Broadway Project
Monthly Schedule and
Budget Update
Gillian Haen, Assistant City
Manager
Natalie Peterson, Assistant to
the City Manager
April 22, 2025
Broadway Project Background
• Location: 2441 Broadway
• 47 Permanent Supportive Housing
Units
• Roughly 97% complete
• Partners:
– Developer: Firm Foundation
– Operator: Shelter Inc.
• Firm Foundation – current property
owners (through construction)
• City to take ownership at end of
construction for anticipated future
sale/transfer to affordable housing
nonprofit organization
Update on Schedule
Construction Timeline – No changes
from March 2025 Update
• Temporary Certificate of Occupancy
(TCO) – May 7, 2025
• Certificate of Occupancy (construction
completion) – May 29, 2025
• Full Lease-Up – 90 days from
construction completion
• Building has received power and is
working with PG&E installed meters to
provide power to individual units
Update on Budget
• Total Funding Secured: $27,114,262
• Funding Spent: $24,972,183
– Includes January, February & partial March invoices
• Remaining Funding: $2,142,079
• Project Overruns: approximately $600,00 by project end – Overruns due to increased costs for: site insurance,
security, & construction management of the site for
increased time due to rain delays
– Solutions: value engineering, funding from outside
partners (ex: partners to sponsor rooms, community
room, other areas)
– Holding Firm Foundation and Cannon final payment
until funds identified.
Final Steps April-May 2025
• Finalize Operator contract; Begin lease up
• Exterior:
a. Concrete walkways, sidewalks, curbs –2/3 finished. Pour this week /next. b. Asphalt parking lot – graded and ready for asphalt once curbs are poured. c. Landscaping – irrigation install now. Plants arriving–install next week. • Interior:
a. Permanent power is ON, PG&E finishes unit meters this week. b. Elevator crew returns next week to balance/program the elevator. Then the State inspector comes for final inspection.
c. Floors 2, 3, and 4-99% complete. Fire alarms-complete this week. d. First Floor main corridor fire alarm devices-install this week, install flooring (next week) on stairs and 1st floor.
e. The Community Room wood ceiling install now. Need cabinets (next week), countertop (the following week), flooring (next 2 weeks), and other minor trim and finishes (in 3 weeks).
f. ERRCS (Emergency Responder Radio Communication System) – this is the system that boosts the radio signals for emergency responders.
Waiting on the equipment-install and test over the next few weeks.
CONTACT(S)
Gillian Haen, Assistant City
Manager
[email protected]
Natalie Peterson, Assistant to the
City Manager
[email protected]
Budget details
Dear Council Member Gordon,
At the last Regular City Council Meeting on April 8, 2025, during the discussion of Action Item 9.B. (appropriation of $3 million Measure P funds for Mare Island bridge repair) you asked: “I’ve been hearing from Mr. Boone, six million dollars, two point eight million dollars, close to nine million dollars, what is that about, please?” (Meeting Video at 1:42:25-1:42:35) The response you received from the City Attorney was incomplete. It did not address the millions of dollars collected from Lennar which is unaccounted for, and the response regarding the UN-collected millions from Mare Island Company was essentially a non-answer: the City Attorney will tell you secretly, in closed session. (Meeting Video at 1:42:38-1:43:18)
I want to answer your question directly and as completely as I can, so that you, and the Mayor, Vice-Mayor and other City Council Members see and hear the facts which support what I have been calling the “missing millions.”
Why do the missing millions matter to Mare Island CFD taxpayers?
1. As an initial matter, it is important to understand that the City Council Resolution which created Mare Island CFD 2002-1 provides that each fiscal year, the City is required to review the revenues generated from property or activities on Mare Island, and to apply that amount against the services budget the City has projected for Mare Island, to calculate the amount of CFD taxes Mare Island taxpayers will pay. (See, Attachment 1, Resolution, PDF page 13, highlighted.) The lease revenues Lennar paid for many years, and the lease revenues Mare Island Company should have been paying since 2019, are obviously “revenues generated from property or activities on Mare Island,” which should have been applied to lower the CFD taxes. (See, Attachment 1, PDF page 10, highlighted.) But the City has ignored taxpayer requests for an accounting of the revenues collected from Lennar, and ignored taxpayer requests for an explanation why the revenues have not been collected from Mare Island Company. Those are public monies unaccounted for and uncollected, and the public has a right to that information.
2. The purpose of a Community Facilities District (CFD) tax is, of course, to pay for facilities or services which benefit the taxpayers in the District. If the millions of dollars of Lennar lease revenues were not used to lower the CFD taxes, they should have been used for the benefit of the District. With no accounting by the City, we don’t know what they were used for.
How did the lease revenue obligation arise?
A Short Summary: The explanation below is very detailed, so I offer this summary at the beginning as a touchstone. Lennar promised to pay the City five percent (5%) of its lease revenues on Mare Island every year. When Nimitz/Mare Island Company bought out Lennar, Nimitz/Mare Island Company promised to fulfill all of Lennar’s obligations to the City, which included the payment of the lease revenues. Lennar paid the lease revenues every year until 2017. Nimitz/Mare Island Company has never paid the lease revenues.
The Detailed Explanation: I am attaching to this email, as Attachment 2, a Memorandum dated December 4, 2023, from Christina Ratcliffe, who was at that time the Planning & Development Director for the City (hereafter “Director Memorandum”). I have highlighted parts of the Director Memorandum and attached additional documents to this email which establish the following facts:
1. Through an Acquisition Agreement (AA) dated December 21, 1999, between the City of Vallejo and Lennar Mare Island Company, LLC (LMI), LMI acquired approximately 670 acres on Mare Island. (Relevant excerpts of the AA are attached to this email as Attachment 3.)
2. As stated in the Director Memorandum, and as shown in Attachment 3, Section 7.3.4 of the AA required LMI to pay the City five percent (5%) of gross lease revenues from LMI’s subleases of Sub-LIFOC Parcels and Reuse Area Subleases on Mare Island.
3. As stated in the Director Memorandum, in September 2001, the City entered into a Development Agreement (DA) with LMI for development of the 670 acres on Mare Island which LMI had acquired through the AA.
4. As stated in the Director Memorandum, Section 2.2 of the September 2001 DA with LMI required LMI to faithfully comply with all terms of the AA. As shown above, those terms included LMI’s obligation to pay the City five percent (5%) of the gross lease revenues.
5. As stated in the Director Memorandum, Lennar did comply with its obligation to pay the five percent (5%) lease revenues to the City until 2017, and those payments typically would exceed four hundred thousand dollars per year. The text of CFD 2002-1 specifically states that the “funds paid to the City by the Master Developer pursuant to the Acquisition Agreement” are “other revenues” which can be applied to reduce the CFD taxes. (Attachment 1, PDF page 10, highlighted.)
6. As stated in the Director Memorandum, on November 14, 2019, The Nimitz Group LLC (dba Mare Island Company) took ownership of the property previously acquired and owned by LMI, and also assumed all of LMI’s obligations to the City under the September 2001 DA. As shown above, those obligations included paying the City five percent (5%) of gross lease revenues. (See Attachment 4, November 2019 Transfer Agreement, highlighted, signed by LMI, Nimitz, and Consent signed by City Manager and City Attorney.)
7. Nimitz/Mare Island Company has never made the five percent lease revenue payments to the City.
8. In January 2022, City Manager Michael Malone and Assistant City Manager Gillian Hayes and City Attorney Veronica Nebb each signed a document titled “ACKNOWLEDGEMENT OF DEVELOPMENT
AGREEMENT SECOND EXTENSION.” (See Attachment 5.) That document included all of the factual statements referenced in the Director Memorandum cited above, including the fact that LMI had made the five percent (5%) lease revenue payments to the City for approximately fifteen (15) years, and that the annualized payments to the City typically exceeded $400,000. (See Attachment 5.) The document, signed by the three City officials, admits that the “issue” of the Developer (Nimitz/Mare Island Company) failing to pay the required lease revenues was “flagged” in 2019 and again in 2021. (See Attachment 5.) The Director Memorandum “flagged” the issue again in 2023 (Attachment 2). From 2019 to 2025, the City has done nothing to collect the lease revenues from Mare Island Company.
9. Doing the math: If LMI was paying $400,000 annually for 15 years as the three City officials stated in Attachment 5, then 15 years x $400,000 = $6 million. Mare Island Company has not paid anything 2019-2025, a period of seven years. 7 years x $400,000 = $2.8 million.
The foregoing facts lead to these questions, still unanswered by the City:
1. Where is the $ 6 million lease revenue collected from Lennar?
2. What was the $6 million used for?
3. Why hasn’t the City collected the $2.8 million lease revenue it should have been collecting from Nimitz/Mare Island Company since 2019?
I urge the City Council to pursue answers to these questions, and respectfully assert that the answers should not be hidden and offered only in closed session. These are millions of dollars of public monies unaccounted for and uncollected. The answers should be given to the public, for transparency, accountability and credibility of the Mayor, Vice-Mayor, City Council and City staff. If they are not made public, what is the public to conclude except that the City has something to hide?
Actions speak louder than words. The words “trust and transparency” have been spoken repeatedly by this City Council since January. Are they just words, or will you take action?
Thank you for your kind attention and consideration of the points above.
Sincerely,
Daniel Boone
Joined by: Sherianne Grimm, Susan Nichols, Daniel Glaze, James DuCharme, Miguel Buchwald
ATTACHMENT - 2
M E M O R A N D U M
PLANNING DIVISION
DATE: December 4, 2023 Item No.: 11A
TO: City of Vallejo Planning Commission
FROM: Christina Ratcliffe, Planning & Development Services Director Kristin Pollot, Interim Planning Manager
SUBJECT: Mare Island Development Agreement Annual Review for 2022 (DA #23-0001) – Informational Item
BACKGROUND
In September 2001, the City entered into a Development Agreement (DA) with Lennar Mare Island, LLC (LMI) for the development of approximately 670 acres on Mare Island. The City determined that entering into the DA would promote orderly growth and quality development on Mare Island in accordance with the goals and policies set forth in the Mare Island Reuse Plan and Specific Plan. The City would also benefit from increased employment, commerce, housing and recreational opportunities created by the Lennar Mare Island Development Project for Vallejo residents.
On November 14, 2019, The Nimitz Group, LLC (doing business as and referred to hereinafter as the “Mare Island Company”) took ownership of the property and assumed responsibility as the successor entity under the September 12, 2001, Development Agreement for Mare Island.
Pursuant to Vallejo Municipal Code (VMC) Chapter 17.20 and Article V (Annual Review) of the DA, the Mare Island Company is required to prepare and submit an Annual Review of its development activity under the DA to the Development Services Director. Such review is to be initiated during the month of March each year, commencing in March 2002. The Development Services Director is required to determine if the DA is being performed in accordance with its terms and conditions, and to notify the Mare Island Company and the Planning Commission in writing of such determination. If the Director is satisfied with the Annual Review and determines that the Mare Island Company is in compliance, the review for that period is concluded. However, if the Director is not satisfied that the Mare Island Company is being performed in accordance with the terms and conditions of the DA, the matter is referred to the Planning Commission for action pursuant to VMC Section 17.20.030(B).
2022 ANNUAL REVIEW
Staff received a letter from the Mare Island Company addressed to Christina Ratcliffe, Planning & Development Services Director, dated July 2023, providing the Annual Review for 2022. Based on staff’s assessment of the Annual Review letter, the Director is satisfied that the DA is being performed in accordance with its terms and conditions, with the exception that the Mare Island Company’s continuing obligation to pay to the City a portion of its rent revenues as required by the Acquisition Agreement (AA),
has yet to be resolved to the City’s satisfaction.
Under the terms of Section 2.2 of the DA, Compliance with the AA, the developer is to faithfully comply with the terms of the AA. Per Section 7.3.4 of the AA, “Sublease Revenue Allocation after the Preliminary Feasibility Period,” the developer is required to pay to the City five percent (5%) of the Gross Lease Revenues from subleases of the Sub- LIFOC (Lease in Furtherance of Conveyance) Parcels and the Reuse Area Subleases. Annualized payments to the City under this section typically would exceed $400,000. In December 2017, LMI ceased making payments to the City . The City raised this issue but with the transition from LMI to Mare Island Company, the issue has yet to reach final resolution.
This memo serves as notification to the Planning Commission of the determination of “substantial” compliance pursuant to VMC Section 17.20.030(A). Therefore, the 2023 Annual Review for the year 2022 is considered to be concluded.
The Annual Review letter (attached) includes the following highlights for 2022:
• In 2022, Mare Island Company ( “MIC”) continued refining development plans, adding additional members to the project team, and expanding the long- term plan to support the future vision for Mare Island.
• The North Mare Island Development and Disposition Agreement (DDA) was approved by the City in March 2022. The purchase of North Mare Island by MIC closed in October 2022.
• The MIC Team successfully began the abatement and demolition of derelict structures on North Mare Island in Nov/Dec 2022.
• MIC invested in multiple buildings which helped maintain historic resources and expand the positive economic impact of the Mare Island business community. Throughout the year dozens of trees received heavy maintenance and weed abatement was performed by bo th our goats and landscaping crew.
• Employment data collection was revised in 2020 such that reported numbers now include only those businesses that lease space from MIC. The net effect dropped gross year over year job numbers. Overall employment figures for MIC leased space increased from 2,667 in June 2022 to 2,706 in December 2022 a net increase of 39 jobs.
RECOMMENDATION
This item is informational only; no Planning Commission action is required.
ATTACHMENTS
1. Annual Review Letter, dated July 2023
2. 2001 Development Agreement between Lennar Mare Island, LLC and City of Vallejo
The Mare Island Company 1195 Walnut Ave. Vallejo, CA 94592 mareislandco.com
The Nimitz Group, LLC, DBA The Mare Island Company
Monthly Report to City of Vallejo
For March 2024
Development Focus
• Specific Plan – MIC/City staff are beginning the process of drafting the new island wide specific plan. As part of that process, the City and MIC have been hosting monthly Community workshops to gather public input. The formal workshop process was completed July 2023. However, MIC had a community workshop on March 28th to review the draft land use plan with the community. This plan will be the basis of the Specific Plan. MIC’s intent is to have a draft of the specific plan submitted to the city in the Fall of 2024. • Connolly Corridor--The EIR Addendum that will allow for development of the Connolly Corridor was approved by the City Council in March 2022. MIC staff is currently working on the detailed design for phase 1 of the project which will include a mix of food and beverage, retail and open space along the waterfront promenade and coal sheds area. MIC presented the conceptual plan to City staff in June. MIC staff is currently working on the design package for City approval. MIC staff intends to provide an update to the city and the community by early 2024.
• Per the North Mare Island DDA, MIC staff submitted the Mare Island Beautification Plan to the City on June 12, 2023. MIC staff has completed detailed construction drawings to be submitted to the City for final approval and building permits. We are currently working with city staff to schedule our first meeting to begin the permitting process. However, due to the city’s staff shortage in all city departments, a meeting date has not been determined.
Commercial Updates
B34- The fire extinguishers were serviced for 2024/25.
B69- The fire extinguishers were serviced for 2024/25.
B77- The annual inspection of the freight elevator was performed.
B77- Elevator mechanical room was re-keyed.
B77- Roof repairs at 30+ locations performed.
B100 Southeast exterior- Installed 60 lin. ft. x 6’ in height, black fence screening.
B106 South@ exterior- Photo cells were installed at @ 2 high-bay LED lamps.
B111- General clean-up of warehouse space after a tenant move-out was completed.
B112- Annual inspections of 2 freight elevators and 1 passenger elevator were performed.
B112- Qtrly. Jetwash at main sewer lateral was performed.
B117 South Parking Lot- Weed abatement was performed.
B117- Elect. and Janitor closet were re-keyed.
B117- A new bathroom exhaust fan was installed.
B117 Rooftop- Preventive maintenance (routine) were performed at 10 Hvac units.
B121 West yard- 2 square blocks of weed abatement was performed.
B126- The annual inspections of 2 passenger elevators were performed.
B149- Roof repairs were completed at expansion joints.
B149 @ Breezeway- The fire extinguisher was serviced for 2024/25.
B459- Annual inspection of 1 passenger elevator was performed. 2 B483- The annual elevator inspection was performed at the southwest freight elevator.
B483 Southwest exterior- Weed abatement along perimeter of building, was performed.
B483 North parking lot- Weed abatement was performed.
B533- Sewer lateral lines (below grade) at 3 spot locations were repaired.
B760- The fire extinguishers were serviced for 2024/25.
B680 exterior west-- Weed abatement along 50 yds. of fire lane was performed.
B1310 West yard- Weed abatement was performed.
Historic Core- Hanging electrical wires caused by Drone Operator error, were repaired.
A St. between Railroad Ave and Walnut Ave- Removed fallen tree limb caused by windstorm.
Azuar Dr. Southeast- 14 Palm trees were pruned.
Azuar Dr. at G St.- 2 large pine trees were pruned, for weight reduction.
Azuar Dr. at O St- 1 large Camphor tree was pruned.
15th. St. between. Azuar Dr. and Nimitz Ave- 8ea. Palm trees were pruned.
B112 Southeast exterior- Large Acacia tree was pruned.
Qtrs. G- 4 large Eucalyptus trees were safe pruned/ weight reduction.
Morton Field East- The tree stump, remnant of the fallen tree caused by windstorm, was removed.
Tyler St. between Walnut Ave and Oak St- 1 large eucalyptus tree was safe pruned/ weight reduction.
B489 lot- 2 large Acasia trees were pruned.
B746-Parking lot- 4ea large Eucalyptus trees were safe pruned/ weight reduction.
Qtrs. C- Cracked drainpipe behind ceiling was replaced with new.
Qtrs. F- The fire extinguishers were serviced for 2024/25.
Qtrs. K- Repaired 10 lin. ft. of fencing.
Qtrs. L- Repaired 2 fence gates.
Qtrs. M- Repaired 15 lin. ft. of fencing.
Qtrs. S- The fire extinguishers were serviced for 2024/25.
A St, between Nimitz Ave. and Azuar Dr.- Weed abatement along the railroad tracks was performed.
Connolly St.- Across from B223- Several potholes (caused by storm) were filled with asphalt patch.
Connolly St. lot- Weed abatement covering a 4 block a 4-block square, was performed.
G St. from Nimitz Ave to Azuar Dr.- Weed abatement was performed along plant medians, and curb/ gutter.
*Horse Stables West- Weed abatement was performed.
North Island- Weed abatement was performed along Walnut Ave from O St. to G St.
North Island- Weed abatement was performed along Railroad Ave, from G St. to O St.
North Island- Flood waters, caused by storm was pumped out from tenant laydown space.
North Island- 30 lin. ft. of cattle fence along Railroad Ave at O St. was repaired.
North Island- Trash and debris was removed from 2 illegal dump sites on K St.
Morton Field Southeast- Weed abatement was performed.
Pier 21- fence breach was repaired.
Railroad Ave-, from 8th. St. to 10th St.- Weed abatement along the historical bunkers was performed.
San Pablo Trail (Dump Road)- Weed abatement was performed along the “Ditch, and Swale.” Walnut Ave from G St. to Kansas St- The red and white curbs were painted at scuffed spots only. 8C Southwest Trac- The goats are chomping away at the fresh weeds.
Leasing
In March the Mare Island Co. leasing team worked with new and existing tenants to complete the following agreements:
• New Leases:
North Bay Site Services executed a new lease for B100 3 Ghilotti Construction Company executed a new lease for B459 Ghilotti Construction Company executed a new lease for the 17th St. Laydown Yard • Lease Extensions:
Integrated Turbo renewed their lease in Building 126
Packaging Arts renewed their lease in Quarters E
Law offices of Christopher Sweeney renewed their lease in Quarters 29 Red Barn Productions renewed their lease in Building 535 Blue and Gold Fleet renewed their waterfront lease of Berth 9 • Move-Outs:
None
Environmental Updates
Lennar Mare Island (LMI) and the Navy retain responsibility for the environmental cleanup and closure of remaining Investigation Areas (IA)s C1, C2, and D1.3 (Building 84) within the Eastern Early Transfer Parcel (EETP). LMI submits separate monthly and quarterly progress reports directly to the City regarding environmental cleanup efforts on behalf of the Navy within the EETP. The Navy submits separate monthly progress reports directly to the City for environmental cleanup activities on Mare Island that are outside of the EETP.
MIC continues to monitor and document all soil disturbing activities within the EETP Land Use Covenant (LUC)-restricted areas of properties owned by the Nimitz Group, including responses to the Department of Toxic Substance Control (DTSC) for Terradex Alerts related to underground service alert (USA/811) notifications. MIC continues to manage and abate hazardous building materials discovered during routine building maintenance and renovations.
MIC continues to attend numerous meetings with the City, LMI, DTSC and the Navy concerning remediation activities within Investigation Areas (IA) C1 and C2, the interior of Building 84 (IA D1.3), and Navy-retained cleanup sites on Mare Island outside of the EETP. MIC continues to perform periodic surveys of industrial tenants to ensure environmental compliance, safe operations, and preservation of historic resources.
Activation
No events were hosted by Mare Island Company in March.
Community Engagement
In March, individual meetings were held with the mayor and city council members to introduce the DRAFT Land Use Plan. On March 27th, a meeting was held for the residents of Mare Island and on March 28th for the entire community to present the DRAFT Land Use Plan and schedule for the Specific Plan submittal.
Additional Exhibits
EXHIBIT I
Preliminary Portfolio Operations Financial Performance – March 2024
4 Revenue March 2024
Rental Revenue 1,135,008
Operating Expense Reimbursement 352,852
CFD Reimbursement 43,077
Property Tax Reimbursement 67,078
Other 1,486
Total Revenue 1,599,501
Property Operating Expenses
Property Operating Expenses (509,966)
CFD Expense (53,714)
Property Tax Expense (71,280)
Leasing Prep (885)
Total Property Operating Expenses (635,845)
Net Operating Income
963,656
ATTACHMENT - 5
MAJL TO:
0 , 10.EOF .11 • Cl!.BRK
t lTY •• VALLEJO
555 SANT ·' - - • • STREEf
VA'UI..EJO, CA 94500
EXENIPT F;ROM RECORDING FEES
Pil!.IRSU1ANiT T10 GOV!ER M.ENT CODE.
SECTI.ONl 6110!3
·CONFORNIEJD ·COP'V
CliV Of VAU.EJO
__ OT~CE OF CO -PL:HCO
Rf.Co~a REQUESTED BY
.ANO· . , ~CQlIDJID , R.B1'URN
0;
Ci1'Y V·- WC
OW.ICE OF CIT"/ CllRi{. 31!:D ft,O(lR
s.,~ · •. , . ·. CLAM STIU!ET
' ..u..LE:10, CA ~ S90
AC~~ow moliM£Ni'f Of ~PMHNT ~
SEODND HXT.ENs;tON
OWLEnOb.farr , OBVEIL.Qf RE -00 D
.EXTENSION .. A-ckmi:- lcd.1me. •• ' f 24, 2e:2I.,
be~ 1'HE NIMrn /GROUP. • fo:mi:11 IErnitcd llfabiJity oo~· I;' ,.,i:ltipe-- • el -
Ceyb_
IXll:lcid h . Owclbpm
m . amy •
d, •~O -
11044,27 of the Of.lieial: Ri~ ofS;:ilano Collll
Affl. ii _ Nov.l!!fflber30, 2004. _· . _d
Olil J . . • ml, (ii, 200:S-00 . .
QI! ty, r ~xfrnrll!idl bf . . . • ell .
A~ ~i:l'cd ' · - --.· ·-•~ on ov ·.,2015
md rtt;OJdoo o:m, N'□ vmibe.r 19 20 tram No, 2015-0010'1!7 J7 of dJ.c 0£racie.l :rt~ . C01Jlril:y, ,oanro CQ.E!~~ .· ~ ~ ' ' [ffCi .. ])e i!'l'!l ' -
Cit,' p« med
,~ ottlffl Dcv~lopm
ti'll [be, «11 _pl' _I
nri ' f ml"!Uilol:.\'linlllir S, ood
Ape oo June 21,, 20(11
uo'IMiitl':!'
Oi:vc.l'opcr a
SL'!ie-lki~. t,J,.l of Qi!!. , • [ty ac.ialllOW find!
i.lDCll!Rd, m 1,. t • . • • •
. l A whicb, wo □ ·, dr:ci.f • • , . _ . _ ~ffl!
,of ,pn'l - 1, . • c:cddmq dliC - • -·~ - ot ··- o :OJ
0-ci Ju~ :u, 2-il~ Ii ·1u1dJ:i1' m 1:cnw of t!bc. DA Scctikm • • opc:r is. cihlLpkd ito • ' fulJy ·th . •etm if ·the Mq!.lu 'Ckm . . - P,· SC®l of lhc • _ · :is r,cqwm:I to , • •. ' :mmc:s." ,eq
~ (:S . ~ • ~v ... "'""'·-'- i:i u'li L fOC - mn
F1:1rtiu:~ra.nce 0-f Co ~f:i) p • ~s - d llhe -- ~ · • - S1.11b - -es., ThiJ Gro-ss -, Re~ue 'Wa!I, in fKI Jmd m ~ City for· ap1,m.xim.8tcly fifioe:p ( 15), yeae.. Howtr•,~ , etrccli •e eocm'li:M:r· 20 7,, fi • . - _ i»ll. - p: !,l'nleiUS ~ c·· . Am'!~ payrnml!i CO 'I\M City Y.Cdfl' ·t:Jm 11ootian l)'ipreali:," u~ $4.00,iOOiJ. Tms issu WH fl)e.g!:d m 20 19' _ • 11 I!! - _ 'L N!i'i'' , fid _ --~-~ rllJ. JuM _ I , ()"ti I .ll.llal ~i .
Th.ti City .:md Dc-vcfo:pcr . 11.c1irvt:li1 oll'UQt oo •· ~ok1tioo . o rt.his issu,:; .tnd belie..-~ (lg~ this. shouM l!Ol l!old Ep" ~: _: . f tlu: DA d!is • -
-~.y. lh ty ac!lllw,m t1!.o tcml . of tho D~ rt
Agrccmc:li lhtU nH:n 11:X1:~,m 1'~ e~ -. ~ .kt
11. :2021 tfuooi,h llhc Scco:md ] ~ ~ as dcmio:11 UIIOO" ·the .~kl: • ml I ,~lfiHt ,
- mi bb !DI' o lb Eiptiom of Ciily nrr DCi'VCLOJI • nnd'cr du: l)e c-1op em m. A.1!ifecmc11t - by thl Ad- vd • - ·, ,
~ _ ZOlt,O , U..C
a . .....,,_,........,,"" .. tim.it 't;Y ~
B . B .
(Oily - IJ
AelmOJ 111"
l
~ '. --...-.i~~ ---- - l
On l--'26:1,0'Z..Z- . re •· 1 - • • •• • • •• 0 ', • • • , .• .•• 1 MV~ ~Js,
~~!l.lllj ~pearnd -L!.~.ESlilliol.lq~~r=:SL~~ ---;,;;;~;~-- - ------ I • - . . . . -
g1 Ciiar.llIYIIDll
---------------- ·o~--------------
~ ,r;.aa detef· altsl'ilthl:!r.t O the. ~t fir
mi'i!'ae/imaiM . of - ~fiifm:t_o,-- • ~
- --- --~---~ · Mow: _ _____ ____ _
Sig IN -
o> ; . - 'Tltle($ - ----
CJ c::I Um l!tdl CJ (ilsAl!lfllf
□ a .·. om · nF
IQGiuafdllifl -- -=liinl-
Fmilhe:nmoc: of Conv.cyan;cc) h:n,el :nnd lhe Rease ~ Snb1~51- 'Thi Gros:s Lease .ht.•cnuc w- , 'n ra-- : • 'iill h) lhe 1Ci. :f'o:r , ---- • - · i:ly B!tten (J .H'.owev;:,,r, em ve , . ·~ 1017. LMI ceased rn • • to If!
fm~ to. thu, Oty rm&r. lmiil s-~ti.Ql!I mypk:mJly ex~r,:di $400,000.. • - - . . .. d , .. - - . . ~ [y wwlti:1111: fm,Jutii) l:l to
KMdiltiJy, Ille City d • :Lie] ~now1!d~~ 1Jm O Wffl of die DevaopmJ ~t]D[!Dii1: shell oim • w 11,111 fNm I Fm 1r ion TtO't'ffl e p;wi:o,l of Smwm'bi! 11, 202.l ihu-ou,gh th: .~ Bxtcmioo af Se:.pk:m ~ l 1. 2026 dicfuiCidi l.lll!kr c ,De.!ile] • I , 1.
' oot o:f.llM :ng,ht& • o'b~ of ify or Dcvcfo,peI" u111I • lht ilc\'elo;JJR □ Agm:rm!:111 . ffl~ by [bis Ai IJ,W'.,~ ·1tmtrnt.
DE • a '.LLC
•. alifi ,OQJ
Cm" Ori' ALLEJO,
a iill'ii~pa,·11 ooipo Jjo:
Tid • Pres ,~fi'\ 11,, , ••• :r;f- o · A'f'TEST~
::Soc:Ji .,,c;, ~"' ii\, ~ +'II - e,o ...... ,.f-1 '(
f.,te,i!,ii. c3,er- .. r "lfl;ie il ~ i 'T~ °''s;:9
Dawn G. • brabll1115'ln, City Ckrk
.Af.PROVIID AS TO CO,N - I ff:
APPROVED-AST. ~ORM:
I 1000: :I U.19
Pit' 8~~~~~ -~= --~---- -=;;;~~;;-== ==-----
. -. -- • ' . I
. • • • -~- - I . ' . ,.- - : . . : . . . • ••
°'"--. _- 11i 9'il~li!d~1:c .:: -··
J Mlype •or Doe~ - - = ==- - ====~----------
~ Dllil:e:--- = ----== -~====="'~ '-"""""'
Sig~ OiJ"lt!- "1he.n ~ ==- --- ===- - = =====--
' -- -- '-----
I
ATTACHMENT - 4
ATTACHMENT - 3
ACQUISITION AGREEMENT
BY AND BETWEEN
THE CITY OF VALLEJO.
AND
LENNAR MARE ISLAND LLC
December 3J, 1999
'/: . -
I .
TABLE OF CONTENTS
ACQUISITION AGREEMENT .................................. ~ .......................... _ ............................ 1 R E C 1·r A L 5 ................................................................................................................ 1· . .
AGREEMENT ................................................................. ~ ................................................. 4 ARTICLE 1·. DEFINITIONS ................ · ....................................... .' .................................... 4 SECTION 1.1
SECTION 1.2
DEFINED TERMS ................................................................................ 4 ADDITIONAL DEFINED TERMS ....................... : ................................ ~ ... 15 ARTICLE 2 ACQUISITION PROPERTY DEFINED .................................................... 15 SECTION 2.1 ACQUISITION PROPERTY DEFINED ..................................................... 15 SECTION 2.2 PROPERTY INCLUDED IN TRANSFER. .................................................. 15
2.2.1 Lennar Acquisition EDC Parcels ................................................................. : ..................... 15
2.2.2 Lennar Acquisition State Lands Sublease Area ................................................................. 15
2.2.3 Gap Lands ...................................................................................... _ .............. , .................... 16
2.2·.4 Improvements .................................................................................................................... 16
2.2.5 Personal Property .............................................................................................................. 16
2.2.6 Main Gate .......................................................................................................................... 16
2.2.7 Direct Federal Transfers .................................................................................................... 17
2.2.8 Off-Island Rail Facilities Fee Parcels and the Required Rail Facilities City Easements .......................................................................................................................... 17
2.2.9 MIHPF Sublease Premises ............................................................................................... 17
2.2. 1 0 Subsequently Included Property ........................................................................................ 17 SECTION 2.3 PROPERTY EXCLUDED FROM TRANSFER. ........................................... 18
2.3.1 Non EDC Property .... _. ...... -............................................................................... , .................. 18
2.3.2 SLC Lands ..................................................................................... : .... _ ......... ~ ..................... 18
2.3.3 Main Gate ............. : ............................................................................................................ 18
2.3.4 Mare Island Public Roads .................................................................................................. 18 ·
2.3.5 Fire Station ......................................... , .............................................................................. 18
2.3.6 Fire Statidn Equipment. ..... : ............................................................................................... 19
2.3.7 School Sites ....................................................................................................................... 19
2.3.8 School Site Equipment ........................................................................................ .-............ 19
2.3.9 Direct Federal Transfer Parcels ......................................................................................... 19
2.3.10 Chapel ............................................................. , ........................... : ..................................... 20
2.3.11 Chapel Park and Alden Park ........................................... : ................................................. 20 wc-30613
i"
ARTICLE.3 ACQUISITION PROPERTY TRANSFERS .................. ~ ........................... 20 SECTION 3.1 CITY ACQUISITION OF THE ACQUISITION PROPERTY ............................ 20 SECTION 3.2 CITY TRANSFER OF THE ACQUISITION PROPERTY ............................... 20
3.2.1 Real Property and Improvements Located Thereon: ........................................................ 20
3.2.2 3.2.3
Lennar Acquisition Personal Property: .............................................................................. 21 Off-Island Rail Facilities Fee Parcels: ................................................................................ 22 SECTION 3.3
SECTION 3.4
~ .
RISK oF Loss ................................................................................... 24 INSURANCE ..................................................................................... 25 ARTICLE 4 DEPOSIT/PROJECT REVENUES ALLOCATIONS TO CITY ................. 25 SECTION 4.1 DEPOSIT .............................................. ~ .......................................... 25 SECTION 4.2 REUSE AREA SUBLEASE REVENUE ALLOCATION TO CITY .................... 26 SECTION 4.3 PERSONAL PROPERTY SALES REVENUE ALLOCATION ......................... 27 · SECTION 4.4 CITY PARTICIPATION PAYMENT ...................................... , .................. 27
4.4.1 ·c;ty Participation Payment. ............................................................................................... 27
4.4.2 . Project Management Fee True Up Adjustment to City Participation Payment. ................ 28
4.4.3 Post-Project Completion Buyout of City's Participation Payment. .................................... 28
4.4.4 Survival of City's Right to City Participation Payment. ...................................................... 29
4.4.5 Memorandum of City's Right to City Participation Payment... .......................................... ~29 '
ARTICLE 5 APPROVED PARTICIPATION MODEL MATTERS ................................ 29 SECTION 5.1
SECTION5.2
SECTION5.3
SECTION 5.4
SECTION5.5
SECTION5.6
APPROVED.PARTICIPATION MODEL. ................................................... 29 RECALCULATION EVENTS ................................................................. 30
CITY'S ACKNOWLEDGEMENT REAPPROVED PARTICIPATION
MODEL ............................................................................................ 32
CALCULATION OF REVENUE FROM TRANSFERS TO LENNAR'S
AFFILIATE FOR APPROVED PARTICIPATION MODEL
CALCULATIONS ................................................................................ 33 APPRAISAL" PROCESS ....................................................................... 34 FINANCING MATTERS ................ , ...................................................... 35 ARTICLE 6 PRELIMINARY FEASIBILITY PERIOD; RIGHT OF ENTRY; PRELIMINARY FEASIBILITY PERIOD TRANSFERS ............................ 35 SECTION 6.1 PRELIMINARY FEASIBILITY PERiOD .................................................... 35
6.1.1 Tit~e Policy and Sur.vey ....................................................................................................... 36
6.1.2 Approved Applicable Documents ........................................ , ............................................. 38
6.1.3 Physical Inspections Including Personal Property lnventory ............................................. 39
6.1.4 Development Agreement. .................................................................................................. 40
6.1.5 Sub-LIFOC ......................................................................................................................... 40 . . .. - . ·-·
6.1.6 ,.Jsland Wide Services District Formation:·.::.-; ..................................................................... .41 ......,_"~.;:--:. ___ ,. .. ~
6. 1. 7 sLc Agreement. ................................................................................................................ 42
6.1.8. City Facility Leases ............................................................................................................ 43
6.1.9 Confirmation of Waiver of Personal Property Holding Period ....................................... : .. .43 ii
wc-30613
;_···
'~)
'·
SECTION6.2
SECTION 6.3
SECTION 6.4
RIGHT OF ENTRY ................................................. -~ .......................... 44 PRELIMINARY FEASIBILITY PERIOD TRANSFERS .................................. 44
PRELIMINARY FEASIBILITY PERIOD MANAGEMENT AND EFFECT
OF TERMiNATION DURING FEASIBILITY PERIOD .................................. .45 ARTICLE 7 ACCELERATION OF ECONOMIC REUSE AND
DEVELOPMENT OF ACQUISITION PROPERTY ..................................... 45 SECTION 7.1 SUB-LIFOC TO LENNAR AND REUSE AREA PRIME SUBLEASE ............ .45 SECTION EARLY TRANSFERS .................... : .................................................... .46 SECTION 7.3 SUBLEASES .................................. , ............................ : ..................... 46
7.3.1 Interim Subleasing Activity .................... : ........................................................................... 46
7.3.2 Security ·oeposits ............................................................................................................... 47 7,3.3. Sublease Revenue During the Preliminary Feasibility Period ......................................... ..47
7.3.4 Sublease Revenue Allocation after the Preliminary Feasibility Period ............................. .47 ARTICLE 8 DEVELOPMENT OF THE ACQUISITION PROPERT¥ ........................... 48 SECTION 8.1
SECTION 8.2
SECTION 8.3
DEVELOPMENT AGREEMENT ............................................................. 48 PERFORMANCE SCHEDULE. ................. : ............................................ 50
COORDINATION AND COOPERATION BETWEEN CITY AND
LENNAR As PRINCIPAL DEVELOPER RE ISLAND WIDE
DEVELOPMENT AND 0PERATION .. , ..................................................... 51 SECTION 8.4 PAYMENT OF COSTS ............................... , ................................... : .... 52 . SECTION 8.5 PROJECT FINANCING ........................................................................ 52
8.5.1 City's Payment of EDC Permitted Costs from Working Capital Account. ......................... 52
8.5.2 Community Facilities DistricUPublic Finance ..................................................................... 52
8.5.3 l.sland Wide Third Party Fair Share Contributions to Jnfrastructure .................................. :.s2 8:5.4 City's Cooperation to Pursue Grants Etc ........................................................................... 53
8.5.5 No Redevelopment Area Designatlon ............................................................................... 53 SECTION 8.6 MUNICIPAL SERVICES DISTRICT ........................................................ 53 SECTION 8.7 COOPERATION IN PROCESSING. ENTITLEMENTS ................................... 54 L:/"'T'I'"'I\.18.8 PROJECT MEETINGS ................................ ; ....................................... 54 SECTION 8.9 CITY OBLIGATIONS ........................................................... : ............... 54
8.9.1 Cooperative Agreement Services ...................................................................................... 54
8.9.2 · Lease and Maintenance of City Facilities ......................... : ................................................ 55
8.9.3 Payment of Mare Island Operating Expenses for City Facilities ............. : ......................... 55
8.9.4 Relocation and Re-sizing of City Facilities ................... · ..................................................... 55
8.9.5 Pre-Transfer Negotiations with Third Parties .......................................................... : ......... 65
8.9.6 State Lands Matters ............................................................................................... : ............ 58
8.9.7 Main Gate ................................................................................................... , .................. : ... 58
8.9.8 Mare Island Public Roads, and Mare Island Public Water and Sewer Systems Maintenance and Operation .............................................................................................. 57.
8.9.9 Municipal Services ............................................................................................ : ......... : ...... 5-? iii
wc-30613
L.
I .t
8.9.10 Causeway Bridge Maintenance.and Operation ............................. -: .......................... : ........ 57
8.9.11 Maintenance and Operation of Chapel, Chapel Park and Alden Park .............................. 58
8.9.12 Reimbursement by Future Developers of Lennar for Offsite Infrastructure Serving Surrendered Acquisition Property .............................................................. , ......... 58
8.9.13 City Commitment to Grant or Cooperate to Cause Others to Grant Easements to Lennar. ..................... ; ........................................... : .......................... · .................................... 58
8.9.14 Relocation of Easements ................................................................................................... 59
8.9.15 Easements froni United States for installation of Infrastructure on Sub-LIFOC and Non-LIFOC Property ..... : ............................................................................................. 59
8.9.16 Island Energy and GST Easements .................................................................................. 59
8.9.17 Assessor Cooperation on Valuation for Property Tax ........... : ........................................ : .. 59 SECTION 8.10 LENNAR OBLIGATIONS ................. ··.··· ................................................ 5.9
8.10.1 Lennar Monthly Reports ................................................................ , .................................... 59
8.10.2 Building and Grounds Maintenance ............................................................... .' .................. 60
8.10.3 Infrastructure Improvements ......................... , ............................................... ; .................... 60
8.10.4 Tenant lmprovements ........................................................................................................ 60
8.10.5 Demolition .......................................................................................................................... 60
8.10.6 Project Management. ................................................................. : ...................................... 60
8.10.7 Lennar Commitment to Grant Easements to City or City's Designee ............................... 61
8.10.8 Competitive Bidding for Property Management and Asset Management Services ............................................................................................................................. 61 SECTION 8.11
SECTION 8.12
PROJECT MANAGEMENT FEE ............................................................ 63 AUDITS ........................................................................................... 63 ARTICLE 9 CITY'S CONDITIONS PRECEDENT TO CITY'S
OBLIGATIONS TO CLOSE .............................. ' ........................................ 64 SECTION 9.1
SECTION·9.2 ·
SECTION 9. 3
PRIOR TRANSFER FROM NAVY AND SLC ...................................... .' .... 64 No DEFAULT BY LENNAR .................................................................. 64
REPRESENTATIONS AND WARRANTIES REMAIN TRUE AND
CORRECT ... •.• ............................................. ~ ............................... : ..... 64 ARTICLE 10 DEVELOPER'S CONDITIONS PRECEDENT TO
DEVELOPER'S OBLIGATIONS TO CLOSE. .. ~ ....................................... 65 SECTION 10.1 ·FINDING OF SUITABILITY TO TRANSFER OR FINDING OF SUITABILiTY FOR EARL YTRANSFER ................................................... 65 SECTION 10.2 TITLE TO PERSONAL PROPERTY ........................................................ 65 SECTION 10.3 REMEDIATION ...................................................... : ......... ~ ................. 65 10:3.1 FOST ..... : ............................................................................................. : ........... : ........ : ......... 65
10.3.2 .FOSET ............................................................................................................................... 65
10.3.3 DTSC and RWQCB Concurrence ........................................................................ , ............ 66 SECTION 10.4 INDEMNITIES .................................................................................... 66 iv
wc-30613
I'.
'·
SECTION 1 0.5
SECTION 10.6
SECTION 10.7
CONDITION OF THE ACQUISITION PROPERTY .......... : ........................... 66 LENNAR CONFIRMATION OF CONDITION OF THE PROPERTY ................. 66
ASSIGNMENT OF APPROVED APPLICABLE DOCUMENTS AND
TERMINATION OF DISAPPROVED APPLICABLE DOCUMENTS .................. 68 SECTION 10.8 PERMITS AND APPROVALS~ ............................................................... 68
10.8.1 Legal Parcels ........................................ : ............................................................................ 68 1 0.8.2 Entitlements ............. _. ................................................................................. · .. : ..................... 68 .
SECTION 10.9
SECTION 1 0.10
· SECTION 10.11
SECTION 10.12
SECTION 10.13
SECTION 10.14
CITY REPRESENTATIONS AND WARRANTIES REMAIN TRUE
AND CORRECT ................................................................................. 68 No CHALLENGES/REFERENDA/LITIGATION ......................................... 69 DELIVERY OF CLOSING DOCUMENTS ................................................. ; 69 DELIVERY OF TITLE POLICY ......................................................•........ 69 REMOVAL OF SHIPS .......................................................................... 69 No UNCURED DEFAULT BY CITY ........................................................ 69 ARTICLE 11 CLOSINGS .............................................................................................. 69 SECTION 1.1.:.1 CLOSINGS ....................................................................................... 69
11.1.1 Escrow ............................................................................................................................... 69
11.1.2 Transfers and Title Policies ............................................................................................... 70
11.1.3 City's Escrow Deposits ........................................................................ : ............................. 70
11.1.4 Lennar's Escrow Deposits ............................................................... _. ................................. 71 ) . 11.1.5 Closing Costs and Prorations ............................................................................................ 72 '· r · · 11.1.6 Delivery of Possession ...................................................................................................... 73 ARTICLE 12 TERM OF ACQUISITION AGREEMENT ................................................. 73 SECTION 12.1 TERM ....... : ...................................................................................... 73 ARTICLE 13 TERMINATION PRIOR TO THE EXPIRATION OF THE
TERM ............... ; ...................................................................................... ; 73 SECTION 13.1 TERMINATION BY LENNAR. ................................................................ 73
13.1.1 . Disapproval of Inspections During Preliminary Feasibility Period ..................................... 73
13.1.2 Determination that Conditions Will Not Be Satisfied ............................................. • ............ 7 4
13.1..3 Recalculation Event Termination ....................................................................................... 75
13.1.4 Failure of Closing Conditions ...................................................................................... , ...... 75
13.1.5 Termination for Breach of this Agreement by City ............................................................. 76 SECTION 13.2 TERMINATION BY CITY ................................ ; ..................................... 77
13.2.1 Failure of Closing Conditions ............................................................................................. 77
13.2.2 Termination for Breach of this Agreement by Lennar ........................................................ 77 SECTION 13.3 EFFECT OF TERMINATION ...................................................... , .......... 78 ARTICLE 14 RIGHTS OF LENDERS ........................................................................... 79 SECTION 14.1 DEEDS OF TRUST, SALES AND LEASES-BACK OR OTHER FINANCING FOR DEVELOPMENT ......................................................... 79 v
wc-30613
)
\ \ '
}
)
SECTION 14.2
SECTION 14.3
· SECTION 14.4
SECTION 14.5
SECTION 14.6
MORTGAGEE NOT OBLIGATED TO CONSTRUCT
IMPROVEMENTS .............................. · ...................... ....... : ................... 79 . NOTICE OF DEFAULT TO MORTGAGEE/RIGHT TO CURE ....................... 79 FAILURE OF MORTGAGEE TO COMPLETE IMPROVEMENTS .................... 80 ·
RIGHT OF CITY TO CURE MORTGAGE, DEED OF TRUST OR
OTHER SECURITY INTEREST .............................. , ........................... : .. 81 SUCCESSOR TO INDEMNITIES ................................ ~ ................. : ........ , 82 ARTICLE 15 NON-DISCRIMINATION ....•................... ~ ... ~ ............................................. 82 SECTION 15.1 OBLIGATION TO REFRAIN FROM DISCRIMINATION ................................. 82
15.1.1 Lennar Covenants ............................................................................................................. 82
15.1.2 Form of Nondiscrimination and Nonsegregation Clauses ................................................. 82 /' ARTICLE 16 HISTORIC RESOURCES ........................................................................ 84 · SECTION 16. 1. HISTORIC RESOURCES ...... : .............................................................. 84 ARiiCLE 17 ASSIGNMENT AND TRANSFER .................. : .......................................... 85 SECTION 17.1 ASSIGNMENT OF INTERESTS, RIGHTS AND OBLIGATIONS ...... : .......... ; ... 85 SECTION 17.2 ASSIGNMENT OF ACQUISITION AGREEMENT ........................................ 85 · SECTION 17.3 RELEASE OF MEMORANDUM ............................................................. 86 ARTICLE 18 REPRESENTATIONS AND WARRANTIES OF CITY ............................. 87 SECTION 18.1
SECTION 18.2
ORGANIZATION ................................................................................. 87· AUTHORIZATION AND APPROVAL OF AGREEMENT ................................. 87 ARTICLE 19 REPRESENTATIONS AND WARRANTIES OF
DEVELOPER ..... ~··········· .......................................................................... 87 SECTION 19.1
SECTION 19.2
ORGANIZATION ................................................................................ 87 AUTHORIZATION AND APPROVAL OF AGREEMENT ................................ 87 ARTICLE 20 INDEMNITIES .......................................................................................... 88 SECTION 20.1
SECTION 20.2
LENNAR INDEMNITY ............................... :.' .......................................... 88 CITY INDEMNITY ............................................................................... 88 ARTICLE 21 DEFAULT, REMEDIES ............................................................................ 89 SECTION 21.1 GENERAL PROVISIONS ........................... ; ......................................... 89 SECTION 21.2 LENNAR DEFAULT ............................................................................ 89 SECTION 21.3 CITY DEFAULT: ................................................................................ 89 SECTION 21.4 CURE OF DEFAULT ........................................................................... 90 SECTION21.5 REMEDIES AFTER EXPIRATION OF CURE PERIOD ................................ 90 SECTION 21.6 LIQUIDATED DAMAGES ........................ : ............................................ 91 ARTICLE 22 MISCELLANEOUS ......................................................... · ................ ~ ........ 92 SECTION 22.1
SECTION 22.2
SECTION 22.3
wc-30613
INCORPORATION OF RECITALS AND INTRODUCTORY
PARAGRAPH.:., ............................................................... : ................ 92 STATUS OF THE PARTIES ............................ , .... : ................................ 92 SUCCESSORS AND ASSIGN ............................................................... 92 vi
1 •.
)
\
)
SECTION 22.4
SECTION 22.5
SECTION 22.6
SECTION 22.7
SECTION 22.8
SECTION 22.9
SECTION 22.1 0
SECTION 22. 11
SECTION 22.12 .
SECTION 22.13
wc-30613
FINDINGS .......................... ~ ................................... -:. ..................... · ... :. 92 SEVERABILITY .......................... : ........................................ ~ .. : ......... ·~. 93 OTHER NECESSARY ACTS/ADMINISTRATIVE EXTENSIONS .................... 93 CONSTRUCTION ..•.............................•..•.................•..........•.............. 93 OTHER MISCELLANEOUS TERMS .................................. ; ......... ; ... ." ...... 94 NOTICES .......................................................................................... 94 AMENDMENTS ................................................... · ..•.... ; ....................... 96 . .
CERTAIN OBLIGATIONS NON-RECOURSE. ..................................... , ... , 96 CONFIDENTIALITY ........................................................ · ..................... 96 GOVERNING LAW ............................................................................. 97 vii
t )
Exhibit
A
8 c
D
E
F
G
H
J
K
L
M
N
0 p
Q
R
wc-30613
LIST OF EXHIBITS
Description
Lennar Acquisition EDC Parcels and Lenriar Acquisition State Lands Sublease Area
Sub-LIFOC Parcels
Approved Participation Model Excerpts Regarding Quarterly Cash Flow Projections and Tiered Return Section
Operating Expenses
Form of Deed
Entitlement Schedule
· Mare Island Public Roads
Memorandum of Acquisition Agreement and City Participation Payment
Off-Island Rail Facilities Fee Parcels
Intentionally Omitted
Reuse Area Subtenants
SLC Endorsement
Gap Lands
MIHPF Sublease Premises
Bill of Sale
Exactions Schedules
Performance Schedule
Project Management, Asset Management and Property
Management Services
l )
ACQUISITION AGREEMENT
THIS ACQUISITION AGREEMENT (the "Agreement") is entered into as of December ;Jj_, 1999, by and between Lennar Mare Island LLC, a California limited liability company ("Lennar''), and the City of Vallejo ("City").
RECITALS
A. The Mare Island Naval Shipyard. ("Mare Island"), located in Vallejo, California, · was used as a military installation and was ordered to be closed pursuant to the Defense Base Closure and Realignment Act of 1990, as amended· (Pub. L. No. 101- 51 0). Subsequent to the order to close Mare Island, on July 26, 1994, the City accepted the Mare Island Final Reuse Plan (the "Reuse Plan"). ·The Reuse Plan divided Mare .
Island into thirteen (13) Reuse Areas, as described in the Reuse Plan. The Reuse Areas consist ofcertain real property owned by the United States of America (the "U.S.
Lands") and certain real property owned by the State of -California (the "State Lands").
The exact boundaries of the U.S. Lands and the State Lands remain to be determined by the City, the United States and the State of California. City anticipates that the exact boundaries of the U. S. Lands and the State Lands will be confirmed pursuant to the proposed Mare Island Property Settlement and Exchange Agreement, to be entered into between City and the State of California acting through the State Lands Commission . (the "SLC Agreement").
B. To facilitate the early reuse of Mare Island, pursuant to a declaration of surplus property in accordance with Public Law 103-337, Section 2841, the United States of America and City entered into seven short term leases, each dated as of June 26, 1996, of the U.S. Lands within Reuse Areas 1 through 6 and 9 (each a "Reuse Area Pdme Lease" and collectively the "Reuse Area Prime Leases"). Pursuant to the Reuse Area Prime Leases, City entered into certain subleases (the "Reuse Area Subleases") of portions of the Reuse Areas. The premises subject to the Reuse Area -Subleases are referred to herein collectively as the "Reuse Area Sublease Premises." 1 wc-30613
\
)
C. Pursuant to a Memorandum of Agreement between City and the United States of America,. dated as of September 30; 1999 (the "EDC"), City has the righf to acquire fee title to a portion of the U.S .. Lands consisting of certain real property described in the EDC, the improvements located thereon, and other rights appurtenant thereto (collectively, the "EDC ·Parcels"), together with title to the personal. property listed on the inventory prepared by United States of America and attached to the EDC (the "Personal Property"). The EDC Parcels and tbe Personal Property are referred to herein collectively as the "EDC Property."
D. Pursuant to a Finding of Suitability to Lease, dated as of September 30, 1999, ·to permit the development of portions of the EDC Parcels prfor to the completion of the environmental remediation work required to be performed by the Navy, City and the United States of America.entered into a Lease in Furtherance of Conveyance, dated as of September 30, 1999 ("LIFOC"). Pursuant to the LIFOC, City has acquired a long term lease of those portions of the EDC Parcels, consisting of Reuse Areas 1 through 6 ·and 9, exclusive of the Direct Federal Transfer Parcels, as defined in Section 2.2.7, and · exclusive of the portions thereof subject to the Reuse Area Subleases, (the "LIFOC Parcels"); provided that as each Reuse Area ·sublease expires, the Reu~e Area Sublease Premises shall automatically become a portion of the LIFOC Parcels and . subject to the LIFOC.
E. City has entered into negotiations with the State Lands Commission of the State of California, pursuant to which City intends to enter into long term leases of the State Lands (the "State Lands Leases").
F. City and Lennar entered into an Amended and Restated Agreement to Negotiate Exclusively for Mare Island Reuse as of December 9, 1998 (the "ERN"). The ERN provided for exclusive negotiations between City and Lennar for the transfer to Lennar for future development of the portion of the EDC Parcels shown on Exhibit A (the "Lennar Acquisition EDC Parcels"), the portion of the State Lands shown on Exhibit A (the "Lennar Acquisition State Lands Sublease Area"), and the portion of the Personal Property confirmed by an inventory prepared by Lennar and City during the 2 wc-30613
Preliminary Feasibility Period, as defined in . Section 6.1 (the "Lennar Acquisition Personal Property") The Lennar Acquisition EDC Parcels and the Lennar Acquisition State Lands Sublease Area are referred to collectively in this Agreement as the "Site." The Site and the Lennar Acquisition Personal Property are referred to as . the "Acquisition Property." Tlie Acquisition Property is more specifically defined in Article 2 of this Agreement.
G. City has adopted the Mare Island Specific Plan, dated as of March 30, 1999. (the "Specific Plan") to govern .the la~d use policy and development process for Mare Island, and the Architectural Heritage and Historic Preservation Ordinance· (Ch. 1.6.38 of the Vallejo Municipal Code) (the "Historic Resources Ordinance") to govern historical resources on Mare Island.
H. To .accelerate the development of the portion of the Acquisition Property that is subject to the LIFOC to facilitate and accelerate job creation on Mare Island, pursuant to a Sublease in . Furtherance of Conveyance (the "Sub-LIFOC") between City and Lenriar, to be negotiated in accordance with Section 6.1.5, Lennar Will sublease a portion of the LIFOC Parcels consisting of (i) the portion of Reuse Area 1 west of Cedar Avenue, exclusive of the Reuse Area Sublease Premises within such Reuse Area, and (ii) all of the land comprising Reuse Areas 2 through 6 and 9 that is not State Lands, exclusive of the Direct Federal Transfer Parcels, and exclusive of the Reuse Area Sublease Premises within such Reuse Areas, all as shown on Exhibit B (collectively, the "Sub-LIFOC Parcels") and the improvements .located thereon; provided that as each Reuse Area Sublease expires, the Reuse Area Sublease Premises shall be automatically become a portion of the Sub-LIFOC Parcels and subject to the Sub LIFOC.
I. City and Lennar desire to set forth terms upon which Lennar will acquire the Acquisition Property and act as the Principal Developer of Mare Island in accordance ) with Section 8.3.
J. City and Lennar are cooperating in good faith and endeavoring to enter into ·a .
Development Agreement consistent with California Government Code Section 65864 3 wc-30613
et seq.; and Title 17, Part II of the City of Vallejo Municipal Code, to govern the development of the Acql{isition Property.(the "DA"). ·City acknowledges and agrees that Lennar's interest in the Acquisition Property pursuant to this Agreement constitutes a legal or equitable interest in real property.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, receipt of which is hereby ·acknowledged; City and Lennar agree.as follows:
ARTICLE 1 DEFINITIONS
Section 1.1 Defined Terms.
The following terms used in the Agreement shall have the following meanings:
"Acquisition Property" is defined in Recital F and Article 2 of this Agreement. "Actions" means all claims, actions, suits or other legal proceedings. "Affiliate" means any entity controlling, controlled by or under common control . . with Lennar, or any entity in which Lennar, directly or indirectly, through one or more intermediaries, is a partner, shareholder, member, beneficiary or otherwise an owner. "Agreement" means this Acquisition Agreement
"Approved Applicable Documents" is defined in Section 6.1.2. "Approved Participation Model" means the financial model for the Project, excerpts of which are attached hereto as Exhibit C, as the Approved Participation Model is amended from time to time by City and Lennar in accordance with this · Agreement. The attached excerpts from the Approved Participation Model consist of the quarterly cash flow projections and the Tiered Return Section. "Asset Management Agreement" means that certain Asset Management Agreement; dated as of January 7, 1998, between City and Lennar's Affiliate. 4 wc-30613
. \.
'. \
payment of rent other than Mare Island Operating Expenses and- Building Operating Expenses.
"Lennar Acquisition EDC Parcels" is defined in Recital F. "Lennar Acquisition Personal Property" is defined in Recital F. "Lennar Acquisition State Lands" is defined in Recital F. "Lennar Capital" means all cash invested by Lennar in the Project from any . source whether before or after the date of this Agreement and. regardless of. whether · such investment is -capitalized or expensed for financial reporting purposes, the fair "~ ·"' .
market value of any real or personal property contributed to the Project by Lennar to the extent not paid for by a cash payment or other cash reimbursement, and the principal amount of any indebtedness incurred by Lennar for the Project, whether or not secured by any portion of the Project, whether before or after the date of this Agreement. The amount of Lennar Capital as of October 31, 1999 is $ 4,942,969, which amount is \.: subject to verification by the City during Preliminary Feasibility Period. ;;. "Lennar-Related Parties" means Lennar and its members, constituent · members, and Affiliates, and their respective directors, officers, agents and employees. "Lennar State Lands Sublease" is defined in Section 3.2.1.2. "LIFOC" is defined in Recital D ..
"LIFOC Parc~ls" is defined in Recital D.
"Losses" means any and all losses, liabilities, judgments, suits, claims, damages, settlements, fines, penalties, costs and expenses (including reasonable attorneys' fees, investigation costs, remediation costs, and court costs), of any kind or nature.
"Mare Island Operating Expenses" means all expenses for the Municipal Services identified in the column entitled Mare Island Operating Expenses on Exhibit D 10 wc-30613
)
( · .. ··'
"RWQCB" means the California Regional Water Quality·Control Board with jurisdiction over the Acquisition Property.
"Site" is defined in Recital F.
"SLC Agreement" is defined in Recital A.
"SLC Endorsement" means an Endorsement by the State Lands Commission in the form of Exhibit L or such other form as is mutually approved by City, Lennar and the State Lands Commission, approving a Lennar State Lands Sublease: . · "Specific Plan" is· defined in Recital G ..
"State Lands" is defined in Recital A.
"State Lands Leases" is defined in Recital E.
"Sub-LIFOC" is. defined in Recital H.
"Sub-LIFOC Parcels" is defined in Recital H.
"Term" is defined in Section 12.1.
"Tiered Return Section" means the section of the Approved Participation Model entitled "Tiered Return Section," the initial version of which is attached hereto as a portion of Exhibit C, as amended in accordance with this Agreement. "Touro Sublease" means the Sublease, dated as of December 11, 1998, . between City and Touro University.
"Unit Count Assumption" is defined in Section 5.2.
"Unit Transfer Assumption" is defined in Section 5.2.
"U.S. Lands" is defined in Reeital A.
14 wc-30613
Period"), City shall enter into subleases onlyunder the LIFOC, and in such form and substance as are mutually approved by City and Lennar.
7.3.2 Security Deposits.
As of the date of this Agreement, City is holding security deposits from the Reuse Area Subtenants. On the date of the Sub-LIFOC, City shall transfer to Lennar all such security deposits, together with any additional security deposits received by City during the Interim Subleasing Period.
7.3.3 Sublease Revenue During the Preliminary Feasibility Period.
Concurrently With the execution of this Agreement, City has approved a Preliminary Feasibility Period b1get prepared by Lennar (the "Preliminary Feasibility Period Budget"). During the Pre.hminary Feasibility Period, all~~evenue received by City from the Reuse Area Subleases, the Touro Sublease, and any sublease entered· into in accordance with Section 7.3.1, other than Mare Island Operating Expense Revenue and BuiJding Operating Expense Revenue, shall be applied in accordance with the Preliminary Feasibility Period Budget. The Mare Island Operating Expense Revenue shall be applied to the provision of Municipal Services· as . City shall determine. The Building Operating Expense Revenue, if any, shall be applied to the repair, maintenance and operation of the sublease premises.
7.3.4 Sublease Revenue Allocation after the Preliminary Feasibility Period.
Concurrently with the execution of the Sub-LIFQC, and pursuant to the Reuse' Area Prime Suplease, between Lennar and City, City shall assign to Lennar all right to receive revenue from the Reuse Area Subleases, the Touro Sublease and any leases entered into by City during the Preliminary Feasibility Period in accordance with Section 1.3.1, whereupon such revenue shall become Project R~venues. Beginning on the twentieth (20th) day of the first calendar month following the date of the Sub-LIFOC .
Lennar shall pay to City an amount equal to five percent (5%) of the Gross Lease . .,__....___~_ ........ --~~_.;..,....
Revenues from subleases of the Sub-LIFOC Parcels and the Reuse Area Subleases. ~
47 wc-30613
As used in this Agreement, "Gross Lease Revenues" means lease revenue actually received by Lennar from the subleasing of the Sub.:.UFOC Par~ls ~'lrLReuse~"AFea" ~....,.,,_.,.~r.t:-F"'-"'"""~~,.....,......,.J\-:-.. <C..~~'*''<"""'"".''"'""""'~I..:..tlol:'1"·,..-,. .• Subleases, excluding Building Operating Expense Revenue, Mare Island Operating ~----.... . '
Expense Revenue, Service ·District fees/assessments, property taxes, insurance reimbursement and other such· costs or fees that are typically characterized as "triple net" expenses~ Mare Island Operating Expense Revenue shall continue to be paid to.
City and used by City to provide the Municipal Services· to Mare Island required to be performed by the Landlord under the Reuse Area Subleases, and the Sub-LIFOC subleases, with any b~lance as of October 1, 2001, contributed to the Island-Wide Services District. Building Operating Expense Revenue and Island-Wide Service District fees, assessment, property tax and insurance reimbursements and other fees and reimbursements typically paid by tenants under "triple nef' leases shall be used by Lennar to pay such costs with any balance constituting Project Revenues under the Approved Participation Model.
· , ARTICLE 8 DEVELOPMENT OF THE ACQUISITION PROPERTY.
j
J
Section·s.1 Development Agreement.
City and Lennar shall cooperate and in good faith endeavor to exclusively negotiate the terms and conditions of the DA covering the Acquisition Property. City and Lennar contemplate that the DA shall provide, among other things, and in addition to all legal requirements for a statutory development agreement pursuant to California Government Code Section 65864 et seq., and the City of Vallejo Municipal Code development.agreement enabling· ordinance, the following; (i) · a term contemplating the long-term phased build out of the Acquisition Property, in view of fluctuating market demands and the complex environmental ahd legal issues.;
(ii) vested rights protections for the Unit Count
Assumption and the Unit Transfer Assumption, and from City exactions other than those shown on Exhibit P,. ch.anges in laws, protections from initiatives and moratorjum; 48 wc-30613
..
IN WITNESS WHEREOF, this Agreement has been entered into by and between Lennar and City as of the day and year first above written.
CITY OF VALLEJO, a Municipal
Corporation
By:
Name:
Its: City Manager
ATTEST:
By:
, N
)
) Its: City Clerk
APPROVED AS TO FORM:
By:
Name:
Its: . City Attorney
LENNAR MARE ISLAND, LLC,
a California limited ra ility company
arne: JO
Western Region ·President,
Lennar Communities
(Municipal Seal)
ATTACHMENT - 1
II
RESOLUTION NO. 02-189 N.C.
A RESOLUTION OF THE CITY COUNCIL OF THE CIT\' OF
VALLEJO OF FORMATION OF A COMMUNITY FACILITIES DISTRICT City of Vallejo
Community Facilitie, District No. 2002-1
(Mare Island Services)
BE IT RESOLVED. by the Council of the City of Vallejo as follows:
WHEREAS, on April 16, 2002, this Council adopted a resolution i:ntitlcd "A Resolution of the City Council (the "Council") of the City of Vallejo (the "City") of Intention to Establish a Community Facilities District'' (the "Resolution of Intention"), stating its intention to fonn the City of Vallejo Community Facilities District No. 2002-l (Mare Island Services) (the "CFO") pursuant to tho Mello-Roos Community Facilities Act of l 982 Sections 53311 et. seq .. California Oovemment Code (the •·Act") and certain provisions of the City of VaUejo•Marc Island Services Financing Code, being Chapter 14.45. commencing with Section 14.4S,OIO. of Title 14 of the Vallejo Municipal Code (the "Code.,) to finance • certain servicciJ (the "Services") by levying special taxes (the "Special Taxes") in the area of the CFO; WHEREAS. the Resolution of Intention, incorporating a map of the proposed boundaries of the CFD and describing the Services and stating the proposed the rate and melbod of apportionment of the Special Taxes to be levied within the CFO. 1s on tile \'\.. the City Clerk and ihc provisions of the Resolution of Intention are inoorporated herein by this reference as if fully set forth herein~ WHEREAS, the Scrvici..-s arc as set forth in Exhibit A and the rate and method of the apportionment of the Special Taxes are as set forth in Exhibit B, both of which arc attacb!Xl hereto and hereby incorporated herein;
WHEREAS. on this date. this Council held a noticed public hearing as required by tho Act. the (ode and the Resolution of ln!cntion relative to the proposed formation of tbc CFO. its Services and Special Taxes~
WHEREAS, at the hearing ult interested persons desiring to be heard on all matters pcitaining to the formation of the CFO. the Services to be provided therein and the levy of such Special Ta.xes were heard and a full and fair hearing was held;
WHEREAS, at the hearing evidence was presented to this Cm•~1cil on said matters before it, including a report caused to be prepared (the "Report") as to the services to be provided through the CFO and the costs thereof. a copy of which is on file with the City Clerk, and this Council at the conclusion of said hearing is fully advised in the premises;
WHEREAS. written protests with respect to the formation of the CPD, the fumishing of specified types of services and thi: rate and method of apportionment of the Special Taxes have not been filed with the Cit~' r·1, •• 1, hy fitly percent (501¼,) or more of the registered voters residing within the territory of the CFD or property o,,ncrs of onc~lmlf ( I /2) or more of the area of land within the CFO and not exempt from the proposed Special Taxes;
..
WHEREAS, the Special Taxes proposed to be levied in the CFO to pay for the proposed Services to be provided therein. as set forth in Exhibit B hereto. has not been eliminated by protest by fifty percent (50%) or more of the registered voters residing within the territory of the CFO or the owncr-s of one-half ( 1/2) or more of the area of land within the CFO and not exempt from the Special Taxes. . .
NOW, THEREFORE, it is hereby resolved by the Council of the City of Vallejo as follows:
l. Recitals Correct. The foregoing recitals are true and correct.
2. No Majority Protest. The proposed Special Taxes to be levk-d within the CFD has not been precluded by majority protest pursuant to the Code.
3. Prior Proceedings Valid. All prior proceedings taken by this City Council in connection with the establishment of the CFD and the levy of the Special Taxes have been duly considered and arc hereby found and determined to be valid and in conformity with the Code.
4. Name of CFD. The community Services CFO designated "City of Vallejo, Community Facilities District No. 2002-1 (Mare Island Services)" is hereby established under the Code.
5. Boundaries of CFD. The boundaries of the CFO, as set forth in the map of the CFO heretofore recorded in the Solano County Recorder· s Office on May 2. 2002, in Book 20 at Page 30 (as Document 02~55894) of Maps of Assessment and Coir ity s~rvices Districts. are hereby fmafly approved, are incorporated herein by reference and shall be the boundaries of the CFO.
6. Description of Services. Tho Services proposed to be financed by the CFO and pursuant to the Code shall consist of all or any of those described in Exhibit A hereto and by this reference incorporated herein.
7. Special Taxes.
a. Except to the extent that funds are otherwise available to the CFO to pay for the Services, the Special Taxes sufficient to pay the costs thereof, secured by the rccordation of a continuing lien against all non..excmpt real property in the CFO. is intended to be levied annually within the CFD, and collected in the same manner as ord.inary ad valorem property taxes or in such other manner as may be prescribed by resolution of this Council. b. The proposed rate and method of apportionment of tile Special Taxes among the parcels of real property within the CFO, in sufficient detail to allow each landowner within the proposed CFO to estimate the maximum amount such owner will have to pay. are shown in Exhibit B attached hereto and hereby incorporated herein.
8. Need for. Services. It is hereby found and detei:mined that the Services arc necessary to meet increased demands placed upon local agencies as the result of development occurring in the CFO and that the provisions of Section 14.45.210 of the Code relating to additional and supplanting services shall be applicabk ~.._ •' rFD.
9. Responsible Official. The Director of Finance of the City of Vallejo, City Hall. 555 Santa Clara Street, Vallejo, California 94590, telephone number (707) 648~4343 is the officer of the City who will be responsible for preparing annually a current roll of Special Taxes obligations by .assessor's parcel number and who will be responsible for cstimaling future Special Taxes levies pursuant to the Code.
10. Lien. Upon recordation of a Notice of the Special Tax Lien under Division 4.5 of the Streets and Highways Code of California. a continuing lien to secure each levy of the Special Taxes shall attach to all nonexempt real property in the CFD and this lien shall continue in force and effect until the Special Taxes obligation terminates as herejn provided . .
11. Termination of Levy. The Council hereby determines that the City shall cease to levy the Special Taxes upon the satisfaction of the conditions for termination of the Special Ta.xes set forth in Exhibit B. Upon such termination. the City Clerk shall cause to be recorded a Notice of Cessation of Special Tax as provided in the Act.
12. Appropriatiom• Limit. In accordance with the Code, the annual appropriations limit. as defined by subdivision (h) of Section 8 of Article XIII B of the California Constitution. of the CFO is hereby preliminarily establish!KI at $6,000,000 and such appropriations limit shall be submitted to the voters of the CFO as hereafter provided. The proposition establishing said annual appropriations limit shall become effective if approved by the qualified electors voting theroon and shall be adjusted in accordance with the applicable provisions of the Code.
13. Election. Pursuant to the provisions of the Act and the Code, the proposition of the levy • of the Special Taxes and the proposition of the establishment of the appropriations limit specified above shall be submitted to the qualified ulcctors of the CFD at an election the time. place an~ conditions of which election shall. be as specified by a separate resolution of this Council. The City Manager is authorized and directed to execute an appropriate written waiver of notices ;,iirJ waiting time for the property-owner election for property owned by the City in the CFD and to file such waiver with the City Clerk before the time specified for the election.
14. Effective Date. This resolution shall take effect upon its adoption.
ADOPTED by the Council of the City of Vallejo at a regular mcoting held on M.ro!,_7, 2~ by the following vote:
AYE..,,
NOES:
ABSENT:
ABSTENTIONS:
Mayor Intintoli, Couneilmembers Cloutier, Davis. Donahue, Pitts, Rey and Schivley
None
None
None
ATTEST:
E, City Clerk
/ ,•
__ ,,.· V
M:\MR\EDMI\STAFF.RPT\MelloRoos8.EXA.AL
EXHIBIT A
City of Vallejo
Community Facilities District No. 2002 .. 1
• • (Mare Island Services)
Dt;SCRIPTION QF 5EBVJs;ES
The Services shown below are to be financed by the above-designated community facilities district {the .. CFO") of the City of Vallejo (the "City"). The Services shall include the attributable costs of engineering. design, planning and coordination. together with the expernu.-s related to the creation and administration of the CFD and all other expenses incidental thereto. The Services shall be provided under applicable rules and regulations of the City and/or any other public agcnoy with jurisdiction over the applicable Services. For the purposes hereof. the Services shall include the perfonnance by employees (of the City or otherwise) of functions, operations. maintenance and repair activities. uo public and private lands. The Services shall consist of any or all of the services defined by Section l4.4S. l 10 (C) of the City of Vallejo-Mare Island Services Financing Code (the - ♦ Code"). which Section is hereby imiorporated • herein as if fully set forth herein, and as such Section exists on the date of the adoption of the within resolution or as it may be hereafter amended by the Council of the City.
Exhibit A
Pantl 1
·EXHIBIT B
CIT\' 0£ V ALLF..JO
COMMUNITY FACIUTrns DISTRICT No. 2002-1
(MARE ISLAND SERVICES)
RA'ff'. ANO METHOD 01• APPORTIONMENT Oft SPECIAL TAX
/
A Sp<.·cial Tax applicable to each Assessor's Parcel in the City of Vallejo Community Facilities District No. 2002 .. 1 (herein "CFD No. 2002~ l ") shall be levied and collected according to the tax liability determined by the City Council through the application of the appropriate amount or rate for Taxable Property, as described below. All of the property in CFD No. 2002-1, unless exempted by law or by the provision~ of Section G below, shall be taxed for the purposes. to the extent, and in the manner herein provided, including property annexed into CFD No. 2002-1 after its formation.
A. DEFINITIONS
The terms hereinafter set forth have the following meanings; "Acquisition Agreement" means the Acquisition Agreement between the City of Vallejo and :he Master Developer dated December 21, 1999, as amended from time to time . ._ Acre or Acreage" means one of the following, as applicable:
Prior to Parcelization: the land area included within a particular Parcel. as identified by records of the Master Dcveloper,t,cgacy.Partners or the City. For Non~Residential Property that is owned by the Ma,;ter Developer, Legacy Partr,ers or the City and is leased to a tenant, Acreage shall be detennined by dividing the square footage of land area reflected in the lease document by 43,560 square feet.
Alier Pan:elization: the land area of an Assessor's Parcel as shown on an Assessor's Pared Map, or if the land area is mjt shown on an Assessor's Parcel Map, the land area shown on an applicable final map or other parcel map recorded at the County Recorder's Otlicc.
•• Administrator" means the person or firm designated by the City to administer the Special Tax according to this Rate and Method of Apportionment of Special Tax. uAsscssor's Parcel" or •~Parcel" means a lot or parcel shown on an Assessor's Parcel Map with an assigned Assessor's Parcel number.
City of Vallejo CFD No. 2002-1
e
.. Assessor's Parcel Map" means an official map of the County Assessor of the County of Solano designating parcels by Assessor's Parcel numbers. unuilding Square Footage•• for Non~Residcntial Property means (i) for property owned by the Master Developer, Legacy Partners or the City and leased to a Tenant. the gross or rcntablc sc1uarc f<.lOtagc of a building or portion of a building or tlw square footage rc11cctcd in a lease document, plus any :,quarc footage added hy the Tenant or owner (ii) for property owned by ti Subsequent Owner, the square footage shown on u huilding permit issued by the City fhr construction or reconstruction of a non.residential building, specified in a purchase agreement or. to the extent building square lhot;c1gc is not indkatcd on a building pcnnit or purchase agreement. •the gross or rcntablc square footage as determined hy the City in its sole discretion. ••City" means the City of Vallejo.
··Code'' means the City of Vallejo Municipal Code.
''City Council" means the City Council of the Cll> ..,r Vallejo, acting as the legislative body of CFD No. 2002-1.
"County'' means the County of Solano, California.
"Developed Residential Property" means, in any Fiscal Year, all Parcels of Single Family Detached Property, Single Family Attached Property or Multi-Family Property for which (i) a building pennit was issued before Jwte 1 of the prior Fiscal Year, (ii) a certificate of occupancy was issued before June 1 of the prior Fiscal Year for a residential stnicture that was constructed without a building pennit and which will be used as a private residence. or (iii) the City has determined a building on the Parcel is occupied for residential use whether or not a building permit or certificate of occupancy has been issued.
"f'iscal Year" means the period starting July I and ending on the following June 30. "Golf Course Property" means any property within CFD No. 2002- t that is used as a golf course, including but not limited to, a driving range, clubhouse, parking, outhuildings and other Taxable Property owned and/or controlled by the golf course operator. Any uses on Golf Course Property other than a clubhouse, pro shop and ancillary uses that were in place at the time CFD No. 2002~ I was formed shall be categorize<! as Non~Rcsidential Property for purposes of detennining the Special Tax levy for the Golf Course Property. "Legacy Partners" means Legacy Partners Commercial, Inc. and its successors imd assignees, or a subsequent developer of the properly covered by the agreement between Legacy Partners Commercial, Inc. and the City of Vallejo if such agreement is terminated. "Living Area" means the square footage of a single family detached dwelling unit that makes up the living space of the unit and is reflected on the initial building permit issued for construction /'
of the residential unit "Living Area1• shall not include garages, patios, decks or other structures which are not used as living spaces. To the extent the initial building permit cannot be located for residential units that were constructed on Mare Island prior to formation ofCFD No. 2002-1, the Living Arca of the residential unit shall he determined at the sole discretion of the City . .. Marc lshmd" means the property formerly known as the Mare Island Naval Shipyard in the City of Vallejo .
.. Mare Island f<'inal Reuse Plan" means the Marc Island Final Reuse Plan that was accepted by the ( 'ity ( 'nundl on July 26, 1994, as may he ,m1cndcd from time to time. ,..Master Developer" means Lennar Mare Island LLC and its successors and assignees or a subsequent developer of the property covered by the agreement between Lennar Mare Island LLC and the City if such agreement is terminated.
"Maximum Special Tax" means the maximum Special Tax, determined in accordance with Sections C and D, that can be levied in any Fiscal Year. "MIHPF PrQpcrty" means any property that is leased or subleased by the City of Vaitejo to the Mare Island Historic Park Foundation.
l•Multi-Family Property" means, in any Fiscal Year. alt Parcels within CFD No. 2002-1 for which a building permit was issued for constmction of a residential structure with Units that are offered for rent to the general public.
"NonwRcsidcntial Property" means, in any Fiscal Year, any Parcel of Taxable Property within the boundaries of CFD No. 2002~ I that (i) is owned by the Master Developer, Legacy Partners, the City or a Subsequent Owner and on which there is an executed lease, license or other agreement for use or occupancy for a building or an area of land, (ii) is owned by .;t Subsequent Owner and has had a .huilding permit issued before June 1 of the prior Fiscal Year (but not prior to June I, 200 I ) for constrnction or reconstruction of a non•residentia! building. (iii) is owned by a Subsequent< lwncr and has had an occupancy permit issued for a non•residential use before June I of the prior Fiscal Year, (iv) is owned by a Subsequent Owner and a building on the Parcel is occupied for a 1101Mcsidential use whdhcr or not a building permit or certificate of occupancy has been issued, (v) is owned by a Subsl!qucnt Owner and a building has been constructed which is lc-asablc hut hm; not yet been leased, or (vi) is Taxable Public Property. "Non-Residential Prnpcrty" shall include any residences (including but not limited to dormitori,,,) ,1 ... , arc purt of educational institutions, as well as any live/work units on Mare hlan<l und certain uses of Golf Course Property .
.. Opera tin~ Rcscrn·" means an ongoing reserve of $300,000 that is available to the City of Vallejo to cover unanticipated service costs on Mare Island.
City t1f Valle),> CFO Nt1. 2001-1 Page J
••Parcel" means, prior to l'arceli~tion, any individual piece of property. Premises, Reuse Area or other defined geographic unit on Mare Island. After Parcclization, Parcel means an individual Assessor's Parcel.
••Pareclization'' means, for all or any portion of Mare Island, that (i) the County Assessor's Office has assigned Assessor's Parcel numbers t(1 individual Parcels of propeny, (ii) those Parcels and Assessor's Parcel numbers arc reflected on th<: County Assessor's Parcel MaJ)S, and (iii) the County will determine an assessed value for lhe P<m,ds and begin levying an ad valorem property tax on such Parcels on the County tax roll. •
""Premises
0 mcuns, for example, a sped fie building. pier, dock, h,:rth. hmd area. or other use.able space on Marc Island which is leased. licensed or made available for use or occupancy or available to be leased by the Master Developer, Legacy Partners or the City. "Proportionately" means, for Developed Residential Property. that the ratio of the actual Special Tax levied in any Fiscal Y car to the Maximum Special Tax authori7..ed to be levied in that Fiscal Year is equal for all Assessor's Parcel:-: , ,. Dcve!o:,ed R•?sidential Property. For Non,,.
Residential Property, Golf Course Property and Unused Property. "Proportionately'' means that the ratio of the actual Special Tax to the Maximum Special Tax is equal for all Assessor's Parcels ofNon .. Residential Property, Golf Course Property and Unused Property. upublic Property" means any property within the boundaries of CFD No. 2002-1 that is owned by the City, federal government, State of California or other local government or public agency, or property used for a public elementary school.
"Single Family Attached Property" means, in any Fiscal Year, all Parcels witllin CFD No. 2002· l for which a building permit was issued for construction of a residential structure consisting of two or more Units that share common walls and are offered as for~sale units, including such residential structures that meet that statutory definition of a condominium contained in Civil Code Section 1351.
"Single Family Detached Property" means, in any Fiscal Year, all Parcels within CFD No. 2002-1 for which a building permit was issued for construction of a Unit that docs not share a common wall with another I Jnit.
"Special Tax" means a Special Tax levied in any Fiscal Y car to pay the Special Tax Requirement.
••Special Tax Requirement" me,ms the amount necessary in any Fiscal Year {i) to pay service costs for the Fiscal Year pursuant to the CFD budget prepared by the City, (ii) to repay the City for amounts advanced to cover the costs of services authorized to be funded by the CFO, (iii) to cure delinquencies in the payment of the Special Tax in prior Fiscal Years or (based on delinquencies in past Fiscal Years) that are expected to occur in the current Fiscal Year, (iv) to pay administrative expenses of the CFD, and (v) to maintain the Operating Reserve at $300;000.
City of Vallejo CFD No.1002-1 Page4
'The Special Tax Requirement sball be reduced in any Fiscal Year by: (i) surplus funds available, if any, from the Special Tax levy in prior Fiscal Years, (ii) revenues generated from property or activities on Mare Island that are required to be applied to reduce the Special Tax Requirement. including but not limited to, property tax, sales tax. utility users tax, transient occupancy tax. franchise tax, business license fees, possessory interest tax, property transfer tax, storm drainage revenues, net water and sanitary sewer revenues, and (iii) other revenues that, at the City's sole discretion, are detem1incd to be available to be applied to reduce the Special Tax Requirement, including hut not limited to, funds paid to the City by the Master Developer pursuant to the Acquisition Agreement, and funds paid to the City as a result of the City's lease of the dredge ponds. The City shall exercise its discretion in making the foregoing determination regarding use of other revenues to reduce the Special Tax Requirement on an annual. In making such detcnnination. the City shall consider the overall benefit to the development of Mare Island of reducing the Special Tax Requirement as opposed to alternative uses of such revenue for • purposes that support the development of Mare Island, including, for example. use as matching funds for federal grants for the construction of infra~tructure consistent with the Mare Island Specific Plan, as amended.
"Subsequent Owner" means an owner of Taxable Property within CFD No. 2002-1 that is not the Master Developer, Legacy Partners, the owner of Golf Course Property or the City of Vallejo.
••Taxable Property" means all ofthe Assessor's Parcels within the boundaries of CFD No. 2002-1 which are not exempt from the Special Tax pursuant to law or Sec1ion G below. "Taxable Public Property" means all Parcels of Public Property which, at the time of formation of CFO No. 2002-1, were owned, leased or anticipated to be owned or leased by a public agency and which are not otherwise exempt pursuant to Section G below. In addition, the Premises being leased to the City of Vallejo for the ferry service, corporation yard and marketing center, as well as any MIHPF Property within the CFO, including, without limitation, other such Premises covered by the Facilities Agreement between the City and the Master Developer, dated on or about March 26, 2002, will be Taxable Public Property. Taxablt' Public Property shall also include any Parccl(s) that would otherwise be exempt from the Special Tax pursuant to law or Section G below that elects to be subject to the levy of a Special Tax in any Fiscal Year. "Tenant" rni.:ans lessees, licensees or permitted u~crs of Premises. ••lJnit" mean~ (i) for Single Family Detached Property, an individual single-family detached unit. (ii~,~.- ,,;"glc Family Attached Property, an individual residential unit.within a duplex, triplex. fcJurplcx. townhome, or con9omini.um structure, and (iii) for Multi:-Family Property, an individual apartment unit.
.. Unused Property" means, in any Fiscal Year, all Taxable Property that is owned or controlled by the Master Developer or Legacy Partners which (i) is developable but has no buildings constructed on it. (ii) is developable but has a building.on it which is unusable and scheduled to City of Vallejo Cf'D No. 2002-1 Page5
e
be demolished, or (iii} has a buildipg on it which is lcasable but has not yet been leased. "Unused Property" shall also include (i) Taxable Property that is owned by a Subsequent Owner which is not yet Developed Residential Property or Non~Rcsidential Property, and (ii) the remainder of a Parcel if the leased land area is a portion, but not all, of a particular Parcel.
Notwithstanding the above. if a lca-;c is entered into for an area of land thut does not have a building constructed 011 it, such land area will be treated as Non-Residential Property and not Unused Property for purposes of determining the Special Tax for the Parcel.
H. COLl,ECTION 01<' DATA FOR PREPARATION OF SPECIAL TAX t.EVV I. Prior to l'arcdization
~~~ ~~~ 's~~~")'"\ -~~ ~~'1 't , ~ .... 't 1'\b)))lli1s\Ta"\or sna)) coorC:fmate w)tb the City, the Master Developer, Legacy Partners and Subsequent Owners to compile a list of the names of all then current Tenants on Non-Residential Pro~rty, the square footage of land either reflected in the lease, license or other such document or oth-. ,sc, in fact, atu-ibutable to the Premises or Tenant and/or the Bu1tding Square Footage reflected in the lease document or the actual gross building square footage for each Tenant. as well as a summary of the Acreage of all Parcels of Unused Property. If a portion of a Parrel is Non-Residential Property and the remainder of the Parcel is Unused Property, the Administrator shall divide the square footage of land area being leased (as identified in the lease document) by 43,560 to determine the Acreage of Non-Residential Property; the remaining Acreage shall be treated as Unused Property for purposes of determining the Special Tax levy pursuant to Section E below. The Administrator shall also confirm the current name and mailing address for the owner(s) of Golf Course Property, determine the Living Area for each Parcel of Single Family Detached Property, and determine the number of Units 011 each Parcel of Single Family Attached Property and Multi-Family Property by referencing the condominiurn plan, apartment plan, site plan or other development plan for the Parcel.
2. ,1/ier Parcelizalion
After July I of each Fiscal Year, the Adminislr;,for shaJJ cmegorize L'ach A.'>:,;essor's Pared for which P11rccliwtion has occurr,·d 11:; Oo/f ( 'oursc Prope1ty. No11~Rcsidential PropcJty.
Developed Residential Property or U11us,·d f'mpcny. Tiu: Administrator shall thall (1) coordinate with lhe Master Developer, Legacy Partners and Subsequent Owners to compile a list of the names of all then current Tenants on Non-Residential Property and the square foota0 ..; , :· !.md and/or Building Square Foolagc reflected in the lease document for each Tenant, (2) identify the Assessor's Parcel numbers and Acreage of all Pan.~els of Unused Property. (3) dctcnnine the date of issuance of building permits or certificates of occupancy issued for Parcels owned by Subsequent Owners, ( 4) contirn1 the current name and mailing address for the owner(s) of Golf Course Property. lS) de\ermine t\1e Uving Area for each \\a.tel.!\~\ ~\\\~e °£'a.\\\\\~ \)~\a.c\"\'!\\ ~'t~~\'!.l\'J, ~\\.\\\()\~~\en'\\.\'\\~ \I\.~'\\.\.\.'\\.~~, 'l\ \.\~\.\.~ ~~ '1'..~~ City of Vallejo en> No. 2002-1 Page6
('.
Parcel of Single Family Attached Property and Multi-Family Property by referencing the condominium plan, apartment plan. site plan or other development plan for the Parcel,
MAXIMUM SPECIAL TAX
The Maximum Special Tax for Taxable Property within CFD No. 2002~ l shall he dctcm1ined by reference to Table l below:
TAHU: I
Crrv ot: VAU.EJO CFU No. 2002-l
MAXIMUM Sl'ECIAL TAXES
·· ·1 Z'!:;A,!~j! ZOOIT' •• Maximum Special Tax
, . .,. Type of Property 1 Residential Units --+· . _Fiscal Year 2001~02* Single Family ! Greater than
Detac~ed ! rop~!!Y _ ._!, .. . . 3,000 -~uare foet
Single Family • 2,601- 3,000
$2,120per Unit
Detached Property --~ql!!ll'e feet_. --·· ... __ .. --·---·•--$1,975 per Unit ..
Single Family 2,301- 2,600
Detached Property __ .... _.,_ sq\!are_feet_ ........ ·--··•·••$1,77~_pf?rJ.Jnit . . ..... ·~·· Single Family 2,001- 2,300 •
Detached Pro~rty ____ , ......... ~uare _feet .
Single Family J,700- 2,000
Detached Pr~perty __ ---- ..... ______ square feet_.
Single Family Less than 1,700
Detached PrQJ?erty ---·-·· _ .. _ ~9..ll!l!'~. f ~~t
Single Family
. Attached Pr2perty
Multi-Family
-~r~gerty_ .
Non-Residential
P~~pcrty
9?1f Course Property
. Unused Property
NIA
NIA
Nli\
NIA
NIA
, ____ $,L300 ~ Unit. __ _
_ $1,100 per l}nit __________ ,,.
The greater of$ I 8,375 per Acre
or $1.95 per square foot of
Building~9.!:lafC Footage .,
.. _$1,837 per Acre
--··•-$9,187 p~ Acre_
* The Maximum s,,ecial Taxes setfort/1 aboves/tall be increased eacl, Fiscal Year to an amouttt equal 1,, 102% oftlte amo,mt in effect in tlte prior Fiscal Year.
City of Vallejo Cf'D No. 2002-1 Page 7
D. AUTOMATIC ADJUSTM,&NT TO MAXIMUM SPECIAL TAX
Each Fiscal Year, the Administrator, in conjunction with the City, shall review the types of revenues that are available to apply against the services budget to calculate the Special Tax Requirement. If some or all of the available revenues arc anticipated to r-ccur in the same or greater amounts in future Fiscal Y cars. the Administratm shall calculate reduced Maximum Special Taxes for each type of property by applying the following steps:
Sup I.
Step 2.
Step 3.
S'tep 4.
Step 5.
( '1:1lculatc the Maximum Special Tax revenues that could be collected from I )cvcloped Residential Property.
Compare the amount calculated in Step I to the Special Tax Requirement fix the then current Fiscal Year. If the amount detennined in Step I is less than the Special Tax Requirement, there shall be no reduction in the Maximum Special Tax for Developed Residential Property and Steps 3 through 6 shall be applied to detcnnine the Maximum Special Tax for other types of property. lf the am\_, ... nt dctennined in Step 1 is greater than the Spc,.:ial Tax Requirement. the Maximum Special Tax on all property in the CFD other than Developed Residential Property shall be reduced to zero. The Maximum Special Tax for each Parcel of Developed Residential Property shall then be determined as follows:
a) Divide the Special Tax Requirement for the then current Fiscal Year by the amount calculated in Step I to determine a quotient b) Multiply the quotient detennined in Step 2a by the Maximum Special Tax for each Parcel of Developed Residential Property to determine the reduced Maximum Special Tax that shall apply to each Parcel for the current Fiscal Year.
Subtract the amount determined in Step : from the Special Tax Requirement for the then current Fiscal Year to determine the net Special Tax Requirement that must be collected from properties other than l kvclopcd Residential Property.
l )ctcrminc the Maximum Special Tax revenues that could be collected from all Parcels of Unused Property, Golf Course Property and Non Residential Property that are not the subject of a lease arrangement (i.e., Parcels that became Non-Residential Property because of issuance of a building permit or certificate of occupancy).
Divide the net Special Tax Requirement determined in Step 3 by the amount calculated in Step 4 to detennine a quotient.
City of V41/ttjtJ CFO No. 2002-1 Pages
Step 6. Multiply1he quotient determined in Step 5 by the Maximum Special Tax that would have applied for each property type {other than Developed Residential Property) for the then current Fiscal Year before application of the steps set forth in this Section D. The amount determined for each type of property shall serve as the new Maximum Special Tax for the then current Fiscal Year and shall continue to apply until the application of these steps in the following Fiscal Y car.
Once tlle Maximum Spedaf Tax ftas bee11 reduced pursuant to t/,e steps set forll, ill tliis Section D, the Maximum Special Tax shall 1101, in a11y fllt11re fl.seal Year, be i11creasecl above tlti.v reduced amou11t.
• E. METHOD OF LEVY OF THE SPECIAL TAX
Each Fiscal Year, the Administrator shall determine the~·. ial T J...X Requirement to be collected from Taxable Property in CFO No. 2002-1. For any Parcels within the CPD for which ParceJization has not yet occurred, a semi-annual direct Special Tax levy for one~half of the Special Tax Requirement shall be prepared pursuant to the requirements set forth in Section E.l below. For any Parcels within the CFO for which Parceli,..ation has occurred. one levy shall be prepared for the entire Fiscal Year pursuant to Section E.2 below.
I. For a Semi-Annual Services Levy
Step I.
Step 2.
Step 4.
Step 5.
Levy the Special Tax Proportionately on each Parcel of Developed Residential Property up to 50% of the Maximum Special Tax, as detennined in Section C or Section D above, as applicable.
If additional revenues are needed after applying Step 1, subtract the amount levied in Step l from the Special Tax Rcquiremrnt for the semi-annual period for which the Special Tax is being collected to dctennine the net Special Tax Requirement to be collected from Taxable Property in the CFD other than Developed Residential Property.
l >ctcrminc the combined Maximum Special Tax revenue that could be collected from Golf Course Property, Non-Residential Property and Unused Property based on then current leases. building pennit issuances and certificate of <>ccupancy issuances.
Divide the net Special Tax Requirement in Step 2 by the Maximum Special Tax revenues determined in Step 3 to calculate a quotient.
Multiply the Maximum Special Tax for each Parcel of Golf Course Property, Non-Residential Property and Unused Property by the quotient calculated in City of Jlalle}o Cf'D No. 1002-1 flage9
Step 4 to detennine the Special Tax levy for each Parcel for the semi-annual period for which the Special Tax is being collected.
2 For a Full Annual Services /.evy
Step I.
Step 2.
Step 3.
Step 4.
Step S.
Levy the Special Tax Proportionately on each Parcel of Developed Residential Property up tn I 00% of lh\: Maximum Special Tax, as determined in Section C or Section D ahovc. as applicable.
If additional revenues arc needed atlcr applying Step I. subtract the amount levied in Step I from the Spcdal Ta.x Requirement for the Fiscal Year for which the Special Tax is being collected to dctcm1ine the net Special Tax Requirement to be collected lhim Taxable Property in the CFD other than Developed Residential Property.
Detennine the combined Maximum Special Tax revenue that could be collected from Golf Course Property, Non-Residential Property and Unused Property based on then current leases. building pem1it issuances and certificate of occupancy issuances.
Divide the net Special Tax Requirement in Step 2 by the Maximum Special Tax revenues determined in Step 3 to calculate a quotient.
Multiply the Maximum Special Tax for each Parcel of Golf Course Property.
Non-Residential Property and Unused Property by the quotient calculated in Step 4 to detennine the Special Tax levy for each Parcel for the Fiscal Year for which the Special Tax is being collected.
I•. METHOD OF LEVY AND COLLECTION OF THE SERVICES LEVY
I. Prior to Parcelization
Until Parcelization occurs for a Parcel within CFD No. 2002-1, a direct Special Tax levy shall be prepared by the Administrator and mailed to the owner of the Parcel by January 10 m1rl July 30 of each year. If, on July I of any Fiscal Year, it is detem1ined for any Parcel within CFD No. 2002-1 that Parcclization has not occurred. the Administrator shall prepare a direct Special Tax levy for such Parcels pursuant to Section E. 1 above. This first installment of the Special Tax levy shall be due and payable by December 10 of that Fiscal Year. After January 1 of that same Fiscal Year, the Administrator shall update the leasing and development status for the Parcels pursuant to Section B and, based on this status, shall prepare a direct Special Tax levy for the second installment of the Special City of Vallejo CFO No. 2002-1 Page /0
Tax for that Fiscal Year·. This second installment of the Special Tax shall be due and payable by April IO of that Fiscal Year.
After Parcelization
1 L after January l of any year. it is dcl\.'rrnincd that Parcelization has occurred for Parcels within the CFD and an ad valorem property tax will be levied on those Assessor's Parcels in thi.: next Fiscal Y car, the second semi-annual direct Special Tax levy shall be mailed to the owner of such Parcels for the amount due hy April 10 of that Fiscal Year. As of July I or the fi.)llowing Fiscal Year, !he <lin:<.:t Special Tax levy within the CFD shall cease for the then current and all future Fiscai Years on the Parcels for which Parcelization occun-ed in the prior Fiscal Year. The Administrator shall instead apply the steps set forth in Section E.2 above to determine lhe Special Tax applicable to each Parcel for which Parcdization has occurred and submit the Special Tax levy to the County Auditor Controller for inclusion 011 the County tax roll, provided that the City may directly bill the Special Tax, may collect the Special Tax ... , a different time or in a different manner if needed to meet the financial obligations of the CFD, and may collect a delinquent Special Tax through foreclosure or other available methods.
The Council has determined, under Chapter 14.45 of the Vallejo Municipal Code. that the levy of the Special Tax for CFO No. 2002-1 shall tenninate upon the detennination by the Administrator that revenues available from the following sources exceed the cosl of services authoriwd to be funded by the CFD: revenues generated from property or activities on Mare Island. that are .equired to be applied to reduce the Special ·-rax Requirement, including but not limited to, property tax, sales tax, utility users tax, tra11s-ient occupancy t.ax, franchise tax, business license fees. possessory interest tax, property transfer tax, stom1 drainage revenues, and m~t water and sanitary sewer revenue. If. in any fiscal Ye~r, the City determines that revenues available from these sources exceed the cost of services to be funded by CFD No. 2002• l, an_d such excess revenues arc not associated with a one-time infusion of revenue that ,;annot be expectedto recur in subsequent Fiscal Years, the City Clerk shall.file such Notices e,i Cessation of Special Tax or other documents as may be required to evidence the termination of the Special Tax in accordance with the applicable provisions of the Vallejo Municipal Code. (;. EXEMPTIONS
Notwithstnndi•1g. any other provision of this Rate and Method of Apportionment of Special Tax, no Special Tax shall he levied on Public Property. with the following exceptions: (i) Public Property that is controlled hy and will be transferred to the Master Developer, Legacy Partners or other private entities, (ii) Taxable Public Property, (iii) Parcels owned by the City that are leased to a private party for use as a drcd,ge pond, and (iv) property that is subject t,~ taxation as otherwise provided in Chapter 14.45 o(thc <:'.ode., If a Parcel owned by tbe City and leased to a private pi;irty for .use as a dredge pond i~ subject.to a Spe<;:ial Tax in future Fiscal Years, theCity . .
City of Vallejo CFD No. 2001-1 Page I I
shall identify a Maximum Special Tax for such property which shall not, in any case, exceed the Maximum Special Tax in effect for such Fiscal Year for Golf Course Property.
H. INTERPRETATION OF RATE AND METHOD OF APPORTIONMENT
The Council reserves the right to make minor administrative and technical changes to this document that do not materially affect the rate· and method of apponioning the Maximum Special Tax. In addition, the interpretation and application of any section of this document shall be left to the Council's discretion.
H:\MR\EDMI\STAFF.RPT\MelloRoos8.Ex B to Ex A
City of Vallejo CFD No. 2001·1 Page 12
1 – FIRST AMENDMENT TO AFFORDABLE HOUSING COVENANT
143484\288062\46796126.v5
RECORDING REQUESTED BY
and WHEN RECORDED RETURN TO:
City of Vallejo
555 Santa Clara Street
Vallejo, CA 94590
ATTN: City Manager
SPACE ABOVE THIS LINE FOR RECORDER ’S USE
FIRST AMENDMENT TO AFFORDABLE HOUSING COVENANT
THIS FIRST AMENDMENT TO AFFORDABLE HOUSING COVENANT (this “Amendment”), is made and entered into as of _____________ __, 202 _, by and among the CITY OF VALLEJO, CALIFORNIA (“City”), and MARINA TOWERS INVESTMENTS, LP, a Delaware limited partnership (“Owner”).
W I T N E S S E T H:
WHEREAS, Marina Towers Associates, a California limited partnership (“Previous Owner”), and the Redevelopment Agency of the City of Vallejo (“RDA”) entered into that certain Affordable Housing Covenant dated as of August 1, 2005 (the “Covenant”), and recorded on August 31, 2005, as Document No. 200500134047, in the Official Records of Solano County, California (the “ Official Records ”) relating to a multifamily rental housing project known as Marina Towers, located on the real property described in Exhibit “A” attached hereto (the “ Project”) in consideration for RDA’s contribution to the acquisition , construction, and rehabilitation of the Project.
WHEREAS, Owner is the successor -in-interest of Previous Owner, and City is the successor-in-interest of RDA;
WHEREAS, Owner is obtaining a mortgage loan (the “FHA Loan ”) in the amount of _______________[TBD]___________________ and 00/100 Dollars ($___[tbd]__) from Lument Real Estate Capital, LLC , a Delaware limited liability company (“Lender”), to be secured by a Multifamily Deed of Trust, Assignment of Leases and Rents and Security Agreement (the “Deed Formatted: Portuguese (Brazil)
2 – FIRST AMENDMENT TO AFFORDABLE HOUSING COVENANT
143484\288062\46796126.v5
of Trust”), which FHA Loan shall be insured by the U.S. Department of Housing and Urban Development Federal Housing Administration ( “HUD”) pursuant to Section 207, pursuant to Section 223(f), of the National Housing Act of 1934, as amended; and WHEREAS, as a condition of insuring the FHA Loan, HUD requires that the Covenant be amended to be made subordinate to the Deed of Trust; NOW, THEREFORE, the parties hereto hereby agree as follows:
Section 1. Definitions. All references to “Agency” in the Covenant are hereby deleted and replaced with “ City”, as this term is defined in this Amendment. Unless otherwise defined, all other capitalized terms used herein shall have the meanings assigned to them in the Covenant.
Section 2. HUD Requirements . The Covenant is hereby amended to add a new Section 12 as follows:
“Section 12. HUD Requirements. The HUD Rider to Affordable Housing Covenant (“HUD Rider”) attached hereto as Exhibit C, is incorporated by reference into this Covenant for such time as the Project is subject to a mortgage, deed of trust , or security instrument insured or held by the U.S. Department of Housing and Urban Development by and through the Secretary, his or her successors, assigns or designates (“HUD”). For the avoidance of doubt, the terms of the HUD Rider shall not in any way prevent the City from enforcing its building code or pursuing claims against Owner unrelated to the Covenant.”
Section 3. HUD Rider to Affordable Housing Covenant . Exhibit “B” to this Amendment is hereby added to the Covenant as Exhibit
“C” and shall be incorporated by reference into the Covenant.
Section 4. The Covenant is hereby amended, ratified, approved, and is in full force and effect. To the extent of any inconsistency between the provisions of the Covenant and the provisions of the HUD Rider to Affordable Housing Covenant, the provisions of the HUD Rider to Affordable Housing Covenant shall control.
Section 5. Reaffirmation of Covenant. City and Owner each hereby reaffirms each of the provisions of the Covenant and confirms that the Covenant, as amended, and each of the terms and provisions thereof shall remain in full force and effect for the term thereof.
Section 6. Execution of Counterparts . This Amendment may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.
[Signatures on following pages]
3 – FIRST AMENDMENT TO AFFORDABLE HOUSING COVENANT
143484\288062\46796126.v5
IN WITNESS WHEREOF, City and Owner have executed this First Amendment to Affordable Housing Covenant, by duly authorized representatives, all as of the date first above written.
WARNING: Federal law provides that anyone who knowingly or willfully submits (or causes to submit) a document containing any false, fictitious, misleading, or fraudulent statement/certification or entry may be criminally prosecuted and may incur civil administrative liability. Penalties upon conviction can include a fine and imprisonment, as provided pursuant to applicable law, which includes, but is not limited to: 18 USC 1001, 1010, 1012; 13 USC 3729, 3802; 24 CFR Parts 25, 28 and 30; and 2 CFR Parts 180 and 2424.
CITY:
CITY OF VALLEJO
By: ___________________________
Name:___________________________
Title: ___________________________
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
State of California )
) SS
County of Solana )
On ____________________________, before me, _____________________________, personally appeared ____________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature: _______________________________________ [Seal]
[Signatures continued on the following page]
4 – FIRST AMENDMENT TO AFFORDABLE HOUSING COVENANT
143484\288062\46796126.v5
WARNING: Federal law provides that anyone who knowingly or willfully submits (or causes to submit) a document containing any false, fictitious, misleading, or fraudulent statement/certification or entry may be criminally prosecuted and may incur civil administrative liability. Penalties upon conviction can include a fine and imprisonment, as provided pursuant to applicable law, which includes, but is not limited to: 18 USC 1001, 1010, 1012; 13 USC 3729, 3802; 24 CFR Parts 25, 28 and 30; and 2 CFR Parts 180 and 2424.
OWNER:
MARINA TOWERS INVESTMENTS, LP,
a Delaware limited partnership
By: Marina Towers Investments LLC,
a California limited liability company,
its Co-General Partner
By: Marina Towers Acquisition LLC,
a California limited liability company,
its Manager
By: LPSF IV, LLC,
a Maine limited liability company,
its Manager
By: _____________________________
Charles P. Gendron, Manager
By: IH Marina Towers Vallejo LLC,
a California limited liability company,
its Managing General Partner
By: Affordable Housing Alliance II, Inc.,
a Colorado nonprofit corporation d/b/a Integrity Housing, its Sole Member
By: _____________________________
Philip Wood, President
5 – FIRST AMENDMENT TO AFFORDABLE HOUSING COVENANT
143484\288062\46796126.v5
STATE OF _______ )
) ss:
COUNTY OF __________ )
On _____________________, 202 4, before me, ______________________________, a notary public, personally appeared ________________________, known to me to be the person whose name is subscribed in the within instrument and acknowledged to me that she executed the same in her authorized capacity, and that by her signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.
WITNESS my hand and official seal.
_____________________________________
NOTARY PUBLIC in and for the _________
6 – FIRST AMENDMENT TO AFFORDABLE HOUSING COVENANT
143484\288062\46796126.v5
A notary public or other officer completing this
certificate verifies only the identity of the individual who signed the document to which this certificate is
attached, and not the truthfulness, accuracy, or
validity of that document.
State of California )
) SS
County of _______________ )
On ____________________________, before me, _____________________________, personally appeared ____________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature: _______________________________________ [Seal]
7 – EXHIBIT A
143484\288062\46796126.v5
EXHIBIT A TO AMENDMENT
Description of Real Property
8 – EXHIBIT B
143484\288062\46796126.v5
EXHIBIT B TO AMENDMENT
HUD Rider To Affordable Housing Covenant
Exhibit C
HUD RIDER TO AFFORDABLE HOUSING COVENANT
This Rider to Affordable Housing Covenant (“Rider”), made as of _____________, 202_, by MARINA TOWERS INVESTMENTS, LP, a Delaware limited partnership (“Owner”), and the CITY OF VALLEJO CALIFORNIA (“City”).
WHEREAS, Owner h as obtained financing from Lument Real Estate Capital, LLC , a Delaware limited liability company (the “Lender”), for the benefit of the project known as Marina Towers (the “Project”), which loan is secured by a Multifamily Deed of Trust, Assignment of Leases and Rents, and Security Agreement ( “Security Instrument”) dated as of _________________, 1, 2025, and recorded in the official records of Solano County, California (the “Records”) on even date concurrently herewith and is insured by the United States Department of Housing and Urban Development (“HUD”);
WHEREAS, Owner ’s predecessor -in-interest, Marina Towers Associates, a California limited partnership, received a contribution from City’s predecessor -in-interest for the acquisition, construction, and rehabilitation of the Project pursuant to certain restrictions were recorded against the Project;
WHEREAS, Owner ’s predecessor -in-interest entered into that certain Affordable Housing Covenant with respect to the Project , dated as of August 1, 2005, and recorded on August 31, 2005, in the Records as Document No. 200500134047 (the “Restrictive Covenants”).
WHEREAS, HUD requires as a condition of its insuring Lender ’s financing to the Project, that the lien and covenan ts of the Restrictive Covenants be subordinated to the lien, covenants, and enforcement of the Security Instrument; and
WHEREAS, City has agreed to subordinate the Restrictive Covenants to the lien of the Mortgage Loan in accordance with the terms of this Rider.
NOW, THEREFORE, in consideration of the foregoing and for other consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:
(a) In the event of any conflict between any provision contained elsewhere in the Restrictive Covenants and any provision contained in this Rider, the provision s contained in this Rider shall govern and be controlling in all respects as set forth more fully herein. (b) The following terms shall have the following definitions:
9 – EXHIBIT B
143484\288062\46796126.v5
“Code” means the Internal Revenue Code of 1986, as amended.
“HUD” means the United States Department of Housing and Urban Development.
“HUD Regulatory Agreement ” means the Regulatory Agreement between Owner and HUD with respect to the Project, as the same may be supplemented, amended or modified from time to time.
“Lender” means Lument Real Estate Capital, LLC, a Delaware limited liability company, its successors and assigns.
“Mortgage Loan ” means the mortgage loan made by Lender to the Owner pursuant to the Mortgage Loan Documents with respect to the Project.
“Mortgage Loan Documents ” means the Security Instrument, the HUD Regulatory Agreement and all other documents required by HUD or Lender in connection with the Mortgage Loan.
“National Housing Act ” means the National Housing Act , 12 USC § 1701 et seq., as amended.
“Program Obligations” has the meaning set forth in the Security Instrument.
“Residual Receipts ” has the meaning specified in the HUD Regulatory Agreement.
“Security Instrument ” means the Multifamily Deed of Trust, Assignment of Leases and Rents and Security Agreement from Owner in favor of Lender, as the same may be supplemented, amended or modified.
“Surplus Cash” has the meaning specified in the HUD Regulatory Agreement.
(c) Notwithstanding anything in the Restrictive Covenants to the contrary, the provisions hereof are expressly subordinate to (i) the Mortgage Loan Documents, including without limitation, the Security Instrument, and (ii) Program Obligations (the Mortgage Loan Documents and Program Obligations are collectively referred to herein as the “HUD Requirements”). Owner covenants that it will not take or permit any action that would result in a violation of the Code, HUD Requirements , or the Restrictive Covenants. In the event of any conflict between the provisions of the Restrictive Covenants and the provisions of the HUD Requirements, HUD shall be and remains entitled to enforce the HUD Requirements.
Notwithstanding the foregoing, nothing herein limits City’s ability to enforce the terms of the Restrictive Covenants, provided such terms do not conflict with statutory provisions of the National Housing Act or the regulations related thereto. The Owner represents and warrants that to the best of Owner ’s knowledge the Restrictive Covenants impose no terms or requirements that conflict with the National Housing Act and related regulations.
10 – EXHIBIT B
143484\288062\46796126.v5
(d) [Intentionally deleted].
(e) Owner and City acknowledge that Owner ’s failure to comply with the covenants provided in the Restrictive Covenants does not and will not serve as a basis for default under the HUD Requirements, unless a separate default also arises under the HUD Requirements.
(f) Except for City’s reporting requirement, in enforcing the Restrictive Covenants City will not file any claim against the Project, the Mortgage Loan proceeds, any reserve or deposit required by HUD in connection with the Security Instrument or HUD Regulatory Agreement, or the rents or other income from the property other than a claim against:
i. Available Surplus Cash, if the Owner is a for-profit entity; ii. Available distributions of Surplus Cash and Residual Receipts authorized for release by HUD, if the Owner is a limited distribution entity; iii. Available Residual Receipts authorized for release by HUD, if the Owner is a non-profit entity; or
iv. A HUD-approved collateral assignment of any HAP contract.
(g) For so long as the Mortgage Loan is outstanding, Owner and City shall not further amend the Restrictive Covenants, with the exception of clerical errors or administrative correction of non-substantive matters, without HUD’s prior written consent.
(h) Subject to the HUD Regulatory Agreement, City may require the Owner to indemnify and hold City harmless from all loss, cost, damage and expense arising from any claim or proceeding instituted against City relating to the subordination and covenants set forth in the Restrictive Covenants, provided, however, that Owner ’s obligation to indemnify and hold City harmless shall be limited to available Surplus Cash and/or Residual Receipts of the Owner.
(i) [Intentionally omitted].
The statements and representations contained in this rider and all supporting documentation thereto are true, accurate, and complete. This certification has been made, presented, and delivered for the purpose of influencing an official action of HUD in insuring a multifamily loan, and may be relied upon by HUD as a true statement of the facts contained therein.
Warning: Federal law provides that anyone who knowingly or willfully submits (or causes to submit) a document containing any false, fictitious, misleading, or fraudulent statement/certification or entry may be criminally prosecuted and may incur civil administrative liability. Penalties upon conviction can include a fine and imprisonment, as provided pursuant to applicable law, which includes, but is not limited to, 18 U.S.C. 1001, 1010, 1012; 31 U.S.C. 3729, 3802, 24 C.F.R. Parts 25, 28 and 30, and 2 C.F.R. Parts 180 and 2424.