRUE
AV
Source: Costar; CBRE; The Gregory Group; EPS.[1] Refer to Table A-5 for details.

Rounded
Value per
Unit/Sq. Ft.
[1]
Total Assessed Value (2020$)
City of
Manteca
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Table D-3Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - City of MantecaEstimated Average Annual Household Income (2020$) Taxable Annual Taxable
Estimated Total Annual Estimated Expenditures Expenditures Home Mortgage Household as a Percentage per Household
Residential Land Use Value [1] or Rent [2] Income [3] of Income [4] (Rounded) Owner-Occupied Residential
Low Density Residential $500,000 $35,767 $102,000 23% $24,000 Renter-Occupied Residential
High Density Residential $200,000 $18,000 $51,000 30% $15,000 income
Source: Costar; Gregory Group; Bureau of Labor Statistics; EPS.[1] See Table A-5 for detail on estimated values for residential units.[4] Based on household expenditures data from the Bureau of Labor Statistics, 2018 Consumer Expenditure Survey.[2] Based on a 5%, 30-year fixed-rate mortgage with a 20% down payment, $150 monthly Homeowner's association dues and 2% annual taxes and insurance.High density residential based on an average monthly rent assumption of $1,500 based on data on similar multifamily residentialobtained from Costar, September 2019 with an average unit size of 1,000 square feet. [3] Assumes 35% of income dedicated to housing costs (mortgage, taxes, insurance, and HOA dues) or rent payments. Rounded to the nearest $1,000.

City of
Manteca
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Table D-4Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - City of MantecaTotal and Taxable Retail Sales per Square Feet (2020$)Item % [2] No. % [2] No. % [2] No.Total Retail Sales per Square Foot Motor Vehicle and Parts Dealers [3] $250 $279 3% $8 2% $6 1% $3Home Furnishings and Appliance Stores $525 $586 0% $0 7% $41 10% $59Bldg. Matrl. and Garden Equip. and Supplies $356 $398 0% $0 15% $60 1% $4Food and Beverage Stores [4] - $578 55% $318 24% $139 3% $17Gasoline Stations [5] $1,321 $1,664 1% $17 2% $33 1% $17Clothing and Clothing Accessories Stores $370 $413 2% $8 5% $21 20% $83General Merchandise Stores $360 $402 5% $20 20% $80 20% $80Food Services and Drinking Places $492 $550 8% $44 10% $55 20% $110 Other Retail $209 $234 12% $28 7% $16 18% $42Nonretail [6] NA $0 14% $0 8% $0 6% $0 Total 100% $440 100% $450 100% $410
Taxable Retail Sales per Square Foot by Retail Center Type Percent Taxable by Shopping Center Type [7] 44% 54% 98%Taxable Sales per Square Foot (Rounded) $190 $240 $400 retail sales
Note: Original data is based on an average of multiple sources and is presented in 2016$ unless noted otherwise in footnotes.[1] Sales adjusted to year-end 2020 based on the Consumer Price Index, All items in West urban, all urban consumers, not seasonally adjusted:

Total Retail Sales per Square Foot
Original
Data
[see Note]
Escalated
Data
(2019$) [1]
Total Retail Sales by Shopping Center Type
Neighborhood Community Regional
Source: BizMiner 2016; ULI Dollars & Cents 2008; State of California Board of Equalization (BOE) Publication 61; Bureau of Labor Statistics, "CPI-All Urban Consumers (Current Series) - West Urban"; RetailSails http://retailsails.files.wordpress.com/2011/09/rs_spsf.pdf; eMarketer pulled February 2019; respective annual 10-K reports; EPS.

Sales per square foot for Food and Beverage stores estimated based on the averages from BizMiner, RetailSales, eMarketer, and annual 10-K reports, escalated to 2020$.

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ATTACHMENT H:

Stockton Fiscal Impact Analysis

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List of Tables
Table 1 Summary of Annual Surplus/Deficits ............................................................. H-1 Table 2 Estimated Annual Revenues and Expenditures ............................................... H-2

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Table 1Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonSummary of Annual Surplus/Deficits (2020$)Item 2025 [1] 2030 2035 2040 2050 Buildout (2060)Annual Fiscal Impact Summary Prior to EIFD Allocation
Annual General Fund Revenues $1,352,000 $2,886,000 $4,905,000 $7,103,000 $10,075,000 $11,239,000Annual General Fund Expenditures $2,988,000 $3,708,000 $4,730,000 $5,582,000 $6,348,000 $6,624,000Net General Fund Surplus/(Deficit) ($1,639,000) ($920,000) ($6,000) $1,244,000 $3,367,000 $4,238,000 Net of EIFD Allocation - Maximum Tax Rate
EIFD Contribution [2] ($2,800) ($98,700) ($181,000) ($277,600) ($360,600) ($377,700) Net General Fund Surplus/(Deficit) ($1,641,800) ($1,018,700) ($187,000) $966,400 $3,006,400 $3,860,300 Net of EIFD Allocation - Variable Tax Rate
EIFD Contribution [2] ($2,800) ($64,200) ($86,000) ($131,900) ($81,100) ($85,000) Net General Fund Surplus/(Deficit) ($1,641,800) ($984,200) ($92,000) $1,112,100 $3,285,900 $4,153,000 sum
Source: EPS.[2] EIFD Contribution represents the portion of City property tax revenues diverted to the EIFD. Refer to Table B-3 for details.

Secured and unsecured tax rolls for a fiscal year are based on taxable assessed values with a lien date of the prior January 1. Thus, the initialphase of this analysis includes estimated development occurring in July-December 2022 (50% of development estimated in calendar year 2022)and development occurring in full calendar years for the remainder of the phase (2023-2025). Subsequent phases include 5-year developmentperiods for development occurring from 2026 through 2040 and 10-year development periods from 2041 through 2060.

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Table 2Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonEstimated Annual Revenues and Expenditures (2020$)Item 2025 [1] 2030 2035 2040 2050 Buildout (2060)Annual General Fund Revenues Property Tax $277,700 $493,500 $905,000 $1,388,200 $1,803,100 $1,888,400Property Tax in Lieu of VLF $196,300 $381,800 $692,400 $1,051,200 $1,417,800 $1,530,300Property Transfer Tax $9,400 $14,900 $23,700 $33,600 $43,300 $46,300Sales and Use Tax $657,400 $1,556,300 $2,559,600 $3,636,900 $5,530,500 $6,384,400Prop. 172 Public Safety Sales Tax $24,400 $57,700 $94,900 $134,800 $205,000 $236,600Utility User Taxes $103,000 $211,200 $348,000 $474,600 $594,500 $637,800Franchise Taxes $44,600 $91,400 $150,600 $205,500 $257,400 $276,100Transient Occupancy Tax $8,200 $16,800 $27,700 $37,800 $47,300 $50,800Business License Tax $29,900 $61,200 $100,900 $137,500 $172,300 $184,800Licenses and Permits $600 $1,300 $2,100 $2,900 $3,600 $3,900Total Annual General Fund Revenue $1,351,500 $2,886,100 $4,904,900 $7,103,000 $10,074,800 $11,239,400 Annual General Fund Expenditures
General Government Administration $52,800 $108,200 $178,200 $243,100 $304,500 $326,700Police Services $404,000 $828,100 $1,364,300 $1,860,600 $2,330,700 $2,500,300Fire Services $136,500 $279,700 $460,800 $628,500 $787,300 $844,600Fire Station Expenditures $2,300,000 $2,300,000 $2,300,000 $2,300,000 $2,300,000 $2,300,000Public Works $50,200 $103,000 $169,600 $231,300 $289,800 $310,900 Economic Development $4,100 $8,500 $13,900 $19,000 $23,800 $25,500 Office of Violence Prevention $6,200 $12,700 $20,900 $28,500 $35,700 $38,300 Library and Recreation (prior to 2034) $17,900 $34,600 - - - - Library and Recreation (2034 and beyond) - - $171,600 $206,800 $206,800 $206,800Entertainment Venues $11,400 $22,000 $33,200 $40,100 $40,100 $40,100 Downtown Marina $700 $1,400 $2,100 $2,500 $2,500 $2,500 Golf Courses $1,300 $4,200 $7,000 $9,500 $11,900 $12,800 Development Services $2,500 $5,200 $8,500 $11,600 $14,500 $15,600 Total Annual General Fund Expenditures $2,987,600 $3,707,600 $4,730,100 $5,581,500 $6,347,600 $6,624,100 EIFD Contribution [2]
Maximum Tax Rate ($2,800) ($98,700) ($181,000) ($277,600) ($360,600) ($377,700)Variable Tax Rate ($2,800) ($64,200) ($86,000) ($131,900) ($81,100) ($85,000) Net General Fund Surplus/(Deficit)
Prior to EIFD Allocation ($1,636,100) ($821,500) $174,800 $1,521,500 $3,727,200 $4,615,300Net of EIFD Allocation - Maximum Tax ($1,638,900) ($920,200) ($6,200) $1,243,900 $3,366,600 $4,237,600 Net of EIFD Allocation - Variable Tax ($1,638,900) ($885,700) $88,800 $1,389,600 $3,646,100 $4,530,300 det sum
Source: EPS.[2] EIFD Contribution represents the portion of City property tax revenues diverted to the EIFD. Refer to Table B-3 for details.

Estimated Annual Revenues/Expenditures (Rounded)
City of
Stockton
[1] This analysis assumes the EIFD will be formed in FY 2022-23 (Base Year) with the first year of revenue accruing to the district in FY 2023-24. Secured and unsecured tax rolls for a fiscal year are based on taxable assessed values with a lien date of the prior January 1. Thus, the initial phase of this analysis includes estimated development occurring in July-December 2022 (50% of development estimated in calendar year 2022) and development occurring in full calendar years for the remainder of the phase (2023-2025). Subsequent phases include 5-year development periods for development occurring from 2026 through 2040 and 10-year development periods from 2041 through 2060.

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APPENDICES:

Appendix A: General Assumptions
Appendix B: General Fund Revenue Analysis
Appendix C: General Fund Expenditure Analysis
Appendix D: Supporting Tables for
Revenue and Expenditure Analysis

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APPENDIX A:

General Assumptions
Table A-1 General Assumptions ..................................................... H-3 Table A-2 Cumulative Land Use Projections ..................................... H-4 Table A-3 Cumulative Occupied Dwelling Units and
Building Square Footage ................................................. H-5 Table A-4 Cumulative Estimated Population and Employees ............... H-6 Table A-5 Land Use Assumptions ................................................... H-7

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Table A-1Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonGeneral AssumptionsItem AssumptionGeneral Assumptions Fiscal Year of Budget Analysis [1] FY 2020-21Base Fiscal Year of Potential EIFD [2] FY 2022-23 General Demographic Characteristics
City of Stockton
Population [3] 318,522Employees [4] 123,000City of Stockton Persons Served [5] 380,022 gen assumps
Source: California Department of Finance; EDD; U.S. Census LED; EPS.[5] Persons served is defined as total population plus half of total employees. Used to estimate specific revenues and expenditures that are assumed to be impacted by growth in resident and employment populations and to avoid double counting of employees who reside in the City.

City of
Stockton
[1] Reflects the City of Stockton Fiscal Year 2020-21 adopted budget. Revenues and expenditures are in 2020 dollars. This analysis does not reflect changes in values resulting from inflation or appreciation.
[3] Based on population estimates from the California Department of Finance (DOF) data for January 1, 2020.
[4] US Census Onthemap.ces.census.gov estimated a total of 109,746 jobs in Stockton, CA in 2018.

California EDD reports an annual average growth rate of 0.95% since 2018 for the Stockton-Lodi MSA.

EPS adjusted the 2018 employment figure to arrive at a 2020 employment estimate using this growth rate and further increased the total by 10% to account for self-employed workers. Estimate is rounded to the nearest hundred employees.
[2] This analysis assumes the EIFD will be formed in FY 2022-23 (Base Year) with the first year of revenue accruing to the district in FY 2023-24. Secured and unsecured tax rolls for a fiscal year are based on taxable assessed values with a lien date of the prior January 1. Thus, the initial phase of this analysis includes estimated development occurring in July-December 2022 (50% of development estimated in calendar year 2022) and development occurring in full calendar years for the remainder of the phase (2023-2025). Subsequent phases include 5-year development periods for development occurring from 2026 through 2040 and 10-year development periods from 2041 through 2060.

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Table A-2Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonCumulative Land Use ProjectionsLand Use Dwelling
Units
Building
Sq. Ft.

Dwelling
Units
Building
Sq. Ft.

Development Projections in Current City Limits [2]
Residential Land Uses [4]
Low Density Residential 187 - 187 - 187 - 187 - 187 - 187 - High Density Residential 75 - 375 - 695 - 888 - 888 - 888 - Subtotal Residential 262 - 562 - 882 - 1,075 - 1,075 - 1,075 - Nonresidential Land Uses
Retail Commercial [5] - 151,652 - 239,152 - 326,652 - 414,152 - 589,152 - 609,207Office Commercial [5] - 64,994 - 102,494 - 139,994 - 177,494 - 252,494 - 261,089Industrial - - - - - 1,104,150 - 2,864,525 - 3,920,750 - 3,920,750 Subtotal Nonresidential - 216,645 - 341,645 - 1,570,795 - 3,456,170 - 4,762,395 - 4,791,045Total All Land Uses 262 216,645 562 341,645 882 1,570,795 1,075 3,456,170 1,075 4,762,395 1,075 4,791,045 Development Projections in Annexation Areas [3]
Nonresidential Land Uses
Retail Commercial [5] - 162,500 - 512,500 - 887,500 - 1,287,500 - 2,028,500 - 2,433,600 Subtotal Nonresidential - 162,500 - 512,500 - 887,500 - 1,287,500 - 2,028,500 - 2,433,600Total All Land Uses - 162,500 - 512,500 - 887,500 - 1,287,500 - 2,028,500 - 2,433,600 Total City of Stockton Development Projections
Residential Land Uses [4]
Low Density Residential 187 - 187 - 187 - 187 - 187 - 187 - High Density Residential 75 - 375 - 695 - 888 - 888 - 888 - Subtotal Residential 262 - 562 - 882 - 1,075 - 1,075 - 1,075 - Nonresidential Land Uses
Retail Commercial [5] - 314,152 - 751,652 - 1,214,152 - 1,701,652 - 2,617,652 - 3,042,807Office Commercial [5] - 64,994 - 102,494 - 139,994 - 177,494 - 252,494 - 261,089Industrial - - - - - 1,104,150 - 2,864,525 - 3,920,750 - 3,920,750 Subtotal Nonresidential - 379,145 - 854,145 - 2,458,295 - 4,743,670 - 6,790,895 - 7,224,645Total All Land Uses 262 379,145 562 854,145 882 2,458,295 1,075 4,743,670 1,075 6,790,895 1,075 7,224,645

TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE lu
Source: City of Stockton; LWA; EPS.[4] For the purpose of this analysis, low density residential is considered to be owner-occupied and high density residential is assumed to be renter-occupied. [1] This analysis assumes the EIFD will be formed in FY 2022-23 (Base Year) with the first year of revenue accruing to the district in FY 2023-24. Secured and unsecured tax rolls for a fiscal year are based on taxable assessed values with a lien date of the prior January 1. Thus, the initial phase of this analysis includes estimated development occurring in July-December 2022 (50% of development estimated in calendar year 2022) and development occurring in full calendar years for the remainder of the phase (2023-2025). Subsequent phases include 5-year development periods for development occurring from 2026 through 2040 and 10-year development periods from 2041 through 2060. [5] Nonresidential commercial land use projections provided by the City reflect a general commercial land use designation. This analysis assumes general commercial will comprise both retail and office land uses. EPS determined a preliminary estimated allocation of retail and office space based on the existing proportion of retail and office space in the City, the City's current General Plan, and the proposed land use plans of anticipated development projects within the EIFD boundary.

City of
Stockton
Cumulative Dwelling Units/Building Square Footage
2025 [1] 2030 2035 2040 2050 Buildout (2060)
[3] Includes development projections in the future Stockton Annexation Area.[2] Development projections were provided by LWA and are based on land use data provided by the City as of February, 2020. Includes development projections in Weston Ranch and the South Airport Area.

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Table A-3Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonCumulative Occupied Dwelling Units and Building Square Footage Vacancy
Land Use Rate [1] 2025 2030 2035 2040 2050 Buildout (2060) Development Projections in Current City Limits
Residential Land Uses
Low Density Residential 6.0% 176 176 176 176 176 176
High Density Residential 6.0% 71 353 653 835 835 835
Subtotal Residential Land Uses 246 528 829 1,010 1,010 1,010 Nonresidential Land Uses
Retail Commercial 7.5% 140,278 221,215 302,153 383,090 544,965 563,516Office Commercial 7.5% 60,119 94,806 129,494 164,181 233,556 241,507Industrial 7.5% - - 1,021,339 2,649,686 3,626,694 3,626,694 Subtotal Nonresidential 200,397 316,022 1,452,985 3,196,957 4,405,215 4,431,717 Development Projections in Annexation Areas
Nonresidential Land Uses
Retail Commercial 7.5% 150,313 474,063 820,938 1,190,938 1,876,363 2,251,080Subtotal Nonresidential 150,313 474,063 820,938 1,190,938 1,876,363 2,251,080 Total City of Stockton Development Projections
Residential Land Uses
Low Density Residential 6.0% 176 176 176 176 176 176High Density Residential 6.0% 71 353 653 835 835 835Subtotal Residential Land Uses 246 528 829 1,010 1,010 1,010 Nonresidential Land Uses
Retail Commercial 7.5% 290,590 695,278 1,123,090 1,574,028 2,421,328 2,814,596Office Commercial 7.5% 60,119 94,806 129,494 164,181 233,556 241,507Industrial 7.5% - - 1,021,339 2,649,686 3,626,694 3,626,694Subtotal Nonresidential 350,709 790,084 2,273,923 4,387,895 6,281,578 6,682,797

TRUE TRUE TRUE TRUE TRUE TRUE
occupied
Source: California Department of Finance; City of Stockton; Costar; LWA; EPS.[1] For details pertaining to vacancy rate assumptions, refer to Table A-5.

Occupied Dwelling Units/Building Square Feet
Occupied Dwelling Units
Occupied Building Square Feet
City of
Stockton
Occupied Building Square Feet
Occupied Dwelling Units
Occupied Building Square Feet
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Table A-4Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonCumulative Estimated Population and Employees Assumption
Land Use [1] 2025 2030 2035 2040 2050 Buildout (2060)
Project Residents
Residential Land Uses PPH
Low Density Residential 3.30 580 580 580 580 580 580High Density Residential 2.50 176 881 1,633 2,087 2,087 2,087Subtotal Residential Land Uses 756 1,461 2,213 2,667 2,667 2,667 Total Resident Population 756 1,461 2,213 2,667 2,667 2,667 Project Employees
Nonresidential Land Uses Sq. Ft. per Emp.

Retail Commercial 400 726 1,738 2,808 3,935 6,053 7,036Office Commercial 400 150 237 324 410 584 604Industrial 2,000 0 0 511 1,325 1,813 1,813 Subtotal Nonresidential 877 1,975 3,642 5,670 8,451 9,454 Total Employee Population 877 1,975 3,642 5,670 8,451 9,454 Project Persons Served 1,195 2,449 4,034 5,502 6,892 7,394 pop
Source: California Department of Finance; EPS. [1] For persons per household and square feet per employee assumptions, refer to Table A-5.

Estimated Population/Employees
City of
Stockton
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Table A-5Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonLand Use Assumptions Persons Per
Estimated Property Household/
Assessed Turnover Vacancy Sq. Ft. per
Land Use Value [1] Rate [2] Rate [3] Employee [4]
Residential Land Uses per Unit PPH
Low Density Residential $425,000 14.3% 6.0% 3.30High Density Residential $200,000 6.7% 6.0% 2.50 Nonresidential Land Uses per Sq. Ft. Sq. Ft. per Emp.

Retail Commercial $250 5.0% 7.5% 400Office Commercial $250 5.0% 7.5% 400Industrial $100 5.0% 7.5% 2,000 lu assum
Source: The Gregory Group; Costar; Colliers, International; CBRE; US Census; EPS.[1] Residential assessed values are based on sales data of comparable products as obtained through The Gregory Group for the last 4 quarters (Q3 2018 through Q2 2019). Nonresidential values per square foot based on comparable transaction data for transactions made in San Joaquin County since2005 obtained from Costar, data accessed on March 25, 2021. Commercial retail and office categories are a blended average of retail andcommercial uses. [2] Owner-occupied residential (low density) assumed to turn over once every 7 years and renter-occupied (high density) residential is assumed to turn over once every 15 years. Nonresidential uses are assumed to turn over once every 20 years.

City of
Stockton
[3] Residential vacancy rates obtained from the US Census American Community Survey, 2018 estimates, for San Joaquin County. Commercial and industrial vacancy rates based on Q3 2019 Costar and Q3 2019 Colliers International market reports for the Stockton/Modesto area. [4] Persons per household figures obtained from the US Census American Community Survey, 2018 estimates. Square feet per employee values are based on empirical research for proposed land uses.

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APPENDIX B:

General Fund Revenue Analysis
Table B-1 Revenue-Estimating Procedures Based on
City of Lathrop FY 2020-21 Budget .................................. H-8 Table B-2 Estimated Annual General Fund Revenues ........................ H-9 Table B-3 Estimated Annual Property Tax Revenues (2 pages) ......... H-10 Table B-4 Real Property Transfer Tax ........................................... H-12 Table B-5 Estimated Annual Taxable Sales and Use Tax Revenue ..... H-13 Table B-5A Estimated Annual Taxable Sales from Proposed Development, Market Support Method ............................ H-14 Table B-5B Estimated Annual Taxable Sales from
Onsite Nonresidential ................................................... H-15

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Table B-1Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonRevenue-Estimating Procedures Based on City of Stockton FY 2020-21 Budget (2020$) FY 2020-21 FY 2020-21
Budgeted Budgeted
Estimating Case Study General Fund Offsetting Net General Service Revenue Item Procedure Reference Revenues Revenue Fund Revenues Population [1] Multiplier General Fund Revenues
Taxes
Property Tax Case Study Table B-3 $37,023,000 - $37,023,000 N/A - Property Tax in Lieu of VLF Case Study Table B-3 $25,626,000 - $25,626,000 N/A - Property Transfer Tax Case Study Table B-4 $780,000 - $780,000 N/A - Sales and Use Tax Case Study Table B-5 $43,229,000 - $43,229,000 N/A - Measure A Transaction Tax [2] - $28,472,000 - $28,472,000 N/A - Prop. 172 Public Safety Sales Tax Case Study Table B-5 $1,602,000 - $1,602,000 N/A - Utility User Taxes Persons Served - $32,780,000 - $32,780,000 380,022 $86.26Franchise Taxes Persons Served - $14,191,000 - $14,191,000 380,022 $37.34Transient Occupancy Tax Persons Served - $2,609,000 - $2,609,000 380,022 $6.87 Business License Tax Persons Served - $9,500,000 - $9,500,000 380,022 $25.00 Total Taxes $195,812,000 - $195,812,000 N/A -
Licenses and Permits Persons Served - $530,735 ($329,550) $201,185 380,022 $0.53 Intergovernmental Revenue [3] - $3,106,730 ($85,000) $3,021,730 N/A - Charges for Services [4] - $9,033,455 ($8,976,275) $57,180 N/A - Uses of Money and Property [3] - $6,111,582 ($378,804) $5,732,778 N/A - Sale of Fixed Assets [3] - $100,000 - $100,000 N/A - Fines and Forfeitures [4] - $1,057,657 ($843,655) $214,002 N/A - Reimbursements/Other Revenue [3] - $7,330,167 ($2,079,215) $5,250,952 N/A - Subtotal General Fund Revenue $223,082,326 ($12,692,499) $210,389,827 Transfers In [3] - $368,000 - $368,000 N/A -
Total General Fund Revenue $223,450,326 ($12,692,499) $210,757,827 rev
Source: City of Stockton Fiscal Year 2020-21 Approved Annual Budget; EPS.[1] Refer to Table A-1.[4] Based on the City of Stockton Fiscal Year 2020-21 Approved Annual Budget, these revenue categories are fully offset by expenditures as shown on Table C-1.[3] These revenue sources are not anticipated to be impacted by development included in this analysis.[2] Measure A is a 0.75% transaction and use tax approved by voters in November 2013 and is set to expire in 2024 or sooner if certain conditions are met. As it is unknown if Measure A will be extended beyond the initial 10 year period, it has been excluded from this analysis.

City of
Stockton
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Table B-2Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonEstimated Annual General Fund Revenues (2020$) Case Study
Revenue Category Reference 2025 2030 2035 2040 2050 Buildout (2060) General Fund Revenues
Property Tax Table B-3 $277,700 $493,500 $905,000 $1,388,200 $1,803,100 $1,888,400Property Tax in Lieu of VLF Table B-3 $196,300 $381,800 $692,400 $1,051,200 $1,417,800 $1,530,300 Property Transfer Tax Table B-4 $9,400 $14,900 $23,700 $33,600 $43,300 $46,300Sales and Use Tax Table B-5 $657,400 $1,556,300 $2,559,600 $3,636,900 $5,530,500 $6,384,400 Prop. 172 Public Safety Sales Tax Table B-5 $24,400 $57,700 $94,900 $134,800 $205,000 $236,600Utility User Taxes - $103,000 $211,200 $348,000 $474,600 $594,500 $637,800Franchise Taxes - $44,600 $91,400 $150,600 $205,500 $257,400 $276,100Transient Occupancy Tax - $8,200 $16,800 $27,700 $37,800 $47,300 $50,800Business License Tax - $29,900 $61,200 $100,900 $137,500 $172,300 $184,800Licenses and Permits - $600 $1,300 $2,100 $2,900 $3,600 $3,900 Total General Fund Revenue $1,351,500 $2,886,100 $4,904,900 $7,103,000 $10,074,800 $11,239,400 EIFD Contribution - Maximum Tax Rate
Less EIFD Contribution ($2,777) ($98,702) ($181,000) ($277,645) ($360,630) ($377,672) Net General Fund Revenues $1,348,723 $2,787,398 $4,723,900 $6,825,355 $9,714,170 $10,861,728 EIFD Contribution - Variable Tax Rate
Less EIFD Contribution ($2,777) ($64,156) ($85,975) ($131,881) ($81,142) ($84,976) Net General Fund Revenues $1,348,723 $2,821,944 $4,818,925 $6,971,119 $9,993,658 $11,154,424 rev est
Source: City of Stockton Fiscal Year 2020-21 Approved Annual Budget; EPS.

Estimated Annual Revenue (Rounded)
City of
Stockton
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Table B-3Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonEstimated Annual Property Tax Revenues (2020$) Assumption/
Item Source Formula 2025 2030 2035 2040 2050 Buildout (2060) Assessed Value of New Development Table D-2
Assessed Value of New Development in Current City Limits a $148,619,250 $239,869,250 $445,534,250 $691,421,750 $859,544,250 $866,706,750 Assessed Value of New Development in Annexation Area b $40,625,000 $128,125,000 $221,875,000 $321,875,000 $507,125,000 $608,400,000 Total Assessed Value c = a + b $189,244,250 $367,994,250 $667,409,250 $1,013,296,750 $1,366,669,250 $1,475,106,750 Property Tax Revenue (1% of Assessed Value) 1.0000%
Property Tax Revenue in Current City Limits d = a * 1.00% $1,486,193 $2,398,693 $4,455,343 $6,914,218 $8,595,443 $8,667,068 Property Tax Revenue in Annexation Areas e = b * 1.00% $406,250 $1,281,250 $2,218,750 $3,218,750 $5,071,250 $6,084,000 Total Property Tax Revenue f = d + e $1,892,443 $3,679,943 $6,674,093 $10,132,968 $13,666,693 $14,751,068 Estimated Property Tax Allocation
Property Tax Allocation in Current City Limits [1]
City of Stockton General Fund 16.7111% g = d * 16.71% $248,360 $400,849 $744,539 $1,155,445 $1,436,397 $1,448,367 Other Agencies/ERAF 83.2889% h = d * 83.29% $1,237,833 $1,997,843 $3,710,804 $5,758,772 $7,159,045 $7,218,701 Property Tax Allocation in Annexation Areas [2]
City of Stockton General Fund 7.2320% i = e * 7.23% $29,380 $92,659 $160,459 $232,779 $366,751 $439,992 Other Agencies/ERAF 92.7680% j = e * 92.77% $376,870 $1,188,591 $2,058,291 $2,985,971 $4,704,499 $5,644,008 Total City of Stockton General Fund Property Tax k = g + i $277,740 $493,509 $904,998 $1,388,224 $1,803,148 $1,888,359EIFD Allocation - Maximum Tax Rate EIFD Allocation Percentage [3] l 1.0% 20.0% 20.0% 20.0% 20.0% 20.0% EIFD Allocation m = k * l $2,777 $98,702 $181,000 $277,645 $360,630 $377,672 Net City General Fund Property Tax n - k - m $274,962 $394,807 $723,998 $1,110,579 $1,442,518 $1,510,687 EIFD Allocation - Variable Tax Rate
EIFD Allocation Percentage [3] l 1.0% 13.0% 9.5% 9.5% 4.5% 4.5% EIFD Allocation m = k * l $2,777 $64,156 $85,975 $131,881 $81,142 $84,976 Net City General Fund Property Tax n - k - m $274,962 $429,352 $819,023 $1,256,343 $1,722,006 $1,803,383 Estimated Property Tax Revenues (2020$)
City of
Stockton
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Table B-3Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonEstimated Annual Property Tax Revenues (2020$) Assumption/
Item Source Formula 2025 2030 2035 2040 2050 Buildout (2060) Estimated Property Tax Revenues (2020$)
City of
Stockton
Property Tax In-Lieu of Motor Vehicle In-Lieu Fee Revenue (VLF) Total Citywide Assessed Value [4] l $24,701,295,559 $24,701,295,559 $24,701,295,559 $24,701,295,559 $24,701,295,559 $24,701,295,559 Total Assessed Value of Project m $189,244,250 $367,994,250 $667,409,250 $1,013,296,750 $1,366,669,250 $1,475,106,750 Total Assessed Value n = l + m $24,890,539,809 $25,069,289,809 $25,368,704,809 $25,714,592,309 $26,067,964,809 $26,176,402,309 Percent Change in AV o = m / l 0.77% 1.49% 2.70% 4.10% 5.53% 5.97% Property Tax In-Lieu of VLF [5] $25,626,000 p = o * $25,626,000 $196,329 $381,770 $692,394 $1,051,230 $1,417,831 $1,530,328 prop tax
Source: City of Stockton; San Joaquin County Auditor-Controller; EPS.[2] Refer to Table D-1 for details.[4] Reflects Assessed Valuation for FY 2020-21. Includes Citywide secured, unsecured, homeowner exemption, and public utility roll.[5] Property tax in-lieu of VLF amount derived from the City of Stockton FY 2020-21 Annual Budget. Refer to Table B-1 for details.[1] Reflects the average property tax allocation to the City's General Fund for all TRAs within the 200-year flood plain that are within the City's boundary. TRAs include: 003-159, 003-206, 003-238, 003,240, 003-289, 003-312, 003-455, 003-463, 003-464, 003-479, and 003-481. [3] EIFD allocation percentage represents the portion of property tax revenues to be diverted to the EIFD. Alocation percentages are negotiated allocation amounts based on discussions between the County, the Cities of Lathrop, Stockton, and Manteca, and Project Consultants. Reflects the Initial Base Rate for the period ending 2029 and the Maximum Tax Allocation Rate for 2030 and beyond.

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Table B-4Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonReal Property Transfer Tax (2020$) Assumption/
Description Source 2025 2030 2035 2040 2050 Buildout (2060) Rate per $1,000 of AV $0.55Project Assessed Value Table D-2 Low Density Residential $79,458,000 $79,458,000 $79,458,000 $79,458,000 $79,458,000 $79,458,000High Density Residential $15,000,000 $75,000,000 $139,000,000 $177,600,000 $177,600,000 $177,600,000Nonresidential $94,786,250 $213,536,250 $448,951,250 $756,238,750 $1,109,611,250 $1,218,048,750Total Assessed Value $189,244,250 $367,994,250 $667,409,250 $1,013,296,750 $1,366,669,250 $1,475,106,750 Turnover Rate
Low Density Residential 14.30%High Density Residential 6.70%Nonresidential 5.00% Annual Transfer Tax Revenue [1]
Low Density Residential $6,249 $6,249 $6,249 $6,249 $6,249 $6,249 High Density Residential $553 $2,764 $5,122 $6,545 $6,545 $6,545 Nonresidential $2,607 $5,872 $12,346 $20,797 $30,514 $33,496Total Annual Transfer Tax Revenue $9,409 $14,885 $23,718 $33,590 $43,308 $46,290 transfer
Source: City of Stockton; San Joaquin County Auditor-Controller; EPS.[1] Formula for Transfer Tax = Assessed Value/$1000 * Rate per $1,000 of Assessed Value * Turnover rate.

Estimated Annual Property Transfer Tax Revenue (2020$)
City of
Stockton
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Table B-5Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonEstimated Annual Taxable Sales and Use Tax Revenue (2020$)Item Formula 2025 2030 2035 2040 2050 Buildout (2060) Estimated Annual Taxable Sales
Annual Taxable Sales from Market Support (Residents and Employees) a $5,167,169 $9,737,481 $15,147,354 $19,514,889 $22,517,496 $23,600,786 Annual Taxable Sales from Onsite Commercial Uses b $60,572,394 $145,888,155 $240,817,294 $344,175,286 $530,532,359 $614,835,607 Annual Taxable Sales from New Development c = a + b $65,739,563 $155,625,636 $255,964,648 $363,690,175 $553,049,855 $638,436,394 Annual Sales Tax Revenue
Bradley Burns Local Sales Tax Revenue d = c * 1.0000% 1.0000% $657,396 $1,556,256 $2,559,646 $3,636,902 $5,530,499 $6,384,364 City of Stockton Prop 172 Public Safety Sales Tax Revenue [1] e = d * 3.7058% 3.7058% $24,362 $57,672 $94,857 $134,778 $204,952 $236,595 sales
Source: City of Stockton; California State Board of Equalization; EPS.

City of
Stockton
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Table B-5AMossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonEstimated Annual Taxable Sales from Proposed Development, Market Support Method (2020$)Annual Taxable Sales from Market Support Assumption 2025 2030 2035 2040 2050 Buildout (2060)Annual Taxable Sales from New Residents Residential Development Table A-3
Low Density Residential 176 176 176 176 176 176High Density Residential 71 353 653 835 835 835Total Residential Development 246 528 829 1,010 1,010 1,010 Taxable Retail Expenditures per Household [1]
Low Density Residential $24,000 $4,217,818 $4,217,818 $4,217,818 $4,217,818 $4,217,818 $4,217,818High Density Residential $15,000 $1,057,500 $5,287,500 $9,799,500 $12,520,800 $12,520,800 $12,520,800Total Taxable Retail Expenditures $5,275,318 $9,505,318 $14,017,318 $16,738,618 $16,738,618 $16,738,618 Estimated Citywide Capture from New Households [2] 80% $4,220,254 $7,604,254 $11,213,854 $13,390,894 $13,390,894 $13,390,894 Estimated Taxable Sales inside Project Area 50% $2,110,127 $3,802,127 $5,606,927 $6,695,447 $6,695,447 $6,695,447Estimated Taxable Sales outside Project Area 50% $2,110,127 $3,802,127 $5,606,927 $6,695,447 $6,695,447 $6,695,447 Annual Taxable Sales from New Employment
Taxable Sales from New Employment
Employees Table A-4 877 1,975 3,642 5,670 8,451 9,454Average Daily Taxable Sales per New Employee $10.00Work Days per Year 240Taxable Sales from New Employees [3] 50%Total Taxable Sales from New Employees $1,052,127 $2,370,252 $4,370,556 $6,804,439 $10,140,669 $11,344,325 Estimated Citywide Capture from New Employees [2] 90% $946,915 $2,133,227 $3,933,500 $6,123,995 $9,126,602 $10,209,892 Estimated Taxable Sales inside Project Area 70% $662,840 $1,493,259 $2,753,450 $4,286,796 $6,388,621 $7,146,925Estimated Taxable Sales outside Project Area 30% $284,074 $639,968 $1,180,050 $1,837,198 $2,737,981 $3,062,968 Total Annual Taxable Sales from Market Support $5,167,169 $9,737,481 $15,147,354 $19,514,889 $22,517,496 $23,600,786 Taxable City Sales inside Project Area $2,772,967 $5,295,386 $8,360,377 $10,982,243 $13,084,068 $13,842,372Taxable City Sales outside Project Area $2,394,201 $4,442,095 $6,786,977 $8,532,646 $9,433,428 $9,758,415 sales a
Source: Costar; Gregory Group; Bureau of Labor Statistics; City of Stockton; EPS.[2] Represents the portion of household and employee retail expenditures estimated to take place within the City of Stockton.[3] Taxable sales from employees discounted by 50 percent to account for employees who are also residents.[1] For details pertaining to household taxable expenditure assumptions, refer to Table D-3.

Estimated Annual Taxable Sales (2020$)
Occupied Dwelling Units
Taxable Retail Expenditures
City of
Stockton
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Table B-5BMossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonEstimated Annual Taxable Sales from Onsite Nonresidential (2020$) Annual
Taxable Sales
per Sq. Ft. [1]
Item / Assumption 2025 2030 2035 2040 2050 Buildout (2060) Taxable Sales from Commercial Development
Taxable Sales Generating Occupied Commercial Development Square Feet Retail Commercial 290,590 695,278 1,123,090 1,574,028 2,421,328 2,814,596Total 290,590 695,278 1,123,090 1,574,028 2,421,328 2,814,596 Total Taxable Sales from Onsite Commercial Development
Retail Commercial $240 $69,741,633 $166,866,633 $269,541,633 $377,766,633 $581,118,633 $675,503,043 Total $69,741,633 $166,866,633 $269,541,633 $377,766,633 $581,118,633 $675,503,043 Less Total Annual Taxable Sales from Market Support (within the Project) [2] $2,772,967 $5,295,386 $8,360,377 $10,982,243 $13,084,068 $13,842,372Annual Sales Less Market Support $66,968,666 $161,571,247 $261,181,256 $366,784,390 $568,034,565 $661,660,671 Shift from
Existing Retail
Less Shift of Sales from Existing Regional and Community Retail to the Project [3] 10% $6,696,867 $16,157,125 $26,118,126 $36,678,439 $56,803,456 $66,166,067 Total Taxable Sales from Retail Commercial Uses $60,271,799 $145,414,122 $235,063,130 $330,105,951 $511,231,108 $595,494,604Occupied Nonretail Commercial Uses Office Commercial $60,119 $94,806 $129,494 $164,181 $233,556 $241,507Industrial - - $1,021,339 $2,649,686 $3,626,694 $3,626,694Total $60,119 $94,806 $1,150,833 $2,813,867 $3,860,250 $3,868,201 Total Taxable Sales from Nonretail Commercial Uses
Office Commercial $5 $300,595 $474,032 $647,470 $820,907 $1,167,782 $1,207,534Industrial $5 - - $5,106,694 $13,248,428 $18,133,469 $18,133,469Total $300,595 $474,032 $5,754,164 $14,069,336 $19,301,251 $19,341,003 Total Taxable Sales from Nonretail Commercial Development $300,595 $474,032 $5,754,164 $14,069,336 $19,301,251 $19,341,003 Total Taxable Sales from Onsite Commercial Uses $60,572,394 $145,888,155 $240,817,294 $344,175,286 $530,532,359 $614,835,607 sales b
Source: U.S. Department of Labor Bureau of Labor Statistics; Urban Land Institute; EPS.[2] Estimated in Table B-5A.

Estimated Annual Taxable Sales (2020$)
[3] Represents a discount factor to account for taxable sales transactions that may shift from the City's existing retail centers to those included in the Project.

Applied only to the Retail uses within the Project.
[1] See Table D-4 for the taxable retail sales calculation. All retail is assumed to be community serving retail. Sales per square foot for the Retail space is based on average total sales per square foot figure derived from BizMiner and eMarketer data (escalated to 2020$) and converts total sales to taxable sales per square foot to account for a small portion of non-taxable goods sold.

City of
Stockton
Occupied Building Square FeetOccupied Building Square Feet Total Taxable SalesTotal Taxable Sales
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APPENDIX C:

General Fund Expenditure Analysis
Table C-1 Expenditure-Estimating Procedures Based on
City of Lathrop FY 2020-21 Budget ................................ H-16 Table C-2 Estimated Annual General Fund Expenditures .................. H-17

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Table C-1Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonExpenditure-Estimating Procedures Based on City of Stockton FY 2020-21 Budget (2020$) FY 2020-21 FY 2020-21 Population
Estimating Budgeted Less Offsetting Net City or Persons FY 2020-21 Adjustment FY 2020-21 Item Procedure Expenditures [1] Revenue Expenditures Served Avg. Cost Factor [2] Avg. Cost General Fund
General Government Administration Persons Served $16,978,158 ($187,500) $16,790,658 380,022 $44.18 100% $44.18Police Services Persons Served $136,160,466 ($7,648,853) $128,511,613 380,022 $338.17 100% $338.17 Fire Services Persons Served $48,088,874 ($4,678,487) $43,410,387 380,022 $114.23 100% $114.23 Fire Station Expenditures [3] Case Study N/A N/A N/A N/A N/A N/A N/A Public Works Persons Served $16,015,900 ($37,355) $15,978,545 380,022 $42.05 100% $42.05Economic Development Persons Served $1,452,575 ($140,304) $1,312,271 380,022 $3.45 100% $3.45Office of Violence Prevention Persons Served $1,967,245 - $1,967,245 380,022 $5.18 100% $5.18Library and Recreation (prior to 2034) [4] Per Capita $7,550,000 - $7,550,000 318,522 $23.70 100% $23.70 Library and Recreation (2034 and beyond) [4] Per Capita $24,697,929 - $24,697,929 318,522 $77.54 100% $77.54 Entertainment Venues Per Capita $4,785,000 - $4,785,000 318,522 $15.02 100% $15.02 Downtown Marina Per Capita $297,000 - $297,000 318,522 $0.93 100% $0.93 Golf Courses Per Capita $550,000 - $550,000 318,522 $1.73 100% $1.73 Grant Match [5] $100,000 - $100,000 N/A - 100% - Development Services Persons Served $800,000 - $800,000 380,022 $2.11 100% $2.11 Low and Moderate Income Housing [5] - - - N/A - 100% -
Radio and Retirement ISF [5] $5,250,000 - $5,250,000 N/A - 100% - Subtotal Annual General Fund Expenditures $264,693,147 ($12,692,499) $252,000,648 Debt Service [5] $1,837,175 - $1,837,175 N/A - 100% -
Contingency [5] $2,000,000 - $2,000,000 N/A - 100% -
Total Annual General Fund Expenditures $268,530,322 ($12,692,499) $255,837,823 Available Balance [6] ($45,079,996) ($45,079,996)
exp
Source: City of Stockton Fiscal Year 2020-21 Approved Annual Budget; City of Stockton; EPS.[6] Available Balance reflects surplus annual General Fund Revenues beyond those required to fund all annual General Fund Expenditures. [5] This expenditure category is not expected to be affected by the project and not evaluated as part of this analysis.

City of
Stockton
[1] Represents the approved FY 2020-21 budgeted expenditures.[2] An adjustment factor may be used to reflect the fact that new employees may not increase certain General Fund department expenditures at a 1:1 ratio. This analysis does not assume an adjustment at this time.
[3] Based on conversations with the Fire Chief it is anticipated that an additional fire station would be required to serve the anticipated development south of the City. The annual operating costs related to the operation of the additional fire station have been included as an additional annual expenditure in all phases of development. [4] Under current budget conditions, Library and Recreation funding includes support from Sales Tax Measure M. This sales tax measure is expected to expire in 2034 and is not anticipated to be renewed. As a result all Library and Recreation expenditures currently funded through Measure M are expected to be absorbed by the City General Fund beginning in 2034.

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Table C-2Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonEstimated Annual General Fund Expenditures (2020$)Expenditure Category 2025 2030 2035 2040 2050 Buildout (2060)General Fund General Government Administration $52,781 $108,196 $178,247 $243,094 $304,513 $326,672Police Services $403,972 $828,110 $1,364,263 $1,860,582 $2,330,670 $2,500,269Fire Services $136,459 $279,730 $460,839 $628,493 $787,285 $844,575Fire Station Expenditures [2] $2,300,000 $2,300,000 $2,300,000 $2,300,000 $2,300,000 $2,300,000Public Works $50,228 $102,963 $169,626 $231,336 $289,785 $310,872Economic Development $4,125 $8,456 $13,931 $18,999 $23,799 $25,531Office of Violence Prevention $6,184 $12,677 $20,884 $28,482 $35,678 $38,274Library and Recreation (prior to 2034) [3] $17,924 $34,635 - - - - Library and Recreation (2034 and beyond) [3] - - $171,610 $206,778 $206,778 $206,778Entertainment Venues $11,360 $21,951 $33,248 $40,061 $40,061 $40,061Downtown Marina $705 $1,362 $2,064 $2,487 $2,487 $2,487Golf Courses $1,306 $4,228 $6,966 $9,500 $11,901 $12,767Development Services $2,515 $5,155 $8,493 $11,582 $14,509 $15,564Total Annual General Fund Expenditures $2,987,559 $3,707,464 $4,730,170 $5,581,394 $6,347,464 $6,623,849 exp est
Source: City of Stockton Fiscal Year 2020-21 Approved Annual Budget; EPS.[1] Annual expenditure estimated on a per persons served or per capita basis. Refer to Table C-1 for estimating procedure and Table A-5 for population and employment estimates.

Estimated Annual Expenditure [1]
City of
Stockton
[2] Based on conversations with the Fire Chief it is anticipated that an additional fire station would be required to serve the anticipated development south of the City. This analysis assumes the required station will be developed and staffed within the first phase of development. Based on information provided by the Fire Chief, current as of July2020, the additional station would require nine additional firefighters to staff an engine and company for a total annual expenditure increase of $2,300,000. The fire stationexpenditures have been included in this analysis in addition to the per persons served multiplier expenditures. [3] Under current budget conditions, Library and Recreation funding includes support from Sales Tax Measure M. This sales tax measure is expected to expire in 2034 and is not anticipated to be renewed. As a result, all Library and Recreation expenditures currently funded through Measure M are expected to be absorbed by the City GeneralFund beginning in 2034.

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APPENDIX D:

Supporting Tables for
Revenue and Expenditure Analysis
Table D-1 Preliminary Property Tax Allocations for
Annexation Area ......................................................... H-18 Table D-2 Cumulative Assessed Valuation ..................................... H-19 Table D-3 Estimated Average Annual Household Income ................. H-20 Table D-4 Total and Taxable Retail Sales per Square Feet ................ H-21

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Table D-1Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonPreliminary Property Tax Allocations for Annexation Area Tax
Code Entity TRA 102-135 TRA 102-032 TRA 102-135 TRA 102-032 Total Formula a b e f g = e + f h e = d * $278,126 f = e / $769,158 Subject to Detachment
10001 County General 22.29650% 22.30610% $172,291 ($796) $171,495 80% $222,501 28.92784% 10527 Road District 1 4.26040% 4.26030% $32,921 ($152) $32,769 - - 0.00000% 14401 French Camp-Mc Kinley Rural Fire 9.60300% 9.60300% $74,205 ($343) $73,862 - - 0.00000% 40400 City of Stockton 0.00000% 0.00000% - - - 20% $55,625 7.23196% Subtotal 36.15990% 36.16940% $279,417 ($1,291) $278,126 100% $278,126 36.15980% Not Subject to Detachment
10618 County Library 1.80010% 1.80010% $13,910 ($64) $13,846 - $13,846 1.80013%12601 Manteca Unified Schools 29.58380% 29.58380% $228,602 ($1,056) $227,546 - $227,546 29.58378%13001 S.J. Delta Comm College 4.00510% 4.00510% $30,949 ($143) $30,806 - $30,806 4.00514% 13201 County Office Of Education 1.43850% 1.42890% $11,116 ($51) $11,065 - $11,065 1.43855%16001 Sjc Flood Control 0.17560% 0.17570% $1,357 ($6) $1,351 - $1,351 0.17564%21901 Sjc Mosquito Abatement 0.78840% 0.78840% $6,092 ($28) $6,064 - $6,064 0.78838%41100 ERAF - Educational Revenue Augmentation Fund 26.04860% 26.04860% $201,285 ($930) $200,355 - $200,355 26.04859% Subtotal 63.84010% 63.83060% $493,311 ($2,279) $491,032 - $491,032 63.84020% Total 100.00000% 100.00000% $772,729 ($3,570) $769,158 100% $769,158 100.00000% TRA
Source: San Joaquin County Auditor-Controller; EPS.[1] Provided by the San Joaquin County Auditor-Controller.

City of
Stockton
Existing Tax Rate Area (TRA)
Post-ERAF Distribution [1]
[2] Based on the most recent tax-sharing agreement between San Joaquin County and the City of Stockton dated August 2015 related to annexed areas to the City.

Gross Revenue
(FY 2019-20) [1]
Property Tax
Sharing
Agreement [2]
Post Annexation Average
Base
Revenue
Post-ERAF
Distribution
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Table D-2Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonCumulative Assessed Valuation (2020$)Item 2025 2030 2035 2040 2050 Buildout (2060)Development Projections in Current City Limits Residential Land Uses per Unit
Low Density Residential $425,000 $79,458,000 $79,458,000 $79,458,000 $79,458,000 $79,458,000 $79,458,000High Density Residential $200,000 $15,000,000 $75,000,000 $139,000,000 $177,600,000 $177,600,000 $177,600,000Subtotal Residential $94,458,000 $154,458,000 $218,458,000 $257,058,000 $257,058,000 $257,058,000 Nonresidential Land Uses per Sq. Ft.

Retail Commercial $250 $37,912,875 $59,787,875 $81,662,875 $103,537,875 $147,287,875 $152,301,625Office Commercial $250 $16,248,375 $25,623,375 $34,998,375 $44,373,375 $63,123,375 $65,272,125Industrial $100 - - $110,415,000 $286,452,500 $392,075,000 $392,075,000Subtotal Nonresidential $54,161,250 $85,411,250 $227,076,250 $434,363,750 $602,486,250 $609,648,750 Total All Land Uses $148,619,250 $239,869,250 $445,534,250 $691,421,750 $859,544,250 $866,706,750 Development Projections in Annexation Areas
Nonresidential Land Uses per Sq. Ft.

Retail Commercial $250 $40,625,000 $128,125,000 $221,875,000 $321,875,000 $507,125,000 $608,400,000Subtotal Nonresidential $40,625,000 $128,125,000 $221,875,000 $321,875,000 $507,125,000 $608,400,000 Total All Land Uses $40,625,000 $128,125,000 $221,875,000 $321,875,000 $507,125,000 $608,400,000 Total City of Stockton Development Projections
Residential Land Uses per Unit
Low Density Residential $425,000 $79,458,000 $79,458,000 $79,458,000 $79,458,000 $79,458,000 $79,458,000High Density Residential $200,000 $15,000,000 $75,000,000 $139,000,000 $177,600,000 $177,600,000 $177,600,000Subtotal Residential $94,458,000 $154,458,000 $218,458,000 $257,058,000 $257,058,000 $257,058,000 Nonresidential Land Uses per Sq. Ft.

Retail Commercial $250 $78,537,875 $187,912,875 $303,537,875 $425,412,875 $654,412,875 $760,701,625Office Commercial $250 $16,248,375 $25,623,375 $34,998,375 $44,373,375 $63,123,375 $65,272,125Industrial $100 - - $110,415,000 $286,452,500 $392,075,000 $392,075,000Subtotal Nonresidential $94,786,250 $213,536,250 $448,951,250 $756,238,750 $1,109,611,250 $1,218,048,750 Total All Land Uses $189,244,250 $367,994,250 $667,409,250 $1,013,296,750 $1,366,669,250 $1,475,106,750

TRUE TRUE TRUE TRUE TRUE TRUE
AV
Source: Costar; CBRE; The Gregory Group; EPS.[1] Refer to Table A-5 for details.

Total Assessed Value (2020$)
Rounded
Value per
Unit/Sq. Ft.
[1]
City of
Stockton
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Table D-3Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonEstimated Average Annual Household Income (2020$) Taxable Annual Taxable
Estimated Total Annual Estimated Expenditures Expenditures Home Mortgage Household as a Percent of per Household
Residential Land Use Value [1] or Rent [2] Income [3] Income [4] (Rounded) Owner-Occupied Residential
Low Density Residential $425,000 $32,202 $92,000 26% $24,000 Renter-Occupied Residential
High Density Residential $200,000 $18,000 $51,000 30% $15,000 income
Source: Costar; Gregory Group; Bureau of Labor Statistics; EPS.[1] See Table A-5 for detail on estimated values for residential units.[4] Based on household expenditures data from the Bureau of Labor Statistics, 2018 Consumer Expenditure Survey.[2] Based on a 5%, 30-year fixed-rate mortgage with a 20% down payment, $150 monthly Homeowner's association dues and 2% annual taxes and insurance.High density residential based on an average monthly rent assumption of $1,500 based on data on similar multifamily residentialobtained from Costar, September 2019 with an average unit size of 1,000 square feet. [3] Assumes 35% of income dedicated to housing costs (mortgage, taxes, insurance, and HOA dues) or rent payments. Rounded to the nearest $1,000.

City of
Stockton
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Table D-4Mossdale Tract Infrastructure Finance Plan Fiscal Impact Analysis - City of StocktonTotal and Taxable Retail Sales per Square Feet (2020$)Item % [2] No. % [2] No. % [2] No.Total Retail Sales per Square Foot Motor Vehicle and Parts Dealers [3] $250 $279 3% $8 2% $6 1% $3Home Furnishings and Appliance Stores $525 $586 0% $0 7% $41 10% $59Bldg. Matrl. and Garden Equip. and Supplies $356 $398 0% $0 15% $60 1% $4Food and Beverage Stores [4] - $578 55% $318 24% $139 3% $17Gasoline Stations [5] $1,321 $1,664 1% $17 2% $33 1% $17Clothing and Clothing Accessories Stores $370 $413 2% $8 5% $21 20% $83General Merchandise Stores $360 $402 5% $20 20% $80 20% $80Food Services and Drinking Places $492 $550 8% $44 10% $55 20% $110 Other Retail $209 $234 12% $28 7% $16 18% $42Nonretail [6] NA $0 14% $0 8% $0 6% $0 Total 100% $440 100% $450 100% $410
Taxable Retail Sales per Square Foot by Retail Center Type Percent Taxable by Shopping Center Type [7] 44% 54% 98%Taxable Sales per Square Foot (Rounded) $190 $240 $400 retail sales
Note: Original data is based on an average of multiple sources and is presented in 2016$ unless noted otherwise in footnotes.[1] Sales adjusted to year-end 2020 based on the Consumer Price Index, All items in West urban, all urban consumers, not seasonally adjusted:

Year CPI Adjustment to 2020$
2008 219.65 25.9%2016 247.71 11.7%2018 263.26 5.1%2019 270.35 2.3%2020 276.59 0.0% [2] Reflects percentage of total square footage by retail category by retail center type, estimated based on ULI's Dollars & Cents 2008.[3] Reflects motor vehicle parts only; excludes taxable sales per square foot for dealerships.[4][5] Estimated using ULI's Dollars & Cents, 2008, escalated to 2020$.[6] Included to account for non-taxable retail space occupants, such as services.[7] Based on BOE Publication 61, March 2018.Source: BizMiner 2016; ULI Dollars & Cents 2008; State of California Board of Equalization (BOE) Publication 61; Bureau of Labor Statistics, "CPI-All Urban Consumers (Current Series) - West Urban"; RetailSails http://retailsails.files.wordpress.com/2011/09/rs_spsf.pdf; eMarketer pulled February 2019; respective annual 10-K reports; EPS.

Sales per square foot for Food and Beverage stores estimated based on the averages from BizMiner, RetailSales, eMarketer, and annual 10-K reports, escalated to 2020$.

Total Retail Sales per Square Foot
Original
Data
[see Note]
Escalated
Data
(2020$) [1]
Total Retail Sales by Shopping Center Type
Neighborhood Community Regional
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ATTACHMENT I:

San Joaquin County Fiscal Impact Analysis

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List of Tables
Table 1 Summary of Annual Surplus/Deficits .............................................................. I-1 Table 2 Estimated Annual Revenues and Expenditures ................................................ I-2

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Table 1Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountySummary of Annual Surplus/Deficits (2020$)Item 2025 [1] 2030 2035 2040 2050 Buildout (2060)Annual Fiscal Impact Summary Prior to EIFD Allocation
Annual General Fund Revenues $10,131,000 $20,394,000 $28,056,000 $32,359,000 $37,918,000 $41,536,000Annual General Fund Expenditures $4,169,000 $7,886,000 $10,502,000 $11,861,000 $14,093,000 $15,827,000Net General Fund Surplus/(Deficit) $5,962,000 $12,508,000 $17,554,000 $20,498,000 $23,825,000 $25,709,000 Net of EIFD Allocation - Maximum Tax Rate
EIFD Contribution [2] ($2,466,100) ($2,005,300) ($2,718,300) ($3,116,300) ($3,659,600) ($4,037,900)Net General Fund Surplus/(Deficit) $3,495,900 $10,502,700 $14,835,700 $17,381,700 $20,165,400 $21,671,100 Net of EIFD Allocation - Variable Tax Rate
EIFD Contribution [2] ($2,466,100) ($1,303,400) ($1,291,200) ($1,480,200) ($823,400) ($908,500)Net General Fund Surplus/(Deficit) $3,495,900 $11,204,600 $16,262,800 $19,017,800 $23,001,600 $24,800,500 sum
Source: EPS.[2] EIFD Allocation represents the portion of County property tax revenues diverted to the EIFD. Refer to Table B-3 for details.

Estimated Annual Revenues/Expenditures (Rounded)
San Joaquin
County
[1] This analysis assumes the EIFD will be formed in FY 2022-23 (Base Year) with the first year of revenue accruing to the district in FY 2023-24.

Secured and unsecured tax rolls for a fiscal year are based on taxable assessed values with a lien date of the prior January 1. Thus, the initialphase of this analysis includes estimated development occurring in July-December 2022 (50% of development estimated in calendar year 2022) and development occurring in full calendar years for the remainder of the phase (2023-2025). Subsequent phases include 5-year developmentperiods for development occurring from 2026 through 2040 and 10-year development periods from 2041 through 2060.

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Table 2
Mossdale Tract Infrastructure Finance Plan
Fiscal Impact Analysis - San Joaquin County
Estimated Annual Revenues and Expenditures (2020$)
Item 2025 [1] 2030 2035 2040 2050 Buildout (2060)
Annual General Fund Revenues (Prior to EIFD Contribution) Property Tax (without EIFD Contribution) $5,213,700 $10,026,300 $13,591,500 $15,581,500 $18,298,200 $20,189,600 Property Tax in Lieu of VLF $3,002,700 $5,774,400 $7,827,600 $8,973,700 $10,538,300 $11,627,600 Property Transfer Tax $132,200 $243,400 $326,000 $368,800 $452,500 $519,900 Prop. 172 Public Safety Sales Tax $1,704,100 $4,200,700 $6,111,600 $7,210,000 $8,362,500 $8,899,800 Licenses, Permits, and Franchise $45,300 $86,900 $116,200 $131,800 $155,700 $173,700 Motor Vehicle License Fee $6,000 $10,500 $13,600 $15,100 $18,500 $21,600 Fines, Forfeitures and Penalties $26,900 $51,700 $69,100 $78,400 $92,600 $103,300 Total General Fund Revenue $10,130,900 $20,393,900 $28,055,600 $32,359,300 $37,918,300 $41,535,500 Annual General Fund Expenditures
General Government
Legislative & Administrative $90,000 $172,700 $231,000 $261,900 $309,400 $345,200 Finance $589,900 $1,131,500 $1,513,900 $1,715,900 $2,027,700 $2,261,900 County Counsel $5,300 $10,200 $13,600 $15,500 $18,300 $20,400 Human Resources $31,700 $60,700 $81,200 $92,100 $108,800 $121,400 Elections $65,500 $125,600 $168,000 $190,400 $225,000 $251,000 Property Management $271,300 $520,400 $696,300 $789,200 $932,600 $1,040,300 Other General $77,800 $149,200 $199,600 $226,300 $267,400 $298,300 Total General Government $1,131,500 $2,170,300 $2,903,600 $3,291,300 $3,889,200 $4,338,500 Public Protection
Judicial $887,500 $1,702,300 $2,277,600 $2,581,500 $3,050,600 $3,403,000 Police Protection $418,300 $802,200 $1,073,400 $1,216,600 $1,437,600 $1,603,700 Detention and Corrections $960,300 $1,841,900 $2,464,500 $2,793,300 $3,300,900 $3,682,200 Protective Inspection $106,100 $203,400 $272,200 $308,500 $364,600 $406,700 Other Protection $4,700 $9,000 $12,000 $13,600 $16,100 $17,900 Total Public Protection $2,376,900 $4,558,800 $6,099,700 $6,913,500 $8,169,800 $9,113,500 Health and Sanitation
Health Services $316,200 $553,800 $717,200 $792,600 $974,000 $1,137,300 Total Health and Sanitation $316,200 $553,800 $717,200 $792,600 $974,000 $1,137,300 Public Assistance
Administration - - - - - -
Aid Programs $184,600 $323,300 $418,700 $462,700 $568,600 $663,900 General Relief $11,200 $19,700 $25,500 $28,100 $34,600 $40,400 Other Assistance $74,100 $129,700 $168,000 $185,700 $228,200 $266,400 Veterans Services $3,900 $6,800 $8,800 $9,700 $11,900 $13,900 Total Public Assistance $273,800 $479,500 $621,000 $686,200 $843,300 $984,600 Education
Agriculture Education $10,000 $18,000 $23,000 $25,000 $31,000 $36,000 Total Education $10,000 $18,000 $23,000 $25,000 $31,000 $36,000 Recreation
Recreation Services $55,000 $96,000 $124,000 $137,000 $168,000 $196,000 Cultural Services $6,000 $10,000 $13,000 $15,000 $18,000 $21,000 Total Recreation $61,000 $106,000 $137,000 $152,000 $186,000 $217,000 Total General Fund Expenditures $4,169,400 $7,886,400 $10,501,500 $11,860,600 $14,093,300 $15,826,900 EIFD Contribution [2]
Maximum Tax Rate ($2,466,100) ($2,005,300) ($2,718,300) ($3,116,300) ($3,659,600) ($4,037,900) Variable Tax Rate ($2,466,100) ($1,303,400) ($1,291,200) ($1,480,200) ($823,400) ($908,500) Net General Fund Surplus/(Deficit)
Prior to EIFD Allocation $5,961,500 $12,507,500 $17,554,100 $20,498,700 $23,825,000 $25,708,600 Net of EIFD Allocation - Maximum Tax $3,495,400 $10,502,200 $14,835,800 $17,382,400 $20,165,400 $21,670,700 Net of EIFD Allocation - Variable Tax $3,495,400 $11,204,100 $16,262,900 $19,018,500 $23,001,600 $24,800,100 det sum
Source: EPS.
[2] EIFD Contribution represents the portion of County property tax revenues diverted to the EIFD. Refer to Table B-3 for details.

Secured and unsecured tax rolls for a fiscal year are based on taxable assessed values with a lien date of the prior January 1. Thus, the initial phase of this analysis includes estimated development occurring in July-December 2022 (50% of development estimated in calendar year 2022) and development occurring in full calendar years for the remainder of the phase (2023-2025). Subsequent phases include 5-year development periods for development occurring from 2026 through 2040 and 10-year development periods from 2041 through 2060.

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APPENDICES:

Appendix A: General Assumptions
Appendix B: General Fund Revenue Analysis
Appendix C: General Fund Expenditure Analysis
Appendix D: Supporting Tables for
Revenue and Expenditure Analysis

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APPENDIX A:

General Assumptions
Table A-1 General Assumptions ...................................................... I-3 Table A-2 Cumulative Land Use Projections ...................................... I-4 Table A-3 Cumulative Occupied Dwelling Units and
Building Square Footage .................................................. I-5 Table A-4 Cumulative Estimated Population and Employees ................ I-6 Table A-5 Land Use Assumptions .................................................... I-7

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Table A-1Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyGeneral AssumptionsItem AssumptionGeneral Assumptions Fiscal Year of Budget Analysis [1] FY 2020-21Base Fiscal Year of Potential EIFD [2] FY 2022-23 General Demographic Characteristics
San Joaquin County
Population [3] 773,632Employees [4] 282,200San Joaquin County Persons Served [5] 914,732 gen assumps
Source: California Department of Finance; EDD; U.S. Census LED; EPS.[5] Persons served is defined as total population plus half of total employees. Used to estimate specific revenues and expenditures that are assumed to be impacted by growth in resident and employment populations and to avoid double counting of employees who reside in the City.

San Joaquin
County
[1] Reflects the County of San Joaquin Fiscal Year 2020-21 adopted budget. Revenues and expenditures are in 2020 dollars. This analysis does not reflect changes in values resulting from inflation or appreciation.
[3] Based on population estimates from the California Department of Finance (DOF) data for January 1, 2020.
[4] US Census Onthemap.ces.census.gov estimated a total of 251,730 jobs in San Joaquin County, CA in 2018. California EDD reports an annual average growth rate of 0.95% since 2018 for the Stockton-Lodi MSA. EPS adjusted the 2018 employment figure to arrive at a 2020 employment estimate using this growth rate and further increased the total by 10% to account for self-employed workers. Estimate is rounded to the nearest hundred employees. [2] This analysis assumes the EIFD will be formed in FY 2022-23 (Base Year) with the first year of revenue accruing to the district in FY 2023-24. Secured and unsecured tax rolls for a fiscal year are based on taxable assessed values with a lien date of the prior January 1. Thus, the initial phase of this analysis includes estimated development occurring in July-December 2022 (50% of development estimated in calendar year 2022) and development occurring in full calendar years for the remainder of the phase (2023-2025). Subsequent phases include 5-year development periods for development occurring from 2026 through 2040 and 10-year development periods from 2041 through 2060.

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Table A-2Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyCumulative Land Use ProjectionsLand Use Dwelling
Units
Building
Sq. Ft.

Dwelling
Units
Building
Sq. Ft.

Development Projections in Current City Limits [2]
Residential Land Uses [4]
Low Density Residential 1,946 - 3,169 - 4,236 - 4,793 - 6,483 - 8,004 - High Density Residential 956 - 1,716 - 2,094 - 2,287 - 2,287 - 2,287 - Subtotal Residential 2,902 - 4,885 - 6,330 - 7,080 - 8,770 - 10,291 - Nonresidential Land Uses
Retail Commercial [5] - 1,691,971 - 4,185,528 - 5,750,736 - 6,504,146 - 7,139,848 - 7,356,351 Office Commercial [5] - 832,363 - 2,023,383 - 2,598,924 - 2,937,792 - 3,153,260 - 3,210,967 Industrial - 6,853,240 - 11,328,609 - 14,357,821 - 16,465,698 - 17,521,923 - 17,521,923 Subtotal Nonresidential - 9,377,573 - 17,537,520 - 22,707,480 - 25,907,636 - 27,815,031 - 28,089,241 Total All Land Uses 2,902 9,377,573 4,885 17,537,520 6,330 22,707,480 7,080 25,907,636 8,770 27,815,031 10,291 28,089,241 Development Projections in Annexation Areas [2]
Residential Land Uses [4]
Low Density Residential 276 - 691 - 860 - 860 - 860 - 860 - Subtotal Residential 276 - 691 - 860 - 860 - 860 - 860 - Nonresidential Land Uses
Retail Commercial [5] - 189,953 - 677,218 - 1,391,530 - 1,944,530 - 2,685,530 - 3,090,630 Industrial - - - - - 1,131,402 - 1,885,670 - 1,885,670 - 1,885,670 Subtotal Nonresidential - 189,953 - 677,218 - 2,522,932 - 3,830,200 - 4,571,200 - 4,976,300 Total All Land Uses 276 189,953 691 677,218 860 2,522,932 860 3,830,200 860 4,571,200 860 4,976,300 Total San Joaquin County Development Projections
Residential Land Uses [4]
Low Density Residential 2,221 - 3,859 - 5,095 - 5,652 - 7,342 - 8,863 - High Density Residential 956 - 1,716 - 2,094 - 2,287 - 2,287 - 2,287 - Subtotal Residential 3,177 - 5,575 - 7,189 - 7,939 - 9,629 - 11,150 - Nonresidential Land Uses
Retail Commercial [5] - 1,881,924 - 4,862,746 - 7,142,266 - 8,448,676 - 9,825,378 - 10,446,981 Office Commercial [5] - 832,363 - 2,023,383 - 2,598,924 - 2,937,792 - 3,153,260 - 3,210,967 Industrial - 6,853,240 - 11,328,609 - 15,489,223 - 18,351,368 - 19,407,593 - 19,407,593 Subtotal Nonresidential - 9,567,526 - 18,214,738 - 25,230,412 - 29,737,836 - 32,386,231 - 33,065,541 Total All Land Uses 3,177 9,567,526 5,575 18,214,738 7,189 25,230,412 7,939 29,737,836 9,629 32,386,231 11,150 33,065,541

TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE lu
Source: San Joaquin County; City of Manteca; City of Lathrop; City of Stockton; LWA; EPS.[4] For purposes of this analysis, residential units were categorized as owner- or renter-occupied based on assumed density.[5] Nonresidential commercial land use projections provided by the applicable City reflect a general commercial land use designation. This analysis assumes general commercial will comprise both retail and office land uses. EPS determined a preliminary estimated allocation of retail and office space based on the existing proportion of retail and office space in each City, the City's current General Plan, and the proposed land use plans of anticipated development projects within the EIFD boundary. [3] Includes development projections in the future Stockton annexation area, the future Manteca Annexation area, and the Oakwood Shores and South Lathrop developments. [2] Development projections include development projections in incorporated cities as were provided by LWA based on land use data provided by the Cities of Lathrop, Manteca, and Stockton as of February, 2020.

San Joaquin
County
Cumulative Dwelling Units/Square Footage
2025 [1] 2030 2035 2040 2050 Buildout (2060)
[1] This analysis assumes the EIFD will be formed in FY 2022-23 (Base Year) with the first year of revenue accruing to the district in FY 2023-24. Secured and unsecured tax rolls for a fiscal year are based on taxable assessed values with a lien date of the prior January 1. Thus, the initial phase of this analysis includes estimated development occurring in July-December 2022 (50% of development estimated in calendar year 2022) and development occurring in full calendar years for the remainder of the phase (2023-2025). Subsequent phases include 5-year development periods for development occurring from 2026 through 2040 and 10-year development periods from 2041 through 2060.

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Table A-3Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyCumulative Occupied Dwelling Units and Building Square Footage Vacancy
Land Use Rate [1] 2025 2030 2035 2040 2050 Buildout (2060) Development Projections in Current City Limits
Residential Land Uses
Low Density Residential 6.0% 1,829 2,979 3,982 4,505 6,094 7,523 High Density Residential 6.0% 899 1,613 1,968 2,150 2,150 2,150 Subtotal Residential 2,728 4,592 5,950 6,655 8,244 9,673 Nonresidential Land Uses
Retail Commercial 7.5% 1,565,073 3,871,613 5,319,430 6,016,335 6,604,359 6,804,624 Office Commercial 7.5% 769,935 1,871,629 2,404,004 2,717,458 2,916,766 2,970,145Industrial 7.5% 6,339,247 10,478,964 13,280,985 15,230,771 16,207,779 16,207,779Subtotal Nonresidential 8,674,255 16,222,206 21,004,419 23,964,563 25,728,904 25,982,548 Development Projections in Annexation Areas
Residential Land Uses
Low Density Residential 6.0% 259 649 808 808 808 808
Subtotal Residential 259 649 808 808 808 808
Nonresidential Land Uses
Retail Commercial 7.5% 175,707 626,427 1,287,165 1,798,690 2,484,115 2,858,833 Industrial 7.5% - - 1,046,547 1,744,245 1,744,245 1,744,245Subtotal Nonresidential 175,707 626,427 2,333,712 3,542,935 4,228,360 4,603,078 Total San Joaquin County Development Projections
Residential Land Uses
Low Density Residential 6.0% 2,088 3,628 4,790 5,313 6,902 8,332High Density Residential 6.0% 899 1,613 1,968 2,150 2,150 2,150Subtotal Residential 2,987 5,241 6,758 7,463 9,052 10,481

TRUE TRUE TRUE TRUE TRUE TRUE
Nonresidential Land Uses
Retail Commercial 7.5% 1,740,779 4,498,040 6,606,596 7,815,025 9,088,474 9,663,457Office Commercial 7.5% 769,935 1,871,629 2,404,004 2,717,458 2,916,766 2,970,145Industrial 7.5% 6,339,247 10,478,964 14,327,532 16,975,016 17,952,024 17,952,024Subtotal Nonresidential 8,849,962 16,848,633 23,338,131 27,507,498 29,957,264 30,585,625

TRUE TRUE TRUE TRUE TRUE TRUE
occupied
Source: California Department of Finance; San Joaquin County; Costar; LWA; EPS.[1] For details pertaining to vacancy rate assumptions, refer to Table A-5.

Occupied Dwelling Units/Building Square Feet
San Joaquin
County
Occupied Dwelling Units
Occupied Building Square Feet
Occupied Dwelling Units
Occupied Building Square Feet
Occupied Dwelling Units
Occupied Building Square Feet
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Table A-4Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyCumulative Estimated Population and Employees Assumption
Land Use [1] 2025 2030 2035 2040 2050 Buildout (2060)Project Residents Residential Land Uses PPH
Low Density Residential 3.30 6,891 11,972 15,806 17,534 22,776 27,494 High Density Residential 2.50 2,247 4,033 4,921 5,374 5,374 5,374 Subtotal Residential 9,138 16,005 20,727 22,908 28,150 32,868 Total Resident Population 9,138 16,005 20,727 22,908 28,150 32,868Project Employees Nonresidential Land Uses Sq. Ft. per Emp.

Retail Commercial 400 4,352 11,245 16,516 19,538 22,721 24,159 Office Commercial 400 1,925 4,679 6,010 6,794 7,292 7,425 Industrial 2,000 3,170 5,239 7,164 8,488 8,976 8,976
Subtotal Nonresidential 9,447 21,163 29,690 34,820 38,989 40,560 Total Employee Population 9,447 21,163 29,690 34,820 38,989 40,560Project Persons Served 13,862 26,587 35,572 40,318 47,645 53,148 pop
Source: California Department of Finance; EPS. [1] For persons per household and square feet per employee assumptions, refer to Table A-5.

Estimated Population/Employees
San Joaquin
County
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Table A-5Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyLand Use Assumptions Persons per
Estimated Property Household/
Assessed Turnover Vacancy Sq. Ft. per
Land Use Value [1] Rate [2] Rate [3] Employee [4]
Residential Land Uses per Unit
Low Density Residential [5] $510,427 14.3% 6.0% 3.30
High Density Residential $200,000 6.7% 6.0% 2.50
Nonresidential Land Uses per Sq. Ft.

Retail Commercial $250 5.0% 7.5% 400Office Commercial $250 5.0% 7.5% 400 Industrial $100 5.0% 7.5% 2,000
lu assum
Source: The Gregory Group; Costar; Colliers, International; CBRE; US Census; EPS.[5] Estimated Countywide assessed value per unit reflects the weighted average, at buildout, of the assessed values per unit assumptions for Lathrop, Manteca, and Stockton. The assessed value per unit for low density residential is assumed to be $425,000 in the City of Stockton, $500,000in the City of Manteca, and $525,000 in the City of Lathrop. The assumption varies in each phase based on varying amounts of low densityresidential development in each jurisdiction by phase.

San Joaquin
County
[1] Residential assessed values are based on sales data of comparable products as obtained through The Gregory Group for the last 4 quarters (Q1 2020 through Q4 2020). Nonresidential values per square foot based on comparable transaction data for transactions made in San Joaquin County since2005 obtained from Costar, data accessed on March 25, 2021. [2] Owner-occupied residential assumed to turn over once every 7 years and renter-occupied residential is assumed to turn over once every 15 years.

Nonresidential uses are assumed to turn over once every 20 years. [3] Residential vacancy rates obtained from the US Census American Community Survey, 2018 estimates, for San Joaquin County. Commercial and industrial vacancy rates based on Q3 2019 Costar and Q3 2019 Colliers International market reports for the Stockton/Modesto area. [4] Persons per household figures obtained from the US Census American Community Survey, 2018 estimates. Square feet per employee values are based on empirical research for proposed land uses.

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APPENDIX B:

General Fund Revenue Analysis
Table B-1 Revenue-Estimating Procedures Based on
City of Lathrop FY 2020-21 Budget ................................... I-8 Table B-2 Estimated Annual General Fund Revenues ......................... I-9 Table B-3 Estimated Annual Property Tax Revenues (2 pages) .......... I-10 Table B-4 Real Property Transfer Tax ............................................ I-12 Table B-5 Estimated Annual Taxable Sales and Use Tax Revenue ...... I-13 Table B-5A Estimated Annual Taxable Sales from Proposed Development, Market Support Method ............................. I-14 Table B-5B Estimated Annual Taxable Sales from
Onsite Nonresidential .................................................... I-15

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Table B-1Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyRevenue-Estimating Procedures Based on San Joaquin County FY 2020-21 Budget (2020$) FY 2020-21 FY 2020-21
Budgeted Budgeted
Estimating Case Study General Fund Offsetting Net General Service Revenue Item Procedure Reference Revenues [1] Revenue Fund Revenues Population [2] Multiplier General Fund Revenues
Property Tax Case Study Table B-3 $168,865,867 ($190,792) $168,675,075 N/A - Property Tax in Lieu of VLF Case Study Table B-3 $95,777,111 - $95,777,111 N/A - Property Transfer Tax Case Study Table B-4 $5,016,651 - $5,016,651 N/A - Sales and Use Tax [3] - $22,156,588 - $22,156,588 N/A - Prop. 172 Public Safety Sales Tax Case Study Table B-5 $67,134,327 - $67,134,327 N/A - Transient Occupancy Tax [4] - $510,000 ($510,000) $0 N/A - Licenses, Permits, and Franchise Persons Served - $8,598,700 ($5,609,526) $2,989,174 914,732 $3.27Intergovernmental Revenue [4] - $495,324,122 ($556,335,941) ($61,011,819) N/A - Motor Vehicle License Fee Per Capita - $509,137 - $509,137 773,632 $0.66 Current Service Charges [4] - $45,015,682 ($44,355,867) $659,815 N/A - Fines, Forfeitures and Penalties Persons Served - $5,344,414 ($3,566,648) $1,777,766 914,732 $1.94 Use of Money and Property [4] - $6,471,039 ($946,039) $5,525,000 N/A - Other Taxes - Racehorse [4] - $2,000 - $2,000 N/A -
Miscellaneous Revenues [4] - $2,319,268 ($2,308,468) $10,800 N/A - Other [4] - $57,178,862 ($68,647,404) ($11,468,542) N/A - Subtotal General Fund Revenue $980,223,768 ($682,470,685) $297,753,083 Contingency Fund [4] - $4,974,834 ($4,974,834) $0 N/A - Total General Fund Revenue $985,198,602 ($687,445,519) $297,753,083 rev pro
Source: San Joaquin County Fiscal Year 2020-21 Approved Annual Budget; EPS.[1] Includes midyear budget adjustments as presented to the County Board of Supervisors on February 23, 2021.[2] Refer to Table A-1.[3] It is assumed that all sales tax revenue generated by the project will be contained within City boundaries; therefore, no sales and use tax is calculated in this analysis.[4] This revenue source is not expected to be affected by anticipated development and therefore is not evaluated in this analysis.

San Joaquin
County
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Table B-2Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyEstimated Annual General Fund Revenues (2020$) Case Study
Revenue Category Reference 2025 2030 2035 2040 2050 Buildout (2060)General Fund Revenues Property Tax (without EIFD Contribution) Table B-3 $5,213,691 $10,026,311 $13,591,493 $15,581,504 $18,298,205 $20,189,567Property Tax in Lieu of VLF Table B-3 $3,002,700 $5,774,400 $7,827,600 $8,973,700 $10,538,300 $11,627,600Property Transfer Tax Table B-4 $132,200 $243,400 $326,000 $368,800 $452,500 $519,900Prop. 172 Public Safety Sales Tax Table B-5 $1,704,067 $4,200,671 $6,111,610 $7,209,969 $8,362,507 $8,899,797Licenses, Permits, and Franchise - $45,300 $86,900 $116,200 $131,800 $155,700 $173,700Motor Vehicle License Fee - $6,000 $10,500 $13,600 $15,100 $18,500 $21,600Fines, Forfeitures and Penalties - $26,900 $51,700 $69,100 $78,400 $92,600 $103,300Total General Fund Revenue $10,130,859 $20,393,881 $28,055,604 $32,359,273 $37,918,311 $41,535,464EIFD Contribution - Maximum Tax Rate Less EIFD Contribution ($2,466,076) ($2,005,262) ($2,718,299) ($3,116,301) ($3,659,641) ($4,037,913) Net General Fund Revenues $7,664,783 $18,388,619 $25,337,305 $29,242,972 $34,258,670 $37,497,551EIFD Contribution - Variable Tax Rate Less EIFD Contribution ($2,466,076) ($1,303,420) ($1,291,192) ($1,480,243) ($823,419) ($908,531) Net General Fund Revenues $7,664,783 $19,090,461 $26,764,412 $30,879,030 $37,094,892 $40,626,934 rev
Source: San Joaquin County Fiscal Year 2020-21 Approved Annual Budget; EPS.

Estimated Annual Revenue (Rounded)
San Joaquin
County
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Table B-3Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyEstimated Annual Property Tax Revenues (2020$) Assumption/
Item Source Formula 2025 2030 2035 2040 2050 Buildout (2060) Assessed Value of New Development Table D-2
Assessed Value of New Development in Current City Limits a $2,483,977,808 $4,618,659,097 $6,067,767,380 $6,872,949,747 $8,078,614,747 $8,945,692,247 Assessed Value of New Development in Annexation Area b $185,363,250 $514,679,500 $890,897,700 $1,104,574,500 $1,289,824,500 $1,391,099,500 Total Assessed Value c = a + b $2,669,341,058 $5,133,338,597 $6,958,665,080 $7,977,524,247 $9,368,439,247 $10,336,791,747

TRUE TRUE TRUE TRUE TRUE TRUE
Property Tax Revenue (1% of Assessed Value) 1.0000%
Property Tax Revenue in Current City Limits d = a * 1.00% $24,839,778 $46,186,591 $60,677,674 $68,729,497 $80,786,147 $89,456,922 Property Tax Revenue in Annexation Areas e = b * 1.00% $1,853,633 $5,146,795 $8,908,977 $11,045,745 $12,898,245 $13,910,995 Total Property Tax Revenue f = d + e $26,693,411 $51,333,386 $69,586,651 $79,775,242 $93,684,392 $103,367,917 Estimated Property Tax Allocation
Estimated Property Tax Allocation in Current City Limits [1] San Joaquin County General Fund 19.5318% g = d * 19.53% $4,851,644 $9,021,051 $11,851,414 $13,424,076 $15,778,951 $17,472,506 Other Agencies/ERAF 80.4682% h = d * 80.47% $19,988,134 $37,165,540 $48,826,260 $55,305,421 $65,007,196 $71,984,417 Property Tax Allocation in Annexation Areas [2]
San Joaquin County General Fund 27.3226% i = e * 27.32% $362,047 $1,005,259 $1,740,079 $2,157,428 $2,519,253 $2,717,061 Other Agencies/ERAF 72.6774% j = e * 72.68% $1,491,586 $4,141,536 $7,168,898 $8,888,317 $10,378,992 $11,193,934 Subtotal San Joaquin County General Fund Property Tax k = g + i $5,213,691 $10,026,311 $13,591,493 $15,581,504 $18,298,205 $20,189,567EIFD Allocation - Maximum Tax Rate EIFD Allocation Percentage [3] l 47.3% 20.0% 20.0% 20.0% 20.0% 20.0% EIFD Allocation m = k * l $2,466,076 $2,005,262 $2,718,299 $3,116,301 $3,659,641 $4,037,913 Net San Joaquin County General Fund Property Tax n - k - m $2,747,615 $8,021,048 $10,873,195 $12,465,203 $14,638,564 $16,151,654EIFD Allocation - Variable Tax Rate EIFD Allocation Percentage [3] l 47.3% 13.0% 9.5% 9.5% 4.5% 4.5% EIFD Allocation m = k * l $2,466,076 $1,303,420 $1,291,192 $1,480,243 $823,419 $908,531 Net San Joaquin County General Fund Property Tax n - k - m $2,747,615 $8,722,890 $12,300,301 $14,101,261 $17,474,786 $19,281,037 Estimated Property Tax Revenues (2020$)
San Joaquin
County
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Table B-3Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyEstimated Annual Property Tax Revenues (2020$) Assumption/
Item Source Formula 2025 2030 2035 2040 2050 Buildout (2060) Estimated Property Tax Revenues (2020$)
San Joaquin
County
Property Tax In-Lieu of Motor Vehicle In-Lieu Fee Revenue (VLF) Total Countywide Assessed Value [4] o $85,144,874,422 $85,144,874,422 $85,144,874,422 $85,144,874,422 $85,144,874,422 $85,144,874,422 Total Assessed Value of Project p $2,669,341,058 $5,133,338,597 $6,958,665,080 $7,977,524,247 $9,368,439,247 $10,336,791,747 Total Assessed Value q = o + p $87,814,215,480 $90,278,213,019 $92,103,539,502 $93,122,398,669 $94,513,313,669 $95,481,666,169 Percent Change in AV r = p / o 3.14% 6.03% 8.17% 9.37% 11.00% 12.14% Property Tax In-Lieu of VLF [5] $95,777,111 s = r * $95,777,111 $3,002,668 $5,774,350 $7,827,610 $8,973,696 $10,538,298 $11,627,571 prop tax
Source: San Joaquin County; San Joaquin County Auditor-Controller; EPS.[2] Refer to Table D-1 for details.[4] Reflects Assessed Valuation for FY 2020-21. Includes countywide secured, unsecured, homeowner exemption, and public utility roll.[5] Property tax in-lieu of VLF amount derived from the San Joaquin County FY 2020-21 Annual Budget. Refer to Table B-1 for details.[1] Reflects the average property tax allocation to the County General Fund for all TRAs within the 200-year flood plain that are within the boundaries of the Cities of Lathrop, Manteca, and Stockton.

TRAs include: 002-000, 002-060, 002-063, 002-064, 002-087, 002-088, 003-159, 003-206, 003-238, 003-240, 003-289, 003-312, 003463, 003-464, 007-000, 007-002, 007-007, 007-008, 007-010, 007-012, 007-013, 007-014, 007-022, 007-029, 007-032, 007-041, 007-043, 007-046, 007-047, 007-048, 007-049, 007-071, and 007-074. [3] EIFD allocation percentage represents the portion of property tax revenues to be diverted to the EIFD. Alocation percentages are negotiated allocation amounts based on discussions between the County, the Cities of Lathrop, Stockton, and Manteca, and Project Consultants. Reflects the Initial Base Rate for the period ending 2029 and the Maximum Tax Allocation Rate for 2030 and beyond.

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Table B-4Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyReal Property Transfer Tax (2020$) Assumption/
Item Source 2025 2030 2035 2040 2050 Buildout (2060)
Rate per $1,000 of AV $0.55
Project Assessed Value Table D-2
Owner-Occupied Residential $1,114,245,500 $1,935,745,500 $2,555,645,500 $2,838,370,500 $3,725,620,500 $4,524,145,500Renter-Occupied Residential $191,200,000 $343,200,000 $418,800,000 $457,400,000 $457,400,000 $457,400,000Nonresidential $1,363,895,558 $2,854,393,097 $3,984,219,580 $4,681,753,747 $5,185,418,747 $5,355,246,247Total Assessed Value $2,669,341,058 $5,133,338,597 $6,958,665,080 $7,977,524,247 $9,368,439,247 $10,336,791,747 Turnover Rate
Owner-Occupied Residential 14.30%Renter-Occupied Residential 6.70%Nonresidential 5.00% Annual Transfer Tax Revenue [1]
Owner-Occupied Residential $87,635 $152,246 $201,002 $223,238 $293,020 $355,824Renter-Occupied Residential $7,046 $12,647 $15,433 $16,855 $16,855 $16,855Nonresidential $37,507 $78,496 $109,566 $128,748 $142,599 $147,269Total Annual Transfer Tax Revenue $132,188 $243,389 $326,000 $368,841 $452,474 $519,949 transfer
Source: San Joaquin County Auditor Assessor; San Joaquin County; EPS[1] Formula for Transfer Tax = Assessed Value/$1,000 * Rate per $1,000 of Assessed Value * Turnover rate.

Estimated Annual Property Transfer Tax Revenue (2020$)
San Joaquin
County
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Table B-5Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyEstimated Annual Taxable Sales and Use Tax Revenue (2020$)Item Formula 2025 2030 2035 2040 2050 Buildout (2060) Estimated Annual Taxable Sales
Annual Taxable Sales from Market Support (Residents and Employees) a Table B-5A $59,945,710 $109,328,494 $144,085,582 $161,240,158 $195,743,518 $224,702,686 Annual Taxable Sales from Onsite Commercial Uses b Table B-5B $379,767,600 $974,602,038 $1,432,939,055 $1,699,202,239 $1,962,096,751 $2,071,778,709Annual Taxable Sales from Total Net New Development c = a + b $439,713,310 $1,083,930,532 $1,577,024,637 $1,860,442,397 $2,157,840,269 $2,296,481,395 County Prop 172 Public Safety Sales Tax Revenue
County Prop 172 Sales Tax Rate d 0.50%
County Share of Prop 172 Revenue [1] e 95.00%
Adjustment for Unincorporated County Costs [2] f 81.59%County Prop 172 Public Safety Sales Tax Revenue g = c * d * e * f $1,704,067 $4,200,671 $6,111,610 $7,209,969 $8,362,507 $8,899,797 sales
Source: San Joaquin County; California State Board of Equalization; EPS.[2] Represents an adjustment made to account for the portion of Proposition 172 revenues allocated to services provided only to the unincorporated portions of the County.

Source/
Assumptions
Annual Sales Tax Revenue
[1] Provided by San Joaquin County.

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Table B-5AMossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyEstimated Annual Taxable Sales from Proposed Development, Market Support Method (2020$)Annual Taxable Sales from Market Support Assumption 2025 2030 2035 2040 2050 Buildout (2060)Annual Taxable Sales from New Residents Residential Development Table A-3
Low Density Residential 2,088 3,628 4,790 5,313 6,902 8,332High Density Residential 899 1,613 1,968 2,150 2,150 2,150Total Residential Development 2,987 5,241 6,758 7,463 9,052 10,481 Taxable Retail Expenditures per Household [1]
Low Density Residential $24,000 $50,116,138 $87,069,418 $114,953,578 $127,519,498 $165,645,898 $199,959,658High Density Residential $15,000 $13,479,600 $24,195,600 $29,525,400 $32,246,700 $32,246,700 $32,246,700Total Taxable Retail Expenditures $63,595,738 $111,265,018 $144,478,978 $159,766,198 $197,892,598 $232,206,358 Estimated Countywide Capture from New Households [2] 80% $50,876,590 $89,012,014 $115,583,182 $127,812,958 $158,314,078 $185,765,086 Estimated Taxable Sales Inside Project Area 50% $25,438,295 $44,506,007 $57,791,591 $63,906,479 $79,157,039 $92,882,543Estimated Taxable Sales Outside Project Area 50% $25,438,295 $44,506,007 $57,791,591 $63,906,479 $79,157,039 $92,882,543 Annual Taxable Sales from New Employment
Taxable Sales from New Employment
Employees Table A-4 9,447 21,163 29,690 34,820 38,989 40,560Average Daily Taxable Sales per New Employee $10.00Work Days per Year 240Taxable Sales from New Employees [3] 50%Total Taxable Sales from New Employees $11,336,400 $25,395,600 $35,628,000 $41,784,000 $46,786,800 $48,672,000 Estimated Citywide Capture from New Employees [2] 90% $9,069,120 $20,316,480 $28,502,400 $33,427,200 $37,429,440 $38,937,600 Estimated Taxable Sales Inside Project Area 70% $6,348,384 $14,221,536 $19,951,680 $23,399,040 $26,200,608 $27,256,320Estimated Taxable Sales Outside Project Area 30% $2,720,736 $6,094,944 $8,550,720 $10,028,160 $11,228,832 $11,681,280 Total Annual Taxable Sales from Market Support $59,945,710 $109,328,494 $144,085,582 $161,240,158 $195,743,518 $224,702,686 Taxable City Sales Inside Project Area $31,786,679 $58,727,543 $77,743,271 $87,305,519 $105,357,647 $120,138,863Taxable City Sales Outside Project Area $28,159,031 $50,600,951 $66,342,311 $73,934,639 $90,385,871 $104,563,823 sales a
Source: Costar; Gregory Group; Bureau of Labor Statistics; San Joaquin County; EPS.[1] For details pertaining to household taxable expenditure assumptions, refer to Table D-3.[2] Represents the portion of household and employee retail expenditures estimated to take place in San Joaquin County.[3] Taxable sales from employees discounted by 50% to account for employees who also are residents.

Estimated Annual Taxable Sales (2020$)
Occupied Dwelling Units
Taxable Retail Expenditures
San Joaquin
County
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Table B-5BMossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyEstimated Annual Taxable Sales from On-Site Nonresidential (2020$) Annual
Taxable Sales
Item per Sq. Ft. [1] 2025 2030 2035 2040 2050 Buildout (2060)Taxable Sales from Commercial Development Taxable Sales Generating Occupied Commercial Development Square Feet Retail Commercial 1,740,779 4,498,040 6,606,596 7,815,025 9,088,474 9,663,457 Total 1,740,779 4,498,040 6,606,596 7,815,025 9,088,474 9,663,457 Annual Taxable Sales from On-Site Commercial Development Retail $240 $417,787,076 $1,079,529,575 $1,585,582,941 $1,875,605,991 $2,181,233,835 $2,319,229,701 Total $417,787,076 $1,079,529,575 $1,585,582,941 $1,875,605,991 $2,181,233,835 $2,319,229,701 Less Total Annual Taxable Sales from Market Support (in the Project) [2] $31,786,679 $58,727,543 $77,743,271 $87,305,519 $105,357,647 $120,138,863Annual Sales Less Market Support $386,000,397 $1,020,802,032 $1,507,839,670 $1,788,300,472 $2,075,876,188 $2,199,090,838 Shift from
Existing Retail
Less Shift of Sales from Existing Regional and Community Retail to the Project [3] 10% $41,778,708 $107,952,958 $158,558,294 $187,560,599 $218,123,383 $231,922,970Total Taxable Sales from Retail Commercial Uses $344,221,690 $912,849,074 $1,349,281,376 $1,600,739,873 $1,857,752,804 $1,967,167,868Occupied Nonretail Commercial Uses Office Commercial 769,935 1,871,629 2,404,004 2,717,458 2,916,766 2,970,145Industrial 6,339,247 10,478,964 14,327,532 16,975,016 17,952,024 17,952,024 Total 7,109,182 12,350,593 16,731,536 19,692,473 20,868,789 20,922,168 Total Taxable Sales from Nonretail Commercial Uses
Office Commercial $5 $3,849,677 $9,358,146 $12,020,021 $13,587,288 $14,583,828 $14,850,723 Industrial $5 $31,696,234 $52,394,818 $71,637,658 $84,875,078 $89,760,119 $89,760,119 Total $35,545,911 $61,752,964 $83,657,679 $98,462,367 $104,343,947 $104,610,842 Total Taxable Sales from Nonretail Commercial Development $35,545,911 $61,752,964 $83,657,679 $98,462,367 $104,343,947 $104,610,842 Total Nonresidential Taxable Sales $379,767,600 $974,602,038 $1,432,939,055 $1,699,202,239 $1,962,096,751 $2,071,778,709 sales b
Source: Costar; Gregory Group; Bureau of Labor Statistics; EPS.[2] Estimated in Table B-5A.

Estimated Annual Taxable Sales (2020$)
[3] Represents a discount factor to account for taxable sales transactions that may shift from the cities' existing Regional- and Community-serving retail centers to those included in the Project.
[1] See Table D-4 for the taxable retail sales calculation. All retail is assumed to be community serving retail. Sales per square foot for the Retail space is based on average total sales per square foot figure derived from BizMiner and eMarketer data (escalated to 2020$) and converts total sales to taxable sales per square foot to account for a small portion of non-taxable goods sold.

San Joaquin
County
Occupied Building Square Feet
Total Taxable Sales
Occupied Building Square Feet
Total Taxable Sales
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APPENDIX C:

General Fund Expenditure Analysis
Table C-1 Expenditure-Estimating Procedures Based on
City of Lathrop FY 2020-21 Budget ................................. I-16 Table C-2 Estimated Annual General Fund Expenditures ................... I-17

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Table C-1Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyExpenditure-Estimating Procedures Based on San Joaquin County FY 2020-21 Budget (2020$) FY 2020-21 FY 2020-21 Population
Estimating Budgeted Less Offsetting Net County or Persons FY 2020-21 Adjustment Net FY 2020-21 Item Procedure Expenditures Revenue Expenditures Served Avg. Cost Factor [1] Avg. Cost General Fund
General Government
Legislative & Administrative Persons Served $6,227,194 ($286,105) $5,941,089 914,732 $6.49 100% $6.49Finance Persons Served $54,203,124 ($15,273,674) $38,929,450 914,732 $42.56 100% $42.56County Counsel Persons Served $536,073 ($185,262) $350,811 914,732 $0.38 100% $0.38Human Resources Persons Served $2,951,843 ($862,982) $2,088,861 914,732 $2.28 100% $2.28Elections Persons Served $9,613,575 ($5,293,315) $4,320,260 914,732 $4.72 100% $4.72Property Management Persons Served $18,563,221 ($658,989) $17,904,232 914,732 $19.57 100% $19.57Economic Promotion [3] $419,781 ($510,000) ($90,219) N/A N/A 100% N/A Other General Persons Served $7,128,467 ($1,994,885) $5,133,582 914,732 $5.61 100% $5.61Total General Government $99,643,278 ($25,065,212) $74,578,066 Public Protection
Judicial Persons Served $99,942,302 ($41,373,427) $58,568,875 914,732 $64.03 100% $64.03 Police Protection [2]
Countywide Police Protection Persons Served $28,852,310 ($1,250,807) $27,601,503 914,732 $30.17 100% $30.17 Unincorporated County Police Protection [3] $64,810,501 ($35,937,052) $28,873,449 N/A N/A 100% N/A Detention and Corrections Persons Served $125,277,743 ($61,904,073) $63,373,670 914,732 $69.28 100% $69.28 Flood Control Persons Served $670,000 ($670,000) $0 914,732 - 100% - Protective Inspection Persons Served $18,678,578 ($11,679,174) $6,999,404 914,732 $7.65 100% $7.65Other Protection Persons Served $8,227,084 ($7,918,171) $308,913 914,732 $0.34 100% $0.34Total Public Protection $346,458,518 ($160,732,704) $185,725,814 Public Ways and Facilities [3] $40,000 ($40,000) $0 N/A N/A 100% N/A Health and Sanitation Health Services Per Capita $96,285,002 ($69,516,326) $26,768,676 773,632 $34.60 100% $34.60Sanitation Per Capita $9,000 ($9,000) $0 773,632 - 100% - Total Health and Sanitation $96,294,002 ($69,525,326) $26,768,676 Public Assistance
Administration Per Capita $190,949,113 ($190,949,113) $0 773,632 - 100% - Aid Programs Per Capita $215,832,666 ($200,206,142) $15,626,524 773,632 $20.20 100% $20.20General Relief Per Capita $950,000 $0 $950,000 773,632 $1.23 100% $1.23Other Assistance Per Capita $39,965,240 ($33,695,007) $6,270,233 773,632 $8.10 100% $8.10Veterans Services Per Capita $524,873 ($197,210) $327,663 773,632 $0.42 100% $0.42Total Public Assistance $448,221,892 ($425,047,472) $23,174,420 Education
Agriculture Education Per Capita $846,913 $0 $846,913 773,632 $1.09 100% $1.09Total Education $846,913 $0 $846,913 Recreation
Recreation Services Per Capita $6,678,208 ($2,059,971) $4,618,237 773,632 $5.97 100% $5.97Cultural Services Per Capita $495,550 $0 $495,550 773,632 $0.64 100% $0.64Total Recreation $7,173,758 ($2,059,971) $5,113,787 Contingency Reserve $816,330 ($4,974,834) ($4,158,504) N/A N/A 100% N/A Total General Fund Expenditures $999,494,691 ($687,445,519) $312,049,172 exp pro
Source: San Joaquin County Fiscal Year 2020-21 Approved Annual Budget; San Joaquin County Administrator; EPS.[1] An adjustment factor may be used to reflect the fact that new employees may not increase certain General Fund department expenditures at a 1:1 ratio. This analysis does not assume an adjustment.

San Joaquin
County
[2] A majority of the police protection budget serves the unincorporated County population only. This analysis excludes this portion of the budget and only accounts for countywide cost impacts.[3] These cost categories serve the unincorporated County population only and have been excluded from the analysis.

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Table C-2Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyEstimated Annual General Fund Expenditures (2020$)Expenditure Category 2025 2030 2035 2040 2050 Buildout (2060)General Fund General Government
Legislative & Administrative $90,029 $172,677 $231,036 $261,861 $309,446 $345,191Finance $589,922 $1,131,477 $1,513,884 $1,715,866 $2,027,670 $2,261,889County Counsel $5,316 $10,196 $13,642 $15,462 $18,272 $20,383 Human Resources $31,654 $60,712 $81,231 $92,069 $108,800 $121,368 Elections $65,468 $125,567 $168,006 $190,421 $225,024 $251,017Property Management $271,314 $520,383 $696,258 $789,152 $932,555 $1,040,276Other General $77,792 $149,207 $199,634 $226,269 $267,386 $298,273Total General Government $1,131,495 $2,170,219 $2,903,692 $3,291,102 $3,889,153 $4,338,396 Public Protection
Judicial $887,530 $1,702,292 $2,277,620 $2,581,499 $3,050,604 $3,402,984 Police Protection $418,263 $802,232 $1,073,364 $1,216,572 $1,437,645 $1,603,710Detention and Corrections $960,340 $1,841,943 $2,464,468 $2,793,277 $3,300,865 $3,682,154Protective Inspection $106,066 $203,436 $272,192 $308,508 $364,569 $406,681Other Protection $4,681 $8,978 $12,013 $13,616 $16,090 $17,949 Total Public Protection $2,376,881 $4,558,882 $6,099,658 $6,913,472 $8,169,773 $9,113,478 Health and Sanitation
Health Services $316,187 $553,794 $717,181 $792,647 $974,027 $1,137,276Total Health and Sanitation $316,187 $553,794 $717,181 $792,647 $974,027 $1,137,276 Public Assistance
Administration - - - - - -
Aid Programs $184,578 $323,284 $418,663 $462,717 $568,599 $663,898General Relief $11,221 $19,654 $25,452 $28,130 $34,567 $40,361 Other Assistance $74,063 $129,719 $167,991 $185,668 $228,154 $266,393Veterans Services $3,870 $6,779 $8,779 $9,702 $11,923 $13,921 Total Public Assistance $273,732 $479,435 $620,885 $686,217 $843,243 $984,573 Education
Agriculture Education $10,004 $17,521 $22,690 $25,078 $30,816 $35,981Total Education $10,004 $17,521 $22,690 $25,078 $30,816 $35,981 Recreation
Recreation Services $54,550 $95,543 $123,731 $136,751 $168,043 $196,207Cultural Services $5,853 $10,252 $13,277 $14,674 $18,031 $21,054Total Recreation $60,403 $105,795 $137,008 $151,424 $186,074 $217,261 Total Annual General Fund Expenditures $4,168,701 $7,885,646 $10,501,114 $11,859,939 $14,093,087 $15,826,964 exp
Source: San Joaquin County Fiscal Year 2020-21 Approved Annual Budget; EPS.

Estimated Annual Expenditure
San Joaquin
County
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APPENDIX D:

Supporting Tables for
Revenue and Expenditure Analysis
Table D-1 Preliminary Property Tax Allocations for
Annexation Area (2 pages) ............................................ I-18 Table D-2 Cumulative Assessed Valuation ...................................... I-20 Table D-3 Estimated Average Annual Household Income .................. I-21 Table D-4 Total and Taxable Retail Sales per Square Feet ................. I-22

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Table D-1Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyPreliminary Property Tax Allocations for Annexation Area Tax
Code Entity TRA 102-135 TRA 102-032 TRA 102-136 TRA 102-001 TRA 102-100 TRA 102-121 Subject to Detachment
10001 County General 22.29650% 22.30610% 20.32600% 20.29360% 19.80000% 22.38190%10527 Road District 1 4.26040% 4.26030% 0.00000% 0.00000% 0.00000% 0.00000%10527 Road District 5 0.00000% 0.00000% 3.97920% 3.97840% 3.87760% 4.26700%14901 Lathrop-Manteca Rural Fire 0.00000% 0.00000% 8.83690% 8.84610% 8.62190% 0.00000%14401 French Camp-Mc Kinley Rural Fire 9.60300% 9.60300% 0.00000% 0.00000% 0.00000% 9.45470% City General Fund 0.00000% 0.00000% 0.00000% 0.00000% 0.00000% 0.00000% Subtotal 36.15990% 36.16940% 33.14210% 33.11810% 32.29950% 36.10360% Not Subject to Detachment
10618 County Library 1.80010% 1.80010% 1.63940% 1.63910% 1.59760% 1.80310%12601 Manteca Unified Schools 29.58380% 29.58380% 26.94230% 26.93720% 26.25470% 29.62960%13001 S.J. Delta Comm College 4.00510% 4.00510% 3.64750% 3.64670% 3.55440% 4.01150%13201 County Office Of Education 1.43850% 1.42890% 1.28960% 1.31780% 1.26400% 1.38930%16001 Sjc Flood Control 0.17560% 0.17570% 0.16000% 0.15990% 0.15580% 0.17590%21901 Sjc Mosquito Abatement 0.78840% 0.78840% 0.71800% 0.71790% 0.69960% 0.78940%24601 South San Joaquin Irrigation 0.00000% 0.00000% 5.41160% 5.41660% 0.00000% 0.00000%14901 Lathrop Manteca Fire District 0.00000% 0.00000% 0.00000% 0.00000% 0.00000% 0.00000%22001 Reclamation District #17 0.00000% 0.00000% 0.00000% 0.00000% 0.00000% 0.00000%24601 South San Joaquin Irrigation 0.00000% 0.00000% 0.00000% 0.00000% 5.27940% 0.00000%25301 CSA No. 4 Lathrop 0.00000% 0.00000% 0.00000% 0.00000% 1.54290% 0.00000%41100 ERAF 26.04860% 26.04860% 27.04950% 27.04670% 27.35210% 26.09760% Subtotal 63.84010% 63.83060% 66.85790% 66.88190% 67.70050% 63.89640% Total 100.00000% 100.00000% 100.00000% 100.00000% 100.00000% 100.00000% Source: San Joaquin County Auditor-Controller; EPS.
[1] Provided by the San Joaquin County Auditor-Controller.[2] Based on the most recent tax-sharing agreements between San Joaquin County and the Cities of Stockton, Lathrop, and Manteca related to annexed areas to the City.

Existing Tax Rate Area (TRA)
Post-ERAF Distribution [1]
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Table D-1Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyPreliminary Property Tax Allocations for Annexation Area Tax
Code Entity TRA 102-135 TRA 102-032 TRA 102-136 TRA 102-001 TRA 102-100 TRA 102-121 Total Subject to Detachment
10001 County General $172,291 ($796) $228,594 $14,804 $12,654 $24,209 $451,756 80% $587,765 27.32264%10527 Road District 1 $32,921 ($152) - - - - $32,769 - - 0.00000%10527 Road District 5 - - $44,751 $2,902 $2,478 $4,615 $54,746 - - 0.00000%14901 Lathrop-Manteca Rural Fire - - $99,384 $6,453 $5,510 - $111,347 - - 0.00000%14401 French Camp-Mc Kinley Rural Fire $74,205 ($343) - - - $10,226 $84,088 - - 0.00000% City General Fund - - - - - - - 20% $146,941 6.83066%
Subtotal $279,417 ($1,291) $372,728 $24,160 $20,642 $39,050 $734,707 100% $734,707 34.15330% Not Subject to Detachment
10618 County Library $13,910 ($64) $18,437 $1,196 $1,021 $1,950 $36,450 - $36,450 1.69441%12601 Manteca Unified Schools $228,602 ($1,056) $303,000 $19,651 $16,779 $32,048 $599,023 - $599,023 27.84598%13001 S.J. Delta Comm College $30,949 ($143) $41,021 $2,660 $2,272 $4,339 $81,097 - $81,097 3.76986%13201 County Office Of Education $11,116 ($51) $14,501 $961 $808 $1,503 $28,838 - $28,838 1.34054%16001 Sjc Flood Control $1,357 ($6) $1,799 $117 $100 $190 $3,556 - $3,556 0.16532%21901 Sjc Mosquito Abatement $6,092 ($28) $8,075 $524 $447 $854 $15,963 - $15,963 0.74205%24601 South San Joaquin Irrigation - - $60,861 $3,951 - - $64,813 - $64,813 3.01287%14901 Lathrop Manteca Fire District - - - - - $15,249 $15,249 - $15,249 0.70887%22001 Reclamation District #17 - - - - - $1,507 $1,507 - $1,507 0.07004%24601 South San Joaquin Irrigation - - - - $3,374 - $3,37425301 CSA No. 4 Lathrop - - - - $986 - $98641100 ERAF $201,285 ($930) $304,205 $19,731 $17,480 $28,227 $569,999 - $569,999 26.49675% Subtotal $493,311 ($2,279) $751,899 $48,791 $43,267 $85,867 $1,420,856 - $1,416,496 65.84670% Total $772,729 ($3,570) $1,124,627 $72,951 $63,909 $124,917 $2,155,562 100% $2,151,202 100.00000% TRA
Source: San Joaquin County Auditor-Controller; EPS.[1] Provided by the San Joaquin County Auditor-Controller.[2] Based on the most recent tax-sharing agreements between San Joaquin County and the Cities of Stockton, Lathrop, and Manteca related to annexed areas to the City.

San Joaquin
County
Gross Revenue
(FY 2019-20) [1]
Property TaxSharing
Agreement [2]
Post Annexation Average
Base
Revenue
Post-ERAF
Distribution
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Table D-2Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyCumulative Assessed Valuation (2020$)Item 2025 2030 2035 2040 2050 Buildout (2060)Development Projections in Current City Limits Residential Land Uses per Unit
Low Density Residential [2] $976,370,500 $1,590,370,500 $2,125,770,500 $2,408,495,500 $3,295,745,500 $4,094,270,500High Density Residential $200,000 $191,200,000 $343,200,000 $418,800,000 $457,400,000 $457,400,000 $457,400,000Subtotal Residential $1,167,570,500 $1,933,570,500 $2,544,570,500 $2,865,895,500 $3,753,145,500 $4,551,670,500 Nonresidential Land Uses per Sq. Ft.

Retail Commercial $250 $422,992,692 $1,046,381,958 $1,437,683,875 $1,626,036,408 $1,784,961,908 $1,839,087,658Office Commercial $250 $208,090,642 $505,845,708 $649,730,875 $734,448,008 $788,315,008 $802,741,758Industrial $100 $685,323,975 $1,132,860,930 $1,435,782,130 $1,646,569,830 $1,752,192,330 $1,752,192,330Subtotal Nonresidential $1,316,407,308 $2,685,088,597 $3,523,196,880 $4,007,054,247 $4,325,469,247 $4,394,021,747 Total All Land Uses $2,483,977,808 $4,618,659,097 $6,067,767,380 $6,872,949,747 $8,078,614,747 $8,945,692,247Development Projections in Annexation Areas Residential Land Uses per Unit
Low Density Residential [2] $137,875,000 $345,375,000 $429,875,000 $429,875,000 $429,875,000 $429,875,000Subtotal Owner-Occupied Residential $137,875,000 $345,375,000 $429,875,000 $429,875,000 $429,875,000 $429,875,000 Nonresidential Land Uses per Sq. Ft.

Retail Commercial $250 $47,488,250 $169,304,500 $347,882,500 $486,132,500 $671,382,500 $772,657,500Industrial $100 - - $113,140,200 $188,567,000 $188,567,000 $188,567,000 Subtotal Nonresidential $47,488,250 $169,304,500 $461,022,700 $674,699,500 $859,949,500 $961,224,500 Total All Land Uses $185,363,250 $514,679,500 $890,897,700 $1,104,574,500 $1,289,824,500 $1,391,099,500 Total San Joaquin County Development Projections
Residential Land Uses per Unit
Low Density Residential [2] $1,114,245,500 $1,935,745,500 $2,555,645,500 $2,838,370,500 $3,725,620,500 $4,524,145,500High Density Residential $200,000 $191,200,000 $343,200,000 $418,800,000 $457,400,000 $457,400,000 $457,400,000Subtotal Residential $1,305,445,500 $2,278,945,500 $2,974,445,500 $3,295,770,500 $4,183,020,500 $4,981,545,500 Nonresidential Land Uses per Sq. Ft.

Retail Commercial $250 $470,480,942 $1,215,686,458 $1,785,566,375 $2,112,168,908 $2,456,344,408 $2,611,745,158Office Commercial $250 $208,090,642 $505,845,708 $649,730,875 $734,448,008 $788,315,008 $802,741,758Industrial $100 $685,323,975 $1,132,860,930 $1,548,922,330 $1,835,136,830 $1,940,759,330 $1,940,759,330Subtotal Nonresidential $1,363,895,558 $2,854,393,097 $3,984,219,580 $4,681,753,747 $5,185,418,747 $5,355,246,247 Total All Land Uses $2,669,341,058 $5,133,338,597 $6,958,665,080 $7,977,524,247 $9,368,439,247 $10,336,791,747

TRUE TRUE TRUE TRUE TRUE TRUE
AV
Source: Costar; CBRE; The Gregory Group; EPS.[1] Refer to Table A-5 for details.

Rounded
Value per
Unit/Sq. Ft.
[1]
Total Assessed Value (2020$)
San Joaquin
County
[2] Countywide Project assessed value is calculated as the sum of the Project assessed values for Lathrop, Manteca, and Stockton, based on differing assessed value assumptions by jurisdiction. The assessed value per unit for low density residential is assumed to be $450,000 in the City of Stockton and $500,000 in the City of Manteca,and $525,000 in the City of Lathrop. as the phasing of the Project varies from jurisdiction to jurisdiction, the average assessed value per unit for low density residentialCountywide varies between phases.

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Attachment I: San Joaquin County Fiscal Impact Analysis ATTACHMENT A 1172
DRAFT
Table D-3Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyEstimated Average Annual Household Income (2020$) Taxable Annual Taxable
Estimated Total Annual Estimated Expenditures Expenditures Home Mortgage Household as a Percentage of per Household Residential Land Use Value [1] or Rent [2] Income [3] Income [4] (Rounded) Owner-Occupied Residential
Low Density Residential $510,427 $36,514 $104,000 23% $24,000 Renter-Occupied Residential
High Density Residential $200,000 $18,000 $51,000 30% $15,000 income
Source: Costar; The Gregory Group; Bureau of Labor Statistics; EPS.[1] See Table A-5 for detail on estimated values for owner-occupied units.[4] Based on household expenditures data from the Bureau of Labor Statistics, 2018 Consumer Expenditure Survey.

San Joaquin
County
[2] Based on a 5%, 30-year fixed-rate mortgage with a 20% down payment, $150 monthly Homeowners' Association dues and 2% annual taxes and insurance.High density residential based on an average monthly rent assumption of $1,500 based on data on similar multifamily residentialobtained from Costar and an average size of 1,000 square feet. [3] Assumes 35% of income dedicated to housing costs (mortgage, taxes, insurance, and HOA dues) or rent payments. Rounded to the nearest $1,000.

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Attachment I: San Joaquin County Fiscal Impact Analysis

ATTACHMENT A
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DRAFT
Table D-4Mossdale Tract Infrastructure Finance PlanFiscal Impact Analysis - San Joaquin CountyTotal and Taxable Retail Sales per Square Feet (2020$)Item % [2] No. % [2] No. % [2] No.Total Retail Sales per Square Foot Motor Vehicle and Parts Dealers [3] $250 $279 3% $8 2% $6 1% $3Home Furnishings and Appliance Stores $525 $586 0% $0 7% $41 10% $59Bldg. Matrl. and Garden Equip. and Supplies $356 $398 0% $0 15% $60 1% $4Food and Beverage Stores [4] - $578 55% $318 24% $139 3% $17Gasoline Stations [5] $1,321 $1,664 1% $17 2% $33 1% $17Clothing and Clothing Accessories Stores $370 $413 2% $8 5% $21 20% $83General Merchandise Stores $360 $402 5% $20 20% $80 20% $80Food Services and Drinking Places $492 $550 8% $44 10% $55 20% $110 Other Retail $209 $234 12% $28 7% $16 18% $42Nonretail [6] NA $0 14% $0 8% $0 6% $0 Total 100% $440 100% $450 100% $410
Taxable Retail Sales per Square Foot by Retail Center Type Percent Taxable by Shopping Center Type [7] 44% 54% 98%Taxable Sales per Square Foot (Rounded) $190 $240 $400 retail sales
Note: Original data is based on an average of multiple sources and is presented in 2016$ unless noted otherwise in footnotes.[1] Sales adjusted to year-end 2019 based on the Consumer Price Index, All items in West urban, all urban consumers, not seasonally adjusted:

Year CPI Adjustment to 2019$
2008 219.65 25.9%2016 247.71 11.7%2018 263.26 5.1%2019 270.35 2.3%2020 276.59 0.0% [2] Reflects percentage of total square footage by retail category by retail center type, estimated based on ULI's Dollars & Cents 2008.[3] Reflects motor vehicle parts only; excludes taxable sales per square foot for dealerships.[4][5] Estimated using ULI's Dollars & Cents, 2008, escalated to 2020$.[6] Included to account for non-taxable retail space occupants, such as services.[7] Based on BOE Publication 61, March 2018.

Total Retail Sales per Square Foot
Original
Data
[see Note]
Escalated
Data
(2020$) [1]
Total Retail Sales by Shopping Center Type
Neighborhood Community Regional
Source: BizMiner 2016; ULI Dollars & Cents 2008; State of California Board of Equalization (BOE) Publication 61; Bureau of Labor Statistics, "CPI-All Urban Consumers (Current Series) - West Urban"; RetailSails http://retailsails.files.wordpress.com/2011/09/rs_spsf.pdf; eMarketer pulled February 2019; respective annual 10-K reports; EPS.

Sales per square foot for Food and Beverage stores estimated based on the averages from BizMiner, RetailSales, eMarketer, and annual 10-K reports, escalated to 2020$.

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Attachment I: San Joaquin County Fiscal Impact Analysis ATTACHMENT A 1174
Resolution No.

STOCKTON CITY COUNCIL

A RESOLUTION APPROVING THE DRAFT MOSSDALE TRACT ENHANCED

INFRACTURE FINANCING DISTRICT FINANCING PLAN AND AUTHORIZING CERTAIN

OTHER ACTIONS RELATED THERETO
Pursuant to Resolution No. R-22-5019 adopted on January 13, 2022 (the “Resolution of Intention”), the City Council of the City of Lathrop (the “City of Lathrop”), (i) initiated the process to establish the Mossdale Tract Enhanced Infrastructure Financing District (the “EIFD”) to finance certain public and other specified facilities, (ii) approved the establishment of the EIFD’s Public Financing Authority (the “Authority”), to be responsible for directing the preparation and implementation of the infrastructure financing plan (the “Infrastructure Financing Plan”), (iii) approved the preparation and distribution of the Infrastructure Financing Plan in accordance with Chapter 2.99 of Part 1 of Division 2 of Title 5 of the California Government Code (commencing with Section 53398.50) (the “EIFD Law”), and (iv) fixed the time and place when and where the Authority would conduct its first public hearing on the proposed establishment of the EIFD and the Infrastructure Financing Plan; and
Pursuant to the Resolution of Intention and in accordance with the EIFD Law, the City of Lathrop directed the Authority to request the assistance of necessary San Joaquin County (“County”) staff, San Joaquin Area Flood Control Agency (“SJAFCA”) staff, and other professionals to prepare the Infrastructure Financing Plan, and the Infrastructure Financing Plan was thereafter prepared and distributed in accordance with EIFD Law; and Pursuant to Resolution No. 2022-02-08-1502 adopted by the City Council (the “City Council”) of the City of Stockton (the “City”) on February 8, 2022, the City agreed to participate in the proposed EIFD as a taxing entity pending approval of the Infrastructure Financing Plan by the City Council; and
In accordance with the EIFD Law, the Authority conducted the first public hearing on the proposed establishment of the EIFD and the Infrastructure Financing Plan on April 21, 2022, and the second public hearing on May 26, 2022; and In accordance with the EIFD Law, the Authority is scheduled to conduct its third public hearing on the proposed establishment of the EIFD and the Infrastructure Financing Plan on July 21, 2022; and
The draft Infrastructure Financing Plan, which is incorporated herein by reference and which is on file in the office of the City Clerk, has been presented to the City Council of the City of Stockton for its review and approval, now, therefore, 1175

BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF STOCKTON, AS FOLLOWS:

1. The foregoing recitals are true and correct.

2. The City Council hereby approves the draft Infrastructure Financing Plan as presented at this meeting and authorizes City staff to file a copy of this Resolution with the Authority at or prior to the Authority’s public hearing on July 21, 2022.

3. The City Council hereby authorizes the City Manager to provide the certifications required by Government Code section 53398.54 in the manner and time required therein.

4. This Resolution shall take effect from and after its adoption.

5. If any section, subsection, phrase, or clause of this Resolution is for any reason found to be invalid, such section, subsection, phrase or clause shall be severed from, and shall not affect the validity of, all remaining portions of this Resolution that can be given effect without the severed portion.

6. The City Manager is hereby authorized and directed to take all actions necessary or advisable to give effect to the transactions contemplated by this Resolution. Any actions heretofore taken, on behalf of the City, that is in conformity with the purposes and intent of this Resolution and with the provisions of the EIFD Law with respect to the proposed EIFD, are hereby approved and confirmed.

PASSED, APPROVED, and ADOPTED June 14, 2022 .

KEVIN J. LINCOLN II
Mayor of the City of Stockton
ATTEST:

ELIZA R. GARZA, CMC
City Clerk of the City of Stockton
1176
SJAFCA MISSION STATEMENT ‐ Reduce and Manage the Region’s Flood Risk 1

PROPOSED MOSSDALE TRACT
ENHANCED INFRASTRUCTURE FINANCING DISTRICT –

INFRASTRUCTURE FINANCING PLAN
City of Stockton
June 14, 2022
Agenda Item 15.1
1177
Reduce and Manage the Region’s Flood Risk
Presentation Overview
• Project objectives and proposed solution• Requested Action• High Level Overview of Infrastructure Financing Plan (IFP) • Key Messages
• Next Steps in EIFD Formation Process
2 1178
Reduce and Manage the Region’s Flood Risk
Project Objectives
• Protect life and property• Comply with State Urban Level of Flood Protection (ULOP/Senate Bill 5)
• Allow for responsible development / investment• Allow for re-development • Protect economy
• Resiliency for changing conditions
3 1179
Reduce and Manage the Region’s Flood Risk 4
Annualized Damages & Life Loss
Damages and Life Loss: Without-Project vs. With-Project • 2018 Climate & Development Conditions:
• Without-Project (Existing Development)
• Damages = $46M/year
• Life Loss = 1.2 lives/year
• With-Project (Existing Development)
• Damages = $4M/year• Life Loss = 0.7 lives/year
• 2065 Climate & Development Conditions:
• Without-Project (Growth prevented due to SB5 restrictions) • Damages = $170M/year• Life Loss = 6.7 lives/year
• With-Project (Includes additional development and growth projections) • Damages = $37M/year• Life Loss = 1.1 lives/year
Annualized Damages
Annualized Life Loss
1180
Reduce and Manage the Region’s Flood Risk
Urban Level of Protection (ULOP)
• Senate Bill 5 (2007)
• Establishes ULOP as – the “level of protection that is necessary to withstand flooding that has a 1-in-200 chance of occurring in any given year using criteria … developed by DWR.” • Links flood management and land use authority• Must be achieved by 2028 (for Mossdale Tract) • RD 17 levees protecting Mossdale Tract don’t comply with ULOP • Land use agency responsible for findings that ULOP exists, or can be achieved by 2028 (Adequate Progress)
• Cities of Lathrop & Manteca, for the areas within Mossdale Tract, made ULOP Adequate Progress findings in June 2016
• City of Stockton made a similar finding (Weston Ranch Area) in September 2018 5 1181
Reduce and Manage the Region’s Flood Risk
ULOP cont’d.

Consequences of Non-Compliance with ULOP
• Increased Estimated Annual Damages & Life Loss• Restrictions on development • No new residential dwellings• No discretionary permits for re-development • Result is stymied economic development, reduced investment and deterioration of value – addressed in 2015 UOP Economic Study
6 1182
Reduce and Manage the Region’s Flood Risk
Proposed Solution
• Levee improvements to meet ULOP
• Levee height raises, slope stability improvements, underseepage improvements (cutoff walls and seepage berms), erosion repairs, right-of-way acquisition, encroachment / pipe remediation & rehabilitation and an extension of the Dryland Levee in Manteca • SJAFCA proposes $270 million, locally-funded project to meet requirements.

Funding Sources identified in last APR:
• Regional development impact fee (DIF)• “Overlay” assessment district (OAD)• Unspent funds from RD 17’s LSRP• Enhanced Infrastructure Financing District (EIFD) 7 1183
Reduce and Manage the Region’s Flood Risk
Requested Action
• Approval of EIFD Infrastructure Financing Plan
• EIFD Law requires:
• Preparation of an Infrastructure Financing Plan (IFP) for review by all residents, property owners and affected taxing entities. • All participating entities must approve the IFP before the EIFD can be formed. • Requested action today reflects the Stockton’s approval of the proposed IFP, as it is presented here today.
8 1184
Proposed
Boundary of
the EIFD
• Reflects the Area of
Benefit of ULOP
• Consistent with the
Area subject to theRegional Levee
Impact Fee and
Proposed Overlay
Assessment District
9 1185
Reduce and Manage the Region’s Flood Risk
Infrastructure Financing Plan & Key Messages
Reduce and Manage the Region’s Flood Risk 10
• The EIFD does not impose a new tax
• Portion of existing tax on new / increased Assessed Value after FY 2021/22 allocated to the EIFD to fund the Project.
• Draft IFP has been available for review and comment by the following • Property owners within the proposed boundaries.• Affected taxing entities (Lathrop, Manteca, Stockton and San Joaquin County). • Mossdale Tract EIFD Public Financing Authority.• Members of the public. 1186
Reduce and Manage the Region’s Flood Risk
Infrastructure Financing Plan Outreach
Reduce and Manage the Region’s Flood Risk 11
•Outreach to date:
• 3 direct mailings to property owners and residents
• 3 direct mailings to affected taxing entities• Direct mailings to planning commissions, councils and board of supervisors • Published notices of each of the public hearings
• Posted notices of each of the public hearings
• Informational briefings (study sessions / workshops) with each participating agency board.
• No comments received on Draft IFP to date; as such, we have prepared a Final IFP for Participating Agency approval.
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Reduce and Manage the Region’s Flood Risk
Infrastructure Financing Plan
Reduce and Manage the Region’s Flood Risk 12
•Rate of allocation to the EIFD is based on approved Infrastructure Financing Plan • Maximum Rates: Initial rates through 2029 & 20% rates beyond Affected Taxing Entity 2030 - 2032 2033 - 2043 2044 -2061Maximum Tax Rate Scenario City of Lathrop 10.0% 20.0% 20.0% 20.0%City of Manteca 5.0% 20.0% 20.0% 20.0%City of Stockton 1.0% 20.0% 20.0% 20.0%San Joaquin County 47.3% 20.0% 20.0% 20.0% Variable Tax Rate Scenario
City of Lathrop 10.0% 13.0% 9.5% 4.5%City of Manteca 5.0% 13.0% 9.5% 4.5%City of Stockton 1.0% 13.0% 9.5% 4.5%San Joaquin County 47.3% 13.0% 9.5% 4.5% EIFD Contribution Rate
Initial Years (2021-2029)
1188
Reduce and Manage the Region’s Flood Risk
Estimated Annual General Fund Fiscal Impacts (After EIFD Allocation) Reduce and Manage the Region’s Flood Risk 13
$15,414,000
$18,306,000
$10,861,000
$37,498,000
$17,831,000
$14,204,000
$6,624,000
$15,827,000
$0
$5,000,000
$10,000,000$15,000,000$20,000,000$25,000,000$30,000,000$35,000,000$40,000,000$45,000,000$50,000,000 Lathrop Manteca Stockton San Joaquin County
Annual Revnues and Expenditures
Mossdale Tract EIFD
Fiscal Impact Results by ATE at Buildout (2060) ‐ Max Tax Rate Scenario Annual Revenues Annual Expenditures
Annual General Fund
Surplus/Deficit =
($2,417,000)
Annual General Fund
Surplus/Deficit =
$4,102,000
Annual General Fund
Surplus/Deficit =
$4,237,000)
Annual General Fund
Surplus/Deficit =
$21,671,000)
1189
Reduce and Manage the Region’s Flood Risk
Estimated Annual General Fund Fiscal Impacts: City of Stockton Reduce and Manage the Region’s Flood Risk 14
Annual Fiscal Impacts to the City of Stockton’s General Fund Prior to EIFD Allocation and After EIFD Allocation under Maximum Tax Rate and Variable Tax Rate Scenarios
1190
Reduce and Manage the Region’s Flood Risk
Next Steps – IFP Approval Schedule
Reduce and Manage the Region’s Flood Risk 15
Week 1
Week 2
Week 3
Week 4
Week 1
Week 2
Week 3
Week 4
Week 1
Week 2
Week 3
Week 4
Week 1
Week 2
Week 3
Week 4
Public Financing Authority Meetings
Public Hearing No. 1  4/21
Public Hearing No. 2  5/26
Public Hearing No. 3 (Consideration of EIFD formation)  7/21 Affected Taxing Entity EIFD Workshops
City of Lathrop  5/2
City of Manteca  4/18
City of Stockton  5/3
San Joaquin County  5/24
Affected Taxing EIFD IFP Adoption Consideration
City of Lathrop  7/11
City of Manteca  6/21
City of Stockton  6/14
San Joaquin County  6/21
 Workshop or hearing date
12 3 4
TASKS
April May June July
• Final IFP to be presented to each of the participating entities for approval. 1191
Reduce and Manage the Region’s Flood Risk
Requested Action
16 • Adopt a Resolution approving the draft Mossdale Tract Enhanced Infrastructure Financing District (EIFD) Infrastructure Financing Plan (IFP)
1192
Questions?
SJAFCA MISSION STATEMENT ‐ Reduce and Manage the Region’s Flood Risk 17 1193
City of Stockton
Legislation Text
File #: 22-0451, Version: 1
ADOPT AN ORDINANCE AMENDING STOCKTON MUNICIPAL CODE TITLE 8, CHAPTERS 8.04 COLLECTION OF SOLID WASTE, RECYCLABLE MATERIALS, AND GREEN WASTE AND 8.28

CONSTRUCTION AND DEMOLITION DEBRIS WASTE REDUCTION

RECOMMENDATION
It is recommended that the City Council:

1. Adopt an Ordinance amending Stockton Municipal Code Title 8, Chapters 8.04 (Collection of Solid Waste, Recyclable Materials, and Green Waste) and 8.28 (Construction and Demolition Debris Waste Reduction) to ensure compliance with Senate Bill 1383.

2. Authorize the City Manager to take appropriate and necessary actions to carry out the purpose and intent of the Ordinance adopted by Council.

Summary
Staff recommends Council enact the proposed revisions to the Stockton Municipal Code (SMC) Title 8, Chapters 8.04 Collection of Solid Waste, Recyclable Materials, and Green Waste, and 8.28 Construction and Demolition Debris Waste Reduction (Attachment A - Redline Version of Ordinance).

These amendments will allow the City of Stockton to achieve compliance with Senate Bill 1383 (SB 1383) legislative mandates.

DISCUSSION
Background
In September 2016, Governor Brown signed into law SB 1383 establishing methane emissions reduction targets representing the next step in California’s environmental protection strategy.

Methane emissions result from the decomposition of organic waste in landfills and are a source of greenhouse gas (GHG) emissions. SB 1383 directs the Department of Resources Recycling & Recovery (CalRecycle) to adopt regulations and requirements to achieve state-wide goals, including a goal to reduce organic waste disposal into landfills by 75 percent by the year 2025.

To meet the state-wide goals of SB 1383, CalRecycle established numerous organic waste disposal program requirements impacting municipal jurisdictions, generators, processors, and haulers of organic waste. Under SB 1383, CalRecycle has the authority to financially penalize non-compliant jurisdictions up to $10,000 per day, per violation.

On November 5, 2019, Council approved exclusive residential and commercial recycling, organics, solid waste, and street sweeping franchise agreements with Sunrise Sanitation, Inc. (also known as City of Stockton Page 1 of 3 Printed on 6/8/2022
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File #: 22-0451, Version: 1
Republic Services) and USA Waste of California (also known as Waste Management). The effective start date was January 1, 2020. The base term of the franchise agreements will expire on December 31, 2029.

The 2020 franchise agreements address SB 1383 requirements such as residential and commercial organic waste collection, color-compliant collection containers, contamination monitoring, enforcement, and increased reporting requirements. The franchise agreements also assign areas of responsibility between the City and franchisees.

Present Situation
The regulations set forth by SB 1383 are effective January 1, 2022. Jurisdictions are required to enforce against SB 1383 related ordinances beginning on January 1, 2024, allowing for a two-year period of extensive outreach and education to bring residents and businesses into compliance. To implement, meet, and enforce the provisions set forth by SB 1383, an update to the existing SMC is necessary.

Staff contracted with HF&H Consultants, LLC (HF&H) to assist the City with updating the SMC.

HF&H has 30 years of experience and has provided support to over 150 public agencies in the field of recycling and solid waste. HF&H was one of CalRecycle’s chosen vendors to develop implementation tools including model franchise agreements and enforcement ordinances. HF&H was also the City’s chosen consultant to assist with negotiating Stockton’s current franchise agreements.

HF&H conducted an analysis of the City’s current SMC and identified areas in Chapters 8.04 (Collection of Solid Waste, Recyclable Materials, and Green Waste) and 8.28 (Construction and Demolition Debris Waste Reduction) that need updating to reflect the State’s municipal ordinance requirements. The SMC revisions are contained in Attachment A (Chapters 8.04 and 8.28 Redline Version of Ordinance) and include:
· Alignment of SMC language with franchise agreement language; · Alignment of SMC language with California Green Building Standards Code, 24 CCR, Part 11 (CALGreen);
· Organic food waste generator waivers and exemptions;
· Contamination inspection requirements for all generators; · Waste stream inspections and investigations; and,
· Enforcement and penalties to achieve SB 1383 compliance.

Although municipal code ordinance enforcement mechanisms are required by SB 1383, education will be the City’s first tool and primary effort to achieve compliance. The City will engage in enhanced public outreach efforts to reduce food waste and help prevent contamination. Customers will receive a variety of materials including sorting guides, newsletters, and access to online resources to promote proper sorting of recyclables and information on ways to reduce food waste at home and in the community.

It is recommended that Council adopt an Ordinance amending SMC Title 8, Chapters 8.04 (Collection of Solid Waste, Recyclable Materials, and Green Waste) and 8.28 (Construction and Demolition Debris Waste Reduction) to achieve compliance with SB 1383 legislative mandates.

City of Stockton Page 2 of 3 Printed on 6/8/2022
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File #: 22-0451, Version: 1

FINANCIAL SUMMARY
There is no impact to the City’s General Fund or any other unrestricted fund as a result of taking the recommended action.

Attachment A - Proposed Ordinance, Chapters 8.04 & 8.28 (Redline Version) City of Stockton Page 3 of 3 Printed on 6/8/2022
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ATTACHMENT A
1 ORDINANCE NO.

AN ORDINANCE AMENDING TITLE 8, CHAPTERS 8.04 AND 8.28 OF THE

STOCKTON MUNICIPAL CODE RELATING TO THE COLLECTION OF ORGANIC

MATERIALS

BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF STOCKTON, AS FOLLOWS:

SECTION I. AMENDMENT OF CODE
Title 8, Chapter 8.04 of the Stockton Municipal Code is amended and shall read as follows:

Chapter 8.04 COLLECTION OF SOLID WASTE, RECYCLABLE MATERIALS, AND

GREEN WASTEORGANIC MATERIALS

8.04.010 Definitions.

ATTACHMENT A
2 “City Manager” means the City Manager of the City of Stockton. “Collection” means the act of collecting recyclable materials, organic materials, solid waste, bulky items, and other material at the place of waste generation by an approved collection agent (public or private) and is distinguished from “removal.”in City. “Collector” means persons, firms, or corporations authorized by the City Council by franchise, contract, or permit to collect, transport, and process or dispose of garbage, rubbishdiscarded materials on an on-call and solid waste on a/or regularly scheduled basis.
“Commercial solid waste” means and includes all types of solid waste generated by warehouse, wholesale, or retail stores, service establishments of any type, professional offices, hospitals, education, health care, military and correctional institutions, and government offices and other commercial sources and wastes. “Commercial” shall mean of, from, or pertaining to non-residential premises where business activity is conducted, including, but not limited to, retail sales, services, wholesale operations, manufacturing, and industrial operations; but excluding businesses conducted upon residential property that are permitted under applicable zoning regulations and are not the primary use of the property. “Commercial edible food generator” includes a tier one or a tier two commercial edible food generator as defined in this chapter or as otherwise defined in 14 CCR Section 18982(a)(73) and (a)(74). For the purposes of this definition, food recovery organizations and food recovery services are not commercial edible food generators pursuant to 14 CCR Section 18982(a)(7).
“Compliance review” means a review of records by the City or its designee to determine compliance with this chapter.
“Community composting” means any activity that composts green material, agricultural material, food material, and vegetative food material, alone or in combination, for which the total amount of feedstock and compost on-site at any one time does not exceed 100 cubic yards and 750 square feet, as specified in 14 CCR Section 17855(a)(4); or, as otherwise defined by 14 CCR Section 18982(a)(8). “Composting or compost (or any variation thereof)” includes a controlled biological decomposition of organic materials yielding a safe and nuisance free compost product.
“Construction and demolition debris” means the or C&D” includes discarded building materials, packaging, debris, used construction materials, dredging, grubbing, and and rubble resulting from constructingconstruction, alteration, remodeling, repair,, razing, renovation, or demolition operations on any pavements, excavation or construction clean-up activities at residentialprojects, houses, commercial or 1198

ATTACHMENT A
3 governmental buildings, and any or other structures; but excludes excluded waste.

Construction and demolition debris includes rocks, soils, tree remains, and other structure or pavement.
“Contract collectoryard trimmings that result from land clearing or land development operations in preparation for construction. “Contamination” means a person designated as the authorized agent of the City to collect residential, multifamily and commercial solidthe following: (i) discarded materials placed in a recyclable materials container that are not identified as recyclable materials; (ii) discarded materials placed in an organic materials container that are not identified as organic materials; (iii) discarded materials placed in a solid waste container that are identified as recyclable materials and/or organic materials, which are to be separately collected; and/or (iv) excluded waste placed in any container. “Contractor” means the individual, partnership, corporation, joint venture, or other legal entity entering into a contract with the City to perform the collection. “Designee” means an entity that the City contracts with or otherwise arranges to carry out any of the City’s responsibilities of this chapter as authorized in 14 CCR Section 18981.2 or other applicable law. A designee may be a government entity, a collector, a private entity, or a combination of those entities. “Director” or “Public Works Director” means the Public Works Director of the City of Stockton, acting either directly or through authorized agents or designees. “Disposal site“Discarded materials” means recyclable materials, Oorganic materials, and includes the place,solid waste placed by a generator in a receptacle and/or at a location, tract of land, area or premises in use, intended to be used, or which has been used for the purposes of collection by a collector, excluding excluded waste. “Disposal facility” means a landfill, or other facility, for ultimate disposal of solid wasteswaste.
“Dwelling” means an occupied residence, flat, apartment, or other facility used for housing one or more persons, and occupied, in the City. “Dwelling unit” means one (1) or more habitable rooms which are any individual living unit in a single-family or multi-family structure or building, mobile home, or motor home located on a permanent site intended to be occupied by one (1) family with facilities for living, sleeping, cooking and eating and from which the City collects refuse, or capable of being utilized for, residential living other than a hotel or motel. “Food waste” means all source-separated vegetable waste, fruit waste, grain waste, and dairy waste, meat waste, fish waste, food-contaminated paper and other 1199

ATTACHMENT A
4 compostable paper (such as pizza boxes, take-out containers, napkins and paper towels), and untreated and unpainted wall board co-collected with green waste. “Garbage”“Edible food” means food that is unsold or unserved and meets all quality and labeling standards imposed by federal, state, and local laws and regulations even though the food may not be readily marketable due to appearance, age, freshness, grade, size, surplus, or other conditions, or as otherwise defined in 14 CCR Section 18982(a)(18). Edible food is not discarded materials if it is recovered and not discarded.
“Enforcement action" means an action of the City to address non-compliance with this chapter including, but not limited to, issuing administrative citations, fines, penalties, or using other remedies.
“Excluded Waste” means hazardous substance, hazardous waste, infectious waste, designated waste, volatile, corrosive, biomedical, infectious, biohazardous, and toxic substances or material, waste that the collector reasonably believes would, as a result of or upon disposal, be a violation of local, state or federal law, regulation or ordinance, including land use restrictions or conditions, waste that cannot be disposed of in class iii landfills, waste that in the collector’s reasonable opinion would present a significant risk to human health or the environment, cause a nuisance or otherwise create or expose the collector or City to potential liability; but not including de minimis volumes or concentrations of waste of a type and amount normally found in residential solid waste after implementation of programs for the safe collection, recycling, treatment, and disposal of batteries and paint in compliance with Sections 41500 and 41802 of the California Public Resources Code.
“Food distributor” means a company that distributes food to entities including, but not limited to, supermarkets and grocery stores, or as otherwise defined in 14 CCR Section 18982(a)(22).
“Food facility” has the same meaning as in Section 113789 of the Health and Safety Code.
“Food recovery” means actions to collect and distribute food for human consumption that otherwise would be disposed, or as otherwise defined in 14 CCR Section 18982(a)(24).
“Food recovery organization” means an entity that engages in the collection or receipt of edible food from commercial edible food generators and distributes that edible food to the public for food recovery either directly or through other entities or as otherwise defined in 14 CCR Section 18982(a)(25), including, but not limited to:

1. A food bank as defined in Section 113783 of the Health and Safety Code; 1200

ATTACHMENT A
5 2. A nonprofit charitable organization as defined in Section 113841 of the Health and Safety code; and,

3. A nonprofit charitable temporary food facility as defined in Section 113842 of the Health and Safety Code.

A food recovery organization is not a commercial edible food generator for the purposes of this chapter and implementation of 14 CCR, Division 7, Chapter 12 pursuant to 14 CCR Section 18982(a)(7).

If the definition in 14 CCR Section 18982(a)(25) for food recovery organization differs from this definition, the definition in 14 CCR Section 18982(a)(25) shall apply to this chapter.
“Food recovery service” means a person or entity that collects and transports edible food from a commercial edible food generator to a food recovery organization or other entities for food recovery, or as otherwise defined in 14 CCR Section 18982(a)(26). A food recovery service is not a commercial edible food generator for the purposes of this chapter and implementation of 14 CCR, Division 7, Chapter 12 pursuant to 14 CCR Section 18982(a)(7).
“Food Scraps" means those discarded materials that will decompose and/or putrefy including: (i) all kitchen and table food waste, and; (ii) animal or vegetable waste that attendsis generated during or results from the storage, preparation, cooking, or handling of food stuffs intended for disposal; (iii) discarded paper (including paper containers and cartons) that is contaminated with food scraps and compostables; (iv) fruit waste, grain waste, dairy waste, meat, and fish waste; and, (v) vegetable trimmings, houseplant trimmings, and other compostable organic waste common to the occupancy of residential dwellings. Food scraps are a subset of organic materials. “Green waste” means biodegradable materials such as leaves, grass, weeds, and wood materials from trees and shrubs.
“Generator” means any person whose act or process produces discarded materials as defined in the Public Resources Code, or whose act first causes discarded materials to become subject to regulation.
“Grocery store” means a store primarily engaged in the retail sale of canned food;, dry goods, fresh fruits and vegetables;, fresh meats, fish, and poultry; and any area that is not separately owned within the store where the food is prepared and served, including a bakery, deli, and meat and seafood departments, or as otherwise defined in 14 CCR Section 18982(a)(30).
“Hauler route” means the designated itinerary or sequence of stops for each segment of the City’s collection service area, or as otherwise defined in 14 CCR Section 18982(a)(31.5).
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6 “Industrial wastes” means and includes all types of solid wastes and semisolid wastes which that result from manufacturing facilities, factories, food processors, refineries, and publicly- operated treatment works.
“Industrial waste collector” means a person authorized by the City by permit to collect industrial waste within the City.
“Inspection” means a site visit or other activities where a City reviews records, containers, and/or an entity’s collection, handling, recycling, or landfill disposal of recyclable materials, organic waste, solid waste/mixed waste, or edible food handling to determine if the entity is complying with requirements set forth in this chapter, or as otherwise defined in 14 CCR Section 18982(a)(35).
“Landfill” means a disposal site employing a method of disposing of solid wastes on land without creating nuisances or hazards to public health or safety, by utilizing principles of engineering to confine the wastes to the smallest practical area, with a layer of suitable cover material at specific designated intervals. “Multifamily refuse” or “multifamily solid waste” means solid waste generated by the residents of any building and/or structure, or portion thereof, located in City that is used for residential housing and having four (4) or more distinct living units. “Large event” means an event, including, but not limited to, a sporting event or a flea market that charges an admission price, or is operated by a local agency, and serves an average of more than two thousand (2,000) individuals per day of operation of the event, at a location that includes, but is not limited to, a public, nonprofit, or privately- owned park, parking lot, golf course, street system, or other open space when being used for an event. If the definition in 14 CCR Section 18982(a)(38) differs from this definition, the definition in 14 CCR Section 18982(a)(38) shall apply to this chapter. “Large venue” means a permanent venue facility that annually seats or serves an average of more than 2,000 individuals within the grounds of the facility per day of operation of the venue facility. For purposes of this chapter and implementation of 14 CCR, Division 7, Chapter 12, a venue facility includes, but is not limited to, a public, nonprofit, or privately-owned or operated stadium, amphitheater, arena, hall, amusement park, conference or civic center, zoo, aquarium, airport, racetrack, horse track, performing arts center, fairground, museum, theater, or other public attraction facility. For purposes of this chapter and implementation of 14 CCR, Division 7, Chapter 12, a site under common ownership or control that includes more than one (1) large venue that is contiguous with other large venues in the site, is a single large venue. If the definition in 14 CCR Section 18982(a)(39) differs from this definition, the definition in 14 CCR Section 18982(a)(39) shall apply to this chapter. “Local education agency” means a school district, charter school, or county office of education that is not subject to the control of City or county regulations related to solid waste, or as otherwise defined in 14 CCR Section 18982(a)(40). 1202

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7 “Multi-family” means any residential premises, other than a single-family premises, with four (4) or more dwelling units used for residential purposes (regardless of whether residence therein is temporary or permanent), including such premises when combined in the same building with commercial establishments, that receive centralized, shared, collection service for all units on the premises that are billed to one (1) Customer at one (1) address. Customers residing in townhouses, mobile homes, condominiums, or other structures with four (4) or more dwelling units who receive individual service and are billed separately shall not be considered multi-family, unless otherwise required by applicable law.
“Occupant” means the person who occupies a premises.
“Organic materials” means yard trimmings and food scraps, individually or collectively. No discarded material shall be considered to be organic materials, however, unless it is separated from recyclable materials and solid waste. “Organic materials container” shall be used for the purpose of storage and collection of source separated organic materials.
“Organic waste” means solid wastes containing material originated from living organisms and their metabolic waste products, including, but not limited to, food, green material, landscape and pruning waste, organic textiles and carpets, lumber, wood, paper products, printing and writing paper, manure, biosolids, digestate, and sludges or as otherwise defined in 14 CCR Section 18982(a)(46). Biosolids and digestate are as defined by 14 CCR Section 18982(a).
“Owner,” when used with reference to a dwelling, means and shall conclusively be deemed to be the person(s) holding legal title to real property and/or any improvements thereon, and shall include the person(s) listed on the latest equalized assessment roll of the county assessor.
“Permittee” means a person authorized by the City by permit to collect industrial wastes, commercial recyclable materials, or construction and demolition debris. “Occupant” means person(s) occupying residential, commercial, or industrial premises.
“Owner,” when used with reference to a dwelling means and shall conclusively be deemed to be the legal owner or the legal owner’s agent of the dwelling. “Person” means any individual, firm, association, partnership, corporation, trust, joint venture, or other legal entity.
“Premises” means and includes a tract or parcel of land with or without habitable buildings or appurtenant structures.
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8 “Putrescible wastes” means and includes wastes that are capable of being decomposed by micro-organisms with sufficient rapidity as to cause nuisances because of odors, gases, or other offensive conditions, and include materials such as food wastes, offal, and dead animals.
“Refuse” means and includes garbage and rubbish.
“Recovery” means any activity or process described in 14 CCR Section 18983.1(b), or as otherwise defined in 14 CCR Section 18982(a)(49). “Recyclable materials” or “recyclables” means discarded materials intendedthat:
the generators set out in recyclable containers for and capablecollection for the purpose of being recycled, and that arerecycling by the collector and that exclude excluded waste. No discarded materials shall be considered recyclable materials unless such material is separated, set aside, handled, packaged offered, or otherwise delivered for from organic materials and solid waste.
“Recyclable materials container” shall be used for the purpose of storage and collection in a manner different from solid wasteof source separated recyclable materials.
“Recycle, recycled, recycling” means the process of collection, sorting, cleansing, treating, and reconstituting recyclable materials that would otherwise be disposed of, and returning them to the economy in the form of raw materials for new, reused, repaired, refabricated, remanufactured, or reconstituted products. The collection, transportation, or disposal of solid waste not intended for, or capable of, reuse is not recycling.
“Removal” means the act of taking solid wastes from the place of waste generation either by an approved collection agent or by a person in control of the premises.
“Remote monitoring” means the use of the internet of things (IOT) and/or wireless electronic devices to visualize the contents of recyclable materials containers, organic materials containers, and solid waste containers for purposes of identifying the quantity of materials in containers (level of fill) and/or presence of contamination. “Residential refuse” or “residential solid waste” means and includes all types of domestic rubbish which originate in single-family, duplex, triplex premises. “Rubbish” includes nonputrescible solid wastes such as ashes, paper, cardboard, tin cans, yard clippings, wood, glass, bedding, crockery, plastics, rubber by-products or litter.
“Solid wastes or wastes” means and includes all putrescible and nonputrescible solid of, from, or pertaining to a single-family premises, including single-family homes, 1204

ATTACHMENT A
9 duplexes, triplexes, townhouse complexes, and semisolid wastes, such as refuse, garbage, rubbish, paper, ashes, industrial wastes, demolition and construction wastes, abandoned vehicles and parts thereof, discardedmobile home and industrial appliances, manure, vegetable or animal solid and semisolid wastes and other discarded solid and semisolid wastes and also includes liquid wastes disposed of in conjunction with solid wastes at solid waste transfer/processing stations or disposal sites, but excludes:parks.

1. Sewage collection and treated in a municipal or regional sewerage system; or

2. Materials or substances having commercial value which have been salvaged for reuse, recycling or resale.
“Responsible party” means the owner, property manager, tenant, lessee, occupant, or other designee that subscribes to and pays for recyclable materials, organic materials, and/or solid waste collection services for a premise in the City, or, if there is no such subscriber, the owner or property manager of a single-family premise, multi-family premise, or commercial premise. In instances of dispute or uncertainty regarding who is the responsible party for a premises, responsible party shall mean the owner of a single-family premise, multi-family premise, or commercial premise. “Restaurant” means an establishment primarily engaged in the retail sale of food and drinks for on-premises or immediate consumption, or as otherwise defined in 14 CCR Section 18982(a)(64).
“Route review” means a visual inspection of containers along a hauler route for the purpose of determining container contamination, in a manner approved by the Director or their designee, or as otherwise defined in 14 CCR Section 18982(a)(65). “SB 1383” means the Short-Lived Climate Pollutants Act of 2016 (an act to add Sections 39730.5, 39730.6, 39730.7, and 39730.8 to the Health and Safety Code, and to add Chapter 13.1 [commencing with Section 42652] to Part 3 of Division 30 of the Public Resources Code, relating to methane emissions), also commonly referred to as "SB 1383," as amended, supplemented, superseded, and replaced from time to time. “SB 1383 Regulations” or “SB 1383 Regulatory” means or refers to, for the purposes of this chapter, the Short-Lived Climate Pollutants: Organic Waste Reduction regulations developed by CalRecycle and adopted in 2020 that created 14 CCR, Division 7, Chapter 12 and amended portions of regulations of 14 CCR and 27 CCR. “Self-haul” means to act as a self-hauler.
“Self-hauler” means a person who hauls solid waste, organic waste, or recyclable material they have generated to another person, subject to City approval in accordance with this chapter. Self-hauler also includes a landscaper, or a person who back-hauls waste.
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10 “Single-family” means any detached or attached house or residence designed or used for occupancy by one (1) family, with three (3) or fewer distinct living units, provided that collection service feasibly can be provided to such premises as an independent unit, and the owner or occupant of such independent unit is billed directly for the collection service. Single-family includes townhouses, and each independent unit of duplex or tri-plex residential structures, regardless of whether each unit is separately billed for their specific service level.
“Solid waste” means solid waste as defined in California Public Resources Code, Division 30, Part 1, Chapter 2, §40191 and regulations promulgated hereunder.

Excluded from the definition of solid waste are excluded waste, C&D, source separated recyclable materials, source separated organic materials, and radioactive waste.

Notwithstanding any provision to the contrary, solid waste may include de minimis volumes or concentrations of waste of a type and amount normally found in residential solid waste after implementation of programs for the safe collection, recycling, treatment, and disposal of household hazardous waste in compliance with Section 41500 and 41802 of the California Public Resources Code as may be amended from time to time. Solid waste includes salvageable materials only when such materials are included for collection in a solid waste container not source separated from solid waste at the site of generation.
“Solid waste container” shall be used for the purpose of storage and collection of solid waste.

“Source separated” means the segregation, by the generator, of materials designated for separate collection for some form of recycling, composting, recovery, or reuse.

“State” means the State of California.

“Supermarket” means a full-line, self-service retail store with gross annual sales of two million dollars ($2,000,000) or more, and that sells a line of dry grocery, canned goods, or nonfood items and some perishable items, or as otherwise defined in 14 CCR Section 18982(a)(71).
“Tenant” means a person who is legally in control of, but is not necessarily the legal owner of, a building, or a part of a building, or a dwelling unit, or any type of premises. SynonymousTenant is synonymous with occupant or lessee. “Tier one commercial edible food generator” means a commercial edible food generator that is one (1) of the following:

1. Supermarket.

2. Grocery store with a total facility size equal to or greater than ten thousand (10,000) square feet.

3. Food service provider.

4. Food distributor.
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11 5. Wholesale food vendor.

If the definition in 14 CCR Section 18982(a)(73) of tier one commercial edible food generator differs from this definition, the definition in 14 CCR Section 18982(a)(73) shall apply to this chapter.
“Tier two commercial edible food generator” means a commercial edible food generator that is one (1) of the following:

1. Restaurant with two hundred fifty (250) or more seats, or a total facility size equal to or greater than five thousand (5,000) square feet.

2. Hotel with an on-site food facility and two hundred (200) or more rooms.

3. Health facility with an on-site food facility and one hundred (100) or more beds.

4. Large venue.

5. Large event.

6. A state agency with a cafeteria with two hundred fifty (250) or more seats or total cafeteria facility size equal to or greater than five thousand (5,000) square feet.

7. A local education agency facility with an on-site food facility.

8. If the definition in 14 CCR Section 18982(a)(74) of tier two commercial edible food generator differs from this definition, the definition in 14 CCR Section 18982(a)(74) shall apply to this chapter.
“Wholesale food vendor” means a business or establishment engaged in the merchant wholesale distribution of food, where food (including fruits and vegetables) is received, shipped, stored, prepared for distribution to a retailer, warehouse, distributor, or other destination, or as otherwise defined in 14 CCR Section 189852(a)(76). “Yard trimmings” means those discarded materials that will decompose and/or putrefy including, but not limited to, green trimmings, grass, weeds, leaves, prunings, branches, dead plants, brush, tree trimmings, dead trees, small pieces of unpainted and untreated wood, and other types of organic materials resulting from normal yard and landscaping maintenance that may be specified by the City or applicable law for collection and processing as organic materials , in accordance with this chapter. Yard trimmings does not include items herein defined as excluded waste. Yard trimmings are a subset of organic materials.
“Vacant lot” means any parcel of real property that is not improved with a community garden, as defined by Section 16.240.020, or a completed permitted structure. (Ord. 2020-09-15-1501 C.S. § 4; prior code § 7-050)

8.04.020 Mandatory solid wastediscarded materials service required.

It shall be mandatory for the record owner of any property in the City in and from which solid waste is created, accumulated, or produced, unless requirements are otherwise waived or exempted subject to Section 8.04.190, to:
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12 A. Subscribe to and pay for solid waste City’s three- (3) container collection services provided to such property by the City, or a collector or permitteefor at least weekly collection of the City;recyclable materials, organic materials, and solid waste; B. Place and/or direct its generators to place, at a location accessible to the collector or permittee, an adequate container or containers provided by the collector or permittee for deposit of refusediscarded materials of such a number, type, or capacity as the Public Works Director for the City may prescribe. (Ord. 2019-11-05-1403-02 C.S. § 2; Ord. 2019-02-05-1403 C.S. § 2; prior code § 7-051); C. Place, and/or direct its generators to place, source separated organic materials in the organic materials container; source separated recyclable materials in the recyclable materials container; and solid waste in the solid waste container.; D. Not place and/or direct its generators to not place contamination in collection containers and not place materials designated for the organic materials containers or recyclable materials containers in the solid waste containers.; E. Nothing in this section prohibits a responsible party or generator of a premise from preventing or reducing discarded materials generation, managing organic waste on site, and/or using a community composting site pursuant to 14 CCR Section 18984.9(c).

8.04.030 Failure to initiate service or to provide sufficient refusediscarded materials containers.

A. When an owner or occupant fails to initiate adequate refusediscarded materials collection service within ten (10) days of occupancy of a dwelling by any person, the Public Works Director will give the owner or occupant notification that such service is required. If the owner or occupant does not arrange with the collector for service within ten (10) days from the date of mailing of the notice, then the collector shall initiate and continue refusediscarded materials collection service for said dwelling.

B. When, in the opinion of the Public Works Director, additional refusediscarded materials containers or, more frequent services, or other service modifications are required, they shall be provided for by the owner or occupant upon written notification from the Director. (Prior code § 7-051.1)

8.04.035 Requirements for multi-family.

A. Responsible parties of multi-family premises shall provide or arrange for recyclable materials, organic materials, and solid waste collection services consistent with this chapter for employees, contractors, and tenants.

B. Responsible parties of multi-family premises shall:
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13 1. Supply and allow access to adequate number, size, and location of collection containers with sufficient labels or colors for employees, contractors, tenants, and customers consistent with City’s recyclable materials container, organic materials container, and solid waste container collection service and, if self-hauling, consistent with the multi-family premise’s approach to complying with self-hauler requirements in Section

8.04.255.

3. Provide education information before or within fourteen (14) days of occupation of the premises to new tenants that describes requirements to source separate recyclable materials and organic materials, the location of containers, and the rules governing their use at each property.

4. Provide or arrange access for City or its designee to their properties during all inspections conducted in accordance with this chapter to confirm compliance with the requirements of this chapter.

C. If the responsible party of a multi-family premise wants to self-haul, meet the selfhauler requirements in Section 8.04.255.

D. Multi-family premises with at least five (5) dwelling units that generate two (2) cubic yards or more of total solid waste, recyclable materials, and organic materials per week (or other threshold defined by the state) that arrange for gardening or landscaping services, shall require that the contract or work agreement between the owner, occupant, or operator of a multi-family premises and a gardening or landscaping service specifies that the designated organic materials generated by those services be managed in compliance with this chapter.

E. Nothing in this section prohibits a responsible party or generator of a multi-family premise from preventing or reducing discarded materials generation, managing organic waste on site, or using a community composting site pursuant to 14 CCR Section 18984.9(c).

8.04.036 Requirements for commercial.

A. Responsible parties of commercial businesses shall provide or arrange for recyclable materials, organic materials, and solid waste collection services consistent with this chapter for employees, contractors, tenants, and customers.

B. Responsible parties of commercial premises shall:
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ATTACHMENT A
14 1. Supply and allow access to adequate number, size, and location of collection containers with sufficient labels or colors (conforming with Section

8.04.036.B.2 below) for employees, contractors, tenants, and customers, consistent with City’s recyclable materials container, organic materials container, and solid waste container collection service and, if self-hauling, consistent with the commercial premise’s’ approach to complying with selfhauler requirements in Section 8.04.255.

2. Provide containers for the collection of source separated recyclable materials and source separated organic materials in all indoor and outdoor areas where solid waste containers are provided for customers, for materials generated by that commercial business. Such containers shall be visible and easily accessible. Such containers do not need to be provided in restrooms. If a commercial business does not generate any of the materials that would be collected in one (1) type of container, then the responsible party of the commercial business does not have to provide that particular container in all areas where solid waste containers are provided for customers. Pursuant to 14 CCR Section 18984.9(b), the containers provided by the responsible party of the commercial business shall have either:
a. A body and/or lid that is blue for recyclable materials, green for organic materials, and grey for solid waste conforms with the container colors provided through the collection service provided by City, or
b. Container labels that include language or graphic images, or both, indicating the primary material accepted and the primary materials prohibited in that container, or containers with imprinted text or graphic images that indicate the primary materials accepted and primary materials prohibited in the container.

3. To the extent practical through education, training, inspection, and/or other measures, prohibit employees from placing materials in a container not designated for those materials per the City’s recyclable materials container, organic materials container, and solid waste container collection service and, if self-hauling, per the instructions of the commercial business’ responsible party to support its compliance with self-hauler requirements provided in Section 8.04.255 of this chapter.

4. Periodically inspect recyclable materials containers, organic materials containers, and solid waste containers for contamination and inform employees if containers are contaminated and of the requirements to keep contaminants out of those containers pursuant to 14 CCR Section 18984.9(b)(3).
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15 5. Annually, provide information to employees, contractors, tenants, and customers about recyclable materials and organic waste recovery requirements and about proper sorting of recyclable materials, organic materials, and solid waste.

6. Provide education information before or within fourteen (14) days of occupation of the premises to new tenants that describes: requirements to source separate recyclable materials and organic materials and keep source separated organic materials and source separated recyclable materials separate from each other and from other solid waste; the location of containers; and, the rules governing containers’ use at each property.

7. Provide or arrange access for City or its designee to their properties during all inspections conducted in accordance with this chapter to confirm compliance with the requirements of this chapter.

E. If the responsible party of a commercial business wants to self-haul, meet the selfhauler requirements in Section 8.04.255 of this chapter.

F. Nothing in this section prohibits a responsible party or a generator of a commercial business from preventing or reducing discarded materials generation, managing organic waste on site, or using a community composting site pursuant to 14 CCR Section 18984.9(c).

G. Responsible parties of commercial businesses that are tier one or tier two commercial edible food generators shall comply with food recovery requirements, pursuant to Section 8.04.195.

8.04.040 Duty to keep right-of-way free from solid wastediscarded materials.

Every person in possession, charge, or control of, and using, any place or premises in the City fronting on a street, alley, or other public right-of-way shall maintain the portion of the street, alley, or other public right-of-way adjacent to the place or premises in a condition free from soliddiscarded materials and waste matter. For the purposes of this section, the portion of a street, alley, or other public right-of-way adjacent to a place or premises includes any walkway, trail, sidewalk, parkway, curb and gutter, and the travel lane portion of the roadway on the side of the street or alley adjoining the property. The City may provide street sweeping services and collect a fee therefor as a part of the solid waste charge in partial satisfaction of this section. (Prior code § 7-051.2)

8.04.050 Containers generally.

A. All refusediscarded materials containers shall be kept clean and sanitary and portable by the owner or other person responsible for providing the container under the provisions of this section.
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ATTACHMENT A
16 B. If the collector is permitted or required to provide containers as a provision of its franchise, contract, or permit, all containers shall comply with the requirements established by the collector pursuant to the provisions of the franchise, contract, or permit, or as otherwise specified by applicable law.

C. Loading of containers shall be subject to the weight limitations established by the Public Works Director.

D. Separate containers for various types of recyclable materials and organic materials shall be provided according to written directives issued by the Public Works Director. (Prior code § 7-051.3)

8.04.060 Placement for collection.

On collection days, all containers and parcels of refusediscarded materials shall be placed adjacent to the roadway in a manner that does not block any travel way, parking area, or gutter. Loaded containers ready for collection shall not be set out before 6:00 p.m. on the day prior to the regular collection day. Containers shall be returned to a proper storage location on private property and not visible from the public right-of-way not later than 11:00 p.m. on the day of collection. The City Council may, by resolution, from time to time, prescribe days and hours for the collection of solid waste and recyclable material from property within certain areas of the City. Within such areas, all solid waste and recyclable material shall be made available for collection at the designated day and time. (Prior code § 7-051.4)

8.04.070 Placement of waste in containers—Separation of recyclable materials. and organic materials.

A. Waste consisting of flammable liquids, anti-freeze, insecticides, poisons, caustics, acids, explosives, liquid paint, or other household hazardous waste material, shall not be placed for collection service, but rather shall be disposed of at designated hazardous waste facilities, or as otherwise required by law.

B. Used motor oil and used oil filters may be placed in appropriate containers for collection as designated by the Public Works Director.

C. Medical waste shall not be placed for collection through solid waste services, but rather shall be disposed of as otherwise required by law.

D. Recyclable material, green wastematerials and food wasteorganic materials shall be separated from other solid waste for collection. However, the collector shall not refuse to collect solid waste from containers properly placed according to this article because it contains incidental amounts of recyclable materialmaterials or organic materials.
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17 E. Large household or bulky items shall not be placed for collection through the collection services, but rather shall be disposed of by special arrangement through the neighborhood clean up program or bulky item collection program provided by the collector. Placement of excess solid waste or bulky items may be placed for collection as designated by the Public Works Director. (Prior code § 7-051.5) containers, but rather shall be placed in accordance with any administrative or operational requirements established by the Director or their designee and applicable law, and in accordance with the current franchise agreement as applicable.

8.04.080 Placement of bins.

A. Bins shall be placed in an accessible, outside location, on a hard surface.

Bins shall be kept in enclosures meeting standards approved by the Public Works Director. The Public Works Director may waive the requirement for enclosure of a bin on the premises, or may establish a time schedule for implementation of the enclosure requirement upon application by the person responsible for the premises and a finding of good cause. Any such waiver shall be in writing and maintained in the records of the Public Works Department. Locked or inaccessible bins will be serviced only by special arrangement with the collector.

B. It is unlawful to place a bin in any public street, alley, or right-of-way without the express written permission of the Public Works Director upon such terms and conditions as Public Works Director deems appropriate in the public interest. (Prior code § 7-051.6)

8.04.090 Summary abatement of improper containers.

Any container or bin whichthat does not conform with the provisions of this chapter may be summarily abated as a public nuisance by the City. Such summary abatement shall occur only after a tag givingwritten or electronic notice of the noncomplying nature of the container has been placed on itprovided and the container has thereafter been used a second time for disposal of solid waste. (Prior code § 7-051.7)

8.04.100 Design of projects to include facilities for recyclable materials CALGreen requirements.

Regulated entities shall at all times comply with the requirements of projectsthe California Green Building Standards Code (24 CCR, Part 11), including, but not limited to include facilities for recyclable, the following provisions related to discarded materials.:

New1. Section 4.410.2 (Recycling by Occupants Residential) and substantially remodeled commercial, industrial and multifamily Section 5.410.1 30 (Recycling by Occupants Non-residential uses shall be designed to include space) regarding provision 1213

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18 of readily accessible areas for storage and collection of recyclable materials on the premises.and organic materials (Prior code § 7.051.8); and,

2. For organic waste commingled with construction and demolition debris, 24 CCR Section 4.408.1 (Construction Waste Management Residential) and 24 CCR Section

5.408.1 (Construction Waste Management non-residential).

8.04.110 Scavenging prohibited.

A. It is unlawful and a misdemeanor for any person to do any of the following:

1. Scavengescavenge, tamper with, move, remove, tip, deface, or destroy, any solid wastediscarded materials collection container, or the contents thereof;

2. Scavenge, tamper with, move, remove, tip, deface or destroy any collection container for discarded recyclable material or the contents thereof.

B. This section shall not apply to activities of the City, the collector, the owner or occupant of a premises, or a person authorized by the City to perform activities under this chapter. (Prior code § 7-051.9)

8.04.120 ReservedViolations.

Any owner or occupant or other person who shall violate any of the provisions of Sections 8.04.020 through 8.04.110 of this chapter shall be guilty of a misdemeanor. (Prior code § 7-051.10)

8.04.130 Collector entitled to payment for services rendered.

A. Pursuant to the provisions of this chapter and the terms and conditions of any applicable franchise or permit, the collector shall be entitled to payment from the owner or occupant for services rendered. When the owner or occupant has been directed to initiate service and the collector attempts to collect refusediscarded materials from the
dwelling, then such attempts shall be deemed the rendering of collection service for which collector is entitled to compensation in the same manner and amount as if discarded materials had actually been collected.
compensation in the same manner and amount as if refuse had actually been collected.

B. For multifamily refusesingle-family discarded materials, multi-family discarded materials, commercial solid wastediscarded materials, and industrial waste, collectors shall bill directly to the owner or occupant for collection services rendered.

The collector may require that the record owner be the customer of record. Moreover, 1214

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19 the collector or permittee may permit a tenant or authorized agent to receive bills pursuant to procedures prescribed by the City and provided that the property owner remains ultimately fully responsible and liable for payment. In all such events where the property owner is the customer of record or fully responsible and liable for payment, the collector or permittee may request that the City collect any delinquent or unpaid fees through a lien or special assessment under the procedures set forth in Section 8.04.160 or Government Code Section 38790.1 as it may be amended. (Ord. 2019-11-05-1403-02 C.S. § 3; prior code § 7-051.11)

8.04.135 Unified bill.

A. A unified bill includes charges for water services provided by the City and all other service charges, including sewer, solid wastediscarded materials, and stormwater service charges.

B. A bill that does not contain charges for water services provided by the City is not a unified bill as used in this chapter.

C. Water services not provided by the City may be billed separately from other City service charges at the water service provider’s sole discretion. (Ord. 2019-02- 05-1403 C.S. § 3)

8.04.140 Billing and collection procedures for residential solid wastediscarded materials collection.

A. All accounts for solid wastediscarded materials collection services shall be established by and held in the name of the record owner of the property where the solid wastediscarded materials services are to be provided.

B. At the time the application for solid wastediscarded materials collection services is requested, and at the Chief Financial Officer’s sole discretion, the applicant shall provide proof of ownership of the property to be served.

C. The record owner of a property receiving solid wastediscarded materials collection services shall be fully responsible and liable for the payment of all solid wastediscarded materials collection service charges, any delinquent solid wastediscarded materials collection service charges, and any penalties applicable to his or her property.

D. The Chief Financial Officer may, in the Chief Financial Officer’s sole discretion, send the bill for solid wastediscarded materials collection services to a tenant or any other person or entity designated by the record owner, provided the record owner or his or her authorized representative submits to the City a complete and signed request to bill the tenant or other designated person or entity on such form as may be specified by the Chief Financial Officer.
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20 E. If, in accordance with subsection D of this section, a bill is sent to a person or entity other than the record owner, then the service account shall remain in the record owner’s name and the record owner shall be fully responsible and liable for the payment of any solid wastediscarded materials collection service charges, any delinquent solid wastediscarded materials collection service charges, and penalties applicable to his or hertheir property as if the bill had been sent to the record owner.

F. The method of billing for residential solid wastediscarded materials collection services will be determined by the Chief Financial Officer with the concurrence of the City Manager. Notification of billing changes shall be provided to the record owner ofto any property where solid wastediscarded materials services are provided shall be provided to the record owner, any tenant, or designated person, or entity authorized to receive a bill for solid wastediscarded materials collection service charges pursuant to subsection D of this section.

G. Except as provided in subsection D, residential solid wastediscarded materials collection service charges will be billed on a unified bill to the record owner if the water services are provided by the City at the service location. Residential properties that consist of two (2) or more separate dwelling units, and are served by a single water meter, shall be billed for solid wastediscarded materials collection service for the total number of separate residential dwelling units served by such water meter on a unified bill.

H. If a property does not receive water services from the City, the solid wastediscarded materials collection service charges may be billed separately or with other utility services provided by the City.

I. Notwithstanding anything to the contrary in this chapter or code, the City may permit the collector or permittee of the City to bill record owners for service provided by the collector or permittee pursuant to the procedures prescribed by the City.

Moreover, the collector or permittee may permit a tenant or authorized agent to receive bills pursuant to procedures prescribed by the City and provided that the property owner remains ultimately fully responsible and liable for payment. In all such events, the collector or permittee may request that the City collect any delinquent or unpaid fees through a lien or special assessment as permitted in Section 8.04.160 or Government Code Section 38790.1 as it may be amended. (Ord. 2019-11-05-1403-02 C.S. § 4; Ord. 2019-02-05-1403 C.S. § 4; prior code § 7-051.12)

8.04.150 Charges payable to City or authorized agent for billing and collection for residential solid wastediscarded materials collection.

All residential solid wastediscarded materials charges shall be payable to the City or its authorized agent for billing and collection. (Prior code § 7-051.13) 1216

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21 8.04.160 Delinquency, penalties and nonpayment for residential solid wastediscarded materials collection.

A. An account is delinquent when payment in full of the bill for solid wastediscarded materials collection service charges is not received in full at the office of the City or its authorized agent for billing and collection within twenty-five (25) days of the billing date. A postmark date is not considered the date of payment.

B. Where all or any part of any bill for a solid wastediscarded materials collection services account remains unpaid twenty-five (25) days after the billing date, a basic penalty of ten (10) percent of the total delinquent amount will be added to such bill for the first month the account is delinquent. In addition, the City may impose a penalty in an amount not to exceed one (1) percent per month for nonpayment of any solid wastediscarded materials service charges and any basic penalty.

C. Except as otherwise provided by law, if a unified bill remains unpaid more than sixty (60) days after the date of billing, City water service at the service location may be terminated.

1. City water service will not be restored until the amount of all delinquent solid wastediscarded materials collection service charges, associated service charges, penalties, deposits, and reconnection charges have been paid in full.

2. Prior to termination of water service, the Chief Financial Officer, in the Chief Financial Officer’s sole discretion, may authorize an amortization agreement pursuant to Section 779 or 10010 of the Public Utilities Code or other applicable statute or regulation.

D. The City shall include a statement in each bill for solid wastediscarded materials collection service charges to each record owner in substantially the following form:
“Solid waste“Discarded materials collection service charges and any penalties shall constitute a lien against the lot or parcel of land against which the charges and any penalties are imposed if the charges remain delinquent for sixty (60) or more days.” Pursuant to such notice, the solid wastediscarded materials collection service charges and penalties may become a lien against the lot or parcel of land against which the charges were imposed if such charges remain delinquent for a period of sixty (60) or more days. The City shall cause to be recorded with the county recorder all such delinquent solid wastediscarded materials service charges and any penalties,; and, when so recorded, such charges and penalties shall have the force, effect, and priority of a judgment lien and continue for ten (10) years from the time of recording ,unless sooner released or otherwise discharged. (Ord. 2020-01-14-1102 C.S. § 2; Ord. 2019- 11-05-1403-02 C.S. § 5; Ord. 2019-02-05-1403 C.S. § 5; prior code § 7-051.14) 1217

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22 8.04.170 Maintenance of records for residential solid wastediscarded materials collection.

The Administrative Services Officer, or authorized agent for billing and collection, is responsible for maintaining adequate records of bills tendered, payments received, delinquencies recorded, cash deposited, and charges incurred. The records shall be maintained in accordance with the City’s record retention policy. (Prior code § 7.051.15)

8.04.180 Payment of fees and mandatory reporting of change in circumstance.

A. No solid wastediscarded materials collection services will be furnished to any property or person free of charge.

B. The record owner of any property where solid wastediscarded materials services are provided shall be responsible for the payment of any and all solid wastediscarded materials collection service charges, any delinquent solid wastediscarded materials collection service charges, and any penalties applicable to his or her property.

C. It shall be, and is hereby made, the duty of each record owner of any property where solid wastediscarded materials services are provided to ascertain from the City Administrative Services Department, or its authorized agent for billing and collection, the amount and due date of any solid wastediscarded materials collection service charges, any delinquent solid wastediscarded materials collection service charges, and any penalties applicable to his or her property, and to pay such charges and penalties when due and payable.

D. The record owner of any property where solid wastediscarded materials services are provided is obligated to inform the City Administrative Services Department, or its authorized agent for billing and collection, immediately of all circumstances and of any change(s) in any circumstance which that will, in any way, affect the applicability of any solid wastediscarded materials collection service charges or the amount of any such charges that may be imposed on his or her property for solid wastediscarded materials services provided. In particular, but not by way of limitation, the record owner of any property where solid wastediscarded materials services are provided by the City, or a collector or permittee of the City, shall immediately inform the City Administrative Services Department or its authorized agent for billing and collection of any sale or transfer of any such property. (Ord. 2019-11-05-1403-02 C.S. § 6; Ord. 2019-02-05-1403 C.S. § 6; prior code § 7-051.16)

8.04.190 Exemptions and waivers.

Owners, occupants or persons in possession, charge or control of dwellings, buildings, places and premises in the City in and from which it is claimed that no solid waste is created, accumulated or produced so as to require refuse collection services, 1218

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23 or that other methods of solid waste collection and disposal are available and will be provided may apply for an exemption from the provisions of this chapter by making application therefor to the Public Works Director on forms provided by said Director.

Upon receiving an application for an exemption, the Director shall cause an investigation to be made concerning the matters contained in the application and into such other matters, as the Director may deem appropriate. If after investigation the Director determines that refuse collection services are not required for the premises described in the application, or that other methods of solid waste collection and disposal are available and will be provided then, in that event, the Director may grant an exemption from the provisions of this chapter. If an exemption is granted, the Director shall notify the collector that an exemption has been granted. Said exemption may be revoked at any time thereafter if after investigation the Director determines that circumstances have changed and that refuse collection services are required. (Prior code § 7-051.17)
The Director or their designee may develop processes for, and grant exemptions or waivers to, individual responsible parties for compliance with specified service requirements of Chapter 8.04, consistent with applicable law and as provided below.

A. Vacancy of premise. The Director or their designee may provide a process for responsible parties to apply for, and to be granted, a temporary exemption from collection service at a vacant or unoccupied premise. The Director or their designee may limit the duration or frequency for which such exemptions may be granted to a responsible party, and may provide for a vacancy credit against the responsible party’s payment for service. Said exemption may be revoked at any time thereafter if, after investigation, the Director determines that circumstances have changed and that discarded material collection services are required.

B. Other waivers. The Director or their designee may develop a process for waiving individual responsible party obligations to comply with some or all recyclable materials and organic waste requirements of Chapter 8.04. Such waivers, if provided, shall be granted in accordance with processes prescribed and implemented by the Director or their designee. The Director or their designee shall periodically verify continued eligibility of the party granted such waiver. Any waiver process shall be consistent with 14 CCR Section 18984.11 and other applicable law.

8.04.195 Requirements for commercial edible food generators.

A. Tier one commercial edible food generators must comply with the requirements of this Section 8.04.195, tier two commercial edible food generators must comply with the requirements of this section commencing January 1, 2024, pursuant to 14 CCR Section 18991.3.

B. Large venue or large event operators not providing food services, but allowing for food to be provided by others, shall require food facilities operating at the 1219

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24 large venue or large event to comply with the requirements of this section, commencing January 1, 2024.

C. Commercial edible food generators shall comply with the following requirements:

1. Arrange to recover the maximum amount of edible food that would otherwise be disposed.

2. Contract with or enter into a written agreement with food recovery organizations or food recovery services for: (i) the collection of edible food for food recovery; or, (ii) acceptance of the edible food that the commercial edible food generator delivers to the food recovery organization for food recovery.

3. Not intentionally spoil edible food that is capable of being recovered by a food recovery organization or a food recovery service.

5. Keep records that include the following information, or as otherwise specified in 14 CCR Section 18991.4:
a. A list of each food recovery service or organization that collects or receives the commercial edible food generator’s edible food pursuant to a contract or written agreement established under 14 CCR Section 18991.3(b). b. A copy of all contracts or written agreements established under 14 CCR Section 18991.3(b).
c. A record of the following information for each of those food recovery services or food recovery organizations:
i. The name, address, and contact information of the food recovery service or food recovery organization.
ii. The types of food that will be collected by or self-hauled to the food recovery service or food recovery organization. iii. The established frequency that food will be collected or selfhauled. iv. The quantity of food, measured in pounds recovered per month, collected or self-hauled to a food recovery service or food recovery organization for food recovery.
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25 6. Maintain records required by this section for five (5) years.

7. The Director may, at their discretion, require commercial edible food generators to provide an annual food recovery report to the City, in a manner and timeline prescribed by the Director, that may include information such as:
a. The amount, in pounds, of edible food donated to a food recovery service or food recovery organization annually;
b. The amount, in pounds of edible food rejected by a food recovery service or food recovery organization annually; and,.
c. Any additional information required by the Director or their designee.

D. Nothing in this chapter shall be construed to limit or conflict with the protections provided by the California Good Samaritan Food Donation Act of 2017, the Federal Good Samaritan Act, or share table and school food donation guidance pursuant to Senate Bill 557 of 2017 (approved by the Governor of the State of California on September 25, 2017, which added Article 13 [commencing with Section 49580] to Chapter 9 of Part 27 of Division 4 of Title 2 of the Education Code, and to amend Section 114079 of the Health and Safety Code, relating to food safety, as amended, supplemented, superseded and replaced from time to time).

8.04.196 Requirements for food recovery organizations and food recovery services.

A. Food recovery services collecting or receiving edible food directly from commercial edible food generators, via a contract or written agreement established under 14 CCR Section 18991.3(b), shall maintain the following records, or as otherwise specified by 14 CCR Section 18991.5(a)(1):
1 The name, address, and contact information for each commercial edible food generator from which the food recovery service collects edible food. 2 The quantity in pounds of edible food collected from each commercial edible food generator per month.
3 The quantity in pounds of edible food transported to each food recovery organization per month.
4 The name, address, and contact information for each food recovery organization to which the food recovery service transports edible food for food recovery.
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26 B. Food recovery organizations collecting or receiving edible food directly from commercial edible food generators, via a contract or written agreement established under 14 CCR Section 18991.3(b), shall maintain the following records, or as otherwise specified by 14 CCR Section 18991.5(a)(2):
1 The name, address, and contact information for each commercial edible food generator from which the organization receives edible food. 2 The quantity in pounds of edible food received from each commercial edible food generator per month.
3 The name, address, and contact information for each food recovery service that the organization receives edible food from for food recovery.

C. Food recovery organizations and food recovery services shall maintain records required by this section for five (5) years.

D. Food recovery organizations and food recovery services that have their primary address physically located in the City and contract with or have written agreements with one or more commercial edible food generators, pursuant to 14 CCR Section 18991.3(b), shall report to the City the total pounds of edible food recovered in the previous calendar year from the tier one and tier two commercial edible food generators they have established a contract or written agreement with pursuant to 14 CCR Section 18991.3(b). The annual report shall be submitted to the City no later than the date prescribed by the Director or their designee.

E. In order to support edible food recovery capacity planning assessments or other studies conducted by the county, City or its designee, food recovery services and food recovery organizations operating in the City shall provide information and consultation to the City, upon request, regarding existing, proposed, new, or expanded, food recovery capacity that could be accessed by the City and its commercial edible food generators. A food recovery service or food recovery organization contacted by the City shall respond to such request for information within sixty (60) days, unless a shorter timeframe is otherwise specified by the City.

8.04.200 Enforcement citationsSingle-use foodware.

The Public Works Director and the employees of the Public Works Department as designated by the Director are hereby authorized to issue citations to owners and/or occupants of property for violations of the provisions of this chapter. (Prior code § 7- 051.18) Entities regulated under Public Resources Code Part 3, Division 30, Chapter

5.2, relating to single-use plastic foodware and condiments, shall at all times comply with the applicable provisions of that chapter. Notwithstanding Section 8.04.360, the Director or their designee shall enforce such requirements commencing June 1, 2022, in accordance with the enforcement procedures and penalty amounts set forth in Public Resources Code Section 42272.
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27 8.04.210 Deposit of garbage, rubbish,discarded materials or waste matter other than in containers—Unlawful.

It is unlawful for any person in the City to throw or deposit any recyclable material, green waste, garbage, rubbishdiscarded materials or waste matter or to cause the same to be thrown or deposited upon any street, alley, gutter, park, or other public way or to throw or deposit the same in or upon any premises or vacant lot or in any water or waterway or upon the levees or banks adjacent thereto, or to store or keep the same except in containers as required herein. (Prior code § 7-052)

8.04.220 Permitting rubbishdiscarded materials to accumulate in vicinity of receptacles—Prohibited—Penalty.

A. It is unlawful for any person to permit or allow rubbishdiscarded materials to accumulate in the vicinity of solid wastediscarded materials receptacles or areas used for the storage of solid wastediscarded materials receptacles. This section shall apply to both residential and commercial properties.

B. Any person, firm, or corporation violating this section shall be deemed guilty of a misdemeanor, and each such person, firm or corporation shall be deemed guilty of a separate offense for each and every day or portion thereof during which a violation of this section is committed, continued, or permitted., and shall be subject to enforcement pursuant to Section 8.04.360. (Prior code § 7-052.1)

8.04.230 Burying garbagediscarded materials, etc.—Prohibited.

It is unlawful for any person to bury garbagediscarded materials at any place within the City. (Prior code § 7-053)

8.04.240 Collection of garbage, rubbishdiscarded materials, waste matter, commercial waste, industrial waste or swill, unless licensed—Unlawful.

It is unlawful for any person, firm, corporation, or association to collect garbage, rubbishdiscarded materials, waste matter, commercial solid waste, or industrial waste within the City or transport the same through the streets, alleys, and public ways of said City unless such person, firm, corporation or association has been licensed to do so by the City by contract, permit, or otherwise. (Prior code § 7-054)

8.04.250 Collectors and facility operators.

The City Council of the City shall, by contract or permit, authorize one (1) or more persons, firms, or corporations to collect, transport, and process or dispose of garbage, rubbish, solid waste, residential refuse, multifamily refuse, commercial solid wastediscarded materials and industrial waste within the City on a regularly- scheduled 1223

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28 basis. With regard to residential, multifamilymulti-family, and commercial refusediscarded materials, the manner of collection and other regulations of said residential, multifamilymulti-family, and commercial refusediscarded materials collectors shall be set forth in the contract, which may include provision of recyclable materials, green waste and food wasteorganic materials collection, and street sweeping and, seasonal leaf collection, and other related programs. With regard to industrial waste, the manner of collection and other regulations of said industrial waste collectors shall be set forth in a separate agreement or permit. (Prior code § 7-055) A. Requirements for collectors

1. Collector(s) providing recyclable materials, organic waste, and/or solid waste collection services to generators within the City’s boundaries shall meet the following requirements and standards as a condition of approval of its franchise, contract, permit, or other authorization with the City to collect recyclable materials, organic materials, and/or solid waste:
a. Through annual written notice to the City on or before the date prescribed by the Director, identify the facilities to which they will transport discarded materials, including facilities for source separated recyclable materials, source separated organic materials, and solid waste unless otherwise stated in the franchise agreement, contract, permit, license, or other authorization with the City. b. Transport source separated recyclable materials to a facility that recovers those materials; transport source separated organic materials to a facility, operation, activity, or property that recovers organic waste as defined in 14 CCR, Division 7, Chapter 12, Article 2; transport solid waste to a disposal facility or transfer facility or operation that processes or disposes of solid waste; and transport manure to a facility that manages manure in conformance with 14 CCR Article 12 and such that the manure is not landfilled, used as alternative daily cover (ADC), or used as alternative intermediate cover (AIC). c. Obtain approval from the City to haul organic waste, unless it is transporting source separated organic waste to a community composting site or lawfully transporting C&D in a manner that complies with 14 CCR Section 18989.1 and Chapter 8.28 of the Stockton municipal code.

2. Collectors authorized to collect recyclable materials, organic materials, and/or solid waste shall comply with education, equipment, signage, container labeling, container color, contamination monitoring, reporting, and other requirements contained within its franchise agreement, contract, permit, or other agreement entered into with City.

B. Requirements for Facility Operators and Community Composting Operations
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29 1. Owners of facilities, operations, and activities located within the City’s boundaries that recover organic waste including, but not limited to, compost facilities, invessel digestion facilities, and publicly-owned treatment works shall, upon City request, provide information regarding available and potential new or expanded capacity at their facilities, operations, and activities, including information about throughput and permitted capacity necessary for planning purposes. Entities contacted by the City shall respond within sixty (60) days.

2. Community composting operators with operations located in the City’s boundaries, upon City request, shall provide information to the City to support organic waste capacity planning, including, but not limited to, an estimate of the amount of organic waste anticipated to be handled at the community composting operation. Entities contacted by the City shall respond within sixty (60) days.

3. Owners of facilities, operations, and activities located in the City’s boundaries that receive recyclable materials, organic materials, and/or solid waste shall provide to the City, on a quarterly basis, copies of all reports they are required to report to CalRecycle, including at minimum, those required by AB 901 and SB 1383.

8.04.255 Self-hauler requirements.

A. The Director may, at their sole discretion, establish processes to allow approved commercial generators to self-haul their discarded materials. Commercial generators interested in self-hauling materials shall comply with all administrative, operational, and regulatory requirements established by the Director or their designee, or as required by applicable law, as a condition of approval to self-haul.

Self-haulers shall prepare and handle their discarded materials in a manner consistent with 14 CCR Section 18984.1, the City’s collection program, and any other requirements established by the Director or their designee. Self-haulers shall deliver their discarded materials only to facilities approved or designated by the Director.

C. Self-haulers that are responsible parties of commercial businesses shall keep records of the amount of recyclable materials, organic waste, and solid waste delivered to each City-approved or designated facility. These records shall be subject to inspection by the Director and/or their designee. The records shall include the following information:

1. Delivery receipts and weight tickets from the entity accepting the recyclable materials, organic materials, and solid waste.

2. The amount of material in cubic yards or tons transported by the generator or responsible party to each entity.

3. If the material is transported to an entity that does not have scales on-site or employs scales incapable of weighing the self-hauler’s vehicle in a 1225

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30 manner that allows it to determine the weight of materials received, the selfhauler is not required to record the weight of material but shall keep a record of the entities that received the recyclable materials, organic materials, and solid waste.

4. Other information prescribed by the Director or their designee as a condition of approval to self-haul.

D. Self-haulers shall retain all records and data required to be maintained by this section for no less than five (5) years after the recyclable materials, organic materials, and/or solid waste was first delivered to the facility accepting the material.

E. Self-haulers that are commercial businesses shall provide copies of records required by this section to City if requested by the Director or their designee and shall provide the records at the frequency requested by the Director.

F. Failure to comply with the provisions of this section may lead to revocation of approval to self-haul, at the Director’s sole discretion, and enforcement procedures pursuant to Section 8.04.360.

8.04.260 Collection and disposal of solid waste—Charges and rates.

The charges or rates that persons, firms, or corporations authorized by contract to collect and dispose of residential refuse, multifamily refusediscarded materials, multifamily discarded materials, and commercial solid wastediscarded materials within the City may charge, shall be established from time to time by resolution of the City Council of the City. The charges or rates for other solid waste collection services, including industrial waste collection and commercial recyclable material collection, shall be established by the collector. (Prior code § 7-056)

8.04.270 Commercial recyclable material collectors—Permit required.

It is unlawful for any person, firm, or corporation to collect commercial recyclable materialmaterials, and/or organic materials, at the Director’s sole discretion, within the City without first having obtained a permit to do so from the Public Works Director and a business license therefor from the Administrative Services Officer. The fee for said permit and license shall be established from time to time by resolution of the City Council. Said permit or license shall expire on May 30th of each year and must be renewed annually on or before said date. (Prior code § 7-057)

8.04.280 Commercial recyclable material collectors.

Persons, firms or corporations licensed as commercial recyclable material and/or organic material collectors are hereby authorized to collect recyclable materials and/or 1226

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31 organic materials, as licensed, from commercial and industrial customers within the City, provided that at least 90 percent of each load is actually recycled and not disposed ofthe collector complies with SB 1383 regulations and other applicable law. (Prior code § 7-058)

8.04.290 Industrial waste collectors—Permit required.

A. It is unlawful for any person, firm, or corporation to collect and dispose of industrial waste within the City as an industrial waste collector without first having received a permit to do so. Said permit shall be issued upon majority vote of the City Council. The fee for the issuance of said permit shall be the sum of one hundred thousand dollars ($100,000.00)., or another amount determined by City Council. Any such permit issued pursuant to this section shall not be transferable to another person, firm, or corporation, and in the case of corporations the permit shall become void whenever there may occur a transfer of the majority interest in said corporation. Said permit or license issued prior to May 30, 2019, shall expire on December 31, 2024. This constitutes the City’s five (5) year notice that may or may not be required under Public Resources Code Section 49520. Permitted industrial waste collectors shall comply at all times with applicable law related to its operations, including, but not limited to, SB 1383.

Industrial waste collectors, upon request of City, shall provide documentation of compliance as a condition of permit approval.

B. Industrial waste collector permits issued prior to May 30, 2019, shall remain in full force and effect until December 31, 2024. (Ord. 2019-04-30-1108 C.S. § 2; prior code § 7-059)

8.04.300 Industrial waste collector—Permit fee and AB 939 fee.

B. For the purpose of this section only, no such additional fee will be due and payable to City for revenues derived from the direct or indirect sale of reclaimed solid waste or its derivatives. However, this provision shall not be construed to exempt revenue from any element of the services to collect such industrial waste.

C. On or before the 15th day of each month, the industrial waste collector shall submit to the Administrative Services Officer a statement of gross revenues collected pursuant to the permit for the preceding month, with the appropriate remittance in full. Such statement shall separately show gross revenue from the sale of reclaimed refusediscarded materials for the preceding month. 1227

ATTACHMENT A
32 D. The industrial waste collector shall, from the sources of revenue available to the collector through the granting of the permit, pay all fees and charges due the City as provided for in this section. A five (5) percent penalty shall apply to a delinquent payment for the first month, and a one (1) percent penalty shall be added for each succeeding month thereafter until the delinquent balance is paid in full.

E. Permit holders of industrial waste collector permits issued prior to May 30, 2019, shall also pay to the City eighteen and one-half (18.520) percent of the gross revenue collected for performing industrial waste collection services and shall also pay an AB 939 fee equal to five three and one-half (53-1/2) percent of gross revenue collected for performing industrial waste collection services. (Ord. 2019-04-30-1108 C.S. § 3; prior code § 7-060)

8.04.310 Industrial waste collector—Diversion requirement.

A. The For materials regulated under Chapter 8.28, the industrial waste collector shall divert from disposal at least 50 percent of all materials collectedthe percentage specified in performing all industrial waste collection servicesChapter 8.28.

B. Permit holders of industrial waste collector permits issued prior to May 30, 2019 shall also divert from disposal 50 percent of all materials collected in performing all industrial waste collection services. (Ord. 2019-04-30-1108 C.S. § 4; prior code § 7-061

8.04.320 Industrial waste collector—Financial reports to City.

A. Every industrial waste collector who has obtained a permit to provide industrial waste collection services within the City shall at any time deemed necessary by the City Manager, make available to the City all accounting records that pertain to any portion of the industrial waste collector’s operations within the scope of the permit issued.

B. Annually, the industrial waste collector shall provide the City with one (1) electronic copy and three (3) printed copies of its annual audited financial statements prepared by an independent certified or public accountant. The statements shall be prepared by the independent auditor in conformance with accepted accounting principles. Such statements shall be provided to the City within one hundred twenty (120) days after the close of the collector’s fiscal year. The financial statements shall clearly indicate all gross revenues collected for industrial waste collection services within the City and confirm that the collector has paid to the City eighteen and one-half (18.520) percent of the gross revenue collected for performing industrial waste collection services and an AB 939 fee of five three and one-half (35-1/2) percent of gross revenue collected for performing industrial waste collection services. The City shall insist that the financial statements do not reflect any other business activities that are carried on by the collector in any other area or jurisdiction other than the City. The City reserves the right to request, and the industrial waste collector shall provide, any 1228

ATTACHMENT A
33 additional documentation, itemization, or detail as requested by City to verify any amounts reported in monthly revenue reports and annual financial statements. (Ord. 014-11 C.S. § 1, eff. 1-5-12; prior code § 7-062)

8.04.330 Regulations—Commercial recyclable materialdiscarded materials collectors and industrial waste collectors.

Every vehicle used for the collection of commercial recyclable material, rubbishdiscarded materials, waste matter, or industrial waste shall have a metal-lined body and be covered or operated so as to prevent the contents from falling, spilling, leaking, blowing, or dripping there from. (Prior code § 7-063)

8.04.340 Commercial recyclable material collectors and industrial waste collectors—Tonnage reportsReports to City.

A. Every commercial recyclable material collector and every industrial waste collector who has obtained a permit to provide collection services within the City, and every permit holder of an industrial waste collector permit issued prior to May 30, 2019, shall at any time deemed necessary by the Public Works Director, make available to City all disposal and diversion records that pertain to any portion of collection services within the scope of the permit issued pursuant to Section 8.04.270 or 8.04.290.

B. Every commercial recyclable material collector and industrial waste collector, and every permit holder of an industrial waste collector permit issued prior to June 1, 2003, shall provide a quarterly report to the City of total tons disposed and tons diverted through provision of commercial recyclable materialdiscarded materials collection or industrial waste collection services in the City. Quarterly reports to the City shall be due on the 15th day of the month following the previous calendar quarter. (Ord. 2019-04-30-1108 C.S. § 5; prior code § 7-064)
C. Every commercial recyclable materials collector, industrial waste collector, and permit holder shall additionally comply with all reporting requirements set forth under its agreement, contract, permit, or other written direction from the City. The subject of such reports may include, but are not limited to, operational, financial, or programmatic information, and shall be submitted in a manner and timeline specified by the Director or its designee.

8.04.345 Model water efficient landscaping ordinance requirements.

A. Property owners or their building or landscape designers, including anyone requiring a building or planning permit, plan check, or landscape design review from the City, who are constructing a new (single-family, multi-family, public, institutional, or commercial) project with a landscape area greater than five hundred (500) square feet, or rehabilitating an existing landscape with a total landscape area greater than two thousand five hundred (2,500) square feet, shall comply with Sections 1229

ATTACHMENT A
34 492.6(a)(3)(B) (C), (D), and (G) of the MWELO September 15, 2015 requirements.

Other requirements of the MWELO are in effect pursuant to Section 16.56.040 of the Stockton municipal code.

B. If the California Department of Water Resources, or its successor agency, amends 23 CCR, Division 2, Chapter 2.7, Sections 492.6(a)(3)(B) (C), (D), and (G) of the MWELO September 15, 2015 requirements in a manner that requires the City to incorporate the requirements of an updated MWELO in a local ordinance, and the amended requirements include provisions more stringent than those required in this section, the revised requirements of 23 CCR, Division 2, Chapter 2.7 shall be enforced.

8.04.350 Public Works Director—Duties.

A. The Public Works Director shall monitor and provide overall direction for the collection and disposal of garbage, rubbishdiscarded materials, waste matter, commercial solid waste, and industrial waste operations in the City. The Public Works Director, or said Director’s authorized representatives, shall receive and investigate all complaints, including complaints from persons regarding an entity that may be potentially non-compliant with SB 1383 regulations, and endeavor to improve and extend the garbage, rubbishdiscarded materials, waste matter, commercial solid waste and industrial waste collection services. In the absence of other regulations, the Public Works Director shall have the power to determine and set the hours of collection, manner of collection, and such other regulations as may be necessary to insure an orderly program for the collection, transportation, and disposal of garbage, rubbishdiscarded materials, waste matter, commercial solid waste and industrial waste in order to promote the community welfare, convenience, health, and safety. All disputes between collectors and producers concerning charges, service, or any other matter not otherwise delegated shall be decided by the Public Works Director, or said Director’s authorized representative. The Public Works Director, or said Director’s authorized representative, is hereby directed and empowered to enforce the provisions set forth herein and he or she shall have the right to enter all premises or vehicles for the purpose of making any inspection or investigation which that he or she may deem necessary under the provisions hereof.

B. In the event an industrial establishment is unable to secure the services of any permitted industrial waste collector who has received permits to do so under the provisions of this chapter, then, in that event the Public Works Director may assign a permittee to service that particular establishment at a reasonable rate to be determined by the Public Works Director.

C. An industrial waste collector shall allow access to its records of customers served by said collector, when requested by the Public Works Director, provided, however, said records shall be held confidentially by said Director and not subject or open to public inspection., except as otherwise required by applicable law. (Prior code § 7-065)
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35 8.04.355 Inspections.

A. The Director and their designees are authorized to conduct inspections and investigations, at random or otherwise, of any collection container, collection vehicle loads, or transfer, processing, or disposal facility for materials collected from generators, or source separated materials to confirm compliance with this chapter by regulated entities such as generators, responsible parties of commercial businesses, responsible parties of multi-family premises, commercial edible food generators, haulers, self-haulers, food recovery services, and food recovery organizations, subject to applicable laws. This Section does not allow City to enter the interior of a private residential property for inspection. For the purposes of inspecting commercial businesses’ or multi-family premises’ containers for compliance with this chapter, City may utilize remote monitoring or other technologies at the Director’s discretion.

B. Regulated entity shall provide or arrange for access during all inspections (with the exception of residential property interiors) and shall cooperate with the Director or their designee(s) during such inspections and investigations. Such inspections and investigations may include confirmation of proper placement of materials in containers, inspection of edible food recovery activities, review of required records, or other verification or inspection to confirm compliance with any other requirement of this chapter.

Failure of a responsible party to provide or arrange for: (i) access to an entity’s premises; or, (ii) access to records for any inspection or investigation is a violation of this chapter and may result in penalties described in Section 8.04.360.

C. Any records obtained by the City during its inspections and other reviews shall be subject to the requirements and applicable disclosure exemptions of the Public Records Act as set forth in Government Code Section 6250 et seq.

D. The Director and their designee(s) are authorized to conduct any inspections or other investigations as reasonably necessary to further the goals of this chapter, subject to applicable laws.

8.04.360 Violations, enforcement and Aappeal.

A. Violation of any provision of this chapter shall constitute grounds for issuance of a notice of violation and assessment of a fine by a City enforcement official or representative in conformance with Chapter 1.28 and Chapter 1.32, except as otherwise indicated in this chapter.

B. The Public Works Director and their designees, including, but not limited to, county agency enforcement officials, as applicable, are hereby authorized to issue citations to owners and/or occupants of property for violations of the provisions of this chapter. (Prior code § 7-051.18)
C. Process for Enforcement
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ATTACHMENT A
36 1. The Director and/or their designee(s) will monitor compliance with this chapter randomly and through compliance reviews, route reviews, investigation of complaints, and an inspection program. This chapter establishes City’s right to conduct inspections and investigations.

2. For incidences of contamination found in containers, City or designee will issue a notice of contamination to any generator or responsible party found to have contamination in a container. The City may authorize the City or designee to assess contamination processing fees if the City or designee observes contamination in a responsible party’s container(s).

3. With the exception of violations of contamination of container contents addressed under Section 8.04.360.C.2, City shall issue a notice of violation requiring compliance within a maximum of sixty (60) days of issuance of the notice.

4. Absent compliance by the respondent within the deadline set forth in the notice of violation, City shall commence an action to impose penalties, via an administrative citation and fine, pursuant to this chapter.

Notices shall be sent to owner at the official address of the owner maintained by the tax collector for the City or, if no such address is available, to the owner at the address of the multi-family premises or commercial premises or to the responsible party for the collection services, depending upon available information.

D. Penalty Amounts

1. The penalty levels for enforcement for violations of Sections 8.04.020,

8.04.035, 8.04.036, 8.04.195, 8.04.196, 8.04.250, and/or 8.04.255 shall be in accordance with 14 CCR Section 18997.2.

2. The penalty levels and other available remedies for enforcement for violations of all other sections of this chapter shall be handled in accordance with Title 1 of the Stockton Municipal Code.

E. Compliance Deadline Extension Considerations
City may extend the compliance deadlines set forth in a notice of violation issued in accordance with this section if it finds that there are extenuating circumstances beyond the control of the respondent that make compliance within the deadlines impracticable, including the following:

1. Acts of God such as earthquakes, wildfires, flooding, and other emergencies or natural disasters;

2. Delays in obtaining discretionary permits or other government agency approvals; or,
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ATTACHMENT A
37 3. Deficiencies in organic waste recycling infrastructure or edible food recovery capacity while the City is under a corrective action plan with CalRecycle pursuant to 14 CCR Section 18996.2 due to those deficiencies.

F. Education Period for Non-Compliance
Through December 31, 2023, City will conduct inspections, route reviews or waste evaluations, and compliance reviews, depending upon the type of regulated entity, to determine compliance with Sections 8.04.020, 8.04.035, 8.04.036, 8.04.195,

8.04.196, 8.04.250, and/or 8.04.255. If the City determines that generator, responsible party, self-hauler, hauler, tier one commercial edible food generator, food recovery organization, food recovery service, or other entity is not in compliance, it shall provide educational materials to the entity describing its obligations under this chapter and a notice that compliance is required, and that violations may be subject to administrative civil penalties starting on January 1, 2024.

G. Civil Penalties for Non-Compliance
Beginning January 1, 2024, if the City determines that a generator, responsible party, self-hauler, hauler, tier one or tier two commercial edible food generator, food recovery organization, food recovery service, or other entity is not in compliance with Sections 8.04.020, 8.04.035, 8.04.036, 8.04.195, 8.04.196,

8.04.250, and/or 8.04.255, it shall document the noncompliance or violation, issue a notice of violation, and take enforcement action pursuant to this section, as needed.

H. Any person dissatisfied with any action taken or any decision made by the Public Works Director or designee with regard to the provisions of this chapter may appeal pursuant to the provisions of Chapter 1.44 of this code. (Ord. 2019-11-05- 1403-02 C.S. § 7; prior code § 7-066)
SECTION II. AMENDMENT OF CODE
Title 8, Chapter 8.28 of the Stockton Municipal Code is amended and shall read as follows:

Chapter 8.28 CONSTRUCTION AND DEMOLITION DEBRIS WASTE REDUCTION

8.28.010 Findings.

ATTACHMENT A
38 The State through its California Green Building Standards Code, 24 CCR, Part 11 (CALGreen) sets minimum diversion standards and establishes other requirements related to handling of construction and demolition debris.

The State through its Senate Bill 1383 (SB 1383), the Short-lived Climate Pollutant Reduction Act of 2016, requires CalRecycle to develop regulations to reduce organic waste in landfills as a source of methane. SB 1383 regulations require jurisdictions to adopt and enforce an ordinance or enforceable mechanism to implement relevant provisions of SB 1383 regulations, including the requirement, among others, to comply with the California Green Building Standards Code, 24 CCR, Part 11 (CALGreen), as amended.

The City could face fines up to $10,000.00 a day for not meeting the above mandated goalAB 939 goals and SB 1383 program requirements.

Construction and demolition debris constitutes a large portion of the waste stream in the City. These materials have significant potential for waste reduction and recycling.

The City finds that reusing and recycling construction and demolition debris is essential to further the City’s efforts to reduce waste and comply with AB 939 and SB 1383.

Reusing construction and demolition debris has proven to reduce the amount of such material from landfills, increase site and worker safety, and be cost effective.

Except in unusual circumstances, it is feasible to divert 50 percent or more of all construction and demolition debris from construction, demolition, and renovation projects. (Ord. 010-08 C.S. § 2, prior code § 7-080)

8.28.020 Purpose.

The general purpose of these regulations is to establish and maintain a program to reduce the amount of construction and demolition waste generated within the City that is disposed in landfills. This chapter sets a waste diversion requirement that 50 percent or more (by weight) of the amount offor construction and demolition debris generated at project sites be reused, recycled or otherwise processed to divert such materials from disposal in landfills. Any party that undertakes a construction, demolition, or renovation project by applying for City permits is responsible for meeting the construction and demolition debris waste diversion requirement. (Ord. 010-08 C.S. § 2, prior code § 7-081)

8.28.030 Definitions.

For the purpose of this chapter, the following definitions shall apply:
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ATTACHMENT A
39 City-Sponsored Projects. All City-sponsored construction, demolition and renovation projects shall be considered covered projects for the purpose of this chapter and shall submit a construction/demolition recycling plan prior to beginning any construction or demolition activities, and shall be subject to all applicable provisions of this chapter.
“Commercial recyclable material collector” means a person, firm or corporation that is licensed by the City for the purpose of providing recyclable material collection service within the City limits, and is required to recycle at least 90 percent of each load collectedcomply with SB 1383 regulations and other applicable law. “Construction” and “new construction” means the building and/or modification of any facility or structure or any portion thereof including any tenant improvements to an existing facility or structure.
“Construction and demolition debris” means used or discarded materials removed from premises during construction or renovation of a structure resulting from construction, remodeling, repair, or demolition operations on any pavement, house, commercial building, or other structure.has the same meaning as construction and demolition debris as defined in Chapter 8.04.
“Construction/demolition recycling plan” means a form the permit applicant must submit to the City at the time the permit applicant seeks permits to undertake a construction, demolition and renovation project within the City. The construction/demolition plan is intended to identify the types of materials that will be generated by the project, and how those materials will be transported and disposed. “Construction/demolition recycling report” means a form the permit applicant must submit to the City at the conclusion of a construction, demolition and renovation project.

ATTACHMENT A
40 “Non-covered projects” refers to all construction, demolition and renovation projects within the City, regardless of the actual or projected cost of the project. For purposes of this regulation, all permit applicants must submit a completed (1) construction/demolition recycling plan and (2) construction/demolition recycling report for review during the permit process.
“Permit applicant” means any individual, firm, limited liability company, association, partnership, political subdivision, government agency, municipality, industry, public or private corporation, or any other entity whatsoever who applies to the City for the applicable permits to undertake any construction, demolition, or renovation project within the City.
“Review Official” means the designated staff persons assigned by the Public Works Director and responsible for implementing and managing this chapter. The Review Official will determine the sufficiency of recycling plans and reports submitted by permit applicants, and either approve or deny a permit based on the review of the forms, documentation, and information provided.
“Self-haul” means the act of transporting debris generated by a construction, demolition or landscape contractor, or an individual performing construction, demolition or landscape work at a covered project site or a non-covered project site and using his or her own vehicle to deliver such debris to a permitted disposal site or recycling facility. “Waste diversion requirement” means the diversion of at least 50 percent (by weight) of theminimum for construction and demolition debris generated by a covered project in accordance with California Green Building Standards Code (24 CCR, Part 11), as amended. (Ord. 010-08 C.S. § 2, prior code § 7-082)

8.28.040 Permit applicant and City responsibilities.

A. The City will not issue an approved permit for any construction, demolition or renovation project unless and until the permit applicant has performed its responsibilities to comply with the City’s construction and demolition debris waste reduction program. All permit applicants for a covered project or a non-covered project have certain responsibilities, as specified below, to meet compliance with this regulation B. Permit applicants of a covered project are responsible to do the following:

1. Obtain from the City a C&D permit packet, which contains the required forms and other resource information needed to comply with waste diversion requirement for a covered project.

2. Complete and submit the construction and demolition recycling plan at the time of permit application.
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ATTACHMENT A
41 3. Complete and submit the construction and demolition recycling report and related receipts and weight tickets within 14 days of final clean up of a covered project site.

4. Meet the waste diversion requirement for the covered project.

5. Comply with the requirements of the California Green Building Standards Code (24 CCR, Part 11), as amended, or more stringent City requirements as applicable.

C. Permit applicants of a non-covered project are responsible to do the following:

1. Obtain from the City a C&D permit packet, which contains the required forms and other resource information needed to comply with the waste diversion goals of the City for any construction, demolition and renovation project within the City.

2. Complete and submit the construction and demolition recycling plan at the time of permit application.

3. Complete and submit the construction and demolition recycling report and related receipts and weight tickets within 14 days of final clean up of a non-covered project site.

D. The City Review Official is responsible for the following:

1. Provide assistance and information requested by the permit applicant in completing the required forms.

2. Review submitted forms in a timely manner and notify the permit applicant regarding any discrepancies and/or missing documentation.

3. Notify appropriate City staff if a permit applicant has met the waste diversion requirement of a project.

4. Require a hold on the project if the permit applicant has not complied with the requirements of this C&D chapter. (Ord. 010-08 C.S. § 2, prior code § 7-083)

8.28.050 Construction and demolition debris collection.

A. The authority to collect solid waste (including the collection of construction and demolition debris addressed in this chapter) is regulated by the City as prescribed in the provisions Sections 8.04.240 through 8.04.300. In general, only an industrial waste collector or a commercial recyclable material collector that has obtained a permit from the City may collect and transport construction and demolition debris from a project site to a disposal or processing facility.
1237

ATTACHMENT A
42 B. A construction contractor or subcontractor or landscape contractor may selfhaul and recycle or dispose of debris from a construction or demolition or landscaping site at which the contractor is performing work, provided that the contractor utilizes its own personnel and equipment and transports debris while performing its own work. Any debris collected on site through general clean-up operations, whether periodically or at the completion of a project, may not be transported and disposed by a third party, unless that third party has secured a necessary solid waste hauling permit from the City (and is therefore registered as an industrial waste collector or a commercial recyclable material collector). The City will provide a list of all industrial waste collectors and commercial recyclable material collectors authorized to collect construction and demolition debris from project sites within the City when it issues the C&D permit packet for the project. (Ord. 010-08 C.S. § 2, prior code § 7-084)

8.28.060 Construction and demolition recycling requirements.

A. All permit applicants of covered projects or non-covered projects shall identify the types of materials expected to be generated as a result of the construction, demolition or renovation project at the time of the permit application. Permit applicants for covered project are required to meet the waste diversion requirement of at least 50 percent ofestablished by this chapter for materials generated as discards by the project, regardless of whether the permit applicant performs the work or hires contractors, subcontractors or others to perform the work.

B. Within 14 days following the completion of the construction, demolition or renovation project, the permit applicant shall submit recycling/reuse and disposal documentation to the Review Official. Documentation shall consist of a final completed “construction and demolition debris recycling report” showing tons recycled/reused and disposed by material type, supported by copies of weight tickets, receipts or other records of measurement from recycling companies, deconstruction contractors and/or landfill disposal companies. The City will provide a list of recycling companies in the Stockton area that receive and recycle various types of materials generated from construction and demolition projects when it issues the C&D permit packet for the project. (Ord. 010-08 C.S. § 2, prior code § 7-085)

8.28.070 City remedies for noncompliance.

The City reserves the right to initiate any or all of the following actions in the event a permit applicant of a covered project fails to meet the waste diversion requirement or fails to submit a completed construction/demolition recycling plan and report and the associated documentation that is required of this chapter:

A. Issue a stop work order on the construction and/or other permits pertinent to the covered project until the project applicant has submitted all required forms and documentation; and/or
1238

ATTACHMENT A
43 B. Issue a fine of $200.00 for the first incident of noncompliance with this chapter, and an additional fine of $500.00 for the second and every subsequent incident of noncompliance. (Ord. 010-08 C.S. § 2, prior code § 7-086) Issue penalties and conduct enforcement action in accordance with Section 8.04.360 for violations of activities regulated under Chapter 8.04 or 14 CCR Section 18989.1.

8.28.080 Appeal.

Any person dissatisfied with any action taken or any decision made by the Review Official assigned by the Public Works Director with regard to the provisions of this chapter may appeal pursuant to the provisions of Chapter 1.44 of this code. (Ord. 010-08 C.S. § 2, prior code § 7-087)
SECTION III. SEVERABILITY
If any section of this ordinance or the application thereof to any person or circumstance is held invalid, the invalidity shall not affect other provisions or applications of the act which can be given without the invalid provisions or application, and to this end the provisions of this act are severable.

SECTION IV. EFFECTIVE DATE
The Ordinance shall take effect and be in full force thirty (30) days after its passage.

ADOPTED: ___________________
EFFECTIVE: ___________________

___________________________
KEVIN J. LINCOLN, II
Mayor of the City of Stockton
ATTEST:
______________________________
ELIZA R. GARZA, CMC
City Clerk of the City of Stockton
1239
1 ORDINANCE NO.

AN ORDINANCE AMENDING TITLE 8, CHAPTERS 8.04 AND 8.28 OF THE

STOCKTON MUNICIPAL CODE RELATING TO THE COLLECTION OF ORGANIC

MATERIALS

BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF STOCKTON, AS FOLLOWS:

SECTION I. AMENDMENT OF CODE
Title 8, Chapter 8.04 of the Stockton Municipal Code is amended and shall read as follows:

Chapter 8.04 COLLECTION OF SOLID WASTE, RECYCLABLE MATERIALS, AND

ORGANIC MATERIALS

8.04.010 Definitions.

The following words, terms, and phrases when used herein shall have the meaning ascribed to them in this section except where the context clearly indicates a different meaning.
“AB 939” means the California Integrated Waste Management Act of 1989 (Division 30, California Public Resources Code), as amended, supplemented, superseded, and replaced from time to time.
“Back-haul” means generating and transporting recyclable materials or organic waste to a destination owned and operated by the generator or responsible party using the generator’s or responsible party’s own employees and equipment, or as otherwise defined in 14 CCR Section 18982(a)(66)(A).
“Bin” means a container with capacity of approximately one (1) to eight (8) cubic yards, with a hinged lid, and with wheels (where appropriate), that is serviced by a front end-loading collection vehicle.
“Building” means all other buildings and structures not defined as dwellings. “CalRecycle” means California's Department of Resources Recycling and Recovery.
“California Code of Regulations” or “CCR” means the State of California Code of Regulations. CCR references in this chapter are preceded with a number that refers to the relevant Title of the CCR (e.g., “14 CCR” refers to Title 14 of CCR). “City” means the City of Stockton.
1240
2 “City Manager” means the City Manager of the City of Stockton. “Collection” means the act of collecting recyclable materials, organic materials, solid waste, bulky items, and other material at the place of generation in City. “Collector” means persons, firms, or corporations authorized by the City Council by franchise, contract, or permit to collect, transport, and process or dispose of discarded materials on an on-call and/or regularly scheduled basis. “Commercial” shall mean of, from, or pertaining to non-residential premises where business activity is conducted including, but not limited to, retail sales, services, wholesale operations, manufacturing, and industrial operations; but excluding businesses conducted upon residential property that are permitted under applicable zoning regulations and are not the primary use of the property. “Commercial edible food generator” includes a tier one or a tier two commercial edible food generator as defined in this chapter or as otherwise defined in 14 CCR Section 18982(a)(73) and (a)(74). For the purposes of this definition, food recovery organizations and food recovery services are not commercial edible food generators pursuant to 14 CCR Section 18982(a)(7).
“Compliance review” means a review of records by the City or its designee to determine compliance with this chapter.
“Community composting” means any activity that composts green material, agricultural material, food material, and vegetative food material, alone or in combination, for which the total amount of feedstock and compost on-site at any one time does not exceed 100 cubic yards and 750 square feet, as specified in 14 CCR Section 17855(a)(4); or, as otherwise defined by 14 CCR Section 18982(a)(8). “Composting or compost (or any variation thereof)” includes a controlled biological decomposition of organic materials yielding a safe and nuisance free compost product.
“Construction and demolition debris or C&D” includes discarded building materials, packaging, debris, and rubble resulting from construction, alteration, remodeling, repair, or demolition operations on any pavements, excavation projects, houses, commercial buildings, or other structures; but excludes excluded waste.

Construction and demolition debris includes rocks, soils, tree remains, and other yard trimmings that result from land clearing or land development operations in preparation for construction.
“Contamination” means the following: (i) discarded materials placed in a recyclable materials container that are not identified as recyclable materials; (ii) discarded materials placed in an organic materials container that are not identified as organic materials; (iii) discarded materials placed in a solid waste container that are 1241
3 identified as recyclable materials and/or organic materials, which are to be separately collected; and/or (iv) excluded waste placed in any container. “Designee” means an entity that the City contracts with or otherwise arranges to carry out any of the City’s responsibilities of this chapter as authorized in 14 CCR Section 18981.2 or other applicable law. A designee may be a government entity, a collector, a private entity, or a combination of those entities. “Director” or “Public Works Director” means the Public Works Director of the City of Stockton, acting either directly or through authorized agents or designees. “Discarded materials” means recyclable materials, organic materials, and solid waste placed by a generator in a receptacle and/or at a location for the purposes of collection by a collector, excluding excluded waste.
“Disposal facility” means a landfill, or other facility, for ultimate disposal of solid waste.
“Dwelling” means an occupied residence, flat, apartment, or other facility used for housing one or more persons in the City.
“Dwelling unit” means any individual living unit in a single-family or multi-family structure or building, mobile home, or motor home located on a permanent site intended for, or capable of being utilized for, residential living other than a hotel or motel. “Edible food” means food that is unsold or unserved and meets all quality and labeling standards imposed by federal, state, and local laws and regulations even though the food may not be readily marketable due to appearance, age, freshness, grade, size, surplus, or other conditions, or as otherwise defined in 14 CCR Section 18982(a)(18). Edible food is not discarded materials if it is recovered and not discarded. “Enforcement action" means an action of the City to address non-compliance with this chapter including, but not limited to, issuing administrative citations, fines, penalties, or using other remedies.
“Excluded Waste” means hazardous substance, hazardous waste, infectious waste, designated waste, volatile, corrosive, biomedical, infectious, biohazardous, and toxic substances or material, waste that the collector reasonably believes would, as a result of or upon disposal, be a violation of local, state or federal law, regulation or ordinance, including land use restrictions or conditions, waste that cannot be disposed of in class iii landfills, waste that in the collector’s reasonable opinion would present a significant risk to human health or the environment, cause a nuisance or otherwise create or expose the collector or City to potential liability; but not including de minimis volumes or concentrations of waste of a type and amount normally found in residential solid waste after implementation of programs for the safe collection, recycling, 1242
4 treatment, and disposal of batteries and paint in compliance with Sections 41500 and 41802 of the California Public Resources Code.
“Food distributor” means a company that distributes food to entities including, but not limited to, supermarkets and grocery stores, or as otherwise defined in 14 CCR Section 18982(a)(22).
“Food facility” has the same meaning as in Section 113789 of the Health and Safety Code.
“Food recovery” means actions to collect and distribute food for human consumption that otherwise would be disposed, or as otherwise defined in 14 CCR Section 18982(a)(24).
“Food recovery organization” means an entity that engages in the collection or receipt of edible food from commercial edible food generators and distributes that edible food to the public for food recovery either directly or through other entities or as otherwise defined in 14 CCR Section 18982(a)(25), including, but not limited to:

1. A food bank as defined in Section 113783 of the Health and Safety Code;

2. A nonprofit charitable organization as defined in Section 113841 of the Health and Safety code; and,

3. A nonprofit charitable temporary food facility as defined in Section 113842 of the Health and Safety Code.

A food recovery organization is not a commercial edible food generator for the purposes of this chapter and implementation of 14 CCR, Division 7, Chapter 12 pursuant to 14 CCR Section 18982(a)(7).

Food scraps are a subset of organic materials.
“Generator” means any person whose act or process produces discarded materials as defined in the Public Resources Code, or whose act first causes discarded materials to become subject to regulation.
“Grocery store” means a store primarily engaged in the retail sale of canned food, dry goods, fresh fruits and vegetables, fresh meats, fish, and poultry; and any area that is not separately owned within the store where the food is prepared and served, including a bakery, deli, and meat and seafood departments, or as otherwise defined in 14 CCR Section 18982(a)(30).
“Hauler route” means the designated itinerary or sequence of stops for each segment of the City’s collection service area, or as otherwise defined in 14 CCR Section 18982(a)(31.5).
“Industrial wastes” means and includes all types of solid wastes and semisolid wastes that result from manufacturing facilities, factories, food processors, refineries, and publicly-operated treatment works.
“Industrial waste collector” means a person authorized by the City by permit to collect industrial waste within the City.
“Inspection” means a site visit or other activities where a City reviews records, containers, and/or an entity’s collection, handling, recycling, or landfill disposal of recyclable materials, organic waste, solid waste/mixed waste, or edible food handling to determine if the entity is complying with requirements set forth in this chapter, or as otherwise defined in 14 CCR Section 18982(a)(35).
“Landfill” means a disposal site employing a method of disposing of solid wastes on land without creating nuisances or hazards to public health or safety, by utilizing principles of engineering to confine the wastes to the smallest practical area, with a layer of suitable cover material at specific designated intervals. “Large event” means an event including, but not limited to, a sporting event or a flea market that charges an admission price, or is operated by a local agency, and serves an average of more than two thousand (2,000) individuals per day of operation of the event, at a location that includes, but is not limited to, a public, nonprofit, or privately-owned park, parking lot, golf course, street system, or other open space when being used for an event. If the definition in 14 CCR Section 18982(a)(38) differs from this definition, the definition in 14 CCR Section 18982(a)(38) shall apply to this chapter. 1244
6 “Large venue” means a permanent venue facility that annually seats or serves an average of more than 2,000 individuals within the grounds of the facility per day of operation of the venue facility. For purposes of this chapter and implementation of 14 CCR, Division 7, Chapter 12, a venue facility includes, but is not limited to, a public, nonprofit, or privately-owned or operated stadium, amphitheater, arena, hall, amusement park, conference or civic center, zoo, aquarium, airport, racetrack, horse track, performing arts center, fairground, museum, theater, or other public attraction facility. For purposes of this chapter and implementation of 14 CCR, Division 7, Chapter 12, a site under common ownership or control that includes more than one (1) large venue that is contiguous with other large venues in the site, is a single large venue. If the definition in 14 CCR Section 18982(a)(39) differs from this definition, the definition in 14 CCR Section 18982(a)(39) shall apply to this chapter. “Local education agency” means a school district, charter school, or county office of education that is not subject to the control of City or county regulations related to solid waste, or as otherwise defined in 14 CCR Section 18982(a)(40). “Multi-family” means any residential premises, other than a single-family premises, with four (4) or more dwelling units used for residential purposes (regardless of whether residence therein is temporary or permanent), including such premises when combined in the same building with commercial establishments, that receive centralized, shared, collection service for all units on the premises that are billed to one (1) Customer at one (1) address. Customers residing in townhouses, mobile homes, condominiums, or other structures with four (4) or more dwelling units who receive individual service and are billed separately shall not be considered multi-family, unless otherwise required by applicable law.
“Occupant” means the person who occupies a premises.
“Organic materials” means yard trimmings and food scraps, individually or collectively. No discarded material shall be considered to be organic materials, however, unless it is separated from recyclable materials and solid waste. “Organic materials container” shall be used for the purpose of storage and collection of source separated organic materials.
“Organic waste” means solid wastes containing material originated from living organisms and their metabolic waste products including, but not limited to, food, green material, landscape and pruning waste, organic textiles and carpets, lumber, wood, paper products, printing and writing paper, manure, biosolids, digestate, and sludges or as otherwise defined in 14 CCR Section 18982(a)(46). Biosolids and digestate are as defined by 14 CCR Section 18982(a).
“Owner,” when used with reference to a dwelling, means and shall conclusively be deemed to be the person(s) holding legal title to real property and/or any 1245
7 improvements thereon, and shall include the person(s) listed on the latest equalized assessment roll of the county assessor.
“Permittee” means a person authorized by the City by permit to collect industrial wastes, commercial recyclable materials, or construction and demolition debris. “Person” means any individual, firm, association, partnership, corporation, trust, joint venture, or other legal entity.
“Premises” means and includes a tract or parcel of land with or without habitable buildings or appurtenant structures.
“Putrescible wastes” means and includes wastes that are capable of being decomposed by micro-organisms with sufficient rapidity as to cause nuisances because of odors, gases, or other offensive conditions, and include materials such as food wastes, offal, and dead animals. “Recovery” means any activity or process described in 14 CCR Section 18983.1(b), or as otherwise defined in 14 CCR Section 18982(a)(49).
“Recyclable materials” or “recyclables” means discarded materials that: the generators set out in recyclable containers for collection for the purpose of recycling by the collector and that exclude excluded waste. No discarded materials shall be considered recyclable materials unless such material is separated from organic materials and solid waste.
“Recyclable materials container” shall be used for the purpose of storage and collection of source separated recyclable materials.
“Recycle, recycled, recycling” means the process of collection, sorting, cleansing, treating, and reconstituting recyclable materials that would otherwise be disposed of, and returning them to the economy in the form of raw materials for new, reused, repaired, refabricated, remanufactured, or reconstituted products. “Removal” means the act of taking solid wastes from the place of waste generation either by an approved collection agent or by a person in control of the premises.
“Remote monitoring” means the use of the internet of things (IOT) and/or wireless electronic devices to visualize the contents of recyclable materials containers, organic materials containers, and solid waste containers for purposes of identifying the quantity of materials in containers (level of fill) and/or presence of contamination. “Residential” means of, from, or pertaining to a single-family premises, including single-family homes, duplexes, triplexes, townhouse complexes, and mobile home parks.
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8 “Responsible party” means the owner, property manager, tenant, lessee, occupant, or other designee that subscribes to and pays for recyclable materials, organic materials, and/or solid waste collection services for a premise in the City, or, if there is no such subscriber, the owner or property manager of a single-family premise, multi-family premise, or commercial premise. In instances of dispute or uncertainty regarding who is the responsible party for a premises, responsible party shall mean the owner of a single-family premise, multi-family premise, or commercial premise. “Restaurant” means an establishment primarily engaged in the retail sale of food and drinks for on-premises or immediate consumption, or as otherwise defined in 14 CCR Section 18982(a)(64).
“Route review” means a visual inspection of containers along a hauler route for the purpose of determining container contamination, in a manner approved by the Director or their designee, or as otherwise defined in 14 CCR Section 18982(a)(65). “SB 1383” means the Short-Lived Climate Pollutants Act of 2016 (an act to add Sections 39730.5, 39730.6, 39730.7, and 39730.8 to the Health and Safety Code, and to add Chapter 13.1 [commencing with Section 42652] to Part 3 of Division 30 of the Public Resources Code, relating to methane emissions), also commonly referred to as "SB 1383," as amended, supplemented, superseded, and replaced from time to time. “SB 1383 Regulations” or “SB 1383 Regulatory” means or refers to, for the purposes of this chapter, the Short-Lived Climate Pollutants: Organic Waste Reduction regulations developed by CalRecycle and adopted in 2020 that created 14 CCR, Division 7, Chapter 12 and amended portions of regulations of 14 CCR and 27 CCR. “Self-haul” means to act as a self-hauler.
“Self-hauler” means a person who hauls solid waste, organic waste, or recyclable material they have generated to another person, subject to City approval in accordance with this chapter. Self-hauler also includes a landscaper or a person who back-hauls waste.
“Single-family” means any detached or attached house or residence designed or used for occupancy by one (1) family, with three (3) or fewer distinct living units, provided that collection service feasibly can be provided to such premises as an independent unit, and the owner or occupant of such independent unit is billed directly for the collection service. Single-family includes townhouses, and each independent unit of duplex or tri-plex residential structures, regardless of whether each unit is separately billed for their specific service level.
“Solid waste” means solid waste as defined in California Public Resources Code, Division 30, Part 1, Chapter 2, §40191 and regulations promulgated hereunder.

Excluded from the definition of solid waste are excluded waste, C&D, source separated recyclable materials, source separated organic materials, and radioactive waste. 1247
9 Notwithstanding any provision to the contrary, solid waste may include de minimis volumes or concentrations of waste of a type and amount normally found in residential solid waste after implementation of programs for the safe collection, recycling, treatment, and disposal of household hazardous waste in compliance with Section 41500 and 41802 of the California Public Resources Code as may be amended from time to time. Solid waste includes salvageable materials only when such materials are included for collection in a solid waste container not source separated from solid waste at the site of generation.
“Solid waste container” shall be used for the purpose of storage and collection of solid waste.
“Source separated” means the segregation, by the generator, of materials designated for separate collection for some form of recycling, composting, recovery, or reuse.
“State” means the State of California.
“Supermarket” means a full-line, self-service retail store with gross annual sales of two million dollars ($2,000,000) or more, and that sells a line of dry grocery, canned goods, or nonfood items and some perishable items, or as otherwise defined in 14 CCR Section 18982(a)(71).
“Tenant” means a person who is legally in control of, but is not necessarily the legal owner of, a building, a part of a building, a dwelling unit, or any type of premises.

Tenant is synonymous with occupant or lessee.
“Tier one commercial edible food generator” means a commercial edible food generator that is one (1) of the following:

1. Supermarket.

2. Grocery store with a total facility size equal to or greater than ten thousand (10,000) square feet.

3. Food service provider.

4. Food distributor.

5. Wholesale food vendor.

1. Restaurant with two hundred fifty (250) or more seats, or a total facility size equal to or greater than five thousand (5,000) square feet.

2. Hotel with an on-site food facility and two hundred (200) or more rooms.

3. Health facility with an on-site food facility and one hundred (100) or more beds. 1248
10 4. Large venue.

5. Large event.

6. A state agency with a cafeteria with two hundred fifty (250) or more seats or total cafeteria facility size equal to or greater than five thousand (5,000) square feet.

7. A local education agency facility with an on-site food facility.

8. If the definition in 14 CCR Section 18982(a)(74) of tier two commercial edible food generator differs from this definition, the definition in 14 CCR Section 18982(a)(74) shall apply to this chapter.
“Wholesale food vendor” means a business or establishment engaged in the merchant wholesale distribution of food, where food (including fruits and vegetables) is received, shipped, stored, prepared for distribution to a retailer, warehouse, distributor, or other destination, or as otherwise defined in 14 CCR Section 189852(a)(76). “Yard trimmings” means those discarded materials that will decompose and/or putrefy including, but not limited to, green trimmings, grass, weeds, leaves, prunings, branches, dead plants, brush, tree trimmings, dead trees, small pieces of unpainted and untreated wood, and other types of organic materials resulting from normal yard and landscaping maintenance that may be specified by the City or applicable law for collection and processing as organic materials, in accordance with this chapter. Yard trimmings does not include items herein defined as excluded waste. Yard trimmings are a subset of organic materials.
“Vacant lot” means any parcel of real property that is not improved with a community garden, as defined by Section 16.240.020, or a completed permitted structure.

8.04.020 Mandatory discarded materials service required.

A. Subscribe to and pay for City’s three- (3) container collection services for at least weekly collection of recyclable materials, organic materials, and solid waste; B. Place and/or direct its generators to place at a location accessible to the collector or permittee, an adequate container or containers provided by the collector or permittee for deposit of discarded materials of such a number, type, or capacity as the Director may prescribe;
C. Place, and/or direct its generators to place, source separated organic materials in the organic materials container; source separated recyclable materials in the recyclable materials container; and solid waste in the solid waste container; 1249
11 D. Not place and/or direct its generators to not place contamination in collection containers and not place materials designated for the organic materials containers or recyclable materials containers in the solid waste containers; E. Nothing in this section prohibits a responsible party or generator of a premise from preventing or reducing discarded materials generation, managing organic waste on site, and/or using a community composting site pursuant to 14 CCR Section 18984.9(c).

8.04.030 Failure to initiate service or to provide sufficient discarded materials containers.

A. When an owner or occupant fails to initiate adequate discarded materials collection service within ten (10) days of occupancy of a dwelling by any person, the Public Works Director will give the owner or occupant notification that such service is required. If the owner or occupant does not arrange with the collector for service within ten (10) days from the date of mailing of the notice, then the collector shall initiate and continue discarded materials collection service for said dwelling.

B. When, in the opinion of the Director, additional discarded materials containers, more frequent services, or other service modifications are required, they shall be provided for by the owner or occupant upon written notification from the Director.

8.04.035 Requirements for multi-family.

B. Responsible parties of multi-family premises shall:

1. Supply and allow access to adequate number, size, and location of collection containers with sufficient labels or colors for employees, contractors, tenants, and customers consistent with City’s recyclable materials container, organic materials container, and solid waste container collection service and, if self-hauling, consistent with the multi-family premise’s approach to complying with self-hauler requirements in Section

8.04.255.

2. Annually provide information to employees, contractors, tenants, and customers about recyclable materials and organic waste recovery requirements and about proper sorting of recyclable materials, organic materials, and solid waste.
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12 3. Provide education information before or within fourteen (14) days of occupation of the premises to new tenants that describes requirements to source separate recyclable materials and organic materials, the location of containers, and the rules governing their use at each property.

4. Provide or arrange access for City or its designee to their properties during all inspections conducted in accordance with this chapter to confirm compliance with the requirements of this chapter.

C. If the responsible party of a multi-family premise wants to self-haul, meet the selfhauler requirements in Section 8.04.255.

8.04.036 Requirements for commercial.

B. Responsible parties of commercial premises shall:

1. Supply and allow access to adequate number, size, and location of collection containers with sufficient labels or colors (conforming with Section

8.04.036.B.2 below) for employees, contractors, tenants, and customers, consistent with City’s recyclable materials container, organic materials container, and solid waste container collection service and, if self-hauling, consistent with the commercial premise’s approach to complying with selfhauler requirements in Section 8.04.255.

2. Provide containers for the collection of source separated recyclable materials and source separated organic materials in all indoor and outdoor areas where solid waste containers are provided for customers, for materials generated by that commercial business. Such containers shall be visible and easily accessible. Such containers do not need to be provided in restrooms. If a commercial business does not generate any of the 1251
13 materials that would be collected in one (1) type of container, then the responsible party of the commercial business does not have to provide that particular container in all areas where solid waste containers are provided for customers. Pursuant to 14 CCR Section 18984.9(b), the containers provided by the responsible party of the commercial business shall have either:
a. A body and/or lid that is blue for recyclable materials, green for organic materials, and grey for solid waste conforms with the container colors provided through the collection service provided by City, or
b. Container labels that include language or graphic images, or both, indicating the primary material accepted and the primary materials prohibited in that container, or containers with imprinted text or graphic images that indicate the primary materials accepted and primary materials prohibited in the container.

5. Annually, provide information to employees, contractors, tenants, and customers about recyclable materials and organic waste recovery requirements and about proper sorting of recyclable materials, organic materials, and solid waste.

7. Provide or arrange access for City or its designee to their properties during all inspections conducted in accordance with this chapter to confirm compliance with the requirements of this chapter.
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14 E. If the responsible party of a commercial business wants to self-haul, meet the selfhauler requirements in Section 8.04.255 of this chapter.

G. Responsible parties of commercial businesses that are tier one or tier two commercial edible food generators shall comply with food recovery requirements, pursuant to Section 8.04.195.

8.04.040 Duty to keep right-of-way free from discarded materials.

Every person in possession, charge, or control of, and using, any place or premises in the City fronting on a street, alley, or other public right-of-way shall maintain the portion of the street, alley, or other public right-of-way adjacent to the place or premises in a condition free from discarded materials and waste matter. For the purposes of this section, the portion of a street, alley, or other public right-of-way adjacent to a place or premises includes any walkway, trail, sidewalk, parkway, curb and gutter, and the travel lane portion of the roadway on the side of the street or alley adjoining the property. The City may provide street sweeping services and collect a fee therefor as a part of the solid waste charge in partial satisfaction of this section.

8.04.050 Containers generally.

A. All discarded materials containers shall be kept clean and sanitary and portable by the owner or other person responsible for providing the container under the provisions of this section.

B. If the collector is permitted or required to provide containers as a provision of its franchise, contract, or permit, all containers shall comply with the requirements established pursuant to the provisions of the franchise, contract, or permit, or as otherwise specified by applicable law.

C. Loading of containers shall be subject to the weight limitations established by the Public Works Director.

D. Separate containers for various types of recyclable materials and organic materials shall be provided according to written directives issued by the Public Works Director.
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15 8.04.060 Placement for collection.

On collection days, all containers and parcels of discarded materials shall be placed adjacent to the roadway in a manner that does not block any travel way, parking area, or gutter. Loaded containers ready for collection shall not be set out before 6:00 p.m. on the day prior to the regular collection day. Containers shall be returned to a proper storage location on private property and not visible from the public right-of-way not later than 11:00 p.m. on the day of collection. The City Council may, by resolution, from time to time, prescribe days and hours for the collection of solid waste and recyclable material from property within certain areas of the City. Within such areas, all solid waste and recyclable material shall be made available for collection at the designated day and time.

8.04.070 Placement of waste in containers—Separation of recyclable materials and organic materials.

B. Used motor oil and used oil filters may be placed in appropriate containers for collection as designated by the Public Works Director.

C. Medical waste shall not be placed for collection through solid waste services, but rather shall be disposed of as otherwise required by law.

D. Recyclable materials and organic materials shall be separated from other solid waste for collection. However, the collector shall not refuse to collect solid waste from containers properly placed according to this article because it contains incidental amounts of recyclable materials or organic materials.

E. Large household or bulky items shall not be placed for collection through the collection services containers, but rather shall be placed in accordance with any administrative or operational requirements established by the Director or their designee and applicable law, and in accordance with the current franchise agreement as applicable.

8.04.080 Placement of bins.

A. Bins shall be placed in an accessible, outside location, on a hard surface.

Bins shall be kept in enclosures meeting standards approved by the Public Works Director. The Public Works Director may waive the requirement for enclosure of a bin on the premise or may establish a time schedule for implementation of the enclosure requirement upon application by the person responsible for the premise and a finding of 1254
16 good cause. Any such waiver shall be in writing and maintained in the records of the Public Works Department. Locked or inaccessible bins will be serviced only by special arrangement with the collector.

8.04.090 Summary abatement of improper containers.

Any container that does not conform with the provisions of this chapter may be summarily abated as a public nuisance by the City. Such summary abatement shall occur only after written or electronic notice of the non-complying nature of the container has been provided and the container has thereafter been used a second time for disposal of solid waste.

8.04.100 CALGreen requirements.

Regulated entities shall at all times comply with the requirements of the California Green Building Standards Code (24 CCR, Part 11), including, but not limited to, the following provisions related to discarded materials:

1. Section 4.410.2 (Recycling by Occupants Residential) and Section 5.410.1 30 (Recycling by Occupants Non-residential) regarding provision of readily accessible areas for storage and collection of recyclable materials and organic materials; and,

2. For organic waste commingled with construction and demolition debris, 24 CCR Section 4.408.1 (Construction Waste Management Residential) and 24 CCR Section

5.408.1 (Construction Waste Management non-residential).

8.04.110 Scavenging prohibited.

A. It is unlawful for any person to scavenge, tamper with, move, remove, tip, deface, or destroy any discarded materials collection container or the contents thereof; B. This section shall not apply to activities of the City, the collector, the owner or occupant of a premises, or a person authorized by the City to perform activities under this chapter.

8.04.120 Reserved.

8.04.130 Collector entitled to payment for services rendered. 1255
17 A. Pursuant to the provisions of this chapter and the terms and conditions of any applicable franchise or permit, the collector shall be entitled to payment from the owner or occupant for services rendered. When the owner or occupant has been directed to initiate service and the collector attempts to collect discarded materials from the dwelling, then such attempts shall be deemed the rendering of collection service for which collector is entitled to compensation in the same manner and amount as if discarded materials had actually been collected.

B. For single-family discarded materials, multi-family discarded materials, commercial discarded materials, and industrial waste, collectors shall bill directly to the owner or occupant for collection services rendered. The collector may require that the record owner be the customer of record. Moreover, the collector or permittee may permit a tenant or authorized agent to receive bills pursuant to procedures prescribed by the City and provided that the property owner remains ultimately fully responsible and liable for payment. In all such events where the property owner is the customer of record or fully responsible and liable for payment, the collector or permittee may request that the City collect any delinquent or unpaid fees through a lien or special assessment under the procedures set forth in Section 8.04.160 or Government Code Section 38790.1 as it may be amended.

8.04.135 Unified bill.

A. A unified bill includes charges for water services provided by the City and all other service charges including sewer, discarded materials, and stormwater service charges.

B. A bill that does not contain charges for water services provided by the City is not a unified bill as used in this chapter.

C. Water services not provided by the City may be billed separately from other City service charges at the water service provider’s sole discretion.

8.04.140 Billing and collection procedures for residential discarded materials collection.

A. All accounts for discarded materials collection services shall be established by and held in the name of the record owner of the property where the discarded materials services are to be provided.

B. At the time the application for discarded materials collection services is requested, and at the Chief Financial Officer’s sole discretion, the applicant shall provide proof of ownership of the property to be served.

C. The record owner of a property receiving discarded materials collection services shall be fully responsible and liable for the payment of all discarded materials 1256
18 collection service charges, any delinquent discarded materials collection service charges, and any penalties applicable to his or her property.

D. The Chief Financial Officer may, in the Chief Financial Officer’s sole discretion, send the bill for discarded materials collection services to a tenant or any other person or entity designated by the record owner, provided the record owner or his or her authorized representative submits to the City a complete and signed request to bill the tenant or other designated person or entity on such form as may be specified by the Chief Financial Officer.

E. If, in accordance with subsection D of this section, a bill is sent to a person or entity other than the record owner, then the service account shall remain in the record owner’s name and the record owner shall be fully responsible and liable for the payment of any discarded materials collection service charges, any delinquent discarded materials collection service charges, and penalties applicable to their property as if the bill had been sent to the record owner.

F. The method of billing for residential discarded materials collection services will be determined by the Chief Financial Officer with the concurrence of the City Manager. Notification of billing changes to any property where discarded materials services are provided shall be provided to the record owner, tenant, designated person, or entity authorized to receive a bill for discarded materials collection service charges pursuant to subsection D of this section.

G. Except as provided in subsection D, residential discarded materials collection service charges will be billed on a unified bill to the record owner if the water services are provided by the City at the service location. Residential properties that consist of two (2) or more separate dwelling units, and are served by a single water meter, shall be billed for discarded materials collection service for the total number of separate residential dwelling units served by such water meter on a unified bill.

H. If a property does not receive water services from the City, the discarded materials collection service charges may be billed separately or with other utility services provided by the City.

Moreover, the collector or permittee may permit a tenant or authorized agent to receive bills pursuant to procedures prescribed by the City and provided that the property owner remains ultimately fully responsible and liable for payment. In all such events, the collector or permittee may request that the City collect any delinquent or unpaid fees through a lien or special assessment as permitted in Section 8.04.160 or Government Code Section 38790.1 as it may be amended.
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19 8.04.150 Charges payable to City or authorized agent for billing and collection for residential discarded materials collection.

All residential discarded materials charges shall be payable to the City or its authorized agent for billing and collection.

8.04.160 Delinquency, penalties and nonpayment for residential discarded materials collection.

A. An account is delinquent when payment of the bill for discarded materials collection service charges is not received in full at the office of the City or its authorized agent for billing and collection within twenty-five (25) days of the billing date. A postmark date is not considered the date of payment.

B. Where all or any part of any bill for a discarded materials collection services account remains unpaid twenty-five (25) days after the billing date, a basic penalty of ten (10) percent of the total delinquent amount will be added to such bill for the first month the account is delinquent. In addition, the City may impose a penalty in an amount not to exceed one (1) percent per month for nonpayment of any discarded materials service charges and any basic penalty.

C. Except as otherwise provided by law, if a unified bill remains unpaid more than sixty (60) days after the date of billing, City water service at the service location may be terminated.

1. City water service will not be restored until the amount of all delinquent discarded materials collection service charges, associated service charges, penalties, deposits, and reconnection charges have been paid in full.

D. The City shall include a statement in each bill for discarded materials collection service charges to each record owner in substantially the following form:
“Discarded materials collection service charges and any penalties shall constitute a lien against the lot or parcel of land against which the charges and any penalties are imposed if the charges remain delinquent for sixty (60) or more days.” Pursuant to such notice, the discarded materials collection service charges and penalties may become a lien against the lot or parcel of land against which the charges were imposed if such charges remain delinquent for a period of sixty (60) or more days.

The City shall cause to be recorded with the county recorder all such delinquent 1258
20 discarded materials service charges and any penalties; and, when so recorded, such charges and penalties shall have the force, effect, and priority of a judgment lien and continue for ten (10) years from the time of recording ,unless sooner released or otherwise discharged.

8.04.170 Maintenance of records for residential discarded materials collection.

8.04.180 Payment of fees and mandatory reporting of change in circumstance.

A. No discarded materials collection services will be furnished to any property or person free of charge.

B. The record owner of any property where discarded materials services are provided shall be responsible for the payment of any and all discarded materials collection service charges, any delinquent discarded materials collection service charges, and any penalties applicable to his or her property.

C. It shall be, and is hereby made, the duty of each record owner of any property where discarded materials services are provided to ascertain from the City Administrative Services Department, or its authorized agent for billing and collection, the amount and due date of any discarded materials collection service charges, any delinquent discarded materials collection service charges, and any penalties applicable to his or her property, and to pay such charges and penalties when due and payable.

D. The record owner of any property where discarded materials services are provided is obligated to inform the City Administrative Services Department, or its authorized agent for billing and collection, immediately of all circumstances and of any change(s) in any circumstance that will, in any way, affect the applicability of any discarded materials collection service charges or the amount of any such charges that may be imposed on his or her property for discarded materials services provided. In particular, but not by way of limitation, the record owner of any property where discarded materials services are provided by the City, or a collector or permittee of the City, shall immediately inform the City Administrative Services Department or its authorized agent for billing and collection of any sale or transfer of any such property.

8.04.190 Exemptions and waivers.

The Director or their designee may develop processes for, and grant exemptions or waivers to, individual responsible parties for compliance with specified service requirements of Chapter 8.04, consistent with applicable law and as provided below. 1259
21 A. Vacancy of premise. The Director or their designee may provide a process for responsible parties to apply for, and to be granted, a temporary exemption from collection service at a vacant or unoccupied premise. The Director or their designee may limit the duration or frequency for which such exemptions may be granted to a responsible party and may provide for a vacancy credit against the responsible party’s payment for service. Said exemption may be revoked at any time thereafter if, after investigation, the Director determines that circumstances have changed and that discarded material collection services are required.

8.04.195 Requirements for commercial edible food generators.

B. Large venue or large event operators not providing food services, but allowing for food to be provided by others, shall require food facilities operating at the large venue or large event to comply with the requirements of this section, commencing January 1, 2024.

C. Commercial edible food generators shall comply with the following requirements:

1. Arrange to recover the maximum amount of edible food that would otherwise be disposed.

3. Not intentionally spoil edible food that is capable of being recovered by a food recovery organization or a food recovery service.

4. Allow City’s designated enforcement entity or designated third-party enforcement entity to access the premises to conduct inspections and review records pursuant to 14 CCR Section 18991.4 and this chapter.
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22 5. Keep records that include the following information, or as otherwise specified in 14 CCR Section 18991.4:
a. A list of each food recovery service or organization that collects or receives the commercial edible food generator’s edible food pursuant to a contract or written agreement established under 14 CCR Section 18991.3(b). b. A copy of all contracts or written agreements established under 14 CCR Section 18991.3(b).
c. A record of the following information for each of those food recovery services or food recovery organizations:
i. The name, address, and contact information of the food recovery service or food recovery organization.
ii. The types of food that will be collected by or self-hauled to the food recovery service or food recovery organization. iii. The established frequency that food will be collected or selfhauled. iv. The quantity of food, measured in pounds recovered per month, collected or self-hauled to a food recovery service or food recovery organization for food recovery.

6. Maintain records required by this section for five (5) years.

7. The Director may, at their discretion, require commercial edible food generators to provide an annual food recovery report to the City, in a manner and timeline prescribed by the Director, that may include information such as:
a. The amount, in pounds, of edible food donated to a food recovery service or food recovery organization annually;
b. The amount, in pounds of edible food rejected by a food recovery service or food recovery organization annually; and,
c. Any additional information required by the Director or their designee.

D. Nothing in this chapter shall be construed to limit or conflict with the protections provided by the California Good Samaritan Food Donation Act of 2017, the Federal Good Samaritan Act, or share table and school food donation guidance pursuant to Senate Bill 557 of 2017 (approved by the Governor of the State of California on September 25, 2017, which added Article 13 [commencing with Section 49580] to 1261
23 Chapter 9 of Part 27 of Division 4 of Title 2 of the Education Code, and to amend Section 114079 of the Health and Safety Code, relating to food safety, as amended, supplemented, superseded and replaced from time to time).

8.04.196 Requirements for food recovery organizations and food recovery services.

B. Food recovery organizations collecting or receiving edible food directly from commercial edible food generators, via a contract or written agreement established under 14 CCR Section 18991.3(b), shall maintain the following records, or as otherwise specified by 14 CCR Section 18991.5(a)(2):
1 The name, address, and contact information for each commercial edible food generator from which the organization receives edible food. 2 The quantity in pounds of edible food received from each commercial edible food generator per month.
3 The name, address, and contact information for each food recovery service that the organization receives edible food from for food recovery.

C. Food recovery organizations and food recovery services shall maintain records required by this section for five (5) years.

D. Food recovery organizations and food recovery services that have their primary address physically located in the City and contract with or have written agreements with one or more commercial edible food generators, pursuant to 14 CCR Section 18991.3(b), shall report to the City the total pounds of edible food recovered in the previous calendar year from the tier one and tier two commercial edible food 1262
24 generators they have established a contract or written agreement with pursuant to 14 CCR Section 18991.3(b). The annual report shall be submitted to the City no later than the date prescribed by the Director or their designee.

E. In order to support edible food recovery capacity planning assessments or other studies conducted by the county, City or its designee, food recovery services and food recovery organizations operating in the City shall provide information and consultation to the City, upon request, regarding existing, proposed, new, or expanded food recovery capacity that could be accessed by the City and its commercial edible food generators. A food recovery service or food recovery organization contacted by the City shall respond to such request for information within sixty (60) days, unless a shorter timeframe is otherwise specified by the City.

8.04.200 Single-use foodware.

Entities regulated under Public Resources Code Part 3, Division 30, Chapter 5.2, relating to single-use plastic foodware and condiments, shall at all times comply with the applicable provisions of that chapter. Notwithstanding Section 8.04.360, the Director or their designee shall enforce such requirements commencing June 1, 2022, in accordance with the enforcement procedures and penalty amounts set forth in Public Resources Code Section 42272.

8.04.210 Deposit of discarded materials or waste matter other than in containers— Unlawful.

It is unlawful for any person in the City to throw or deposit any discarded materials or waste matter or to cause the same to be thrown or deposited upon any street, alley, gutter, park, or other public way or to throw or deposit the same in or upon any premises or vacant lot or in any water or waterway or upon the levees or banks adjacent thereto, or to store or keep the same except in containers as required herein.

8.04.220 Permitting discarded materials to accumulate in vicinity of receptacles— Prohibited—Penalty.

A. It is unlawful for any person to permit or allow discarded materials to accumulate in the vicinity of discarded materials receptacles or areas used for the storage of discarded materials receptacles. This section shall apply to both residential and commercial properties.

B. Any person, firm, or corporation violating this section shall be deemed guilty of a separate offense for each and every day or portion thereof during which a violation of this section is committed, continued, or permitted, and shall be subject to enforcement pursuant to Section 8.04.360.
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25 8.04.230 Burying discarded materials, etc.—Prohibited.

It is unlawful for any person to bury discarded materials at any place within the City.

8.04.240 Collection of discarded materials, waste matter, industrial waste or swill, unless licensed—Unlawful.

It is unlawful for any person, firm, corporation, or association to collect discarded materials, waste matter, or industrial waste within the City or transport the same through the streets, alleys, and public ways of City unless such person, firm, corporation or association has been licensed to do so by the City by contract, permit, or otherwise.

8.04.250 Collectors and facility operators.

The City Council of the City shall, by contract or permit, authorize one (1) or more persons, firms, or corporations to collect, transport, and process or dispose of discarded materials and industrial waste within the City on a regularly-scheduled basis.

With regard to residential, multi-family, and commercial discarded materials, the manner of collection and other regulations of said residential, multi-family, and commercial discarded materials collectors shall be set forth in the contract, which may include provision of recyclable materials, organic materials collection, street sweeping, seasonal leaf collection, and other related programs. With regard to industrial waste, the manner of collection and other regulations of said industrial waste collectors shall be set forth in a separate agreement or permit.

A. Requirements for collectors

1. Collector(s) providing recyclable materials, organic waste, and/or solid waste collection services to generators within the City’s boundaries shall meet the following requirements and standards as a condition of approval of its franchise, contract, permit, or other authorization with the City to collect recyclable materials, organic materials, and/or solid waste:
a. Through annual written notice to the City on or before the date prescribed by the Director, identify the facilities to which they will transport discarded materials, including facilities for source separated recyclable materials, source separated organic materials, and solid waste unless otherwise stated in the franchise agreement, contract, permit, license, or other authorization with the City. b. Transport source separated recyclable materials to a facility that recovers those materials; transport source separated organic materials to a facility, operation, activity, or property that recovers organic waste as defined in 14 CCR, Division 7, Chapter 12, Article 2; transport solid waste to a disposal facility or transfer facility or operation that processes or disposes of solid waste; and 1264
26 transport manure to a facility that manages manure in conformance with 14 CCR Article 12 and such that the manure is not landfilled, used as alternative daily cover (ADC), or used as alternative intermediate cover (AIC). c. Obtain approval from the City to haul organic waste, unless it is transporting source separated organic waste to a community composting site or lawfully transporting C&D in a manner that complies with 14 CCR Section 18989.1 and Chapter 8.28 of the Stockton municipal code.

B. Requirements for Facility Operators and Community Composting Operations

1. Owners of facilities, operations, and activities located within the City’s boundaries that recover organic waste including, but not limited to, compost facilities, invessel digestion facilities, and publicly-owned treatment works shall, upon City request, provide information regarding available and potential new or expanded capacity at their facilities, operations, and activities, including information about throughput and permitted capacity necessary for planning purposes. Entities contacted by the City shall respond within sixty (60) days.

2. Community composting operators with operations located in the City’s boundaries, upon City request, shall provide information to the City to support organic waste capacity planning including, but not limited to, an estimate of the amount of organic waste anticipated to be handled at the community composting operation. Entities contacted by the City shall respond within sixty (60) days.

8.04.255 Self-hauler requirements.

Self-haulers shall prepare and handle their discarded materials in a manner consistent with 14 CCR Section 18984.1, the City’s collection program, and any other requirements established by the Director or their designee. Self-haulers shall 1265
27 deliver their discarded materials only to facilities approved or designated by the Director.

1. Delivery receipts and weight tickets from the entity accepting the recyclable materials, organic materials, and solid waste.

2. The amount of material in cubic yards or tons transported by the generator or responsible party to each entity.

3. If the material is transported to an entity that does not have scales on-site or employs scales incapable of weighing the self-hauler’s vehicle in a manner that allows it to determine the weight of materials received, the selfhauler is not required to record the weight of material but shall keep a record of the entities that received the recyclable materials, organic materials, and solid waste.

4. Other information prescribed by the Director or their designee as a condition of approval to self-haul.

F. Failure to comply with the provisions of this section may lead to revocation of approval to self-haul, at the Director’s sole discretion, and enforcement procedures pursuant to Section 8.04.360.

8.04.260 Collection and disposal of solid waste—Charges and rates.

The charges or rates that persons, firms, or corporations authorized by contract to collect and dispose of residential discarded materials, multi-family discarded materials, and commercial discarded materials within the City may charge shall be established from time to time by resolution of the City Council of the City. The charges or rates for other solid waste collection services, including industrial waste collection and commercial recyclable material collection, shall be established by the collector. 1266
28 8.04.270 Commercial recyclable material collectors—Permit required.

It is unlawful for any person, firm, or corporation to collect commercial recyclable materials and/or organic materials, at the Director’s sole discretion, within the City without first having obtained a permit to do so from the Public Works Director and a business license therefor from the Administrative Services Officer. The fee for said permit and license shall be established from time to time by resolution of the City Council. Said permit or license shall expire on May 30 of each year and must be renewed annually on or before said date.

8.04.280 Commercial recyclable material collectors.

Persons, firms or corporations licensed as commercial recyclable material and/or organic material collectors are hereby authorized to collect recyclable materials and/or organic materials, as licensed, from commercial and industrial customers within the City, provided that the collector complies with SB 1383 regulations and other applicable law.

8.04.290 Industrial waste collectors—Permit required.

The fee for the issuance of said permit shall be the sum of one hundred thousand dollars ($100,000.00), or another amount determined by City Council. Any such permit issued pursuant to this section shall not be transferable to another person, firm, or corporation, and in the case of corporations the permit shall become void whenever there may occur a transfer of the majority interest in said corporation. Said permit or license issued prior to May 30, 2019, shall expire on December 31, 2024. This constitutes the City’s five (5) year notice that may or may not be required under Public Resources Code Section 49520. Permitted industrial waste collectors shall comply at all times with applicable law related to its operations including, but not limited to, SB 1383.

Industrial waste collectors, upon request of City, shall provide documentation of compliance as a condition of permit approval.

8.04.300 Industrial waste collector—Permit fee and AB 939 fee.

A. In addition to the initial permit fee mentioned in Section 8.04.290, for the privilege to provide service pursuant to permit, the industrial waste collector shall pay to the City eighteen and one-half percent (18.5) percent of the gross revenue collected for performing industrial waste collection services. The industrial waste collector shall also pay to the City an AB 939 fee equal to five (5) percent of gross revenue collected for performing industrial waste collection services.
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29 B. For the purpose of this section only, no such additional fee will be due and payable to City for revenues derived from the direct or indirect sale of reclaimed solid waste or its derivatives. However, this provision shall not be construed to exempt revenue from any element of the services to collect such industrial waste.

D. The industrial waste collector shall, from the sources of revenue available to the collector through the granting of the permit, pay all fees and charges due the City as provided for in this section. A five (5) percent penalty shall apply to a delinquent payment for the first month, and a one (1) percent penalty shall be added for each succeeding month thereafter until the delinquent balance is paid in full.

E. Permit holders of industrial waste collector permits issued prior to May 30, 2019, shall also pay to the City eighteen and one-half (18.5) percent of the gross revenue collected for performing industrial waste collection services and shall also pay an AB 939 fee equal to five (5) percent of gross revenue collected for performing industrial waste collection services.

8.04.310 Industrial waste collector—Diversion requirement.

A. For materials regulated under Chapter 8.28, the industrial waste collector shall divert from disposal the percentage specified in Chapter 8.28.

8.04.320 Industrial waste collector—Financial reports to City.

B. Annually, the industrial waste collector shall provide the City with one (1) electronic copy and three (3) printed copies of its annual audited financial statements prepared by an independent certified or public accountant. The statements shall be prepared by the independent auditor in conformance with accepted accounting principles. Such statements shall be provided to the City within one hundred twenty (120) days after the close of the collector’s fiscal year. The financial statements shall clearly indicate all gross revenues collected for industrial waste collection services within the City and confirm that the collector has paid to the City eighteen and one-half (18.5) percent of the gross revenue collected for performing industrial waste collection 1268
30 services and an AB 939 fee of five (5) percent of gross revenue collected for performing industrial waste collection services. The City shall insist that the financial statements do not reflect any other business activities that are carried on by the collector in any other area or jurisdiction other than the City. The City reserves the right to request, and the industrial waste collector shall provide, any additional documentation, itemization, or detail as requested by City to verify any amounts reported in monthly revenue reports and annual financial statements.

8.04.330 Regulations—Commercial discarded materials collectors and industrial waste collectors.

Every vehicle used for the collection of commercial discarded materials, waste matter, or industrial waste shall have a metal-lined body and be covered or operated so as to prevent the contents from falling, spilling, leaking, blowing, or dripping there from.

8.04.340 Commercial recyclable material collectors and industrial waste collectors—Reports to City.

C. Every commercial recyclable materials collector, industrial waste collector, and permit holder shall additionally comply with all reporting requirements set forth under its agreement, contract, permit, or other written direction from the City. The subject of such reports may include, but are not limited to, operational, financial, or programmatic information and shall be submitted in a manner and timeline specified by the Director or its designee.

8.04.345 Model water efficient landscaping ordinance requirements.

A. Property owners or their building or landscape designers, including anyone requiring a building or planning permit, plan check, or landscape design review from the City, who are constructing a new (single-family, multi-family, public, institutional, or commercial) project with a landscape area greater than five hundred 1269
31 (500) square feet, or rehabilitating an existing landscape with a total landscape area greater than two thousand five hundred (2,500) square feet, shall comply with Sections 492.6(a)(3)(B) (C), (D), and (G) of the MWELO September 15, 2015 requirements.

Other requirements of the MWELO are in effect pursuant to Section 16.56.040 of the Stockton municipal code.

8.04.350 Public Works Director—Duties.

A. The Public Works Director shall monitor and provide overall direction for the collection and disposal of discarded materials, waste matter, and industrial waste operations in the City. The Public Works Director, or Director’s authorized representatives, shall receive and investigate all complaints, including complaints from persons regarding an entity that may be potentially non-compliant with SB 1383 regulations, and endeavor to improve and extend the discarded materials, waste matter, and industrial waste collection services. In the absence of other regulations, the Public Works Director shall have the power to determine and set the hours of collection, manner of collection, and such other regulations as may be necessary to insure an orderly program for the collection, transportation, and disposal of discarded materials, waste matter, and industrial waste in order to promote the community welfare, convenience, health, and safety. All disputes between collectors and producers concerning charges, service, or any other matter not otherwise delegated shall be decided by the Public Works Director, or Director’s authorized representative. The Public Works Director, or Director’s authorized representative, is hereby directed and empowered to enforce the provisions set forth herein and he or she shall have the right to enter all premises or vehicles for the purpose of making any inspection or investigation that he or she may deem necessary under the provisions hereof.

B. In the event an industrial establishment is unable to secure the services of any permitted industrial waste collector, the Public Works Director may assign a permittee to service that particular establishment at a reasonable rate to be determined by the Public Works Director.

C. An industrial waste collector shall allow access to its records of customers served by said collector, when requested by the Public Works Director, provided, however, said records shall be held confidentially by said Director and not subject or open to public inspection, except as otherwise required by applicable law. 1270
32 8.04.355 Inspections.

A. The Director and their designees are authorized to conduct inspections and investigations, at random or otherwise, of any collection container, collection vehicle loads, or transfer, processing, or disposal facility for materials collected from generators or source separated materials to confirm compliance with this chapter by regulated entities such as generators, responsible parties of commercial businesses, responsible parties of multi-family premises, commercial edible food generators, haulers, self-haulers, food recovery services, and food recovery organizations, subject to applicable laws. This Section does not allow City to enter the interior of a private residential property for inspection. For the purposes of inspecting commercial businesses’ or multi-family premises’ containers for compliance with this chapter, City may utilize remote monitoring or other technologies at the Director’s discretion.

D. The Director and their designee(s) are authorized to conduct any inspections or other investigations as reasonably necessary to further the goals of this chapter, subject to applicable laws.

8.04.360 Violations, enforcement and appeal.

B. The Public Works Director and their designees including, but not limited to, county agency enforcement officials, as applicable, are hereby authorized to issue citations to owners and/or occupants of property for violations of the provisions of this chapter. (Prior code § 7-051.18)
C. Process for Enforcement
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33 1. The Director and/or their designee(s) will monitor compliance with this chapter randomly and through compliance reviews, route reviews, investigation of complaints, and an inspection program. This chapter establishes City’s right to conduct inspections and investigations.

D. Penalty Amounts

1. The penalty levels for enforcement for violations of Sections 8.04.020,

8.04.035, 8.04.036, 8.04.195, 8.04.196, 8.04.250, and/or 8.04.255 shall be in accordance with 14 CCR Section 18997.2.

2. The penalty levels and other available remedies for enforcement for violations of all other sections of this chapter shall be handled in accordance with Title 1 of the Stockton Municipal Code.

1. Acts of God such as earthquakes, wildfires, flooding, and other emergencies or natural disasters;

2. Delays in obtaining discretionary permits or other government agency approvals; or,
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34 3. Deficiencies in organic waste recycling infrastructure or edible food recovery capacity while the City is under a corrective action plan with CalRecycle pursuant to 14 CCR Section 18996.2 due to those deficiencies.

8.04.250, and/or 8.04.255, it shall document the noncompliance or violation, issue a notice of violation, and take enforcement action pursuant to this section, as needed.

SECTION II. AMENDMENT OF CODE
Title 8, Chapter 8.28 of the Stockton Municipal Code is amended and shall read as follows:

Chapter 8.28 CONSTRUCTION AND DEMOLITION DEBRIS WASTE REDUCTION

8.28.010 Findings.

The State through its California Waste Management Act of 1989, Assembly Bill 939 (AB 939), requires that each local jurisdiction in the State divert 50 percent of discarded materials (base year 1990, State methodology) from landfill. 1273
35 The State through its California Green Building Standards Code, 24 CCR, Part 11 (CALGreen) sets minimum diversion standards and establishes other requirements related to handling of construction and demolition debris.

The City could face fines up to $10,000.00 a day for not meeting the above mandated AB 939 goals and SB 1383 program requirements.

Construction and demolition debris constitutes a large portion of the waste stream in the City. These materials have significant potential for waste reduction and recycling.

The City finds that reusing and recycling construction and demolition debris is essential to further the City’s efforts to reduce waste and comply with AB 939 and SB 1383.

Reusing construction and demolition debris has proven to reduce the amount of such material from landfills, increase site and worker safety, and be cost effective.

8.28.020 Purpose.

The general purpose of these regulations is to establish and maintain a program to reduce the amount of construction and demolition waste generated within the City that is disposed in landfills. This chapter sets a waste diversion requirement for construction and demolition debris generated at project sites be reused, recycled or otherwise processed to divert such materials from disposal in landfills. Any party that undertakes a construction, demolition, or renovation project by applying for City permits is responsible for meeting the construction and demolition debris waste diversion requirement.

8.28.030 Definitions.

For the purpose of this chapter, the following definitions shall apply:

City-Sponsored Projects. All City-sponsored construction, demolition and renovation projects shall be considered covered projects for the purpose of this chapter and shall submit a construction/demolition recycling plan prior to beginning any construction or demolition activities, and shall be subject to all applicable provisions of this chapter.
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36 “Commercial recyclable material collector” means a person, firm or corporation that is licensed by the City for the purpose of providing recyclable material collection service within the City limits, and is required to comply with SB 1383 regulations and other applicable law.
“Construction” and “new construction” means the building and/or modification of any facility or structure or any portion thereof including any tenant improvements to an existing facility or structure.
“Construction and demolition debris” has the same meaning as construction and demolition debris as defined in Chapter 8.04.
“Construction/demolition recycling plan” means a form the permit applicant must submit to the City at the time the permit applicant seeks permits to undertake a construction, demolition and renovation project within the City. The construction/demolition plan is intended to identify the types of materials that will be generated by the project, and how those materials will be transported and disposed. “Construction/demolition recycling report” means a form the permit applicant must submit to the City at the conclusion of a construction, demolition and renovation project.

The construction/demolition recycling report is intended to document the types and quantities of materials that were recycled or reused, and the quantities of materials that were finally disposed at a landfill. The permit applicant must complete the form and submit it for review and approval by the City for the purpose of compliance with this ordinance. “Covered projects” refers to all construction, demolition and renovation projects covered by the scope of the California Green Building Standards Code, 24 CCR, Part 11, known as CALGreen, as amended.
“Divert” means to use material for any purpose other than disposal in a landfill. “Industrial waste collector” means a person, firm or corporation that is licensed by the City for the purpose of providing collection and disposal of industrial waste within the City limits.
“Non-covered projects” refers to all construction, demolition and renovation projects within the City, regardless of the actual or projected cost of the project. For purposes of this regulation, all permit applicants must submit a completed (1) construction/demolition recycling plan and (2) construction/demolition recycling report for review during the permit process.
“Permit applicant” means any individual, firm, limited liability company, association, partnership, political subdivision, government agency, municipality, industry, public or private corporation, or any other entity whatsoever who applies to the City for the applicable permits to undertake any construction, demolition, or renovation project within the City.
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37 “Review Official” means the designated staff persons assigned by the Public Works Director and responsible for implementing and managing this chapter. The Review Official will determine the sufficiency of recycling plans and reports submitted by permit applicants, and either approve or deny a permit based on the review of the forms, documentation, and information provided.
“Self-haul” means the act of transporting debris generated by a construction, demolition or landscape contractor, or an individual performing construction, demolition or landscape work at a covered project site or a non-covered project site and using his or her own vehicle to deliver such debris to a permitted disposal site or recycling facility. “Waste diversion requirement” means the diversion minimum for construction and demolition debris generated by a covered project in accordance with California Green Building Standards Code (24 CCR, Part 11), as amended.

8.28.040 Permit applicant and City responsibilities.

1. Obtain from the City a C&D permit packet, which contains the required forms and other resource information needed to comply with waste diversion requirement for a covered project.

2. Complete and submit the construction and demolition recycling plan at the time of permit application.

3. Complete and submit the construction and demolition recycling report and related receipts and weight tickets within 14 days of final clean up of a covered project site.

4. Meet the waste diversion requirement for the covered project.

5. Comply with the requirements of the California Green Building Standards Code (24 CCR, Part 11), as amended, or more stringent City requirements as applicable.

C. Permit applicants of a non-covered project are responsible to do the following:
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38 1. Obtain from the City a C&D permit packet, which contains the required forms and other resource information needed to comply with the waste diversion goals of the City for any construction, demolition and renovation project within the City.

2. Complete and submit the construction and demolition recycling plan at the time of permit application.

3. Complete and submit the construction and demolition recycling report and related receipts and weight tickets within 14 days of final clean up of a non-covered project site.

D. The City Review Official is responsible for the following:

1. Provide assistance and information requested by the permit applicant in completing the required forms.

2. Review submitted forms in a timely manner and notify the permit applicant regarding any discrepancies and/or missing documentation.

3. Notify appropriate City staff if a permit applicant has met the waste diversion requirement of a project.

4. Require a hold on the project if the permit applicant has not complied with the requirements of this C&D chapter.

8.28.050 Construction and demolition debris collection.

B. A construction contractor or subcontractor or landscape contractor may selfhaul and recycle or dispose of debris from a construction or demolition or landscaping site at which the contractor is performing work, provided that the contractor utilizes its own personnel and equipment and transports debris while performing its own work. Any debris collected on site through general clean-up operations, whether periodically or at the completion of a project, may not be transported and disposed by a third party, unless that third party has secured a necessary solid waste hauling permit from the City (and is therefore registered as an industrial waste collector or a commercial recyclable material collector). The City will provide a list of all industrial waste collectors and commercial recyclable material collectors authorized to collect construction and demolition debris from project sites within the City when it issues the C&D permit packet for the project. 1277
39 8.28.060 Construction and demolition recycling requirements.

A. All permit applicants of covered projects or non-covered projects shall identify the types of materials expected to be generated as a result of the construction, demolition or renovation project at the time of the permit application. Permit applicants for covered project are required to meet the waste diversion requirement established by this chapter for materials generated as discards by the project, regardless of whether the permit applicant performs the work or hires contractors, subcontractors or others to perform the work.

8.28.070 City remedies for noncompliance.

A. Issue a stop work order on the construction and/or other permits pertinent to the covered project until the project applicant has submitted all required forms and documentation; and/or
B. Issue penalties and conduct enforcement action in accordance with Section

8.04.360 for violations of activities regulated under Chapter 8.04 or 14 CCR Section 18989.1.

8.28.080 Appeal.

SECTION III. SEVERABILITY
If any section of this ordinance or the application thereof to any person or circumstance is held invalid, the invalidity shall not affect other provisions or applications 1278
40 of the act which can be given without the invalid provisions or application, and to this end the provisions of this act are severable.

SECTION IV.EFFECTIVE DATE
The Ordinance shall take effect and be in full force thirty (30) days after its passage.

ADOPTED: ___________________
EFFECTIVE: ___________________
___________________________
KEVIN J. LINCOLN, II
Mayor of the City of Stockton
ATTEST:
______________________________
ELIZA R. GARZA, CMC
City Clerk of the City of Stockton
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City of Stockton
June 14, 2022Agenda Item 15.2SB 1383 ORDINANCE
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SB 1383 STATEWIDE EMISSIONS REDUCTION TARGETS
2 50%
75%
Edible Food
Recovery
Reduction of
Organic Waste to
Landfill
Reduction of
Organic
Waste to
Landfill
20%
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SB 1383 REGULATIONS: LOCAL ORDINANCE
By January 1, 2022, jurisdictions are required to adopt enforceable ordinance(s), or similarly enforceable mechanisms to “mandate that organic waste generators, haulers, and other entities subject to the requirements of [SB 1383 regulations] that are subject to the jurisdiction’s authority comply with the requirements of this chapter.” (14 CCR Section 18981.2)A CalRecycle grant of nearly $422,000 is contingent on the passage of the SB 1383 ordinance by June 14, 2022. 1282
SB 1383 ORDINANCE REQUIREMENTS
Regulated Entities SB 1383 RequirementsSingle-Family Generators Subscribe to recycling and organics collection services.Place materials in proper container.

Multi-Family Generators
Subscribe to recycling and organics collection services, unless granted a waiver. Place materials in proper container.Annually educate tenants on proper sorting.

Commercial Generators (Excluding Multi-Family)
Subscribe to recycling and organics collection services, unless granted a waiver. Place materials in proper container.Annually educate employees on proper sorting.Provide SB 1383 compliant containers for customers.Monitor contamination of business’s containers. 1283
SB 1383 ORDINANCE REQUIREMENTS (CONTINUED)
Regulated Entities SB 1383 RequirementsCommercial Edible Food Generators Recover surplus edible food and have a contract in place with a food recovery organization or service. Keep monthly records.

Food Recovery Organizations and Services
Record and report quantity and source of food recovered.

Haulers and Facility Operators
Transport recycling and organics to facilities that comply with SB 1383. Recordkeeping and reporting requirements.

Self-Haulers Sort recycling and organics, and deliver materials to SB 1383 compliant facilities. Recordkeeping requirements. 1284
ADDITIONAL SB 1383 REQUIREMENTS
 Procurement policies for purchasing recycled content paper and meeting a procurement target for organic waste products (compost, mulch, renewable natural gas, and electricity from biomass)o City to meet requirements through an update to Purchasing Policy  Adopt an ordinance addressing specific sections of the State Model Water Efficient Landscaping Ordinance (MWELO) identified by SB 1383 and CALGreeno Relevant chapters modified 1285

ADDITIONAL MUNICIPAL CODE UPDATES
 Updates to align with terms of most recent franchise agreement Updates to industrial waste permitting process to align with current practice
1286

RECOMMENDATION TO COUNCIL
Introduce and pass an ordinance amending Title 8, Chapters 8.04 and 8.28 of the Stockton Municipal Code relating to the collection of organic materials. 1287
City of Stockton
Legislation Text
File #: 22-0303, Version: 1

ADOPT RESOLUTION AUTHORIZING THE ISSUANCE OF SPECIAL TAX BONDS FOR AND ON BEHALF OF IMPROVEMENT AREA 2 OF THE CITY OF STOCKTON COMMUNITY FACILITIES DISTRICT NO. 2018-2 (WESTLAKE VILLAGES II), APPROVE AND DIRECT THE EXECUTION OF

A FISCAL AGENT AGREEMENT, APPROVE THE FORM OF PRELIMINARY OFFICIAL

STATEMENT, APPROVE SALE OF SUCH BONDS, AND APPROVE OTHER RELATED

DOCUMENTS AND ACTIONS

RECOMMENDATION
It is recommended that City Council adopt a resolution to authorize the issuance and sale of Special Tax Bonds, payable from Special Taxes, for and on behalf of Improvement Area 2 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) in the estimated amount of $10,625,000 (not-to-exceed $12,500,000), and direct the execution of a Fiscal Agent agreement, approve the bond sale, and approve all necessary actions and documents in connection with the issuance.

Summary
The City Council established the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) (the “District”) on June 19, 2018, to provide financing for the acquisition of a portion of the public infrastructure improvements for the District. The original boundary map for Westlake Villages II included two improvement areas, Improvement Area 1 and Improvement Area 2, and the City issued two series of bonds totaling $13.505 million for Improvement Area 1 in 2020 and 2021. On Dec 7, 2021, council adopted a resolution to reduce the size of the original Improvement Area 2 to facilitate the creation of two new improvement areas-Improvement Area 3 and Improvement Area 4.

Development of Improvement Area 2 is sufficiently advanced to support a bond issue for this phase of the development. Approval of the Resolution authorizes the issuance of special tax bonds for Improvement Area 2 of the Westlake Villages II Community Facilities District in the estimated amount of $10,625,000 and a not-to-exceed amount of $12,500,000 (with the actual principal amount being a factor of market conditions at the time of sale). This bond issue will reimburse the developer for the cost of improvements in Improvement Area 2 of the District, consisting primarily of flood control infrastructure, arterial and lateral streets, sidewalks, street lighting, landscaping, and water and sewer infrastructure including hookups, and parks and bike paths. The current issue is expected to represent the only bond issuance for Improvement Area 2.

DISCUSSION
Background
The City Council established the District in June 2018 to provide the funding necessary for the City of Stockton Page 1 of 5 Printed on 6/8/2022
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acquisition of certain public infrastructure improvements authorized for the District. The District was split off from CFD 2006-2, which had lain dormant after the first 322 homes out of 2,622 planned had been built. CFD 2018-2 (Westlake Village II) is comprised of the remaining 580 acres of the original roughly 855 gross acres of contiguous parcels that made up the CFD 2006-2 district in North Stockton, South of Eight Mile Road and West of Interstate 5, just east of White Slough and the Delta.

The District is planned to house 2,198 homes ranging in size from 1,400 to 3,500 square feet, and when fully developed will include a master-planned portion dedicated to 55+ living, multiple neighborhood parks, a school site, and a series of artificial lakes to aid in flood control. It is bounded on the west by Bishop Cut, on the north by Eight Mile Road, on the east by Regatta Lane (which separates the remaining development from the existing Spanos West CFD, and the initial homes built in the original Westlake Villages CFD), and on the south by Disappointment Slough.

The City formed CFD No. 2018-2 (Westlake Villages II) via Resolution 2018-06-19-1501, authorized special taxes to pay for associated services and public facilities, and moved undeveloped parcels from CFD 2006-2 into the new district. On February 4, 2020, a revision to Improvement Area 1 within the District was approved, which decreased the size of Improvement Area 1 and increased the area of Improvement Area 2 (via Resolution 2020-02-04-1501).

Two issues of bonds, totaling $13,505,000, were issued in 2020 and 2021 to acquire public infrastructure in Improvement Area 1.

On December 7, 2021, Council adopted a Resolution of Consideration to begin the process of changing the boundary map to reduce the size of Improvement Area 2 and create Improvement Areas 3 and 4 out of the remaining area of Improvement Area 2. This process was concluded on January 11, 2022, after a public hearing and landowner election process.

During the process of creating Improvement Areas 3 and 4 out of a reduction in Improvement Area 2, the original $60 million bonding capacity for Improvement Area 2 was left unchanged, as only documents related to the liens for the new Improvement Areas were recorded. As part of this issuance, the lien on Improvement Area 2 is being closed off and no further issuances will be permitted in this improvement Area.

Present Situation
All of the 292 residential lots in Improvement Area 2 have been completed and most of the improvement area’s off
‐
site improvements are in place, including paved access and public utilities.

The balance of offsite improvements, including parks, are anticipated to be completed in the near term. As of April 15, 2022, 56 homes were under construction.

The special taxes for facilities will commence in FY 2022-23 for all 93 “developed” homes (those having had building permits pulled as of May 1, 2022), with the remaining final mapped parcels being taxed at a reduced rate in the first year to enable merchant builders additional time to market and sell homes prior to full taxes being instituted in FY 2023-24. Beginning in FY 2023-24 all parcels (regardless of development status) will be assessed for the facilities tax. The facilities tax will continue until all of the bonds mature, expected to be in FY 2052-53.

The special tax is expected to provide approximately $659,000 annually as of FY 2023-24 (the first City of Stockton Page 2 of 5 Printed on 6/8/2022
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year in which all property will be taxed), which will finance administrative charges, debt service, and provide for an additional 10% of taxing capacity to produce the debt service coverage required by investors. The tax and the revenues produced will escalate by 2% annually. First-year debt service will be partially paid out of bond proceeds (“capitalized interest”) to give ample opportunity for merchant builders to market as many homes as possible before being subject to the special tax.

A second special tax for services will be levied starting in FY 2023-24, which has no expiration date.

Financing Team
The financing team consists of representatives from the appropriate City vendor pools:
· Municipal Advisor: KNN Public Finance LLC (Resolution No. 2017-05-25-1102) · Bond Counsel: Jones Hall (Resolution No. 2018-05-15-1102) · Underwriter: Brandis Tallman LLC (Resolution No. 2017-07-25-1101) · Fiscal Agent: US Bank National Association
Legal Authority and Procedures
The Special Taxes levied in the District are captured on the property tax bill and treated the same as other taxes such as the ad valorem, general obligation bonds for schools and other overlapping assessments and special taxes from other jurisdictions. Should a property owner become delinquent on any portion of their tax bill, the property is subject to accelerated judicial foreclosure, and the amount of lien on the property associated with the special taxes can be paid from proceeds of any foreclosure action. This process provides security to the bondholders.

Schedule
If approved by the City Council, the transaction schedule is as follows:

Timeline Item
Week of June 13th Post Preliminary Official Statement
Week of June 20th Pre-market bonds
Week of June 27th Price bonds
Week of July 11th Pre-closing, closing and transfer of funds Documents for Consideration
Fiscal Agent Agreement: This Agreement governs the terms and conditions of the bonds and the role and responsibilities of the Fiscal Agent. It also includes the covenants of the City concerning the levy of the special tax, foreclosure of delinquent parcels and related matters.

Preliminary Official Statement: This is the offering document provided to investors that provides all material information related to the proposed bonds and the District. This document includes a Continuing Disclosure Certificate, which is the document detailing what ongoing information will be provided to investors.

City of Stockton Page 3 of 5 Printed on 6/8/2022
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Bond Purchase Agreement: This document details the agreement related to the terms of the negotiated sale of the bonds to the underwriter and the conditions for closing the bond issue.

Construction and Acquisition Agreement: This agreement entered into in 2019 during issuances in Improvement Area 1 will be applicable throughout all Issuances in the CFD. It lays out a list of improvements that may be financed from bond proceeds once accepted and acquired by the City after completion. The Council has previously approved this agreement with the Westlake II developer.

FINANCIAL SUMMARY
There is no impact to the City’s General Fund or any other unrestricted fund as a result of taking the recommended action. There will be sufficient special taxes placed on the tax roll for FY 2022-23 to pay the portion of first year debt service on the bonds not paid out of capitalized interest. Final sizing of the bond issue will ensure that tax proceeds are sufficient to account for City administrative fees and coverage beyond actual debt service requirements. Bond investors take the risk that, if delinquencies exceed 10% and the funded debt service reserve is depleted, there may not be sufficient funds to pay debt service when due.

This CFD issuance is reported in a custodial fund that does not report revenues and expenditures.

For this reason, adoption of this resolution approves the costs related to the transaction, which include those costs shown in the good faith estimate. The estimated costs of issuance are $382,000, which include fixed costs for the fees and expenses of bond counsel, underwriter, municipal advisor, fiscal agent, and the City’s administrative fee of approximately $66,250. Other costs, including that of the appraiser and the absorption consultant, will be paid directly out of funds deposited by the developer.

SB 450 Compliance (“Good Faith Estimates”)
In compliance with state law (Government Code 5852.1), a good faith estimate related to the proposed bonds is attached. The good faith estimates have been provided to the City by the Municipal Advisor. Each estimate is based on the City’s financing plan, estimates of costs, and current market conditions, including market interest rates prevailing at the time of preparation of the estimate.
· Principal Amount-the estimated aggregate principal amount of the bonds to be sold is $11,270,000.
· True Interest Cost-the estimated true interest cost of the bonds, which means the rate necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received for the bonds, is 5.3%. · Finance Charge-the estimated finance charge for the bonds, which means the sum of all fees paid to third parties (or costs associated with the bonds), is estimated at $382,065. · Amount of Proceeds to be Received-the estimated amount of proceeds to be received by the City from the sale of the bonds, less the finance charge of the bonds, as estimated above, and less estimated reserves and capitalized interest, is $9,408,570. · Total Payment Amount-the estimated total payment amount, which means the total of all payments to pay debt service on the bonds, plus the finance charge for the bonds, as City of Stockton Page 4 of 5 Printed on 6/8/2022
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described above, not paid with the proceeds of the bonds, calculated to the final maturity of the bonds, is $21,444,260.

These estimates are good faith estimates only. The actual figures will differ due to:
· Differences between assumptions regarding the date of the sale of the bonds, the principal amount of bonds sold, the amortization of the bonds, and market interest rates at the time of sale of the bonds
· Other market conditions
· Changes in the City’s financing plan
Attachment A - Description of Documents Being Approved and Terms Used City of Stockton Page 5 of 5 Printed on 6/8/2022
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ATTACHMENT A
Description of Documents Being Approved and Terms Used
Bond Purchase Contract - Is a contract between the City and the Underwriter that provides the terms and conditions under which the underwriter will purchase the Series 2022 Bonds.

Continuing Disclosure Certificate - Is required under Securities and Exchange Commission Rule 15c2-12 (“Rule”) and is a written agreement issued in connection with the issuance of bonds requiring the City to provide annual reports (containing certain financial or operating data relating to the City’s water system) and to provide notice of certain events required by the Rule.

Construction and Acquisition Agreement – The developer is required to place certain infrastructure as a condition of development approval. This document lays out a list of improvements that may be financed from bond proceeds once accepted and acquired by the City after completion.

Fiscal Agent Agreement – Is a legal agreement between the bond fiscal agent and the City concerning the handling of all funds arising out of a municipal bond issuance. This document describes how the Fiscal Agent acts out of a fiduciary responsibility to protect bondholder interests, including default provisions and remedies, use of project funds, and use of reserve funds.

Net Present Value - Presents actual annual cash flow savings discounted to a current value Net Present Value Savings - Generally net present value savings in excess of 3.00% are considered significant. The Government Finance Officers Association, in their best practices white paper titled “Analyzing and Issuing Refunding Bonds” from February 2011, reports that “one test often used by issuers to assess the appropriateness of a refunding is the requirement specifying the achievement of a minimum net present value (NPV) savings. A common threshold is that the savings (net of all issuance costs and any cash contribution to the refunding), as a percentage of the refunding bonds exceeds 3-5%.” The City Debt Policy uses 3% NPV savings as a guideline.

Not-To-Exceed Amount - The City Council and Authority are being asked to approve the issuance in an amount “not-to-exceed” $12,500,000. The amount of issuance is currently estimated at a par amount of $10,625,000, however, sizing may differ due to investor preference. The tradeoff is higher interest rates with a lower issue size (premium pricing) or lower interest rates with a higher issue size (discount pricing). The overall goal is to market to the entire range of buyers and demand will determine the final interest rates and yields with the goal to maximize refunding savings.

Official Statement - Is a document used by the financial community to make investment decisions.

It describes the essential terms of the bonds, including whether and on what terms the bonds can be redeemed prior to maturity the sources pledged to repay the bonds, the issuer’s covenants for the benefit of investors and risk associated with the investment.

Preliminary Official Statement (“POS”) - The POS is the form of the Official Statement that must be approved by the issuers governing board. It is used to market the bonds prior to final sale and determination of final rates and sizing, which will be included in the Final Official Statement prepared after the sale and closing of the bonds (typically a two-week period). 1293
Resolution No.

STOCKTON CITY COUNCIL

RESOLUTION AUTHORIZING ISSUANCE OF SPECIAL TAX BONDS FOR AND ON BEHALF OF IMPROVEMENT AREA 2 OF THE CITY OF STOCKTON COMMUNITY FACILITIES DISTRICT NO. 2018-2 (WESTLAKE VILLAGES II), APPROVING AND

DIRECTING THE EXECUTION OF A FISCAL AGENT AGREEMENT, APPROVING

THE FORM OF PRELIMINARY OFFICIAL STATEMENT, APPROVING THE SALE OF

SUCH BONDS, AND APPROVING OTHER RELATED DOCUMENTS AND ACTIONS The City Council (the “Council”) of the City of Stockton (the “City”) has conducted proceedings under and pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, Chapter 2.5 of Part 1 of Division 2 of Title 5, commencing at section 53311, of the California Government Code (the “Act”), to form (i) City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) (the “CFD”), (ii) Improvement Area 1 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) (“Improvement Area 1”), and (iii) Improvement Area 2 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) (“Improvement Area 2” and together with Improvement Area 1, the “Improvement Areas”), to authorize the levy of special taxes upon the land within the Improvement Areas, and to issue bonds secured by said special taxes for the purpose of providing moneys for the construction and acquisition of authorized improvements for the District; and
Subsequent to the initial formation of the District, the Council adopted (i) “Resolution Ordering Change to Rate and Method for Improvement Area No. 1 and 2 and Adjusting Improvement Area Boundaries for a Community Facilities District and Directing Recording of Notice of Special Tax Lien,” Resolution No. 2020-02-04-1501, on February 4, 2020, officially reforming the boundaries of Improvement Area No. 1 and Improvement Area No. 2 and amending the Rate and Method of Apportionment of Special Tax for Improvement Area 1 and Improvement Area 2, and (ii) “Resolution Ordering Changes Affecting Certain Parcels Within Improvement Area 2 of Community Facilities District No. 2018-2 (Westlake Villages II), Establishing Improvement Area 3 and Improvement Area 4 in the District, and Directing Recording of Amended Notice of Special Tax Lien,” Resolution No. 2022-01-11-1601, on January 11, 2022, officially reforming the boundaries of Improvement Area No. 2, all pursuant to the Act; and The Council, as legislative body of the District, authorized the issuance of special tax bonds of the City for Improvement Area 2 in the maximum principal amount of not to exceed $60,000,000 (the “Bond Authorization”), and the Council, as legislative body of the District, now desires to issue the first and only planned series of “new money” bonds for Improvement Area 2 (the “Bonds”), as further detailed in the Fiscal Agent Agreement approved herein; and
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The Council, as legislative body of the District, has obtained and disclosed all of the information required to be obtained and disclosed related to the Bonds under section 5852.1 of the California Government Code in the staff report accompanying this Resolution; and
There has been submitted to the Council a Fiscal Agent Agreement (the “Fiscal Agent Agreement”) (attached as Exhibit 1), between the City and Computershare Trust Company, N.A., as fiscal agent, providing for the issuance and terms of the Bonds, and the Council, with the aid of City staff, has reviewed the Fiscal Agent Agreement and found it to be in proper order, and now desires to approve the Fiscal Agent Agreement, the issuance of the Bonds and the execution of those and related documents; and The City proposes to sell the Bonds to Oppenheimer & Co. Inc., as underwriter (the “Underwriter”), pursuant to the terms of a Bond Purchase Agreement by and between the City and the Underwriter, and the Underwriter proposes to offer the Bonds to the investing public by means of a Preliminary Official Statement, and the Council, with the aid of City staff, has reviewed the Bond Purchase Agreement (attached as Exhibit 2) and the Preliminary Official Statement (attached as Exhibit 3) and found them to be in proper order, and now desires to approve said documents; and
All conditions, things and acts required to exist, to have happened and to have been performed precedent to and in the issuance of the Bonds as contemplated by this Resolution and the documents referred to herein exist, have happened and have been performed in due time, form and manner as required by the laws of the State of California, including the Act; now, therefore,

BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF STOCKTON, AS FOLLOWS:

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

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

3. Pursuant to the Act, this Resolution and the Fiscal Agent Agreement, special tax bonds of the City for Improvement Area 2 of the District designated as “Improvement Area 2 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) Special Tax Bonds Series 2022” in an aggregate principal amount estimated at $10,625,000 (not to exceed $12,500,000) are hereby authorized to be issued. The Bonds shall be executed in the form set forth in, and otherwise as provided in the Fiscal Agent Agreement.
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4. The Bonds shall not be issued unless the value of the real property within Improvement Area 2 subject to the special tax to pay debt service on the Bonds, based on assessed values and/or an appraisal by an independent appraiser hired by the City for the purpose of determining such value, is at least three (3) times the proposed principal amount of the outstanding Bonds proposed to be issued and secured by a special tax levied pursuant to the Act on property within Improvement Area 2.

5. The Council hereby approves the Fiscal Agent Agreement and the terms therein, substantially in the form presented to the Council at this meeting. The City Manager, Chief Financial Officer or such other person or persons as any of them may designate (collectively, the “Authorized Officers”), each acting alone or together with any other Authorized Officer, are each hereby authorized and directed to execute the Fiscal Agent Agreement, for and in the name and on behalf of the City and Improvement Area 2 of the District, in such form, together with any additions thereto or changes therein deemed necessary or advisable by the Authorized Officer executing such document upon consultation with Jones Hall, A Professional Law Corporation, as bond counsel to the City (“Bond Counsel”). The proceeds of the Bonds shall be applied by the City for the purposes and in the amounts as set forth in the Fiscal Agent Agreement. The Council hereby authorizes the delivery and performance by the City of the Fiscal Agent Agreement.

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

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

8. The Council hereby approves the Bond Purchase Agreement in substantially the form on file with the City Clerk; provided, that the aggregate principal amount of Bonds 1296
shall not exceed $12,500,000 or result in an Underwriter’s discount in excess of 1.25%, or a true interest cost in excess of 7.00%. Subject to the foregoing parameters, an Authorized Officer is hereby authorized and directed to execute the Bond Purchase Agreement in substantially the form on file with the City Clerk, together with such changes and additions thereto deemed advisable by the Authorized Officer executing the same.

The Council hereby finds and determines that the sale of the Bonds at negotiated sale as contemplated by the Bond Purchase Agreement will result in a lower overall cost.

9. All actions heretofore taken by the officers, employees and agents of the City with respect to the establishment of the District and the Improvement Areas and the sale and issuance of the Bonds are hereby approved, confirmed and ratified, and the Authorized Officers of the City are hereby authorized and directed to do any and all things and take any and all actions and execute any and all certificates, agreements and other documents, which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the Bonds in accordance with this resolution, and any certificate, agreement, and other document described in the documents herein approved. All actions to be taken by a specified Authorized Officer as specified herein, may be taken by the Authorized Officer (including any person holding such office on an interim basis) or any designee, with the same force and effect as if taken by such Authorized Officer.

10. This Resolution shall take effect immediately upon its adoption.

11. The City Manager is hereby authorized to take whatever actions are necessary and appropriate to carry out the purpose and intent of this Resolution.

PASSED, APPROVED, and ADOPTED June 14, 2022 .

KEVIN J. LINCOLN II
Mayor of the City of Stockton
ATTEST:

ELIZA R. GARZA, CMC
City Clerk of the City of Stockton
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JONES HALL DRAFT of MAY 2, 2022 EXHIBIT 1

FISCAL AGENT AGREEMENT
by and between

CITY OF STOCKTON
and
U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION,
as Fiscal Agent
Dated as of _____________ 1, 2022
Relating to:
$_____________
Improvement Area 2 of the City of Stockton
Community Facilities District No. 2018-2 (Westlake Villages II) Special Tax Bonds
Series 2022
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EXHIBIT 1
i

TABLE OF CONTENTS

ARTICLE I

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

ARTICLE II
THE 2022 BONDS
Section 2.01. Principal Amount; Designation....................................................................................12 Section 2.02. Terms of the 2022 Bonds............................................................................................12 Section 2.03. Redemption.................................................................................................................13 Section 2.04. Form of Bonds.............................................................................................................16 Section 2.05. Execution of Bonds .....................................................................................................16 Section 2.06. Transfer of Bonds........................................................................................................16 Section 2.07. Exchange of Bonds .....................................................................................................17 Section 2.08. Bond Register .............................................................................................................17 Section 2.09. Temporary Bonds........................................................................................................17 Section 2.10. Bonds Mutilated, Lost, Destroyed or Stolen ...............................................................17 Section 2.11. Limited Obligation .......................................................................................................18 Section 2.12. Book-Entry Only System.............................................................................................18 Section 2.13. No Acceleration...........................................................................................................19

ARTICLE III

ISSUANCE OF BONDS
Section 3.01. Issuance and Delivery of Bonds .................................................................................20 Section 3.02. Application of Proceeds of Sale of 2022 Bonds..........................................................20 Section 3.03. Special Tax Fund ........................................................................................................20 Section 3.04. Improvement Fund......................................................................................................22 Section 3.05. Costs of Issuance Fund ..............................................................................................23 Section 3.06. Surplus Fund...............................................................................................................23

ARTICLE IV
PLEDGE OF NET TAXES; RESERVE FUND
Section 4.01. Pledge of Net Taxes and Other Amounts. ..................................................................25 Section 4.02. Reserve Fund..............................................................................................................25

ARTICLE V

OTHER COVENANTS OF THE CITY
Section 5.01. Punctual Payment .......................................................................................................28 Section 5.02. Limited Obligation .......................................................................................................28 Section 5.03. Extension of Time for Payment...................................................................................28 Section 5.04. Against Encumbrances ...............................................................................................28 Section 5.05. Books and Accounts ...................................................................................................28 Section 5.06. Protection of Security and Rights of Owners ..............................................................28 Section 5.07. Collection of Special Taxes; Transfer of Net Taxes....................................................29 Section 5.08. Covenant to Foreclose................................................................................................29 Section 5.09. Additional Bonds .........................................................................................................30 Section 5.10. Compliance with Law; Completion of Project .............................................................31 Section 5.11. Continuing Disclosure to Owners................................................................................31 Section 5.12. Private Activity Bond Limitation...................................................................................31 Section 5.13. Federal Guarantee Prohibition....................................................................................31 Section 5.14. No Arbitrage ................................................................................................................31 1299
EXHIBIT 1
ii
Section 5.15. Maintenance of Tax-Exemption ..................................................................................32 Section 5.16. Yield of the 2022 Bonds..............................................................................................32 Section 5.17. Annual State Reports..................................................................................................32 Section 5.18. Further Assurances.....................................................................................................32

ARTICLE VI
INVESTMENTS; DISPOSITION OF INVESTMENT PROCEEDS;

LIABILITY OF THE CITY
Section 6.01. Deposit and Investment of Moneys in Funds..............................................................34 Section 6.02. Rebate of Excess Investment Earnings to the United States .....................................35 Section 6.03. Limited Obligation .......................................................................................................35

ARTICLE VII

THE FISCAL AGENT
Section 7.01. Appointment of Fiscal Agent .......................................................................................36 Section 7.02. Liability of Fiscal Agent ...............................................................................................36 Section 7.03. Information ..................................................................................................................38 Section 7.04. Notice to Fiscal Agent .................................................................................................38 Section 7.05. Compensation, Indemnification...................................................................................39

ARTICLE VIII

MODIFICATION OR AMENDMENT OF THIS AGREEMENT
Section 8.01. Amendments Permitted ..............................................................................................40 Section 8.02. Owners’ Meetings .......................................................................................................40 Section 8.03. Procedure for Amendment with Written Consent of Owners ......................................41 Section 8.04. Disqualified Bonds ......................................................................................................41 Section 8.05. Effect of Supplemental Agreement .............................................................................41 Section 8.06. Endorsement or Replacement of Bonds Issued After Amendments ..........................42 Section 8.07. Amendatory Endorsement of Bonds ...........................................................................42 Section 8.08. Opinion of Counsel Regarding Supplemental Agreement ..........................................42

ARTICLE IX

MISCELLANEOUS
Section 9.01. Benefits of Agreement Limited to Parties ...................................................................43 Section 9.02. Successor is Deemed Included in All References to Predecessor.............................43 Section 9.03. Discharge of Agreement .............................................................................................43 Section 9.04. Execution of Documents and Proof of Ownership by Owners....................................44 Section 9.05. Waiver of Personal Liability.........................................................................................44 Section 9.06. Notices to and Demands on City and Fiscal Agent ....................................................44 Section 9.07. Partial Invalidity...........................................................................................................45 Section 9.08. Unclaimed Moneys......................................................................................................45 Section 9.09. Applicable Law............................................................................................................45 Section 9.10. Conflict with Act...........................................................................................................45 Section 9.11. Conclusive Evidence of Regularity .............................................................................45 Section 9.12. Payment on Business Day..........................................................................................45 Section 9.13. Counterparts ...............................................................................................................45

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

IMPROVEMENT FUND
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EXHIBIT 1
1 FISCAL AGENT AGREEMENT
THIS FISCAL AGENT AGREEMENT (the “Agreement”) is made and entered into as of _____________ 1, 2022, by and between the City of Stockton, California, a charter city and public body, corporate and politic, organized and existing under and by virtue of the Constitution and laws of the State of California (the “City”) for and on behalf of Improvement Area 2 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) (the “District”), and U.S. Bank Trust Company, National Association, a national banking association organized under the laws of the United States of America as fiscal agent (the “Fiscal Agent”).

W I T N E S S E T H :

WHEREAS, the City Council of the City has conducted proceedings under and pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, Chapter 2.5 of Part 1 of Division 2 of Title 5, commencing at section 53311, of the California Government Code (the “Act”) and Resolution No. 2018-06-19-1502-01 of the City Council adopted on June 19, 2018, to form (i) City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) (the “District”), (ii) Improvement Area 1 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) (“Improvement Area 1”), and (iii) Improvement Area 2 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) (“Improvement Area 2” and together with Improvement Area 1, the “Improvement Areas”), to authorize the levy of special taxes upon the land within the Improvement Areas, and to issue bonds secured by said special taxes for the purpose of providing moneys for the construction and acquisition of authorized improvements for the District; and
WHEREAS, subsequent to the initial formation of the District, the City Council adopted (i) “Resolution Ordering Change to Rate and Method for Improvement Area No. 1 and 2 and Adjusting Improvement Area Boundaries for a Community Facilities District and Directing Recording of Notice of Special Tax Lien,” Resolution No. 2020-02-04-1501, on February 4, 2020, officially reforming the boundaries of Improvement Area No. 1 and Improvement Area No. 2 and amending the Rate and Method of Apportionment of Special Tax for Improvement Area 1 and Improvement Area 2, and (ii) “Resolution Ordering Changes Affecting Certain Parcels Within Improvement Area 2 of Community Facilities District No. 2018-2 (Westlake Villages II), Establishing Improvement Area 3 and Improvement Area 4 in the District, and Directing Recording of Amended Notice of Special Tax Lien,” Resolution No. 2022-01-11-1601, on January 11, 2022, officially reforming the boundaries of Improvement Area No. 2, all pursuant to the Act; and
WHEREAS, the City Council, as the legislative body of the District, is authorized under the Act to levy special taxes to pay for the costs of facilities within the District and the Improvement Areas therein, and to authorize the issuance of bonds secured by said special taxes under the Act; and
WHEREAS, under the provisions of the Act, on _____________, 2022, the City Council of the City adopted its Resolution No. 2022-08-11-1401 (the “Resolution”), which resolution, among other matters, authorized the issuance of the Improvement Area 2 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) Special Tax Bonds Series 2022 to provide moneys for the construction and acquisition of improvements within the Improvement Area 2 and provided that said issuance would be in accordance with the Act and this Agreement, and authorized the execution hereof; and
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EXHIBIT 1
2 WHEREAS, it is in the public interest and for the benefit of the City, the District, the persons responsible for the payment of special taxes and the Owners of the Bonds that the City enter into this Agreement to provide for the issuance of the Bonds, the disbursement of proceeds of the Bonds, the disposition of the special taxes securing the Bonds and any additional bonds authorized to be issued hereunder and the administration and payment of the Bonds; and
WHEREAS, the City has determined that all things necessary to cause the Bonds, when authenticated by the Fiscal Agent for the District and issued as in the Act, the Resolution and this Agreement provided to be legal, valid and binding and special obligations of the City for Improvement Area 2 in accordance with their terms, and all things necessary to cause the creation, authorization, execution and delivery of this Agreement and the creation, authorization, execution and issuance of the Bonds, subject to the terms hereof, have in all respects been duly authorized.

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

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

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

Section 1.03. Definitions. Unless the context otherwise requires, the terms defined in this Section 1.03 shall, for all purposes of this Agreement, of any Supplemental Agreement, and of any certificate, opinion or other document herein mentioned, have the meanings herein specified. All references herein to “Articles,” “Sections” and other subdivisions are to the corresponding Articles, Sections or subdivisions of this Agreement, and the words “herein,” “hereof,” “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section or subdivision hereof. “Additional Bonds” means any series of bonds other than the 2022 Bonds issued pursuant to Section 5.09.
“Administrative Expenses” means any or all of the following:
(a) the expenses directly related to the administration of the District, including, but not limited to, the costs of computing the Special Taxes and preparing the annual Special Tax collection schedules (whether by the City or a designee thereof or both); the costs of collecting the Special Taxes (whether by San Joaquin County, the City or otherwise); the costs of remitting the Special Taxes to the Fiscal Agent; the costs associated with preparing Special Tax disclosure statements and responding to the public inquiries regarding the Special Taxes; the costs of the City, the District or any designee thereof related to an appeal of the Special Tax; (b) the costs of the Fiscal Agent (including its legal counsel) in the discharge of the duties of the Fiscal Agent pertaining to the Bonds required under this Fiscal Agent Agreement and any Supplemental Agreement;
(c) the costs of the City or any designee thereof of complying with the City, the District, or obligated person disclosure requirements associated with applicable federal or state securities laws of the Act pertaining to the Bonds; (d) any amounts required to be rebated to the federal government; and (e) all other costs and expenses of the City (including, but not limited to, an allocable share of the salaries of the City staff directly related to the foregoing, a proportionate amount of City general administrative overhead related to the foregoing, and amounts advanced by the City for any administrative purpose of the District, 1303
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4 including costs related to prepayments of Special Taxes, recordings related to such prepayments and satisfaction of Special Taxes, amounts advanced to ensure maintenance of tax exemption, and the costs of prosecuting foreclosure of delinquent Special Taxes, which amounts advanced are subject to reimbursement from other sources, including proceeds of foreclosure) and the Fiscal Agent incurred in connection with the discharge of their respective duties hereunder and in any way related to the administration of the District and all actual costs and expenses incurred in connection with the administration of the Bonds.
“Agreement” means this Fiscal Agent Agreement, as it may be amended or supplemented from time to time by any Supplemental Agreement. “Annual Debt Service” means, for each Bond Year and each Series of Outstanding Bonds, the sum of (i) the interest due on the respective Series of Outstanding Bonds in such Bond Year, assuming that such Outstanding Bonds are retired as scheduled, and (ii) the principal amount of the respective Series of Outstanding Bonds, including any mandatory sinking fund payments, due in such Bond Year.
“Authorized Officer” means the City Manager, Chief Financial Officer, City Clerk, City Attorney, including any deputy, acting or interim officer holding such position, or any other officer or employee authorized by the City Council of the City or by an Authorized Officer to undertake the action referenced in this Agreement as required to be undertaken by an Authorized Officer.
“Bond Counsel” means Jones Hall, A Professional Law Corporation, and its successors; or any other attorney at law or firm of attorneys selected by the City, of nationally recognized standing in matters pertaining to the federal tax exemption of interest on bonds issued by states and political subdivisions, and duly admitted to practice law before the highest court of any state of the United States of America.
“Bond Year” means each twelve-month period beginning on September 2 in any year and extending to the next succeeding September 1, both dates inclusive; except that the first Bond Year shall begin on the Closing Date and end on September 1, 2022. “Bonds” means the 2022 Bonds and any Additional Bonds.
“Business Day” means any day other than (i) a Saturday or a Sunday or (ii) a day on which banking institutions in the state in which the Principal Office of the Fiscal Agent is located are authorized or obligated by law or executive order to be closed. “CDIAC” means the California Debt and Investment Advisory Commission of the office of the State Treasurer of the State of California or any successor agency or bureau thereto. “Chief Financial Officer” means the duly acting Chief Financial Officer of the City, or if the City has no Chief Financial Officer, such officer of the City serving a similar role. “City” means the City of Stockton, California, and any successor thereto. “Closing Date” means _______________, 2022, the date upon which there is a physical delivery of the 2022 Bonds in exchange for the amount representing the purchase price of the 2022 Bonds by the Original Purchaser.
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5 “Code” means the Internal Revenue Code of 1986 as in effect on the date of issuance of the Bonds or (except as otherwise referenced herein) as it may be amended to apply to obligations issued on the date of issuance of the Bonds, together with applicable temporary and final regulations promulgated, and applicable official public guidance published, under the Code.
“Continuing Disclosure Certificate” means the Continuing Disclosure Certificate, dated as of the Closing Date, by and between the City and Willdan Financial Services, or successors, in its capacity as Dissemination Agent, as originally executed and as it may be amended from time to time in accordance with the terms thereof. “Cost of Issuance” means items of expense payable or reimbursable directly or indirectly by the City and related to the authorization, sale and issuance of the Bonds, which items of expense shall include, but not be limited to, printing costs, costs of reproducing and binding documents, closing costs, filing and recording fees, initial fees, expenses and charges of the Fiscal Agent, including its first annual administration fee, and expenses and fees of counsel to the Fiscal Agent, expenses incurred by the City in connection with the issuance of the Bonds, financial advisor fees, Bond (underwriter’s) discount or underwriting fee, legal fees and charges, including bond counsel, charges for execution, transportation and safekeeping of the Bonds and other costs, charges and fees in connection with the foregoing. “Costs of Issuance Fund” means the fund by that name established pursuant to Section 3.05(A).
“DTC” means the Depository Trust Company, and its successors and assigns. “Debt Service” means the scheduled amount of interest and amortization of principal payable on the Bonds during the period of computation, excluding amounts scheduled during such period which relate to principal which has been retired before the beginning of such period. “Depository” means (a) initially, DTC, and (b) any other Securities Depository acting as Depository pursuant to Section 2.12.
“District” means the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) formed pursuant to the Resolution of Formation. “Fair Market Value” means the price at which a willing buyer would purchase the investment from a willing seller in a bona fide, arm’s length transaction (determined as of the date the contract to purchase or sell the investment becomes binding) if the investment is traded on an established securities market (within the meaning of Section 1273 of the Code) and, otherwise, the term “Fair Market Value” means the acquisition price in a bona fide arm’s length transaction (as referenced above) if (i) the investment is a certificate of deposit that is acquired in accordance with applicable regulations under the Code, (ii) the investment is an agreement with specifically negotiated withdrawal or reinvestment provisions and a specifically negotiated interest rate (for example, a guaranteed investment contract, a forward supply contract or other investment agreement) that is acquired in accordance with applicable regulations under the Code, (iii) the investment is a United States Treasury Security—State and Local Government Series that is acquired in accordance with applicable regulations of the United States Bureau of Public Debt, or (iv) the investment is the Local Agency Investment Fund of the State of California, but only if at all times during which the investment is held its yield is reasonably 1305
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6 expected to be equal to or greater than the yield on a reasonably comparable direct obligation of the United States.
“Federal Securities” means any of the following which are non-callable and which at the time of investment are legal investments under the laws of the State of California for funds held by the Fiscal Agent (the Fiscal Agent entitled to rely upon investment direction from the City as a certification that such investment constitutes a legal investment). (i) Direct general obligations of the United States of America (including obligations issued or held in book-entry form on the books of the United States Department of the Treasury) and obligations, the payment of principal of and interest on which are directly or indirectly guaranteed by the United States of America, including, without limitation, such of the foregoing which are commonly referred to as “stripped” obligations and coupons; or
(ii) Any of the following obligations of the following agencies of the United States of America: (a) direct obligations of the Export-Import Bank, (b) certificates of beneficial ownership issued by the Farmers Home Administration, (c) participation certificates issued by the General Services Administration, (d) mortgage-backed bonds or passthrough obligations issued and guaranteed by the Government National Mortgage Association, (e) project notes issued by the United States Department of Housing and Urban Development, and (f) public housing notes and bonds guaranteed by the United States of America.
“Fiscal Agent” means the Fiscal Agent appointed by the City and acting as an independent fiscal agent with the duties and powers herein provided, its successors and assigns, and any other corporation or association which may at any time be substituted in its place, as provided in Section 7.01.
“Fiscal Year” means the twelve-month period extending from July 1 in a calendar year to June 30 of the succeeding year, both dates inclusive. “Gross Taxes” means the proceeds of the Special Taxes received by the City, including any scheduled payments and any prepayments thereof, interest thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes to the amount of said lien and interest thereon. “Gross Taxes” does not include any penalties collected in connection with delinquent Special Taxes or any interest in excess of the interest due on the Bonds.
“Improvement Area 2” means Improvement Area 2 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II).
“Improvement Fund” means the fund by that name established pursuant to Section 3.04(A) hereof.
“Information Services” means “EMMA” or the “Electronic Municipal Market Access” system of the Municipal Securities Rulemaking Board; or, in accordance with then-current guidelines of the Securities and Exchange Commission, such other services providing information with respect to called bonds as the City may designate in an Officer’s Certificate delivered to the Fiscal Agent.
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7 “Interest Payment Dates” means March 1 and September 1 of each year, commencing March 1, 2023.
“Maximum Annual Debt Service” means, for each Series of Outstanding Bonds, the largest Annual Debt Service for any Bond Year after the calculation is made through the final maturity date of the respective Series of Outstanding Bonds. “Net Taxes” means Gross Taxes minus amounts set aside to pay Administrative Expenses.
“Officer’s Certificate” means a written certificate of the City signed by an Authorized Officer.
“Ordinance” means any ordinance of the City levying the Special Taxes. “Original Purchaser” means the first purchaser of the Bonds from the City. “Outstanding,” when used as of any particular time with reference to Bonds, means (subject to the provisions of Section 8.04) all Bonds except (i) Bonds theretofore canceled by the Fiscal Agent or surrendered to the Fiscal Agent for cancellation; (ii) Bonds paid or deemed to have been paid within the meaning of Section 9.03; and (iii) Bonds in lieu of or in substitution for which other Bonds shall have been authorized, executed, issued and delivered by the City pursuant to the Agreement or any Supplemental Agreement. “Owner” or “Bondowner” means any person who shall be the registered owner of any Outstanding Bond.
“Participating Underwriter” shall have the meaning ascribed thereto in the Continuing Disclosure Certificate.
“Permitted Investments” means any of the following, to the extent that they are lawful investments for City funds at the time of investment, and are acquired at Fair Market Value (the Fiscal Agent is entitled to rely upon investment direction from the City as a certification that such investment constitutes a Permitted Investment):
(i) Federal Securities;
(ii) any of following obligations of federal agencies not guaranteed by the United States of America: (a) debentures issued by the Federal Housing Administration; (b) participation certificates or senior debt obligations of the Federal Home Loan Mortgage Corporation or Farm Credit Banks (consisting of Federal Land Banks, Federal Intermediate Credit Banks or Banks for Cooperatives); (c) bonds or debentures of the Federal Home Loan Bank Board established under the Federal Home Loan Bank Act, bonds of any federal home loan bank established under said act and stocks, bonds, debentures, participations and other obligations of or issued by the Federal National Mortgage Association, the Student Loan Marketing Association, the Government National Mortgage Association and the Federal Home Loan Mortgage Corporation; and (d) bonds, notes or other obligations issued or assumed by the International Bank for Reconstruction and Development;
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8 (iii) interest-bearing demand or time deposits (including certificates of deposit) in federal or State of California chartered banks (including the Fiscal Agent and its affiliates), provided that (a) in the case of a savings and loan association, such demand or time deposits shall be fully insured by the Federal Deposit Insurance Corporation, or the unsecured obligations of such savings and loan association shall be rated in one of the top two rating categories by a nationally recognized rating service; (b) in the case of a bank, such demand or time deposits shall be fully insured by the Federal Deposit Insurance Corporation, or the unsecured obligations of such bank (or the unsecured obligations of the parent bank holding company of which such bank is the lead bank) shall be rated at the time of purchase in one of the top two rating categories by a nationally recognized rating service; and (c) U.S. dollar denominated deposit accounts, federal funds and banker’s acceptances with domestic commercial banks, which may include the Trustee, its parent holding company, if any, and their affiliates, which have a rating on their short term certificates of deposit on the date of purchase of “A” or better by S&P, maturing no more than 360 days after the date of purchase, provided that ratings on holding companies are not considered as the rating of the bank;
(iv) repurchase agreements with a registered broker/dealer subject to the Securities Investors Protection Corporation Liquidation in the event of insolvency, or any commercial bank provided that: (a) the unsecured obligations of such bank shall be rated in one of the top two rating categories by a nationally recognized rating service, or such bank shall be the lead bank of a banking holding company whose unsecured obligations are rated in one of the top two rating categories by a nationally recognized rating service; (b) the most recent reported combined capital, surplus and undivided profits of such bank shall be not less than $100 million; (c) the repurchase obligation under any such repurchase obligation shall be required to be performed in not more than thirty (30) days; (d) the entity holding such securities as described in clause (c) shall have a pledged first security interest therein for the benefit of the Fiscal Agent under the California Commercial Code or pursuant to the book-entry procedures described by 31 C.F.R. 306.1 et seq. or 31 C.F.R. 350.0 et seq. and are rated in one of the top two rating categories by a nationally recognized rating service; (v) bankers acceptances endorsed and guaranteed by banks described in clause (iv) above;
(vi) obligations, the interest on which is exempt from federal income taxation under Section 103 of the Code and which are rated in the one of the top two rating categories by a nationally recognized rating service;
(vii) money market funds which invest solely in Federal Securities or in obligations described in the preceding clause (ii) of this definition, or money market funds which are rated in the highest rating category by Standard & Poor’s Ratings Services or Moody’s Investor Service, including such funds for which the Fiscal Agent, its affiliates or subsidiaries provide investment advisory or other management services or for which the Fiscal Agent or an affiliate of the Fiscal Agent serves as investment administrator, shareholder servicing agent, and/or custodian or subcustodian, notwithstanding that (a) the Fiscal Agent or an affiliate of the Fiscal Agent receives and retains a fee for services provided to the fund, (b) the Fiscal Agent collects fees for services rendered pursuant to this Agreement, which fees are separate from the fees received from such funds, and (c) services performed for such funds and pursuant to this 1308
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9 Agreement may at times duplicate those provided to such funds by the Fiscal Agent or an affiliate of the Fiscal Agent;
(viii) units of a taxable government money market portfolio comprised solely of obligations listed in (i) and (iv) above, such funds for which the Fiscal Agent, its affiliates or subsidiaries provide investment advisory or other management services or for which the Fiscal Agent or an affiliate of the Fiscal Agent serves as investment administrator, shareholder servicing agent, and/or custodian or subcustodian, notwithstanding that (a) the Fiscal Agent or an affiliate of the Fiscal Agent receives and retains a fee for services provided to the fund, (b) the Fiscal Agent collects fees for services rendered pursuant to this Agreement, which fees are separate from the fees received from such funds, and (c) services performed for such funds and pursuant to this Agreement may at times duplicate those provided to such funds by the Fiscal Agent or an affiliate of the Fiscal Agent;
(ix) any investment which is a legal investment for proceeds of the Bonds at the time of the execution of such agreement, and which investment is made pursuant to an agreement between the City or the Fiscal Agent or any successor Fiscal Agent and a financial institution or governmental body whose long term debt obligations are rated in one of the top two rating categories by a nationally recognized rating service; (x) commercial paper which at the time of purchase is of “prime” quality of the highest ranking or of the highest letter and numerical rating as provided for by Moody’s Investors Service, or Standard and Poor’s Corporation, of issuing corporations that are organized and operating within the United States and having total assets in excess of five hundred million dollars ($500,000,000) and having an “AA” or higher rating for the issuer’s debentures, other than commercial paper, as provided for by Moody’s Investors Service or Standard and Poor’s Corporation, and provided that purchases of eligible commercial paper may not exceed 180 days maturity nor represent more than 10 percent of the outstanding paper of an issuing corporation; (xi) any general obligation of a bank or insurance company whose long term debt obligations are rated in one of the two highest rating categories of a national rating service;
(xii) shares in a common law trust established pursuant to Title 1, Division 7, Charter 5 of the Government Code of the State which invests exclusively in investments permitted by Section 53635 of Title 5, Division 2, Chapter 4 of the Government Code of the State, as it may be amended;
(xiii) shares in the California Asset Management Program; or (xiii) the Local Agency Investment Fund established pursuant to Section 16429.1 of the Government Code of the State of California, provided, however, that the Fiscal Agent shall be permitted to make investments and withdrawals in its own name and the Fiscal Agent may restrict investments in the such fund if necessary to keep moneys available for the purposes of this Fiscal Agent Agreement. (xiv) any other lawful investment for City funds.
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10 “Prepayment” means moneys received by the City from the prepayment of Special Taxes as provided in the “Rate, Method of Apportionment, and Manner of Collection of Special Tax” applicable to Improvement Area 2.
“Principal Office” means the corporate trust office of the Fiscal Agent set forth in Section 9.06, or such other or additional offices as may be designated by the Fiscal Agent. “Project” means the acquisitions and improvements described in the Resolution of Formation, including Administrative Expenses related thereto. “Qualified Reserve Fund Credit Instrument” means an irrevocable standby or direct-pay letter of credit or surety bond issued by a commercial bank or insurance company and deposited with the Fiscal Agent pursuant to Section 4.02, provided that all of the following requirements are met: (a) the long-term credit rating of such bank or insurance company is rated at the time of issuance in the “AA” category or higher by S&P or Moody’s (without regard to qualifier); (b) such letter of credit or surety bond has a term of at least 12 months; (c) such letter of credit or surety bond has a stated amount at least equal to the portion of the Reserve Requirement with respect to which funds are proposed to be released pursuant to Section

4.02; and (d) the Fiscal Agent is authorized pursuant to the terms of such letter of credit or surety bond to draw thereunder an amount equal to any deficiencies which may exist from time to time in the Special Tax Fund for the purpose of making payments required pursuant to Section 4.02 or the amount to be restored to the Reserve Fund if not timely renewed or extended.
“Record Date” means the 15th day of the month next preceding the month of the applicable Interest Payment Date whether or not such day is a Business Day. “Regulations” means temporary and permanent regulations promulgated under the Code.
“Reserve Fund” means the fund by that name established pursuant to Section 4.02(A). “Reserve Requirement” means, as of the date of any calculation, an amount equal to the lesser of (a) Maximum Annual Debt Service on the respective Outstanding Bonds covered by the Reserve Fund, (b) 125% of the average Annual Debt Service on the respective Outstanding Bonds covered by the Reserve Fund, or (c) 10% of the original principal amount of the respective Bonds covered by the Reserve Fund (or the issue price of the respective Bonds excluding accrued interest, if the net original issue discount or premium is less than 98% or more than 102% of the principal amount of the respective Bonds), as calculated by the City; provided, that (1) in no event shall the City, in connection with the issuance of Additional Bonds covered by the Reserve Fund pursuant to a Supplemental Agreement be obligated to deposit an amount in the Reserve Fund which is in excess of the amount permitted by the applicable provisions of the Code to be so deposited from the proceeds of tax-exempt bonds without having to restrict the yield of any investment purchased with any portion of such deposit and, in the event the amount of any such deposit into the Reserve Fund is so limited, the Reserve Requirement shall, in connection with the issuance of such Additional Bonds, be increased only by the amount of such deposit as permitted by the Code, and (2) the City may meet all or a portion of the Reserve Requirement by depositing a Qualified Reserve Fund Credit Instrument in the Reserve Fund in accordance with Section 4.02(A). 1310
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11 “Resolution” means Resolution No. 2022-____________ adopted by the City Council of the City on ____________, 2022, which resolution, among other matters, authorized the issuance of the Bonds.
“Resolution of Formation” means collectively, (i) Resolution No. 2018-06-19-1502-01 of the City Council adopted on June 19, 2018, establishing the District and the Improvement Areas for the purpose of providing for the financing of certain public facilities in and for such District, (ii) Resolution No. 2020-02-04-1501 of the City Council adopted on February 4, 2020, reforming the boundaries of Improvement Area No. 1 and Improvement Area No. 2 and amending the Rate and Method of Apportionment of Special Tax for Improvement Area 1 and Improvement Area 2, and (iii) Resolution No. 2022-01-11-1601 of the City Council adopted on January 11, 2022, reforming the boundaries of Improvement Area No. 2 and establishing Improvement Area No. 3 and Improvement Area No. 4 of the District.
“Securities Depositories” means The Depository Trust Company; and, in accordance with then current guidelines of the Securities and Exchange Commission, such other addresses and/or such other securities depositories as the City may designate in an Officer’s Certificate delivered to the Fiscal Agent.
“Series” means a series of Bonds issued under this Fiscal Agent Agreement. “Special Tax Fund” means the fund by that name established by Section 3.03(A). “Special Taxes” means the special taxes levied within Improvement Area 2 pursuant to the Act, the Ordinance and this Agreement.
“Supplemental Agreement” means an agreement the execution of which is authorized by a resolution which has been duly adopted by the City under the Act and which agreement is amendatory of or supplemental to this Agreement, but only if and to the extent that such agreement is specifically authorized hereunder.
“Teeter Plan” means the County of San Joaquin’s program of distributing special taxes as described under the Alternative Method of Distribution of Tax Levies and Collections and of Tax Sale Proceeds, as provided for in Sections 4701 through 4717, inclusive, of the Revenue and Taxation Code of the State of California.
“Term 2022 Bonds” means the 2022 Bonds maturing on September 1, _____, September 1, _____, and September 1, _____.
“2022 Bonds” means the Improvement Area 2 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) Special Tax Bonds, Series 2022. “2022 Reserve Account” means the account within the Reserve Fund by that name established pursuant to Section 4.02(A).
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12 ARTICLE II
THE 2022 BONDS
Section 2.01. Principal Amount; Designation. The 2022 Bonds in the aggregate principal amount of $______________ are hereby authorized to be issued by the City for Improvement Area 2 under and subject to the terms of the Resolution and this Agreement, the Act and other applicable laws of the State of California. The 2022 Bonds shall be designated the “ Improvement Area 2 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) Special Tax Bonds Series 2022.”
Section 2.02. Terms of the 2022 Bonds.
(A) Form; Denominations. The 2022 Bonds shall be issued as fully registered Bonds without coupons in denominations of $5,000 or any integral multiple thereof. The 2022 Bonds shall be lettered and numbered in a customary manner as determined by the Fiscal Agent.
(B) Date of the 2022 Bonds. The 2022 Bonds shall be dated the Closing Date. (C) CUSIP Identification Numbers. “CUSIP” identification numbers shall be imprinted on the 2022 Bonds, but such numbers shall not constitute a part of the contract evidenced by the 2022 Bonds and any error or omission with respect thereto shall not constitute cause for refusal of any purchaser to accept delivery of and pay for the 2022 Bonds.

In addition, failure on the part of the City or the Fiscal Agent to use such CUSIP numbers in any notice to Owners shall not constitute an event of default or any violation of the City’s contract with such Owners and shall not impair the effectiveness of any such notice. (D) Maturities. The 2022 Bonds shall be issued as term bonds and shall mature and become payable as follows:

Maturity Principal Interest Maturity Principal Interest (Sept 1) Amount Rate (Sept 1) Amount Rate
(E) Interest. The 2022 Bonds shall bear interest at the rates set forth above payable on the Interest Payment Dates in each year. Interest shall be calculated on the basis of a 360-day year composed of twelve 30-day months. Each 2022 Bond shall bear interest from the Interest Payment Date next preceding the date of authentication thereof unless (i) it is authenticated on an Interest Payment Date, in which event it shall bear interest from such date of authentication, or (ii) it is authenticated prior to an Interest Payment Date and after the close of business on the Record Date preceding such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, or (iii) it is authenticated prior to the Record 1312
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13 Date preceding the first Interest Payment Date, in which event it shall bear interest from the Closing Date; provided, however, that if at the time of authentication of a 2022 Bond, interest is in default thereon, such 2022 Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon. (F) Method of Payment. Interest on the 2022 Bonds (including the final interest payment upon maturity or earlier redemption) is payable by check of the Fiscal Agent mailed on the Interest Payment Dates by first class mail to the registered Owner thereof at such registered Owner’s address as it appears on the registration books maintained by the Fiscal Agent at the close of business on the Record Date preceding the Interest Payment Date, or by wire transfer made on such Interest Payment Date upon written instructions received by the Fiscal Agent on or before the Record Date preceding the Interest Payment Date of any Owner of $1,000,000 or more in aggregate principal amount of 2022 Bonds; provided that so long as any 2022 Bonds are in book-entry form, payments with respect to such 2022 Bonds shall be made by wire transfer or such other method acceptable to the Fiscal Agent and to the Depository. The principal of the 2022 Bonds and any premium on the 2022 Bonds are payable in lawful money of the United States of America upon surrender of the 2022 Bonds at the Principal Office of the Fiscal Agent. All 2022 Bonds paid by the Fiscal Agent pursuant to this Section shall be cancelled by the Fiscal Agent. The Fiscal Agent shall destroy the cancelled 2022 Bonds in accordance with its records retention policy then in effect.

Section 2.03. Redemption.
(A) Redemption Dates.
(i) Optional Redemption. The 2022 Bonds are subject to optional redemption from any source of available funds other than Prepayments prior to maturity, in whole, or in part among maturities as specified by the City and by lot within a maturity, on any date on or after September 1, ______, at the following respective redemption prices (expressed as percentages of the principal amount of the 2022 Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates Redemption Price
September 1, ____ through August 30, ____ 103%
September 1, ____ through August 30, ____ 102
September 1, ____ through August 30, ____ 101
September 1, ____ and any date thereafter 100
(ii) Mandatory Redemption From Prepayments. The 2022 Bonds shall be subject to mandatory redemption from Prepayments of the Special Tax by property owners, in whole or in part among maturities as shall be specified by the City and by lot within a maturity, on any Interest Payment Date at the following respective redemption prices (expressed as percentages of the principal amount of the 2022 Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates Redemption Price
Interest Payment Dates through March 1, _____ 103%
September 1, _____ and March 1, _____ 102
September 1, _____ and March 1, _____ 101
September 1, _____ and Interest Payment Dates thereafter 100 1313
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14 (iii) Mandatory Sinking Fund Redemption. The 2022 Bonds maturing September 1, _____, September 1, _____ and September 1, _____ (the “Term 2022 Bonds”) are subject to mandatory sinking payment redemption in part on September 1, _____, September 1, _____ and September 1, _____, respectively, and on each September 1 thereafter to maturity, by lot, at a redemption price equal to 100% of the principal amount thereof to be redeemed, without premium, in the aggregate respective principal amounts as set forth in the following tables:

Term Bonds Due September 1, _____
Mandatory
Redemption Date
(September 1)
Sinking Fund
Payment
Term Bonds Due September 1, _____
Mandatory
Redemption Date
(September 1)
Sinking Fund
Payment
Term Bonds Due September 1, _____
Mandatory
Redemption Date
(September 1)
Sinking Fund
Payment
The amounts in the foregoing tables shall be reduced pro rata, at the direction of the City in an Officer’s Certificate, in order to maintain substantially uniform debt service, as a result of any prior partial optional or mandatory redemption of the Term 2022 Bonds pursuant to Section 2.03(A)(i) or (ii) above. In the event of a redemption pursuant to Section 2.03(A)(i) or (ii), the City shall provide the Fiscal Agent with a revised sinking fund schedule giving effect to the redemption so completed.

In lieu of redemption under this Section 2.03, moneys in the Special Tax Fund may be used and withdrawn by the Fiscal Agent for purchase of Outstanding 2022 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 2022 Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase. 1314
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15 (B) Notice to Fiscal Agent. The City shall give the Fiscal Agent an Officer’s Certificate containing notice of its intention to redeem 2022 Bonds pursuant to Section

2.03(A)(i) and (ii) not less than 60 days prior to the applicable redemption date. (C) Redemption Procedure by Fiscal Agent; Rescission. The Fiscal Agent shall cause notice of any redemption to be mailed by first class mail, postage prepaid, at least 20 days but not more than 60 days prior to the date fixed for redemption, to the Securities Depositories and to one or more Information Services, and to the respective registered Owners of any 2022 Bonds designated for redemption, at their addresses appearing on the 2022 Bond registration books in the Principal Office of the Fiscal Agent; but such mailing shall not be a condition precedent to such redemption and failure to mail or to receive any such notice, or any defect therein, shall not affect the validity of the proceedings for the redemption of such 2022 Bonds.

Such notice shall state the redemption date and the redemption price and, if less than all of the then Outstanding 2022 Bonds are to be called for redemption, shall designate the CUSIP numbers and 2022 Bond numbers of the 2022 Bonds to be redeemed by giving the individual CUSIP number and 2022 Bond number of each 2022 Bond to be redeemed or shall state that all 2022 Bonds between two stated 2022 Bond numbers, both inclusive, are to be redeemed or that all of the 2022 Bonds of one or more maturities have been called for redemption, shall state as to any 2022 Bond called in part the principal amount thereof to be redeemed, and shall require that such 2022 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 2022 Bonds will not accrue from and after the redemption date.

Upon the payment of the redemption price of 2022 Bonds being redeemed, each check or other transfer of funds issued for such purpose shall, to the extent practicable, bear the CUSIP number identifying, by issue and maturity, of the 2022 Bonds being redeemed with the proceeds of such check or other transfer.

The City has the right to rescind any notice of the redemption of 2022 Bonds under Section 2.03(A)(i) by written notice to the Fiscal Agent on or prior to two Business Days prior the date fixed for redemption. Any notice of redemption shall be cancelled and annulled if for any reason funds will not be or are not available on the date fixed for redemption for the payment in full of the 2022 Bonds then called for redemption, and such cancellation shall not constitute an event of default. The City and the Fiscal Agent have no liability to the Owners or any other party related to or arising from such rescission of redemption. The Fiscal Agent shall mail notice of such rescission of redemption in the same manner as the original notice of redemption was sent under this Section.

Whenever provision is made in this Agreement for the redemption of less than all of the 2022 Bonds of any maturity, the Fiscal Agent shall select the 2022 Bonds to be redeemed, from all 2022 Bonds or such given portion thereof of such maturity by lot in any manner which the Fiscal Agent in its sole discretion shall deem appropriate.

Upon surrender of 2022 Bonds redeemed in part only, the City shall execute and the Fiscal Agent shall authenticate and deliver to the registered Owner, at the expense of the City, a new 2022 Bond or 2022 Bonds, of the same series and maturity, of authorized denominations in an aggregate principal amount equal to the unredeemed portion of the 2022 Bond or 2022 Bonds.
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16 (D) Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the principal of, and interest and any premium on, the 2022 Bonds so called for redemption shall have been deposited in the Special Tax Fund, such 2022 Bonds so called shall cease to be entitled to any benefit under this Agreement other than the right to receive payment of the redemption price, and no interest shall accrue thereon on or after the redemption date specified in such notice.

All 2022 Bonds redeemed and purchased by the Fiscal Agent pursuant to this Section shall be canceled by the Fiscal Agent. The Fiscal Agent shall destroy the cancelled 2022 Bonds it has received in accordance with its records retention policy then in effect.

Section 2.04. Form of Bonds. The 2022 Bonds, the form of Fiscal Agent’s certificate of authentication and the form of assignment, to appear thereon, shall be substantially in the forms, respectively, set forth in Exhibit A attached hereto and by this reference incorporated herein, with necessary or appropriate variations, omissions and insertions, as permitted or required by this Agreement, the Resolution and the Act.

Section 2.05. Execution of Bonds. The Bonds shall be executed on behalf of the City by the Mayor and the City Clerk of the City who are in office on the date of adoption of this Agreement or at any time thereafter, and the seal of the City may be impressed, imprinted or reproduced by facsimile thereon. If any officer whose signature appears on any Bond ceases to be such officer before delivery of the Bonds to the Owner, such signature shall nevertheless be as effective as if the officer had remained in office until the delivery of the Bonds to the Owner.

Any Bond may be signed and attested on behalf of the City by such persons as at the actual date of the execution of such Bond shall be the proper officers of the City although at the nominal date of such Bond any such person shall not have been such officer of the City.

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

Section 2.06. Transfer of Bonds. Any Bond may, in accordance with its terms, be transferred, upon the books required to be kept pursuant to the provisions of Section 2.08 by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a duly written instrument of transfer in a form acceptable to the Fiscal Agent. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such transfer shall be paid by the City. The Fiscal Agent shall collect from the Owner requesting such transfer any tax or other governmental charge required to be paid with respect to such transfer.

Whenever any Bond or Bonds shall be surrendered for transfer, the City shall execute and the Fiscal Agent shall authenticate and deliver a new Bond or Bonds, for a like aggregate principal amount of Bonds of authorized denominations and of the same maturity.

No transfers of Bonds shall be required to be made (i) within 15 days prior to the date established by the Fiscal Agent for selection of Bonds for redemption or (ii) with respect to a Bond after such Bond has been selected for redemption.
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17 The transferor of any Bond shall also provide or cause to be provided to the Fiscal Agent all information necessary to allow the Fiscal Agent to comply with any applicable tax reporting obligations, including without limitation any cost basis reporting obligations under Internal Revenue Code Section 6045. The Trustee may rely on the information provided to it and shall have no responsibility to verify or ensure the accuracy of such information.

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

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

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

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

Section 2.10. Bonds Mutilated, Lost, Destroyed or Stolen. If any Bond shall become mutilated, the City shall execute, and the Fiscal Agent shall authenticate and deliver, a new Bond of like tenor and principal amount in exchange and substitution for the Bond so mutilated, but only upon surrender to the Fiscal Agent of the Bond so mutilated. Every mutilated Bond so surrendered to the Fiscal Agent shall be canceled by it and destroyed by the Fiscal Agent in accordance with its records retention policy then in effect. If any Bond shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Fiscal Agent and, if such evidence be satisfactory to it and indemnity for the Fiscal Agent and the City satisfactory to the Fiscal Agent shall be given, the City shall execute, and the Fiscal Agent shall authenticate and deliver, a new Bond of like tenor and principal amount in lieu of and in substitution for the Bond so lost, destroyed or stolen. The City may require payment of a sum not exceeding the 1317
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18 actual cost of preparing each new Bond delivered under this Section and of the expenses which may be incurred by the City and the Fiscal Agent for the preparation, execution, authentication and delivery. Any Bond delivered under the provisions of this Section in lieu of any Bond alleged to be lost, destroyed or stolen shall constitute an original additional contractual obligation on the part of the City whether or not the Bond so alleged to be lost, destroyed or stolen is at any time enforceable by anyone, and shall be equally and proportionately entitled to the benefits of this Agreement with all other Bonds issued pursuant to this Agreement.

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

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

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

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

The Fiscal Agent may treat as and deem DTC to be the absolute Owner of each Bond for which DTC is acting as Depository for the purpose of payment of the principal of and interest on such Bonds, for the purpose of giving notices of prepayment and other matters with respect to such Bonds, for the purpose of registering transfers with respect to such Bonds, and for all purposes whatsoever. The Fiscal Agent shall pay all principal of and interest on the Bonds only to the Owners as shown on the Registration Books, and all such payments shall be valid and effective to fully satisfy and discharge all obligations with respect to the principal of and interest on the Bonds to the extent of the sum or sums so paid. 1318
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19 No person other than an Owner, as shown on the Bond Register, shall receive a physical Bond. Upon delivery by DTC to the Fiscal Agent of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the transfer provisions in Section 2.06 hereof, references to “Cede & Co.” in this Section 2.12 shall refer to such new nominee of DTC.

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

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

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

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

ISSUANCE OF BONDS
Section 3.01. Issuance and Delivery of Bonds. At any time after the execution of this Agreement, the City may issue the Bonds for Improvement Area 2 in the aggregate principal amount set forth in Section 2.01 or as authorized in any supplemental agreement and deliver such Bonds to the Original Purchaser. The Authorized Officers of the City are hereby authorized and directed to deliver any and all documents and instruments necessary to cause the issuance of Bonds in accordance with the provisions of the Act, the Resolution and this Agreement, to authorize the payment of Costs of Issuance of the Bonds from the proceeds of the Bonds and to do and cause to be done any and all acts and things necessary or convenient for delivery of the Bonds to the Original Purchaser.

Section 3.02. Application of Proceeds of Sale of 2022 Bonds. The proceeds of the purchase of the 2022 Bonds by the Original Purchaser in the amount of $____________, which represents the aggregate principal amount of the Bonds ($___________), plus net original issue premium of $___________, less an Underwriter’s discount of $___________, shall be paid to the Fiscal Agent, who shall forthwith set aside, pay over and deposit such proceeds on the Closing Date as follows:
(i) Deposit in the Improvement Fund $___________;
(ii) Deposit in the 2022 Reserve Account of the Reserve Fund $___________, equaling the initial Reserve Requirement; (iii) Deposit in the Costs of Issuance Fund $___________; and (iv) Deposit in the Interest Account of the Special Tax Fund $___________.

The Fiscal Agent may establish such temporary funds or accounts as reasonably necessary to complete the foregoing deposits.

Section 3.03. Special Tax Fund.
(A) Establishment and Disbursements. There is hereby established as a separate fund to be held by the Fiscal Agent, the Community Facilities District No. 2018-2 (Westlake Villages II) Special Tax Bonds Special Tax Fund to be held by the Fiscal Agent for the benefit of the Owners. Except for the portion of any Prepayment to be deposited to the Redemption Account as specified in an Officer’s Certificate delivered to the Fiscal Agent, the Fiscal Agent shall, on each date on which Net Taxes are received from the City (pursuant to Section 5.07), deposit the Net Taxes in the Special Tax Fund. The Fiscal Agent shall transfer the Net Taxes on deposit in the Special Tax Fund on the dates and in the amounts set forth in this Section, in the following order of priority:
(1) To the Interest Account of the Special Tax Fund;
(2) To the Principal Account of the Special Tax Fund;
(3) To the Redemption Account of the Special Tax Fund;
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21 (4) To the Reserve Fund; and
(5) To the Surplus Fund.
(B) Interest Account and Principal Account of the Special Tax Fund. The principal of and interest due on the Bonds until maturity, other than principal due upon optional or special mandatory redemption, shall be paid by the Fiscal Agent from the Principal Account and the Interest Account of the Special Tax Fund, respectively. For the purpose of assuring that the payment of principal of and interest on the Bonds will be made when due (including mandatory sinking fund payments), at least one Business Day prior to each Interest Payment Date, the Fiscal Agent shall transfer from the Special Tax Fund, first to the Interest Account and then to the Principal Account, the amount required to pay interest on and principal of the Bonds (including mandatory sinking fund payments) on the immediately succeeding Interest Payment Date; provided, that to the extent that deposits have been made in the Interest Account or the Principal Account from the proceeds of the sale of an issue of the Bonds, or otherwise, the transfer from the Special Tax Fund need not be made. (C) Redemption Account of the Special Tax Fund.
(1) In accordance with the City’s election to call 2022 Bonds for optional redemption as set forth in Section 2.03(A)(i), or to call Additional Bonds for optional redemption as set forth in any Supplemental Agreement for Additional Bonds, the Fiscal Agent shall transfer from the Special Tax Fund and deposit in the Redemption Account of the Special Tax Fund moneys available for the purpose and sufficient to pay the principal, interest and premium, if any, payable on the 2022 Bonds or Additional Bonds called for optional redemption.
(2) The portion of any Prepayment specified in an Officer’s Certificate delivered to the Fiscal Agent to be deposited to the Redemption Account pursuant to Section 3.03(A), shall be deposited to the Redemption Account and applied on the redemption date established pursuant to Section 2.03(A)(ii) for the 2022 Bonds, and in any Supplemental Agreement for any Additional Bonds, for the payment of the principal, interest and the premium, if any, payable on the 2022 Bonds or Additional Bonds to be redeemed with such Prepayments.
(3) Moneys set aside in the Redemption Account shall be used solely for the purpose of redeeming Bonds and shall be applied on or after the redemption date to the payment of principal, interest and premium, if any, on the Bonds to be redeemed; provided, that in lieu or partially in lieu of such call and redemption, moneys deposited in the Redemption Account may be used to purchase Outstanding Bonds in the manner hereinafter provided. Purchases of Outstanding Bonds may be made by the City at public or private sale as and when and at such prices as the City may in its discretion determine but only at prices (including brokerage or other expenses) not more than par plus accrued interest, plus, in the case of moneys set aside for an optional redemption, the premium applicable at the next following call date according to the premium schedule established for such Bonds. Any accrued interest payable upon the purchase of Bonds may be paid from the amount reserved in the Interest Account of the Special Tax Fund for the payment of interest on the next following Interest Payment Date. (D) Reserve Fund. After making the transfers required by the foregoing provisions of this Section 3.03, the Fiscal Agent shall, after taking into account amounts then on deposit 1321
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22 in the Reserve Fund (including the accounts therein), transfer amounts needed from the Special Tax Fund to the Reserve Fund so that the amount in the Reserve Fund equals the Reserve Requirement for each Series of Bonds.
(E) Surplus Fund. After making the transfers required by the foregoing provisions of this Section 3.03, as soon as practicable after each September 2, the Fiscal Agent shall transfer all remaining amounts in the Special Tax Fund to the Surplus Fund, unless on or prior to such date, it has received an Officer’s Certificate directing that certain amounts be retained in the Special Tax Fund because the City has assumed such amounts would be available in the Special Tax Fund in calculating the amount of the levy of Special Taxes for such Bond Year pursuant to Section 5.07.
(F) Investment. Moneys in the Special Tax Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from such investment and deposit shall be retained in the Special Tax Fund to be used for the purposes thereof.

Section 3.04. Improvement Fund.
(A) Establishment of Improvement Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the Community Facilities District No. 2018-2 (Westlake Villages II) Special Tax Bonds Improvement Fund to the credit of which a deposit shall be made as required by Section 3.02. Moneys in the Improvement Fund shall be held in trust and shall be disbursed as provided in subsection (B) of this Section for the payment or reimbursement of costs of the Project. Prior to disbursement, amounts on deposit in the Improvement Fund shall be subject to a lien in favor of the Owners of the Bonds. (B) Procedure for Disbursement. Disbursements from the Improvement Fund shall be made by the Fiscal Agent upon receipt of an Officer’s Certificate substantially in the form of Exhibit B attached hereto which shall:
(i) set forth the amount required to be disbursed, the purpose for which the disbursement is to be made, the person to which the disbursement is to be paid and state that such disbursement is for a Project cost; and (ii) certify that no portion of the amount then being requested to be disbursed was set forth in any Officer’s Certificate previously filed requesting disbursement.

Each such Officer’s Certificate shall be sufficient evidence to the Fiscal Agent of the facts stated therein and the Fiscal Agent shall have no duty to confirm the accuracy of such facts.
(C) Investment. Moneys in the Improvement Fund and the accounts established thereunder shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits from the investment of amounts in the Improvement Fund shall be retained by the Fiscal Agent in the Improvement Fund to be used for the purposes of the Improvement Fund. (D) Closing of Fund. Upon the earlier of three years after the Closing Date or the filing of an Officer’s Certificate stating that the portion of the Project to be financed from the Improvement Fund has been completed and that all costs of such portion of the Project have been paid, the Fiscal Agent shall transfer the amount, if any, remaining in the Improvement 1322
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23 Fund to the Special Tax Fund for application to the payment of principal of and interest on the Bonds, and the Improvement Fund shall be closed.

Section 3.05. Costs of Issuance Fund.
(A) Establishment of Costs of Issuance Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the Community Facilities District No. 2018-2 (Westlake Villages II) Special Tax Bonds Costs of Issuance Fund, to the credit of which a deposit shall be made as required by Section 3.02. Moneys in the Costs of Issuance Fund shall be held in trust by the Fiscal Agent and shall be disbursed as provided in subsection (B) of this Section for the payment or reimbursement of Costs of Issuance of the Bonds. (B) Disbursement; Closing of Fund. Amounts in the Costs of Issuance Fund shall be disbursed from time to time to pay Costs of Issuance, as set forth in an Officer’s Certificate containing respective amounts to be paid to the designated payees, signed by an Authorized Officer or a designee thereof and delivered to the Fiscal Agent. The Fiscal Agent shall pay all Costs of Issuance of the Bonds upon receipt of an invoice from any such payee which requests payment in an amount which is less than or equal to the amount set forth with respect to such payee in such Officer’s Certificate, or upon receipt of an Officer’s Certificate requesting payment of a Cost of Issuance not listed on the initial Officer’s Certificate delivered to the Fiscal Agent on the Closing Date of the Bonds. Each such Officer’s Certificate shall be sufficient evidence to the Fiscal Agent of the facts stated therein and the Fiscal Agent shall have no duty to confirm the accuracy of such facts.

The Fiscal Agent shall maintain the Costs of Issuance Fund for a period of 6 months from the Closing Date of the Bonds and then shall transfer any moneys remaining therein, including any investment earnings thereon, to the Improvement Fund, unless such fund has been closed, in which event the moneys shall be transferred to the Special Tax Fund and the Costs of Issuance Fund shall be closed. Thereafter, any cost of issuance invoice received by the Fiscal Agent shall be submitted to the Chief Financial Officer for payment. (C) Investment. Moneys in the Costs of Issuance Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from said investment shall be retained by the Fiscal Agent in the Costs of Issuance Fund to be used for the purposes of the Costs of Issuance Fund.

Section 3.06. Surplus Fund.
(A) Establishment of Surplus Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the Community Facilities District No. 2018-2 (Westlake Villages II) Special Tax Bonds Surplus Fund, to the credit of which a deposit shall be made as required by Section 3.03(E). Moneys in the Surplus Fund shall be held in trust by the Fiscal Agent for the benefit of the City.
(B) Disbursement. The amounts in the Surplus Fund are not pledged to the repayment of the Bonds and may be used by the City for any lawful purpose. Moneys deposited in the Surplus Fund shall be transferred by the Fiscal Agent upon the direction of the City, as set forth in an Officer’s Certificate delivered to the Fiscal Agent. (C) Investment. Moneys in the Surplus Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from said investment 1323
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24 shall be retained by the Fiscal Agent in the Surplus Fund to be used for the purposes of such fund.
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25 ARTICLE IV
PLEDGE OF NET TAXES; RESERVE FUND
Section 4.01. Pledge of Net Taxes and Other Amounts. All of the Net Taxes and all moneys deposited in the Special Tax Fund, the Reserve Fund and, until disbursed as provided herein, in the Improvement Fund, are hereby pledged to secure the repayment of the Bonds.

Such pledge shall constitute a first lien on the Net Taxes and said amounts. The Net Taxes and all moneys deposited into such funds (except as otherwise provided herein) are hereby dedicated in their entirety to the payment of the principal of, including any mandatory sinking fund payments, and interest and any premium on, the Bonds as provided herein and in the Act until all of the Bonds have been paid and retired or until moneys or Federal Securities have been set aside irrevocably for that purpose in accordance with Section 9.03.

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

Notwithstanding any provision contained in this Agreement to the contrary, Net Taxes deposited in the Surplus Fund shall no longer be considered to be pledged to the Bonds, and none of the Surplus Fund shall be construed as a trust fund held for the benefit of the Owners.

Section 4.02. Reserve Fund.
(A) Establishment of Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the Community Facilities District No. 2018-2 (Westlake Villages II) Special Tax Bonds Reserve Fund, and within the Reserve Fund shall be established a 2022 Reserve Account, to the credit of which a deposit shall be made as required by Section 3.02 and deposits shall be made as provided in Section 3.03(D). Unless otherwise set forth in a Supplemental Agreement, for each Series of Additional Bonds covered by the Reserve Fund, the Fiscal Agent shall establish a separate account within the Reserve Fund for each such Series, which account shall be maintained purely for accounting purposes, and amounts in all accounts within the Reserve Fund shall be pledged to all Bonds equally and ratably. Moneys in each account of 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 principal of, and interest on, the Bonds and shall be subject to a lien in favor of the Owners of the Bonds.

The City has the right at any time to cause the Fiscal Agent to release funds from the Reserve Fund, in whole or in part, by tendering to the Fiscal Agent: (1) a Qualified Reserve Fund Credit Instrument, and (2) an opinion of Bond Counsel stating that such release will not, of itself, cause the interest on the Bonds to become includable in gross income for purposes of federal income taxation. Upon tender of such items to the Fiscal Agent, the Fiscal Agent will transfer such funds from the Reserve Fund to the City. Prior to the expiration of any Qualified Reserve Fund Credit Instrument, the City is obligated either to replace such Qualified Reserve Fund Credit Instrument with a new Qualified Reserve Fund Credit Instrument, or to deposit or cause to be deposited with the Fiscal Agent an amount of funds such that the funds on deposit in the Reserve Fund together with all Qualified Reserve Fund Credit Instruments held by the Fiscal Agent is at least equal to the Reserve Requirement (which funds may come from a draw by the Fiscal Agent on the Qualified Reserve Fund Credit Instrument prior to its expiration). 1325
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26 Any Qualified Reserve Fund Credit Instrument deposited with the Fiscal Agent shall contain instructions to the Fiscal Agent with respect to the purpose and use thereof. (B) Use of Fund. Except as otherwise provided in this Section, all amounts deposited in the Reserve Fund shall be used and withdrawn by the Fiscal Agent solely for the purpose of making transfers to the Special Tax Fund one Business Day prior to any Interest Payment Date for which there is a deficiency in the amount required for payment of the principal of, and interest on, the Bonds on such Interest Payment Date. Whenever transfer is made from the Reserve Fund to the Special Tax Fund due to a deficiency in the Special Tax Fund, the Fiscal Agent shall provide written notice thereof to the Chief Financial Officer.

To the extent the Fiscal Agent is required to draw on amounts in the Reserve Fund, the Fiscal Agent shall draw on such amounts from any accounts within the Reserve Fund on a pro rata basis based upon the amounts produced by calculating the Reserve Requirement for each Series of Bonds related to such accounts; provided, that because the accounts are established within the Reserve Fund solely for the purpose of complying with federal tax law, nothing in this Section shall be construed to limit the availability of amounts in any account within the Reserve Fund to pay debt service on any Series of Bonds. (C) Transfer of Excess of Reserve Requirement. Whenever the amount in the Reserve Fund exceeds the then applicable Reserve Requirement, the Fiscal Agent shall provide written notice to the Chief Financial Officer of the amount of the excess. The Chief Financial Officer shall advise the Fiscal Agent in writing of the amount, if any, of any transfer required pursuant to Section 4.02(D) and 6.02 below, and otherwise direct the Fiscal Agent to transfer an amount equal to the excess from the Reserve Fund to the Improvement Fund, if the Project has not been completed as of the date of such transfer, or if the Project has been completed, to the Special Tax Fund to be used for the payment of the principal of and interest on the Outstanding Bonds covered by the Reserve Fund in accordance with Section 3.03; provided, that to the extent that such excess results from the Prepayment of Special Taxes and redemption of Bonds as provided in an Officer’s Certificate in accordance with this Agreement, such amount shall be transferred to the Redemption Account and applied to the corresponding special mandatory redemption of Bonds.
(D) Transfer for Rebate Purposes. Investment earnings on amounts in the Reserve Fund may be withdrawn from the Reserve Fund for purposes of making payment to the federal government to comply with Section 6.02.
(E) Transfer When Balance Exceeds Outstanding Bonds. Whenever the balance in the Reserve Fund exceeds the amount required to redeem or pay the Outstanding Bonds covered by the Reserve Fund, including interest accrued to the date of payment or redemption and premium, if any, due upon redemption, and after making any transfer required under Section 4.02(D) above and upon receipt of an Officer’s Certificate directing it to do so, the Fiscal Agent shall transfer the amount in the Reserve Fund to the Special Tax Fund to be applied, on the next succeeding Interest Payment Date to the payment and redemption, in accordance with Section 3.03, of all such Outstanding Bonds. In the event that the amount so transferred from the Reserve Fund to the Special Tax Fund exceeds the amount required to pay and redeem the Outstanding Bonds covered by the Reserve Fund, the balance in the Reserve Fund shall be transferred to the City, after payment of any amounts due the Fiscal Agent hereunder, to be used for any lawful purpose of the City. 1326
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27 Notwithstanding the foregoing, no amounts shall be transferred from the Reserve Fund pursuant to this Section 4.02(E) until after the calculation, pursuant to Section 6.02, of any amounts due to the federal government following payment of the respective Series of Bonds and withdrawal of any such amount under Section 4.02(D) for purposes of making such payment to the federal government, and payment of any fees and expenses due to the Fiscal Agent.
(F) Investment. Moneys in the Reserve Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from such investment and deposit shall be retained in the Reserve Fund to be used and disbursed as provided in this Section 4.02.
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28 ARTICLE V

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

Section 5.02. Limited Obligation. The Bonds are limited obligations of the City on behalf of Improvement Area 2 and are payable solely from and secured solely by the Net Taxes and the amounts in certain funds created hereunder as, and to the extent, set forth in Section 4.01.

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

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

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

The Fiscal Agent will keep, or cause to be kept, proper books of record and accounts, separate from all other records and accounts of the Fiscal Agent, in which complete and correct entries shall be made of all transactions relating to the expenditure of amounts disbursed from the Special Tax Fund, the Reserve Fund and the Costs of Issuance Fund. Such books of record and accounts shall at all times during business hours and upon reasonable prior notice, be subject to the inspection of the City and the Owners of not less than 10% of the principal amount of the Bonds then Outstanding, or their representatives duly authorized in writing. The Fiscal Agent may establish and maintain for so long as is necessary one or more temporary funds and accounts under this Agreement.

Section 5.06. Protection of Security and Rights of Owners. The City will preserve and protect the security of the Bonds and the rights of the Owners, and will warrant and defend their rights against all claims and demands of all persons. From and after the delivery of any of the Bonds by the City, the Bonds shall be incontestable by the City. 1328
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29 Section 5.07. Collection of Special Taxes; Transfer of Net Taxes. The City shall comply with all requirements of the Act so as to assure the timely collection of the Special Taxes, including without limitation, the enforcement of delinquent Special Taxes.

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

The City shall effect the levy of the Special Taxes each Fiscal Year in accordance with the Ordinance such that the computation of the levy is complete before the final date on which the County Treasurer-Tax Collector will accept the transmission of the Special Tax amounts for the parcels within Improvement Area 2 for inclusion on the next secured real property tax roll.

Upon the completion of the computation of the amounts of the levy, the City shall prepare or cause to be prepared, and shall transmit to the County Treasurer-Tax Collector such data as the County Treasurer-Tax Collector requires to include the levy of the Special Taxes on the next secured real property tax roll.

The City shall fix and levy the amount of Special Taxes within Improvement Area 2 required for the payment of principal of and interest on any outstanding Bonds of Improvement Area 2 becoming due and payable during the ensuing Bond Year, including any necessary replenishment or expenditure of the Reserve Fund for the Bonds and an amount estimated to be sufficient to pay the Administrative Expenses during such year, all in accordance with the rate and method of apportionment of the Special Taxes for Improvement Area 2 and the Ordinance. In any event, the Special Taxes so levied shall not exceed the authorized amounts as provided in the proceedings pursuant to the Resolution of Formation.

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

The City covenants that it will receive Net Taxes in trust for the Owners and will instruct the Chief Financial Officer to deposit all Net Taxes with the Fiscal Agent at least three Business Days prior to each Interest Payment Date, and the City shall have no beneficial right or interest in the amounts so deposited, except as provided by this Agreement. All such Net Taxes shall be disbursed, allocated and applied solely to the uses and purposes set forth in this Agreement, and shall be accounted for separately and apart from all other money, funds, accounts or other resources of the City.

Section 5.08. Covenant to Foreclose. The City hereby covenants with and for the benefit of the Owners of the Bonds that it will annually on or before October 1 of each year review the public records of the County of San Joaquin relating to the collection of the Special Tax in order to determine the amount of the Special Tax collected in the prior Fiscal Year, and if the City determines on the basis of such review that:
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30 (a) the amount so collected is deficient by more than 5% of the total amount of the Special Tax levied in such Fiscal Year, it will within 30 days thereafter institute foreclosure proceedings as authorized by the Act in order to enforce the lien of the delinquent installment of the Special Tax against each separate lot or parcel of land in Improvement Area 2 for which such installment of the Special Tax is delinquent, and will diligently prosecute and pursue such foreclosure proceedings to judgment and sale; or
(b) the amount so collected is deficient by less than 5% of the total amount of the Special Tax levied in Improvement Area 2 in such Fiscal Year, but that property owned by any single property owner in Improvement Area 2 is delinquent by more than $3,000 with respect to the Special Tax due and payable by such property owner in such Fiscal Year and prior Fiscal Year(s), it will within 30 days thereafter institute foreclosure proceedings as authorized by the Act in order to enforce the lien of the delinquent installment of the Special Tax against each such property, and will diligently prosecute and pursue such foreclosure proceedings to judgment and sale.

The Chief Financial Officer shall notify legal counsel of any such delinquency of which it is aware, and such legal counsel shall commence, or cause to be commenced, such actions to collect such delinquencies and subsequent foreclosure proceedings in such a manner as such counsel deems appropriate.

Notwithstanding the foregoing, the City's obligation to pursue foreclosure shall be at the option of the City so long as (i) the Teeter Plan is in effect with respect to any delinquent parcel meeting the conditions above, and (ii) there is no then-outstanding draw on any amounts in the Reserve Fund.

Section 5.09. Additional Bonds. In addition to the 2022 Bonds, the City may, by a Supplemental Agreement, authorize the issuance additional Bonds, payable from Net Taxes and secured, unless otherwise provided in the Supplemental Agreement, by the Net Taxes equally and ratably with Bonds previously issued, and the City may issue, and the Fiscal Agent may authenticate and deliver to the purchaser thereof, Bonds of any series so established, in such principal amount as shall be determined by the City, but only if (a) the Bonds are issued to refund some or all of the then-Outstanding Bonds and (b) debt service on the refunding Bonds in each Bond Year is less than debt service on the Bonds refunded.

Nothing in this Agreement shall be interpreted to prohibit issuance of bonds, notes or other obligations secured on a subordinate basis to the Bonds.

Nothing in this Section or in this Agreement contained shall prevent or be construed to prevent the Supplemental Agreement providing for the issuance of Additional Bonds from pledging or otherwise providing, in addition to the security given or intended to be given by this Agreement, additional security for the benefit of such Additional Bonds or any portion thereof. (b) Proceedings for Issuance of Additional Series of Bonds. Whenever the City shall determine to issue an additional Series of Bonds, the City shall authorize the execution of a Supplemental Fiscal Agent Agreement specifying the principal amount and prescribing the forms of Bonds of such additional Series and providing the terms, conditions, distinctive designation, denominations, methods of numbering, date, maturity date or dates, interest rate or rates (or the manner of determining same), interest payment dates, redemption provisions (including the amount and dates of Sinking Fund Payments, if any), place or places of payment 1330
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31 of principal or redemption price, if any, application of the proceeds thereof and any other provisions respecting the Bonds of such Series not inconsistent with the terms of this Fiscal Agent Agreement.

Before such additional Series of Bond shall be issued and delivered, the Fiscal Agent shall receive a Certificate of the City stating that, to the best knowledge of the City after reasonable investigation, the requirements of Section 5.09(a) are met, and the City shall file the following documents with the Fiscal Agent:
(i) an executed copy of the Supplemental Fiscal Agent Agreement authorizing such Series;
(ii) a comparison of the debt service on the new series of Bonds being issued compared to the debt service on the Bonds refunded; and (iii) an Opinion of Counsel that the execution of the Supplemental Fiscal Agent Agreement has been duly authorized by the City in accordance with this Fiscal Agent Agreement; that all actions required to be taken by the City with respect to the issuance of the additional Series of Bonds have been taken; that such Series, when duly executed by the City and authenticated and delivered by the Fiscal Agent, will be valid and binding limited obligations of the City; that upon the delivery of such Series the aggregate principal amount of Bonds then Outstanding will not exceed the amount permitted by law or by the Fiscal Agent Agreement; and that the issuance of such Series will not cause the interest on any Bonds previously issued to be includable in the gross income of any Bonds for purposes of federal income taxation.

Section 5.10. Compliance with Law; Completion of Project. The City will comply with all applicable provisions of the Act and the law in completing the acquisition and construction of the Project; provided that the City shall have no obligation to advance any funds to complete the Project in excess of the amounts available therefor in the Improvement Fund.

Section 5.11. Continuing Disclosure to Owners. The City hereby covenants and agrees that it will comply with and carry out all of the provisions of the Continuing Disclosure Certificate.

Notwithstanding any other provision of this Agreement, failure of the City to comply with the Continuing Disclosure Certificate shall not be considered a default hereunder; however, any Participating Underwriter or any holder or beneficial owner of the 2022 Bonds may take such actions as may be necessary and appropriate to compel performance by the City of its obligations thereunder, including seeking mandate or specific performance by court order.

Section 5.12. Private Activity Bond Limitation. The City shall assure that the proceeds of the 2022 Bonds are not so used as to cause the 2022 Bonds to satisfy the private business tests of Section 141(b) of the Code or the private loan financing test of Section 141(c) of the Code.

Section 5.13. Federal Guarantee Prohibition. The City shall not take any action or permit or suffer any action to be taken if the result of the same would be to cause any of the 2022 Bonds to be “federally guaranteed” within the meaning of Section 149(b) of the Code.

Section 5.14. No Arbitrage. The City shall not take, or permit or suffer to be taken by the Fiscal Agent or otherwise, any action with respect to the gross proceeds of the 2022 Bonds which if such action had been reasonably expected to have been taken, or had been deliberately and intentionally taken, on the Closing Date for the 2022 Bonds would have 1331
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32 caused the 2022 Bonds to be “arbitrage bonds” within the meaning of Section 148 of the Code and Regulations.

Section 5.15. Maintenance of Tax-Exemption. The City shall take all actions necessary to assure the exclusion of interest on the 2022 Bonds from the gross income of the Owners of the 2022 Bonds to the same extent as such interest is permitted to be excluded from gross income under the Code as in effect on the date of issuance of the 2022 Bonds.

Section 5.16. Yield of the 2022 Bonds. In determining the yield of the 2022 Bonds to comply with Section 5.14 and 6.02 hereof, the City will take into account redemption (including premium, if any) in advance of maturity based on the reasonable expectations of the City, as of the closing date of the 2022 Bonds, without regard to whether or not redemption moneys are received or 2022 Bonds are redeemed.

Section 5.17. Annual State Reports. The following requirements shall apply to each Series of the Bonds:
(A) CDIAC Annual Reporting. Not later than October 30 of each calendar year, beginning with the October 30 first succeeding the date of the Bonds, and in each calendar year thereafter until the October 30 following the final maturity of the Bonds, the City shall prepare and supply the California Debt and Investment Advisory Commission, by mail, postage prepaid, with the information required to be supplied by Government Code Section 53359.5(b).

The annual reporting shall be made using such form or forms as may be prescribed by CDIAC. (B) CDIAC Other Reporting. If within 10 days prior to any Interest Payment Date it appears to the Fiscal Agent that there is a danger of deficiency in the Special Tax Fund and that the Fiscal Agent may be unable to pay regularly scheduled debt service on the Bonds in a timely manner or if the Fiscal Agent is unable to pay principal, interest and premium, if any, due on any Interest Payment Date for the Bonds due to insufficient funds in the Special Tax Fund, or if funds are withdrawn from the Reserve Fund to pay principal and/or interest on the Bonds, then in accordance with Government Code Section 53359.5(c), the Fiscal Agent shall notify the Chief Financial Officer in writing of such fact, and the Chief Financial Officer shall notify CDIAC of such fact within 10 days of such Interest Payment Date. (C) Governing Body Annual Reporting. Not later than January 1, 2021, and at least once a year thereafter, the Chief Financial Officer shall file a report with the City Council in accordance with the requirements of Government Code Section 53411, which report shall contain: (a) the amount of Special Taxes collected and expended; and (b) the status of the Project financed by the Bonds.
(D) Amendment. The reporting requirements of this Section shall be amended from time to time, without action by the City or the Fiscal Agent, to reflect any amendments to Section 53359.5(b) or Section 53359.5(c) of the Act or Government Code Section 53411. (E) No Liability. None of the City and its officers, agents and employees, or the Fiscal Agent shall be liable for any inadvertent error in reporting the information required by this Section.

Section 5.18. Further Assurances. The City will adopt, make, execute and deliver any and all such further resolutions, instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of this Agreement, and for the 1332
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33 better assuring and confirming unto the Owners of the rights and benefits provided in this Agreement.
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34 ARTICLE VI
INVESTMENTS; DISPOSITION OF INVESTMENT PROCEEDS;

LIABILITY OF THE CITY
Section 6.01. Deposit and Investment of Moneys in Funds. Subject in all respects to the provisions of Section 6.02, moneys in any fund or account created or established by this Agreement and held by the Fiscal Agent, shall be invested by the Fiscal Agent in Permitted Investments, as directed pursuant to an Officer’s Certificate filed with the Fiscal Agent at least 2 Business Days in advance of the making of such investments. In the absence of any such Officer’s Certificate, the Fiscal Agent shall invest any such moneys in Permitted Investments described in clause (vii) of the definition thereof which by their terms mature prior to the date on which such moneys are required to be paid out hereunder provided, however, that any such investment shall be made by the Fiscal Agent only if, prior to the date on which such investment is to be made, the Fiscal Agent shall have received an Officer’s Certificate specifying a specific money market fund and, if no such Officer’s Certificate is so received, the Fiscal Agent shall hold such moneys uninvested. Subject in all respects to the provisions of Section 6.02, moneys in any fund or account created or established by this Agreement and held by the Chief Financial Officer shall be invested by the Chief Financial Officer in any lawful investments that the City may make, which by their terms mature prior to the date on which such moneys are required to be paid out hereunder. Obligations purchased as an investment of moneys in any fund shall be deemed to be part of such fund or account, subject, however, to the requirements of this Agreement for transfer of interest earnings and profits resulting from investment of amounts in funds and accounts.

The Fiscal Agent or the City may act as principal or agent in the acquisition or disposition of any investment. Neither the Fiscal Agent nor the City shall incur any liability for losses arising from any investments made pursuant to this Section. Any losses arising from any investments made pursuant to this Section shall be offset against interest earnings and profits retained in the same fund.

Except as otherwise provided in the next sentence, all investments of amounts deposited in any fund or account created by or pursuant to this Agreement, or otherwise containing gross proceeds of the Bonds (within the meaning of Section 148 of the Code), shall be acquired, disposed of, and valued (as of the date that valuation is required by this Agreement or the Code) at Fair Market Value. Investments in funds or accounts (or portions thereof) that are subject to a yield restriction under applicable provisions of the Code and (unless valuation is undertaken at least annually) investments in the Reserve Fund shall be valued by the City at their present value (within the meaning of Section 148 of the Code). For purposes of any Fair Market Value determination hereunder, the Fiscal Agent shall be entitled to conclusively rely on an Officer’s Certificate of the City and shall be fully protected in relying thereon.

Investments in any and all funds and accounts may be commingled in a separate fund or funds for purposes of making, holding and disposing of investments, notwithstanding provisions herein for transfer to or holding in or to the credit of particular funds or accounts of amounts received or held by the Fiscal Agent or the Chief Financial Officer hereunder, provided that the Fiscal Agent or the Chief Financial Officer, as applicable, shall at all times account for such investments strictly in accordance with the funds and accounts to which they are credited and otherwise as provided in this Agreement.
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35 The Fiscal Agent or the City, as applicable, shall sell or present for redemption, any investment security whenever it shall be necessary to provide moneys to meet any required payment, transfer, withdrawal or disbursement from the fund or account to which such investment security is credited and neither the Fiscal Agent nor the City shall be liable or responsible for any loss resulting from the acquisition or disposition of such investment security in accordance herewith.

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

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

The City shall notify the Fiscal Agent of any amounts determined to be due to the federal government, and the Fiscal Agent shall, upon receipt of an Officer’s Certificate of the City, withdraw such amounts from the Reserve Fund pursuant to Section 4.02(D), and pay such amounts to the federal government as required by the Code and the Regulations. In the event of any shortfall in amounts available to make such payments under Section 4.02(D), the Fiscal Agent shall notify the Chief Financial Officer in writing of the amount of the shortfall and the Chief Financial Officer shall make such payment from any amounts available in the Special Tax Fund. Any fees or expenses incurred by the Fiscal Agent or the City under or pursuant to this Section 6.02 shall be Administrative Expenses. The Fiscal Agent may rely conclusively upon the City’s determinations, calculations and certifications required by this Section. The Fiscal Agent shall have no responsibility to independently make any calculation or determination or to review the City’s calculations hereunder.

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

Section 6.03. Limited Obligation. The City’s obligations hereunder are limited obligations of the City on behalf of Improvement Area 2 and are payable solely from and secured solely by the Net Taxes and the other amounts pledged to the Bonds hereunder. 1335
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36 ARTICLE VII

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

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

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

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

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

Section 7.02. Liability of Fiscal Agent. The recitals of facts, covenants and agreements herein and in the Bonds contained shall be taken as statements, covenants and agreements of the City, and the Fiscal Agent assumes no responsibility for the correctness of the same, or makes any representations as to the validity or sufficiency of this Agreement or of the Bonds, or shall incur any responsibility in respect thereof, other than in connection with the duties or obligations herein or in the Bonds assigned to or imposed upon it. The Fiscal Agent shall not be liable in connection with the performance of its duties hereunder, except for its own negligence or willful misconduct. The Fiscal Agent assumes no responsibility or liability for any information, 1336
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37 statement or recital in any offering memorandum or other disclosure material prepared or distributed with respect to the issuance of the Bonds. The Fiscal Agent has no liability regarding the use of the proceeds from the purchase of the Bonds deposited in funds held by the City.

In the absence of bad faith, the Fiscal Agent may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Fiscal Agent and conforming to the requirements of this Agreement, including all Officer’s Certificates of the City meeting such requirements; but in the case of any such certificates or opinions by which any provision hereof are specifically required to be furnished to the Fiscal Agent, the Fiscal Agent shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Agreement. Except as provided above in this paragraph, the Fiscal Agent shall be protected and shall incur no liability in acting or proceeding, or in not acting or not proceeding, in good faith, reasonably and in accordance with the terms of this Agreement, upon any resolution, order, notice, request, consent or waiver, certificate, statement, affidavit, or other paper or document which it shall in good faith reasonably believe to be genuine and to have been adopted or signed by the proper person or to have been prepared and furnished pursuant to any provision of this Agreement, and the Fiscal Agent shall not be under any duty to make any investigation or inquiry as to any statements contained or matters referred to in any such instrument.

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

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

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

The Fiscal Agent shall not be considered in breach of or in default in its obligations hereunder or progress in respect thereto in the event of unavoidable delay in the performance of such obligations due to unforeseeable causes beyond its control and without its fault or negligence, including, but not limited to, Acts of God or of the public enemy or terrorists, acts of a government, acts of the other party, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes, earthquakes, explosion, mob violence, riot, inability to procure or general sabotage or rationing of labor, equipment, facilities, sources of energy, material or supplies in the open market, litigation or arbitration involving a party or others relating to zoning or other governmental action or inaction pertaining to the project, malicious mischief, condemnation, and unusually severe weather or delays of suppliers or subcontractors due to such causes or any similar event and/or occurrences beyond the control of the Fiscal Agent.

The Fiscal Agent may become the owner of the Bonds with the same rights it would have if it were not the Fiscal Agent.
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38 The Fiscal Agent shall not be concerned with or accountable to anyone for the subsequent use or application of any moneys which shall be released or withdrawn in accordance with the provisions hereof.

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

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

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

The Fiscal Agent shall have the right to accept and act upon instructions, including funds transfer instructions (“Instructions”) given pursuant to this Agreement and delivered using Electronic Means by an Authorized Officer (or his or her designee) (“Electronic Means” shall mean the following communications methods: e-mail, facsimile transmission, secure electronic transmission containing applicable authorization codes, passwords and/or authentication keys issued by the Fiscal Agent, or another method or system specified by the Fiscal Agent as available for use in connection with its services hereunder); provided, however, that the City shall provide to the Fiscal Agent an incumbency certificate for each person with the authority to provide such Instructions and containing specimen signatures of such persons, which incumbency certificate shall be amended by the City whenever a person is to be added or deleted from the listing. If the City elects to give the Fiscal Agent Instructions using Electronic Means and the Fiscal Agent in its discretion elects to act upon such Instructions, the Fiscal Agent’s understanding of such Instructions shall be deemed controlling. The City understands and agrees that the Fiscal Agent cannot determine the identity of the actual sender of such Instructions and that the Fiscal Agent shall conclusively presume that directions that purport to have been sent by an Authorized Officer (or designee) listed on the incumbency certificate provided to the Fiscal Agent have been sent by such Authorized Officer (or designee). The City shall be responsible for ensuring that only Authorized Officers (or their designees) transmit such Instructions to the Fiscal Agent and that the City is solely responsible to safeguard the use and confidentiality of applicable user and authorization codes, passwords and/or authentication keys upon receipt by the City. The Fiscal Agent shall not be liable for any losses, costs or expenses arising directly or indirectly from the Fiscal Agent’s reliance upon and compliance with such Instructions notwithstanding such directions conflict or are inconsistent with a subsequent written instruction. The City agrees: (i) to assume all risks arising out of the use of Electronic Means to submit Instructions to the Fiscal Agent, including without limitation the risk of the 1338
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39 Fiscal Agent acting on unauthorized Instructions, and the risk of interception and misuse by third parties; (ii) that it is fully informed of the protections and risks associated with the various methods of transmitting Instructions to the Fiscal Agent and that there may be more secure methods of transmitting Instructions than the method(s) selected by the City; (iii) that the security procedures (if any) to be followed in connection with its transmission of Instructions provide to it a commercially reasonable degree of protection in light of its particular needs and circumstances; and (iv) to notify the Fiscal Agent immediately upon learning of any compromise or unauthorized use of the security procedures.

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

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

Section 7.05. Compensation, Indemnification. The City shall pay to the Fiscal Agent from time to time reasonable compensation for all services rendered as Fiscal Agent under this Agreement, and also all reasonable expenses, charges, counsel fees and other disbursements, including those of their attorneys, agents and employees, incurred in and about the performance of their powers and duties under this Agreement, but the Fiscal Agent shall not have a lien therefor on any funds at any time held by it under this Agreement. The City further agrees, to the extent permitted by applicable law, to indemnify and save the Fiscal Agent, its officers, employees, directors and agents harmless against any costs, claims, damages, expenses or liabilities, including, without limitation, fees and expenses of its attorneys which it may incur in the exercise and performance of its powers and duties hereunder which are not due to its negligence or willful misconduct. The obligation of the City under this Section shall survive resignation or removal of the Fiscal Agent under this Agreement and payment of the Bonds and discharge of this Agreement. 1339
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40 ARTICLE VIII

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

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

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

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

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

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

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

Section 8.05. Effect of Supplemental Agreement. From and after the time any Supplemental Agreement becomes effective pursuant to this Article VIII, this Agreement shall be deemed to be modified and amended in accordance therewith, the respective rights, duties and obligations under this Agreement of the City and all Owners of Bonds Outstanding shall thereafter be determined, exercised and enforced hereunder subject in all respects to such 1341
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42 modifications and amendments, and all the terms and conditions of any such Supplemental Agreement shall be deemed to be part of the terms and conditions of this Agreement for any and all purposes.

Section 8.06. Endorsement or Replacement of Bonds Issued After Amendments. The City may determine that Bonds issued and delivered after the effective date of any action taken as provided in this Article VIII shall bear a notation, by endorsement or otherwise, in form approved by the City, as to such action. In that case, upon demand of the Owner of any Bond Outstanding at such effective date and presentation of his Bond for that purpose at the Principal Office of the Fiscal Agent or at such other office as the City may select and designate for that purpose, a suitable notation shall be made on such Bond. The City may determine that new Bonds, so modified as in the opinion of the City is necessary to conform to such Owners’ action, shall be prepared, executed and delivered. In that case, upon demand of the Owner of any Bonds then Outstanding, such new Bonds shall be exchanged at the Principal Office of the Fiscal Agent without cost to any Owner, for Bonds then Outstanding, upon surrender of such Bonds.

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

Section 8.08. Opinion of Counsel Regarding Supplemental Agreement. The Fiscal Agent shall be furnished, upon request, an opinion of counsel that any Supplemental Agreement entered into by the City and the Fiscal Agent complies with the provisions of this Article VIII, is enforceable against the City, does not adversely impact the tax-exempt status of the interest on the Bonds, and the Fiscal Agent may conclusively rely upon such opinion. 1342
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43 ARTICLE IX

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

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

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

Section 9.03. Discharge of Agreement. If the City shall pay and discharge the entire indebtedness on all or any portion of the Bonds Outstanding in any one or more of the following ways:
(A) by well and truly paying or causing to be paid the principal of, and interest and any premium on, such Bonds Outstanding, as and when the same become due and payable;
(B) by depositing with the Fiscal Agent, in trust, at or before maturity, money which, together with (in the event that all of the Bonds are to be defeased) the amounts then on deposit in the funds and accounts provided for in Sections 3.03 and 4.02, is fully sufficient to pay such Bonds Outstanding, including all principal, interest and redemption premiums; or
(C) by irrevocably depositing with the Fiscal Agent, in trust, cash and Federal Securities in such amount as the City shall determine as confirmed by an independent certified public accountant will, together with the interest to accrue thereon and (in the event that all of the Bonds are to be defeased) moneys then on deposit in the fund and accounts provided for in Sections 3.03 and 4.02, be fully sufficient to pay and discharge the indebtedness on such Bonds (including all principal, interest and redemption premium, if any) at or before their respective maturity dates; and if such Bonds are to be redeemed prior to the maturity thereof notice of such redemption shall have been given as in this Agreement provided or provision satisfactory to the Fiscal Agent shall have been made for the giving of such notice, then, at the election of the City, and notwithstanding that any Bonds shall not have been surrendered for payment, the pledge of the Net Taxes and other funds provided for in this Agreement and all other obligations of the City under this Agreement with respect to such Bonds Outstanding shall cease and terminate, except only the obligations of the City (i) under Section 5.15 (Maintenance of Tax-Exemption) and (ii) to pay or cause to be paid to the Owners of the Bonds not so surrendered and paid all sums due thereon and all amounts owing to the Fiscal Agent pursuant to Section 7.05; and thereafter Special Taxes shall not be payable to the Fiscal Agent. Notice of such election shall be filed with the Fiscal Agent.
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44 Any funds thereafter held by the Fiscal Agent upon payments of all fees and expenses of the Fiscal Agent, which are not required for said purpose, shall be paid over to the City.

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

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

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

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

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

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

City of Stockton
425 N. El Dorado Street
Stockton, California 95202
Attention: Chief Financial Officer
Tel: (209) 937-8908
Any notice or demand which by any provision of this Agreement is required or permitted to be given or served by the City to or on the Fiscal Agent may be given or served by being deposited postage prepaid in a post office letter box, by overnight courier or by electronic means (with receipt confirmed by telephone) addressed (until another address is filed by the Fiscal Agent with the City) as follows:

U.S. Bank Trust Company, National Association333 S. Grand Ave., 5th Floor MAC E2064-05ALos Angeles, California 90071
Attention: Corporate Trust Department
Tel: (213) 253-7517
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45 Section 9.07. Partial Invalidity. If any Section, paragraph, sentence, clause or phrase of this Agreement shall for any reason be held illegal or unenforceable, such holding shall not affect the validity of the remaining portions of this Agreement. The City hereby declares that it would have adopted this Agreement and each and every other Section, paragraph, sentence, clause or phrase hereof and authorized the issue of the Bonds pursuant thereto irrespective of the fact that any one or more Sections, paragraphs, sentences, clauses, or phrases of this Agreement may be held illegal, invalid or unenforceable.

Section 9.08. Unclaimed Moneys. Anything contained herein to the contrary notwithstanding, any moneys held by the Fiscal Agent in trust for the payment and discharge of the principal of, and the interest and any premium on, the Bonds which remains unclaimed for 2 years after the date when the payments of such principal, interest and premium have become payable, if such moneys was held by the Fiscal Agent at such date, shall be repaid by the Fiscal Agent to the City as its absolute property free from any trust, and the Fiscal Agent shall thereupon be released and discharged with respect thereto and the Bond Owners shall look only to the City for the payment of the principal of, and interest and any premium on, such Bonds.

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

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

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

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

Section 9.13. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original.
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[Signature page to Fiscal Agent Agreement dated as of __________ 1, 2022] IN WITNESS WHEREOF, THE CITY OF STOCKTON, for and on behalf of its Community Facilities District No. 2018-2 (Westlake Villages II), has caused this Fiscal Agent Agreement to be signed by its Chief Financial Officer, and U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION, in token of its acceptance of the duties hereunder, has caused this Fiscal Agent Agreement to be signed in its corporate name by its officers identified below, all as of the day and year first above written.

CITY OF STOCKTON, for and on behalf of
its Community Facilities District No. 2018-2
(Westlake Villages II)
By:

Chief Financial Officer
U.S. BANK TRUST COMPANY, NATIONAL
ASSOCIATION, as Fiscal Agent
By:

Authorized Officer
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A-1

EXHIBIT A

FORM OF BOND

UNITED STATES OF AMERICA

STATE OF CALIFORNIA
No. __________ $____________
IMPROVEMENT AREA 2 OF THE CITY OF STOCKTON
COMMUNITY FACILITIES DISTRICT NO. 2018-2 (WESTLAKE VILLAGES II) SPECIAL TAX BONDS SERIES 2022
INTEREST RATE: MATURITY DATE: BOND DATE: CUSIP:

September 1, 20__ ______, 2022
REGISTERED OWNER: CEDE & CO.

PRINCIPAL AMOUNT: DOLLARS
The City of Stockton (the “City”) for and on behalf of Improvement Area 2 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) (“Improvement Area 2”), for value received, hereby promises to pay solely from the Net Taxes to be collected in Improvement Area 2 or amounts in certain funds and accounts held under the Agreement (as hereinafter defined), to the Registered Owner named above, or registered assigns (the “Owner”), on the Maturity Date set forth above, unless redeemed prior thereto as hereinafter provided, the Principal Amount set forth above, and to pay interest on such principal amount from the Bond Date shown above, or from the most recent Interest Payment Date (as hereinafter defined) to which interest has been paid or duly provided for, semiannually on March 1 and September 1, commencing March 1, 2023 (the “Interest Payment Dates”), at the Interest Rate set forth above, until the principal amount hereof is paid or made available for payment.

The principal of this Bond is payable to the Owner hereof in lawful money of the United States of America upon presentation and surrender of this Bond at the principal corporate trust office of U.S. Bank Trust Company, National Association in Los Angeles, California (the “Fiscal Agent”).

Interest on this Bond shall be paid by check of the Fiscal Agent mailed by first class mail on each Interest Payment Date to the Owner hereof as of the close of business on the 15th day of the month preceding the month in which the Interest Payment Date occurs whether or not such day is a Business Day (the “Record Date”) at such Owner’s address as it appears on the registration books maintained by the Fiscal Agent, or by wire transfer made on such Interest Payment Date upon written instructions delivered to the Fiscal Agent by the applicable Record Date of any Owner of $1,000,000 or more in aggregate principal amount of Bonds.

This Bond is one of a duly authorized issue of bonds approved by resolution of the City Council of the City on __________, 2022 pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, Sections 53311, et seq., of the California Government Code (the “MelloRoos Act”) for the purpose of providing moneys for the construction and acquisition of 1347
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improvements for its Community Facilities District No. 2018-2 (Westlake Villages II), and is one of the bonds designated “Improvement Area 2 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) Special Tax Bonds Series 2022” (the “Bonds”). The issuance of the Bonds and the terms and conditions thereof are provided for by a Fiscal Agent Agreement, dated as of ____________ 1, 2022, by and between the City and the Fiscal Agent (the “Agreement”) and this reference incorporates the Agreement herein, and by acceptance hereof the Owner of this Bond assents to said terms and conditions. The Agreement is authorized under, this Bond is issued under and both are to be construed in accordance with, the laws of the State of California.

Pursuant to the Mello-Roos Act, the Agreement and the Resolution, the principal of and interest on this Bond are payable solely from Net Taxes (as defined in the Agreement) and the amounts in certain funds held under the Agreement.

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

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

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

Redemption Dates Redemption Price
September 1, ____ through August 30, ____ 103%
September 1, ____ through August 30, ____ 102
September 1, ____ through August 30, ____ 101
September 1, ____ and any date thereafter 100
The Bonds shall be subject to mandatory redemption from Prepayments of the Special Tax by property owners, in whole or in part among maturities as shall be specified by the City and by lot within a maturity, on any Interest Payment Date at the following respective redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates Redemption Price
Interest Payment Dates through March 1, _____ 103%
September 1, _____ and March 1, _____ 102
September 1, _____ and March 1, _____ 101
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September 1, _____ and Interest Payment Dates thereafter 100 The Bonds maturing September 1, _____, September 1, _____ and September 1, _____ are subject to mandatory sinking payment redemption in part on September 1, _____, September 1, _____ and September 1, _____, respectively, and on each September 1 thereafter to maturity, by lot, at a redemption price equal to 100% of the principal amount thereof to be redeemed, without premium, in the aggregate respective principal amounts as set forth in the following tables:

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

This Bond shall be registered in the name of the Owner hereof, as to both principal and interest. Each registration and transfer of registration of this Bond shall be entered by the Fiscal Agent in books kept by it for this purpose and authenticated by its manual signature upon the certificate of authentication endorsed hereon.
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No transfer or exchange hereof shall be valid for any purpose unless made by the registered owner, by execution of the form of assignment endorsed hereon, and authenticated as herein provided, and the principal hereof, interest hereon and any redemption premium shall be payable only to the registered owner or to such Owner’s order. The Fiscal Agent shall require the Owner requesting transfer or exchange to pay any tax or other governmental charge required to be paid with respect to such transfer or exchange. No transfer or exchange hereof shall be required to be made (i) within 15 days prior to the date established by the Fiscal Agent for selection of Bonds for redemption or (ii) with respect to a Bond after such Bond has been selected for redemption.

The transferor of any Bond shall also provide or cause to be provided to the Fiscal Agent all information necessary to allow the Fiscal Agent to comply with any applicable tax reporting obligations, including without limitation any cost basis reporting obligations under Internal Revenue Code Section 6045. The Trustee may rely on the information provided to it and shall have no responsibility to verify or ensure the accuracy of such information.

The Agreement and the rights and obligations of the City thereunder may be modified or amended as set forth therein. The principal of the Bonds is not subject to acceleration upon a default under the Agreement or any other document.

This Bond shall not become valid or obligatory for any purpose until the certificate of authentication hereon endorsed shall have been dated and manually signed by the Fiscal Agent.

It is hereby certified, recited and declared that all acts, conditions and things required by law to exist, happen and be performed precedent to and in the issuance of this Bond have existed, happened and been performed in due time, form and manner as required by law, and that the amount of this Bond, together with all other indebtedness of the City, does not exceed any debt limit prescribed by the laws or Constitution of the State of California.

Unless this Bond is presented by an authorized representative of The Depository Trust Company to the Fiscal Agent for registration of transfer, exchange or payment, and any Bond issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of The Depository Trust Company and any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.
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IN WITNESS WHEREOF, the City of Stockton has caused this Bond to be dated ___________, 2022 and to be signed by the Mayor of the City and countersigned by the City Clerk of the City.

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

Dated: _____________, 2022
U.S. BANK TRUST COMPANY, NATIONAL
ASSOCIATION, as Fiscal Agent
By:

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

Dated: ________________
Signature Guaranteed:

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

NOTE: The signature(s) on this Assignment must
correspond with the name(s) as written on the face of
the within Bond in every particular without alteration or enlargement or any change whatsoever.
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B-1

EXHIBIT B
City of Stockton
Improvement Area No. 2
Community Facilities District No. 2018-2 (Westlake Villages II) Special Tax Bonds Series 2022
OFFICER’S CERTIFICATE REQUESTING DISBURSEMENT

FROM IMPROVEMENT FUND
REQUISITION NO. _____
The undersigned hereby states and certifies that:
(i) I am an “Authorized Officer,” as such term is defined in that certain Fiscal Agent Agreement, dated as of _____________ 1, 2022 (the “Fiscal Agent Agreement”), by and between the City and U.S. Bank Trust Company, National Association, as fiscal agent (the “Fiscal Agent”) and as such, am familiar with the facts herein certified and am authorized to certify the same;
(ii) under Section 3.04(B) of the Fiscal Agent Agreement, the undersigned hereby requests and authorizes the Fiscal Agent to disburse from the Improvement Fund established under the Fiscal Agent Agreement to each payee designated on Schedule A attached hereto and by this reference incorporated herein, the amount set forth opposite such payee, for payment or reimbursement of previous payment of a cost of the Project (as that term is defined in the Fiscal Agent Agreement) as described on attached Schedule A;
(iii) no portion of the amount herein requested to be disbursed was set forth in any Officer’s Certificate previously filed requesting disbursement; (iv) there has not been filed with or served upon the City a stop notice or any other notice of any lien, right to lien or attachment upon, or claim affecting the right to receive payment of, any of the money payable to the person named in this Officer’s Cetificate, which has not been released or will not be released with the payment of such obligation, other than materialmen's or mechanics' liens accruing by mere operation of laws; and
(v) in the case of each payment made under any contract for installation or construction, insofar as such obligation was incurred for work, materials, equipment or supplies, such work was actually performed or such materials, equipment or supplies were actually installed in furtherance of the Project or delivered at the site for that purpose or delivered for storage or fabrication at a place or places approved by the City.

Dated: _______________ CITY OF STOCKTON
______________________________________
By: Authorized Officer
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EXHIBIT 1
B-2

SCHEDULE A
Payee Name and Address Purpose of Obligation Amount
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1 $_______
IMPROVEMENT AREA 2 OF THE CITY OF STOCKTON
COMMUNITY FACILITIES DISTRICT NO. 2018-2
(WESTLAKE VILLAGES II)
SPECIAL TAX BONDS, SERIES 2022

BOND PURCHASE AGREEMENT
_______, 2022
City of Stockton
425 North El Dorado Street
Stockton, California 95202
Ladies and Gentlemen:

The undersigned, Oppenheimer & Co. Inc., as underwriter (the “Underwriter”), acting not as a fiduciary or agent for you, but on behalf of itself, offers to enter into this Bond Purchase Agreement (this “Purchase Agreement”) with the City of Stockton (the “City”) for Improvement Area 2 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II) (the “Community Facilities District”), which upon acceptance will be binding upon the Underwriter and the City. The agreement of the Underwriter to purchase the Bonds (as hereinafter defined) is contingent upon the City satisfying all of the obligations imposed upon it under this Purchase Agreement. This offer is made subject to the City’s acceptance by the execution of this Purchase Agreement and its delivery to the Underwriter at or before 11:59 p.m., California time, on the date hereof, and, if not so accepted, will be subject to withdrawal by the Underwriter upon notice delivered to the City at any time prior to the acceptance hereof by the City. All capitalized terms used herein, which are not otherwise defined, shall have the meaning provided for such terms in the Fiscal Agent Agreement, dated as of July 1, 2022 (the “Fiscal Agent Agreement”), by and between the City and U.S. Bank Trust Company, National Association, as fiscal agent (the “Fiscal Agent”).

1. Purchase, Sale and Delivery of the Bonds.

A. Subject to the terms and conditions and in reliance upon the representations, warranties and agreements set forth herein: the Underwriter hereby agrees to purchase from the City and the City hereby agrees to sell to the Underwriter all (but not less than all) of the $10,625,000 aggregate principal amount of the Improvement Area 2 of the City of Stockton Community Facilities District No. 2018-2 (Westlake Villages II), Special Tax Bonds, Series 2022 (the “Bonds”), dated the Closing Date (as hereinafter defined), bearing interest at the rates and maturing on the dates and in the principal amounts set forth in Appendix A hereto. The purchase price for the Bonds shall be $______ (being 100% of the aggregate principal amount thereof, plus net original issue premium of $_______, less an Underwriter’s discount of $______).

The Underwriter agrees to make a bona fide initial public offering of all of the Bonds in compliance with federal and state securities laws, at a price not in excess of the initial offering prices (or yields) set forth in Appendix A attached hereto and incorporated herein by reference. Subsequent to the initial public offering, the Underwriter reserves the right to change the public offering prices (or yields) as it deems necessary in connection with the offering of the Bonds, without any requirement of prior notice subject to Section 5 herein, provided that the Underwriter shall not 1355
EXHIBIT 2
2 change the interest rates set forth in Appendix A. The Bonds may be offered and sold to certain dealers at prices lower than such initial offering prices.

The Bonds shall be substantially in the form described in, shall be issued and secured under the provisions of, and shall be payable from the Net Taxes and certain other amounts as provided in the Fiscal Agent Agreement, the Preliminary Official Statement (as hereinafter defined), and the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2, Title 5 of the Government Code of the State of California (the “Act”). The issuance of the Bonds has been duly authorized by the City pursuant to a resolution (the “Resolution”), adopted by its City Council (the “City Council”) on behalf of the Community Facilities District, on ______, 2022.

The proceeds of the Bonds shall be used to (i) construct and/or acquire certain public facilities authorized for the Community Facilities District, (ii) pay capitalized interest on a portion of the Bonds through September 1, 2023, (iii) establish a debt service reserve fund for the Bonds, and (iv) pay initial administration costs and the costs of issuing the Bonds.

B. The City hereby acknowledges that the Underwriter is entering into this Purchase Agreement in reliance on the representations, warranties and agreements made by the City on behalf of itself and on behalf of the Community Facilities District herein, and the City shall take all action necessary to enforce its rights hereunder for the benefit of the Underwriter and shall immediately notify the Underwriter if it becomes aware that any representation, warranty or agreement made by the City, on behalf of itself or on behalf of the Community Facilities District, herein is incorrect in any material respect.

C. The City acknowledges and agrees that: (i) the primary role of the Underwriter, as an underwriter, is to purchase securities for resale to investors in an arm’s-length commercial transaction between the City and the Underwriter and that the Underwriter has financial and other interests that differ from those of the City and the Community Facilities District; (ii) the Underwriter is not acting as a municipal advisor, financial advisor or fiduciary to the City, the Community Facilities District, or any other person or entity and has not assumed any advisory or fiduciary responsibility to the City or the Community Facilities District with respect to the transaction contemplated hereby and the discussions, undertakings and proceedings leading thereto (irrespective of whether the Underwriter has provided other services or is currently providing other services to the City or the Community Facilities District on other matters); (iii) the only obligations the Underwriter has to the City or the Community Facilities District with respect to the transaction contemplated hereby expressly are set forth in this Purchase Agreement, except as otherwise provided by applicable rules and regulations of the Securities and Exchange Commission or the rules of the Municipal Securities Rulemaking Board (the “MSRB”); and (iv) the City has consulted its own legal, accounting, tax, financial and other advisors, as applicable, to the extent it has deemed appropriate in connection with the transaction contemplated herein. The City acknowledges that it has previously provided the Underwriter with an acknowledgement of receipt of the required Underwriter disclosure under Rule G-17 of the MSRB and acknowledges that it has engaged KNN Public Finance (the “Municipal Advisor”), as its municipal advisor (as defined in Securities and Exchange Commission Rule 15Ba1) and will rely solely on the Municipal Advisor for financial advice with respect to the Bonds.

D. Pursuant to the authorization of the City, the Underwriter has distributed copies of the Preliminary Official Statement dated ______, 2022, relating to the Bonds, which, together with the cover page, inside cover page and appendices thereto is herein called the “Preliminary Official Statement.” By its acceptance of this Purchase Agreement, the City hereby 1356
EXHIBIT 2
3 consents to and ratifies the use and distribution by the Underwriter of the Preliminary Official Statement, and the City agrees to execute a final official statement relating to the Bonds (the “Official Statement”) which will consist of the Preliminary Official Statement with such changes as may be made thereto, with the approval of Jones Hall, A Professional Law Corporation, San Francisco, California, Bond Counsel and Disclosure Counsel (herein called “Bond Counsel”), and the Underwriter, and to provide copies thereof to the Underwriter as set forth in Section 2(S) hereof.

The City hereby authorizes and requires the Underwriter to use and promptly distribute, in connection with the offer and sale of the Bonds, the Preliminary Official Statement, the Official Statement and any supplement or amendment thereto. The City further authorizes the Underwriter to use and distribute, in connection with the offer and sale of the Bonds, the Fiscal Agent Agreement, this Purchase Agreement and all information contained herein, and all other documents, certificates and statements furnished by or on behalf of the City or the Community Facilities District to the Underwriter in connection with the transactions contemplated by this Purchase Agreement. The Preliminary Official Statement and/or the Official Statement may be delivered and printed in a “designated electronic format” as defined in the MSRB’s Rule G-32 and as may be agreed to by the City and the Underwriter. The City confirms that it does not object to distribution of the Preliminary Official Statement or the Official Statement in electronic form. A copy of the most recent Preliminary Official Statement sent to a potential purchaser shall be sent electronically (or other equally prompt means) by first class mail not later than the first business day following the day upon which each such request is received.

E. To assist the Underwriter in complying with Securities and Exchange Commission Rule 15c2-12(b)(5) (the “Rule”), the City will undertake pursuant to the City Continuing Disclosure Certificate, in the form attached as an appendix to the Official Statement (the “City Continuing Disclosure Certificate”), to provide annual reports and notices of certain enumerated events. A description of this undertaking is set forth in the Preliminary Official Statement and will also be set forth in the Official Statement.

F. Except as the Underwriter and the City may otherwise agree, the City will deliver to the Underwriter, at the offices of Bond Counsel in San Francisco, California, or at such other location as may be mutually agreed upon by the Underwriter and the City, the documents hereinafter mentioned; and the City will deliver to the Underwriter through The Depository Trust Company’s (“DTC”) FAST delivery system, the Bonds, in definitive form (all Bonds bearing CUSIP®numbers printed thereon), duly executed by the City and authenticated by the Fiscal Agent in the manner provided for in the Fiscal Agent Agreement and the Act at 8:30 a.m. California time, on ______, 2022 (the “Closing Date”), and the Underwriter will accept such delivery and pay the purchase price of the Bonds as set forth in paragraph (A) of this Section by wire transfer, payable in federal or other immediately available funds (such delivery and payment being herein referred to as the “Closing”). The Bonds shall be in fully registered book-entry form (which may be typewritten) and shall be registered in the name of Cede & Co., as nominee of DTC, which will act as securities depository for the Bonds, and the specimen Bonds will be made available for checking by the Underwriter not less than 5 days prior to the Closing.

G. Except as the City and the Underwriter may otherwise agree, the City will deliver to the Underwriter, at the offices of Bond Counsel in San Francisco, California, or at such other location as may be mutually agreed upon by the Underwriter and the City, the documents hereinafter mentioned on the Closing Date.
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4 2. Representations, Warranties and Covenants of the Community Facilities District.

The City represents, warrants and covenants to the Underwriter, on behalf of itself and the Communities Facilities District, as the case may be, that:

A. The City is a municipal corporation and charter city duly organized and validly existing pursuant to the Constitution and laws of the State of California (the “State”), and has duly authorized the formation of the Community Facilities District pursuant to resolutions duly adopted by the City Council (the “Community Facilities District Formation Resolution” and, together with the Resolution, the “Community Facilities District Resolutions”) and the Act. The City Council, as the legislative body of the Community Facilities District, has duly adopted the Community Facilities District Formation Resolution, has duly adopted the Ordinance levying the Special Tax (for all purposes herein, as such are defined in the Fiscal Agent Agreement) within Improvement Area 2 of the Community Facilities District (the “Ordinance”), and has caused to be recorded in the real property records of San Joaquin County, a notice of special tax lien (the “Notice of Special Tax Lien”). The Community Facilities District Formation Resolution, the Ordinance, and the Notice of Special Tax Lien are collectively referred to herein as the “Formation Documents.” The City Council has duly adopted the Resolution. Each of the Formation Documents remains in full force and effect as of the date hereof and has not been amended. The Community Facilities District is duly organized and validly existing as a community facilities district under the laws of the State.

The City has, and at the Closing Date will have, as the case may be, full legal right, power and authority: (i) to execute, deliver and perform its obligations under this Purchase Agreement and the Fiscal Agent Agreement and to carry out all transactions contemplated by each of such agreements; (ii) to enter into the City Continuing Disclosure Certificate; and (iii) to carry out, give effect to and consummate the transactions contemplated by the Formation Documents, the Fiscal Agent Agreement, this Purchase Agreement and the Official Statement.

This Purchase Agreement, the Fiscal Agent Agreement, and the City Continuing Disclosure Certificate are collectively referred to herein as the “City Documents.” B. By all necessary official action of the City, the City has duly authorized and approved the execution and delivery by the City of, and the performance by City of, the obligations on its part contained in, the City Documents and has approved the use and distribution by the Underwriter of the Preliminary Official Statement and the execution, use and distribution by the Underwriter of the Official Statement, and, as of the date hereof, such authorizations and approvals are in full force and effect and have not been amended, modified or rescinded. When executed and delivered by the parties thereto, the City Documents will constitute the legally valid and binding obligations of the City, on its own behalf and on behalf of the Communities Facilities District, enforceable upon the City and the Community Facilities District in accordance with their respective terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws or equitable principles relating to or affecting creditors’ rights generally. To the best of the City’s knowledge, the City has complied, and will at the Closing Date be in compliance in all respects, with the terms of the City Documents that are applicable to the City, and the Community Facilities District has complied, and will at the Closing Date be in compliance in all respects, with the terms of the City Documents that are applicable to the Community Facilities District.

City Council and Concurrent AuthoritiesJune 14, 2022

City Council and Concurrent Authorities
June 14, 2022