HomeMy WebLinkAbout0011_3_EXHIBIT TO RESOLUTION OF FORMATIONCity of Lake Elsinore
Community Facilities District No. 2015‐5 (Trieste) Page 1
RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAXES FOR
COMMUNITY FACILITIES DISTRICT NO. 2015‐5 (TRIESTE)
OF THE CITY OF LAKE ELSINORE
A Special Tax (all capitalized terms are defined in Section A, “Definitions”, below) shall be applicable to each
Assessor’s Parcel of Taxable Property located within the boundaries of the City of Lake Elsinore Community
Facilities District No. 2015‐5 (Trieste) ("CFD No. 2015‐5"). The amount of Special Tax to be levied in each
Fiscal Year, on an Assessor’s Parcel, shall be determined by the City Council of the City of Lake Elsinore,
acting in its capacity as the legislative body of the CFD No. 2015‐5 by applying the appropriate Special Tax for
Developed Property, Approved Property, Undeveloped Property, Public Property and/or Property Owner’s
Association Property that is not Exempt Property as set forth below. All of the real property, unless
exempted by law or by the provisions hereof in Section F, shall be taxed for the purposes, to the extent and
in the manner herein provided.
A. DEFINITIONS
The terms hereinafter set forth have the following meanings:
"Acre or Acreage" means the land area of an Assessor's Parcel as shown on an Assessor's Parcel Map, or if
the land area is not shown on an Assessor’s Parcel Map, the land area shown on the applicable final map,
parcel map, condominium plan, or other recorded County parcel map or instrument. The square footage of
an Assessor’s Parcel is equal to the Acreage multiplied by 43,560.
"Act" means the Mello‐Roos Communities Facilities Act of 1982, as amended, being Chapter 2.5
(commencing with Section 53311) of Part 1 of Division 2 of Title 5 of the Government Code of the State of
California.
"Administrative Expenses" means the following actual or reasonably estimated costs directly related to the
administration of CFD No. 2015‐5: the costs of computing the Special Taxes and preparing the Special Tax
collection schedules (whether by the City or designee thereof or both); the costs of collecting the Special
Taxes (whether by the City or otherwise); the costs of remitting Special Taxes A to the Trustee; the costs of
the Trustee (including legal counsel) in the discharge of the duties required of it under the Indenture; the
costs to the City, CFD No. 2015‐5 or any designee thereof of complying with arbitrage rebate requirements;
the costs to the City, CFD No. 2015‐5 or any designee thereof of complying with disclosure requirements of
the City, CFD No. 2015‐5 or obligated persons associated with applicable federal and state securities laws
and the Act; the costs associated with preparing Special Tax disclosure statements and responding to public
inquiries regarding the Special Taxes; the costs of the City, CFD No. 2015‐5 or any designee thereof related to
an appeal of the Special Tax; the costs associated with the release of funds from an escrow account; and the
City’s annual administration fees and third party expenses. Administration Expenses shall also include
amounts estimated by the CFD Administrator or advanced by the City or CFD No. 2015‐5 for any other
administrative purposes of CFD No. 2015‐5, including attorney’s fees and other costs related to commencing
and pursuing to completion any foreclosure of delinquent Special Taxes.
"Approved Property" means all Assessor’s Parcels of Taxable Property: (i) that are included in a Final Map
that was recorded prior to the January 1st preceding the Fiscal Year in which the Special Tax is being levied,
and (ii) that have not been issued a building permit on or before March 1st preceding the Fiscal Year in which
the Special Tax is being levied.
"Assessor’s Parcel" means a lot or parcel of land designated on an Assessor’s Parcel Map with an assigned
Assessor’s Parcel Number.
"Assessor’s Parcel Map" means an official map of the Assessor of the County designating parcels by
Assessor’s Parcel Number.
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Community Facilities District No. 2015‐5 (Trieste) Page 2
"Assessor’s Parcel Number" means that number assigned to an Assessor’s Parcel by the County for purposes
of identification.
"Assigned Special Tax A" means the Special Tax of that name described in Section D below.
"Backup Special Tax A" means the Special Tax of that name described in Section D below.
"Boundary Map" means a recorded map of the CFD which indicates the boundaries of the CFD.
"Bonds" means any obligation to repay a sum of money, including obligations in the form of bonds, notes,
certificates of participation, long‐term leases, loans from government agencies, or loans from banks, other
financial institutions, private businesses, or individuals, or long‐term contracts, or any refunding thereof, to
which Special Tax A within CFD No. 2015‐5 have been pledged.
"Building Permit" means the first legal document issued by a local agency giving official permission for new
construction. For purposes of this definition, “Building Permit” may or may not include any subsequent
building permitsdocument(s) authorizing new construction on an Assessor’s Parcel that are issued or
changed by the City after the first original issuance, as determined by the CFD Administrator as necessary to
fairly allocate Special Tax A to the Assessor’s Parcel, provided that following such determination the
Maximum Special Tax A that may be levied on all Assessor’s Parcels of Taxable Property will be at least 1.1
times maximum annual debt service on all outstanding Bonds plus the estimated annual Administrative
Expenses.
"Building Square Footage" or "BSF" means the square footage of assessable internal living space, exclusive
of garages or other structures not used as living space, as determined by reference to the Building Permit for
such Assessor’s Parcel.
"Calendar Year" means the period commencing January 1 of any year and ending the following December
31.
“CFD Administrator" means an official of the City, or designee thereof, responsible for (i) determining the
Special Tax A Requirement, (ii) determining the Special Tax B (Contingent) Requirement, and (iii) providing
for the levy and collection of the Special Taxes.
"CFD” or “CFD No. 2015‐5" means Community Facilities District No. 2015‐5 (Trieste) established by the City
under the Act.
“City” means the City of Lake Elsinore.
"City Council" means the City Council of the City of Lake Elsinore, acting as the Legislative Body of CFD
No. 2015‐5, or its designee.
“Condominium Plan" means a condominium plan as set forth in the California Civil Code, Section 1352.
"County" means the County of Riverside.
"Developed Property" means all Assessor’s Parcels of Taxable Property that: (i) are included in a Final Map
that was recorded prior to the January 1st preceding the Fiscal Year in which the Special Tax is being levied,
and (ii) a Building Permit for new construction was issued on or before March 1st preceding the Fiscal Year in
which the Special Tax is being levied.
"Exempt Property" means all Assessor’s Parcels designated as being exempt from Special Taxes as provided
for in Section F.
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Community Facilities District No. 2015‐5 (Trieste) Page 3
"Final Map" means a subdivision of property by recordation of a final map, parcel map, or lot line
adjustment, pursuant to the Subdivision Map Act (California Government Code Section 66410 et seq.) or
recordation of a Condominium Plan pursuant to California Civil Code Section 1352 that creates individual lots
for which Building Permits may be issued without further subdivision.
"Fiscal Year" means the period commencing on July 1st of any year and ending the following June 30th.
“Indenture” means the indenture, fiscal agent agreement, resolution or other instrument pursuant to which
Bonds are issued, as modified, amended and/or supplemented from time to time, and any instrument
replacing or supplementing the same.
“Land Use Category” means any of the categories listed in Table 1 of Section D and Table 2 of Section L.
"Maximum Special Tax A" means the maximum Special Tax A, determined in accordance with Section D
below, that can be levied by CFD No. 2015‐5 in any Fiscal Year on any Assessor’s Parcel.
“Maximum Special Tax B (Contingent)” means the Maximum Special Tax B (Contingent), as determined in
accordance with Section L below that can be levied in any Fiscal Year on any Assessor's Parcel of Taxable
Property within CFD No. 2015‐5.
“Multifamily Property” means all Assessor’s Parcels of Developed Property for which a Building Permit has
been issued for the purpose of constructing a building or buildings comprised of attached Residential Units
available for rental by the general public, not for sale to an end user, and under common management, as
determined by the CFD Administrator.
"Non‐Residential Property" or “NR” means all Assessor's Parcels of Taxable Property for which a building
permit(s) was issued for a non‐residential use. The CFD Administrator shall make the determination if an
Assessor’s Parcel is Non‐Residential Property.
"Partial Prepayment Amount" means the amount required to prepay a portion of the Special Tax A
obligation for an Assessor’s Parcel, as described in Section G.2.
"Prepayment Amount" means the amount required to prepay the Special Tax A obligation in full for an
Assessor’s Parcel, as described in Section G.1.
“Property Owner Association” or “POA” means a corporation formed by a real estate developer for the
purpose of marketing, managing, and selling of homes and lots in a residential subdivision.
“Property Owner’s Association Property” means all Assessor’s Parcels which, as of July 1st of the Fiscal Year
in which the Special Tax is being levied, have been conveyed, dedicated to, or irrevocably offered for
dedication to a property owner association, including any master or sub‐association.
“Proportionately” means for Taxable Property for Special Tax A that is (i) Developed Property, that the ratio
of the actual Special Tax A levy to the Assigned Special Tax A is the same for all Assessor’s Parcels of
Developed Property, (ii) Approved Property, that the ratio of the actual Special Tax A levy to the Maximum
Special Tax A is the same for all Assessor’s Parcels of Approved Property, and (iii) Undeveloped Property,
Public Property and Property Owner’s Association Property, that the ratio of the actual Special Tax A levy per
Acre to the Maximum Special Tax A per Acre is the same for all Assessor’s Parcels of Undeveloped Property,
Public Property and Property Owner’s Association Property.
For Special Tax B (Contingent) that is (i) Developed Property, that the ratio of the actual Special Tax B
(Contingent) levy to the Maximum Special Tax B (Contingent) is the same for all Assessor’s Parcels of
Developed Property, (ii) Approved Property, that the ratio of the actual Special Tax B (Contingent) levy to the
Maximum Special Tax B (Contingent) is the same for all Assessor’s Parcels of Approved Property, and (iii)
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Community Facilities District No. 2015‐5 (Trieste) Page 4
Undeveloped Property that the ratio of the actual Special Tax B (Contingent) levy per Acre to the Maximum
Special Tax B (Contingent) per Acre is the same for all Assessor’s Parcels of Undeveloped Property.
“Public Property” means all Assessor’s Parcels which, as of July 1st of the Fiscal Year in which the Special
Tax is being levied, are used for rights‐of‐way or any other purpose and is owned by, dedicated to, or
irrevocably offered for dedication to the federal government, the State of California, the County, or any
other local jurisdiction, provided, however, that any property leased by a public agency to a private entity
and subject to taxation under Section 53340.1 of the Act shall be taxed and classified according to its use.
"Residential Property" means all Assessor’s Parcels of Developed Property for which a building permit has
been issued for purposes of constructing one or more Residential Units.
“Residential Unit” or "RU" means a residential unit that is used or intended to be used as a domicile by one
or more persons, as determined by the CFD Administrator.
“Service(s)” means services permitted under the Mello‐Roos Community Facilities Act of 1982 including,
without limitation, those services authorized to be funded by CFD No. 2015‐5 as set forth in the documents
adopted by the City Council at the time the CFD was formed.
“Single Family Residential Property” means all Assessor’s Parcels of Residential Property other than
Multifamily Property on an Assessor’s Parcel.
"Special Tax(es)" means any of the special taxes authorized to be levied within CFD No. 2015‐5 pursuant to
the Act.
"Special Tax A" means any of the special taxes authorized to be levied within CFD No. 2015‐5 pursuant to
the Act to fund the Special Tax A Requirement.
"Special Tax A Requirement " means the amount required in any Fiscal Year to pay: (i) the debt service or
the periodic costs on all outstanding Bonds due in the Calendar Year that commences in such Fiscal Year, (ii)
Administrative Expenses, (iii) the costs associated with the release of funds from an escrow account, (iv) any
amount required to establish or replenish any reserve funds established in association with the Bonds, (v) an
amount equal to any anticipated shortfall due to Special Tax A delinquencies, and (vi) the collection or
accumulation of funds for the acquisition or construction of facilities authorized by CFD No. 2015‐5 provided
that the inclusion of such amount does not cause an increase in the levy of Special Tax A on Undeveloped
Property as set forth in Step Three of Section E., less (vii) any amounts available to pay debt service or other
periodic costs on the Bonds pursuant to the Indenture.
“Special Tax B (Contingent)” means the Special Tax B (Contingent) to be levied in each Fiscal Year on each
Assessor’s Parcel of Taxable Property to fund the Special Tax B (Contingent) Requirement, if required.
“Special Tax B (Contingent) Requirement” means that amount required in any Fiscal Year, if the POA is
unable to maintain the Service(s) to: (i) pay the costs of Special Tax B (Contingent) Services incurred or
otherwise payable in the Calendar Year commencing in such Fiscal Year; (ii) fund an operating reserve
for the costs of Special Tax B (Contingent) Services as determined by the CFD Administrator; less a credit
for funds available to reduce the annual Special Tax B (Contingent) levy as determined by the CFD
Administrator.
Special Tax B (Contingent) Services” means the City’s maintenance and operation of the improvements
described in Exhibit “A” attached hereto following the POA’s default of its obligation to maintain such
improvements, which default shall be deemed to have occurred in each of the circumstances described in
Section J.
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Community Facilities District No. 2015‐5 (Trieste) Page 5
"Taxable Property" means all Assessor’s Parcels within CFD No. 2015‐5, which are not Exempt Property.
“Taxable Unit” means either a Residential Unit or an Acre.
"Tract(s)" means an area of land within a subdivision identified by a particular tract number on a Final Map
approved for the subdivision.
“Trustee” means the trustee, fiscal agent, or paying agent under the Indenture.
"Undeveloped Property" means all Assessor’s Parcels of Taxable Property which are not Developed
Property, Approved Property, Public Property or Property Owner’s Association Property.
B. SPECIAL TAX A
Commencing Fiscal Year 2016‐2017 and for each subsequent Fiscal Year, the City Council shall levy Special
Tax A on all Taxable Property, up to the applicable Maximum Special Tax A to fund the Special Tax A
Requirement.
C. ASSIGNMENT TO LAND USE CATEGORY FOR SPECIAL TAX A
Each Fiscal Year, beginning with Fiscal Year 2016‐2017, each Assessor’s Parcel within CFD No. 2015‐5 shall be
classified as Taxable Property or Exempt Property. In addition, each Assessor’s Parcel of Taxable Property
shall be further classified as Developed Property, Approved Property, Undeveloped Property or Public
Property and/or Property Owner’s Association Property.
Assessor’s Parcels of Developed Property shall further be classified as Residential Property or Non‐
Residential Property. Each Assessor’s Parcel of Residential Property shall further be classified as a Single
Family Residential Property, or Multifamily Property. Each Assessor’s Parcel of Single Family Residential
Property shall be further categorized into Land Use Categories based on its Building Square Footage and
assigned to its appropriate Assigned Special Tax A rate.
D. MAXIMUM SPECIAL TAX A
1. Developed Property
The Maximum Special Tax A for each Assessor’s Parcel of Single Family Residential Property in any Fiscal
Year shall be the greater of (i) the Assigned Special Tax A or (ii) the Backup Special Tax A.
The Maximum Special Tax A for each Assessor’s Parcel of Non‐Residential Property or Multifamily
Residential Property shall be the applicable Assigned Special Tax A described in Table 1 of Section D.
a. Assigned Special Tax A
Each Fiscal Year, each Assessor’s Parcel of Single Family Residential Property, Multifamily Property, or
Non‐Residential Property shall be subject to an Assigned Special Tax A. The Assigned Special Tax A
applicable to an Assessor's Parcel of Developed Property for Fiscal Year 2016‐2017 shall be determined
pursuant to Table 1 below.
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Community Facilities District No. 2015‐5 (Trieste) Page 6
TABLE 1
ASSIGNED SPECIAL TAX A FOR DEVELOPED PROPERTY
Land Use Category
Taxable
Unit Building Square Footage
Assigned
Special Tax Per
Taxable Unit
1. Single Family Residential Property RU Less than 2,400 sq. ft $1,977
2. Single Family Residential Property RU 2,400 sq. ft to 2,600 sq. ft $2,068
3. Single Family Residential Property RU Greater than 2,600 $2,265
4. Multifamily Property Acres N/A $19,437
5. Non‐Residential Property Acres N/A $19,437
On each July 1, commencing July 1, 2017, the Assigned Special Tax A rate for Developed Property shall be
increased by one percent (1.00%) of the amount in effect in the prior Fiscal Year.
b. Multiple Land Use Categories
In some instances an Assessor’s Parcel of Developed Property may contain more than one Land Use Type.
The Maximum Special Tax A levied on an Assessor’s Parcel shall be the sum of the Maximum Special Tax A
for all Land Use Categories located on the Assessor’s Parcel. The CFD Administrator’s allocation to each
type of property shall be final.
c. Backup Special Tax A
The Backup Special Tax A for an Assessor’s Parcel within a Final Map classified or to be classified as Single
Family Property shall be $2,358 per unit. This Backup Special Tax A has been established based on the
land use configurations shown on the Final Map. In the event any portion of the Final Map is changed or
modified, the Backup Special Tax A for all Assessor’s Parcels within such changed or modified area shall
be $19,437 per Acre.
In the event any superseding Final Map is recorded as a Final Map within the Boundaries of the CFD, the
Backup Special Tax A for all Assessor’s Parcels within such Final Map shall be $19,437 per Acre.
The Backup Special Tax A shall not apply to Multifamily Residential Property, Non‐Residential Property,
Public Property, or Property Owners’ Association Property.
On each July 1, commencing July 1, 2017, the Backup Special Tax A rate shall be increased by one percent
(1.00%) of the amount in effect in the prior Fiscal Year.
2. Approved Property
The Maximum Special Tax A for each Assessor’s Parcel of Approved Property expected to be classified as
Single Family Property shall be the Backup Special Tax A computed pursuant to Section D.1.c above.
The Maximum Special Tax A for each Assessor’s Parcel of Approved Property expected to be classified as
Multifamily Residential Property or Non‐Residential Property shall be $19,437 per Acre.
On each July 1, commencing July 1, 2017, the Maximum Special Tax A rate for Approved Property shall be
increased by one percent (1.00%) of the amount in effect in the prior Fiscal Year.
3. Undeveloped Property, Public Property, and Property Owner’s Association Property that is not
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Exempt Property pursuant to the provisions of Section F
The Maximum Special Tax A for each Assessor’s Parcel of Undeveloped Property, Public Property and/or
Property Owners Association Property that is not Exempt Property shall be equal to the product of
$19,437 multiplied by the Acreage of such Assessor’s Parcel.
On each July 1, commencing July 1, 2017, the Maximum Special Tax A rate for Undeveloped, Public
Property, and Property Owners Association Property shall be increased by one percent (1.00%) of the
amount in effect in the prior Fiscal Year.
E. METHOD OF APPORTIONMENT OF THE SPECIAL TAX A
Commencing Fiscal Year 2016‐2017 and for each subsequent Fiscal Year, the City Council shall levy Special
Taxes A on all Taxable Property in accordance with the following steps:
Step One: The Special Tax A shall be levied Proportionately on each Assessor’s Parcel of Developed
Property at up to 100% of the applicable Assigned Special Tax A rates in Table 1 to satisfy
the Special Tax A Requirement.
Step Two: If additional moneys are needed to satisfy the Special Tax A Requirement after the first step
has been completed, the Special Tax A shall be levied Proportionately on each Assessor’s
Parcel of Approved Property at up to 100% of the Maximum Special Tax A applicable to
each such Assessor’s Parcel as needed to satisfy the Special Tax A Requirement.
Step Three: If additional moneys are needed to satisfy the Special Tax A Requirement after the first two
steps have been completed, the Annual Special Tax A shall be levied Proportionately on
each Assessor’s Parcel of Undeveloped Property up to 100% of the Maximum Special Tax A
applicable to each such Assessor’s Parcel as needed to satisfy the Special Tax A
Requirement.
Step Four: If additional moneys are needed to satisfy the Special Tax A Requirement after the first
three steps have been completed, then the Special Tax A on each Assessor's Parcel of
Developed Property whose Maximum Special Tax A is the Backup Special Tax A shall be
increased Proportionately from the Assigned Special Tax A up to 100% of the Backup Special
Tax A as needed to satisfy the Special Tax A Requirement.
Step Five: If additional moneys are needed to satisfy the Special Tax A Requirement after the first four
steps have been completed, the Special Tax A shall be levied Proportionately on each
Assessor’s Parcel of Public Property or Property Owner’s Association Property up to 100% of
the Maximum Special Tax A applicable to each such Assessor’s Parcel as needed to satisfy
the Special Tax A Requirement.
Notwithstanding the above, under no circumstances will the Special Taxes levied in any Fiscal Year against
any Assessor’s Parcel of Residential Property as a result of a delinquency in the payment of the Special Tax A
applicable to any other Assessor’s Parcel be increased by more than ten percent (10%) above the amount
that would have been levied in that Fiscal Year had there never been any such delinquency or default.
F. EXEMPTIONS
The City shall classify as Exempt Property, in the following order of priority, (i) Assessor’s Parcels which are
owned by, irrevocably offered for dedication, encumbered by or restricted in use by the State of California,
Federal or other local governments, including school districts, (ii) Assessor’s Parcels which are used as places
of worship and are exempt from ad valorem property taxes because they are owned by a religious
organization, (iii) Assessor’s Parcels which are owned by, irrevocably offered for dedication, encumbered by
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Community Facilities District No. 2015‐5 (Trieste) Page 8
or restricted in use by a homeowners' association, (iv) Assessor’s Parcels with public or utility easements
making impractical their utilization for other than the purposes set forth in the easement, (v) Assessor’s
Parcels which are privately owned and are encumbered by or restricted solely for public uses, or (vi)
Assessor’s Parcels restricted to other types of public uses determined by the City Council, provided that no
such classification would reduce the sum of all Taxable Property to less than 8.19 Acres.
Notwithstanding the above, the City Council shall not classify an Assessor’s Parcel as Exempt Property if such
classification would reduce the sum of all Taxable Property to less than 8.19 Acres. Assessor's Parcels which
cannot be classified as Exempt Property because such classification would reduce the Acreage of all Taxable
Property to less than 8.19 Acres will be classified as Undeveloped Property, and will be subject to Special Tax
A pursuant to Step Five in Section E.
G. PREPAYMENT OF SPECIAL TAX A
The following additional definitions apply to this Section G:
“CFD Public Facilities” means $2,645,000 expressed in 2016 dollars, which shall increase by the Construction
Inflation Index on July 1, 2017, and on each July 1 thereafter, or such lower amount (i) determined by the
City Council as sufficient to provide the public facilities under the authorized bonding program for CFD No.
2015‐5, or (ii) determined by the City Council concurrently with a covenant that it will not issue any more
Bonds to be supported by Special Tax A levied under this Rate and Method of Apportionment.
“Construction Fund” means an account specifically identified in the Indenture or functionally equivalent to
hold funds, which are currently available for expenditure to acquire or construct public facilities eligible
under CFD No. 2015‐5.
“Construction Inflation Index” means the annual percentage change in the Engineering News‐Record
Building Cost Index for the city of Los Angeles, measured as of the Calendar Year which ends in the previous
Fiscal Year. In the event this index ceases to be published, the Construction Inflation Index shall be another
index as determined by the City that is reasonably comparable to the Engineering News‐Record Building Cost
Index for the city of Los Angeles.
“Future Facilities Costs” means the CFD Public Facilities minus public facility costs available to be funded
through existing construction or escrow accounts or funded by the Outstanding Bonds, and minus public
facility costs funded by interest earnings on the Construction Fund actually earned prior to the date of
prepayment.
“Outstanding Bonds” means all previously issued Bonds issued and secured by the levy of Special Tax A
which will remain outstanding after the first interest and/or principal payment date following the current
Fiscal Year, excluding Bonds to be redeemed at a later date with the proceeds of prior prepayments of
Special Tax A.
1. Prepayment in Full
The Maximum Special Tax A obligation may be prepaid and permanently satisfied for (i) Assessor’s Parcels of
Developed Property, (ii) Assessor’s Parcels of Approved Property or Undeveloped Property for which a
Building Permit has been issued, (iii) Approved or Undeveloped Property for which a Building Permit has not
been issued, and (iv) Assessor’s Parcels of Public Property or Property Owner’s Association Property that are
not Exempt Property pursuant to Section F. The Maximum Special Tax A obligation applicable to an
Assessor’s Parcel may be fully prepaid and the obligation to pay the Special Tax A for such Assessor’s Parcel
permanently satisfied as described herein; provided that a prepayment may be made only if there are no
delinquent Special Taxes with respect to such Assessor’s Parcel at the time of prepayment. An owner of an
Assessor’s Parcel intending to prepay the Maximum Special Tax A obligation for such Assessor’s Parcel shall
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Community Facilities District No. 2015‐5 (Trieste) Page 9
provide the CFD Administrator with written notice of intent to prepay, and within 5 business days of receipt
of such notice, the CFD Administrator shall notify such owner of the amount of the non‐refundable deposit
determined to cover the cost to be incurred by the CFD in calculating the Prepayment Amount (as defined
below) for the Assessor’s Parcel. Within 15 days of receipt of such non‐refundable deposit, the CFD
Administrator shall notify such owner of the Prepayment Amount for the Assessor’s Parcel. Prepayment
must be made not less than 60 days prior to the redemption date for any Bonds to be redeemed with the
proceeds of such prepaid Special Taxes.
The Prepayment Amount (defined below) shall be calculated as follows (capitalized terms are defined
below):
Bond Redemption Amount
plus Redemption Premium
plus Future Facilities Amount
plus Defeasance Amount
plus Administrative Fees and Expenses
less Reserve Fund Credit
Equals: Prepayment Amount
The Prepayment Amount shall be determined as of the proposed prepayment date as follows:
1. Confirm that no Special Tax delinquencies apply to such Assessor’s Parcel.
2. For an Assessor’s Parcel of Developed Property, compute the Maximum Special Tax A for the
Assessor’s Parcel. For an Assessor’s Parcel of Approved Property or Undeveloped Property for which a
Building Permit has been issued, compute the Maximum Special Tax A for the Assessor’s Parcel as
though it was already designated as Developed Property, based upon the Building Permit which has
been issued for the Assessor’s Parcel. For an Assessor’s Parcel of Approved Property or Undeveloped
Property for which a Building Permit has not been issued, Public Property or Property Owner’s
Association Property to be prepaid, compute the Maximum Special Tax A for the Assessor’s Parcel.
3. Divide the Maximum Special Tax A derived pursuant to paragraph 2 by the total amount of Special
Taxes that could be levied at the Maximum Special Tax A at build out of all Assessor’s Parcels of Taxable
Property based on the applicable Maximum Special Tax A for Assessor’s Parcels of Developed Property
not including any Assessor’s Parcels for which the Special Tax A obligation has been previously prepaid.
4. Multiply the quotient derived pursuant to paragraph 3 by the principal amount of the Outstanding
Bonds to determine the amount of Outstanding Bonds to be redeemed with the Prepayment Amount
(the “Bond Redemption Amount”).
5. Multiply the Bond Redemption Amount by the applicable redemption premium, if any, on the
Outstanding Bonds to be redeemed (the “Redemption Premium”).
6. Determine the Future Facilities Costs.
7. Multiply the quotient derived pursuant to paragraph 3 by the amount determined pursuant to
paragraph 6 to determine the amount of Future Facilities Costs for the Assessor’s Parcel (the “Future
Facilities Amount”).
8. Determine the amount needed to pay interest on the Bond Redemption Amount from the first
bond interest and/or principal payment date following the current Fiscal Year until the earliest
redemption date for the Outstanding Bonds on which Bonds can be redeemed from Special Tax A
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prepayments.
9. Determine the Special Taxes levied on the Assessor’s Parcel in the current Fiscal Year which have
not yet been paid.
10. Determine the amount the CFD Administrator reasonably expects to derive from the investment
of the Bond Redemption Amount and the Redemption Premium from the date of prepayment until the
redemption date for the Outstanding Bonds to be redeemed with the Prepayment Amount.
11. Add the amounts derived pursuant to paragraphs 8 and 9 and subtract the amount derived
pursuant to paragraph 10 (the “Defeasance Amount”).
12. Verify the administrative fees and expenses of the CFD, including the cost of computation of the
Prepayment Amount, the cost to invest the Prepayment Amount, the cost of redeeming the Outstanding
Bonds, and the cost of recording notices to evidence the prepayment of the Maximum Special Tax A
obligation for the Assessor’s Parcel and the redemption of Outstanding Bonds (the “Administrative Fees
and Expenses”).
13. The reserve fund credit (the “Reserve Fund Credit”) shall equal the lesser of: (a) the expected
reduction in the reserve requirement (as defined in the Indenture), if any, associated with the
redemption of Outstanding Bonds as a result of the prepayment, or (b) the amount derived by
subtracting the new reserve requirement (as defined in the Indenture) in effect after the redemption of
Outstanding Bonds as a result of the prepayment from the balance in the reserve fund on the
prepayment date, but in no event shall such amount be less than zero.
14. The Prepayment Amount is equal to the sum of the Bond Redemption Amount, the Redemption
Premium, the Future Facilities Amount, the Defeasance Amount and the Administrative Fees and
Expenses, less the Reserve Fund Credit.
15. From the Prepayment Amount, the Bond Redemption Amount, the Redemption Premium, and
Defeasance Amount shall be deposited into the appropriate fund as established under the Indenture
and be used to redeem Outstanding Bonds or make debt service payments. The Future Facilities
Amount shall be deposited into the Construction Fund. The Administrative Fees and Expenses shall be
retained by the CFD.
The Prepayment Amount may be sufficient to redeem other than a $5,000 increment of Bonds. In such
event, the increment above $5,000 or an integral multiple thereof will be retained in the appropriate fund
established under the Indenture to be used with the next redemption from other Special Tax A prepayments
of Outstanding Bonds or to make debt service payments.
As a result of the payment of the current Fiscal Year’s Special Tax A levy as determined pursuant to
paragraph 9 above, the CFD Administrator shall remove the current Fiscal Year’s Special Tax A levy for the
Assessor’s Parcel from the County tax roll. With respect to any Assessor’s Parcel for which the Maximum
Special Tax A obligation is prepaid, the City Council shall cause a suitable notice to be recorded in compliance
with the Act, to indicate the prepayment of Maximum Special Tax A obligation and the release of the Special
Tax A lien for the Assessor’s Parcel, and the obligation to pay the Special Tax A for such Assessor’s Parcel
shall cease.
Notwithstanding the foregoing, no Special Tax A prepayment shall be allowed unless the amount of
Maximum Special Tax A that may be levied on all Assessor’s Parcels of Taxable Property after the proposed
prepayment will be at least 1.1 times maximum annual debt service on the Bonds that will remain
outstanding after the prepayment plus the estimated annual Administrative Expenses.
City of Lake Elsinore
Community Facilities District No. 2015‐5 (Trieste) Page 11
Tenders of Bonds in prepayment of the Maximum Special Tax A obligation may be accepted upon the terms
and conditions established by the City Council pursuant to the Act. However, the use of Bond tenders shall
only be allowed on a case‐by‐case basis as specifically approved by the City Council.
2. Prepayment in Part
The Maximum Special Tax A obligation for an Assessor’s Parcel of Developed Property, Approved Property or
Undeveloped Property may be partially prepaid. For purposes of determining the partial prepayment
amount, the provisions of Section G.1 shall be modified as provided by the following formula:
PP = ((PE –A) x F) +A
These terms have the following meaning:
PP = Partial Prepayment Amount
PE = the Prepayment Amount calculated according to Section G.1
F = the percent by which the owner of the Assessor’s Parcel(s) is partially prepaying the
Maximum Special Tax A obligation
A = the Administrative Fees and Expenses determined pursuant to Section G.1
The owner of an Assessor’s Parcel who desires to partially prepay the Maximum Special Tax A obligation for
the Assessor’s Parcel shall notify the CFD Administrator of (i) such owner’s intent to partially prepay the
Maximum Special Tax A obligation, (ii) the percentage of the Maximum Special Tax A obligation such owner
wishes to prepay, and (iii) the company or agency that will be acting as the escrow agent, if any. Within 5
days of receipt of such notice, the CFD Administrator shall notify such property owner of the amount of the
non‐refundable deposit determined to cover the cost to be incurred by the CFD in calculating the amount of
a partial prepayment. Within 15 business days of receipt of such non‐refundable deposit, the CFD
Administrator shall notify such owner of the amount of the Partial Prepayment Amount for the Assessor’s
Parcel. A Partial Prepayment Amount must be made not less than 60 days prior to the redemption date for
the Outstanding Bonds to be redeemed with the proceeds of the Partial Prepayment Amount.
With respect to any Assessor’s Parcel for which the Maximum Special Tax A obligation is partially prepaid,
the CFD Administrator shall (i) distribute the Partial Prepayment Amount as provided in Paragraph 15 of
Section G.1, and (ii) indicate in the records of the CFD that there has been a Partial Prepayment Amount for
the Assessor’s Parcel and that a portion of the Special Tax A obligation equal to the remaining percentage
(1.00 ‐ F) of Special Tax A obligation will continue on the Assessor’s Parcel pursuant to Section E.
H. TERMINATION OF SPECIAL TAX A
For each Fiscal Year that any Bonds are outstanding the Special Tax A shall be levied on all Assessor’s Parcels
subject to the Special Tax A. The Special Tax A shall cease not later than the 2057‐58 Fiscal Year, however,
Special Tax A will cease to be levied in an earlier Fiscal Year if the CFD Administrator has determined (i) that
all required interest and principal payments on the CFD No. 2015‐5 Bonds have been paid; (ii) all authorized
facilities of CFD No. 2015‐5 have been acquired and all reimbursements to the developer have been paid, (iii)
no delinquent Special Tax A remain uncollected and (iv) all other obligations of CFD No. 2015‐5 have been
satisfied.
I. MANNER OF COLLECTION
The Special Tax A shall be collected in the same manner and at the same time as ordinary ad valorem
property taxes, provided, however, that CFD No. 2015‐5 may collect Special Tax A at a different time or in a
different manner if necessary to meet its financial obligations, and may covenant to foreclose and may
actually foreclose on delinquent Assessor’s Parcels as permitted by the Act.
City of Lake Elsinore
Community Facilities District No. 2015‐5 (Trieste) Page 12
J. SPECIAL TAX B (CONTINGENT)
The City Council shall levy Special Tax B (Contingent) commencing in the first Fiscal Year following the POA’s
default of its obligation to maintain the improvements described in Exhibit “A” attached hereto, which
default shall be deemed to have occurred in each of the following circumstances:
(i) the POA files for bankruptcy;
(ii) the POA is dissolved;
(iii) the POA ceases to levy annual assessments for the maintenance of the improvements
described above; or
(iv) the POA fails to maintain such improvements at the same level as the City maintains similar
improvements throughout the City and within ninety (90) days after written notice from the
City, or such longer period permitted by the City Manager, fails to remedy such maintenance
deficiency to the reasonable satisfaction of the City Council.
K. ASSIGNMENT TO LAND USE CATEGORY FOR SPECIAL TAX B (CONTINGENT)
For each Fiscal Year, all Assessor’s Parcels of Taxable Property within CFD No. 2015‐5 shall be classified as
Developed Property, Approved Property, or Undeveloped Property, and shall be subject to the levy of
Special Taxes as determined pursuant to Sections L and M below. Assessor’s Parcels of Developed Property
and Approved Property shall be classified as either Residential Property or Non‐Residential Property.
Residential Property shall be further classified as Single Family Residential Property or Multi‐Family Property.
For Single Family Residential Property the number of Residential Units shall be determined by the CFD
Administrator.
L. MAXIMUM SPECIAL TAX B (CONTINGENT)
For purposes of determining the applicable Maximum Special Tax B (Contingent) for Assessor’s Parcels of
Developed Property which are classified as Single Family Residential Property, all such Assessor’s Parcels
shall be assigned the number of Residential Unit(s) constructed thereon as specified in or shown on the
Building Permit(s) issued as determined by the CFD Administrator. Once a single family attached building or
buildings have been built on an Assessor's Parcel, the CFD Administrator shall determine the actual number
of Residential Units contained within the building or buildings, and the Special Tax B (Contingent) levied
against the Assessor’s Parcel in the next Fiscal Year shall be calculated by multiplying the actual number of
Residential Units by the Maximum Special Tax B (Contingent) per Residential Unit identified for the
Assessor’s Parcel.
For purposes of determining the applicable Maximum Special Tax B (Contingent) for Assessor’s Parcels of
Developed Property and Approved Property which are classified as Multifamily Property or Non‐Residential
Property, all such Assessor’s Parcels shall be assigned the number of Building Square Footage or Acres as
shown on the Final Map as determined by the CFD Administrator. Once the CFD Administrator determines
the actual number of Acres for the Assessor’s Parcels, the Special Tax B (Contingent) levied against the
Assessor’s Parcel in the next Fiscal Year shall be calculated by multiplying the number of Acres by the
Maximum Special Tax per Acre.
1. Developed Property
a. Maximum Special Tax B (Contingent)
City of Lake Elsinore
Community Facilities District No. 2015‐5 (Trieste) Page 13
The Maximum Special Tax B (Contingent) for each Assessor’s Parcel of Taxable Property for Fiscal Year
2016‐2017 is identified in Table 2 below:
TABLE 2
MAXIMUM SPECIAL TAX B (CONTINGENT) FOR DEVELOPED PROPERTY
Land Use Category
Taxable
Unit
Maximum Special Tax Per
Taxable Unit
1. Single Family Residential Property RU $54
2. Multifamily Property Acre $495
3. Non‐Residential Property Acre $495
On each July 1, commencing on July 1, 2017 the Maximum Special Tax B (Contingent) for Developed
Property shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los
Angeles ‐ Riverside ‐ Orange County (1982‐84 = 100) since the beginning of the preceding Fiscal Year, or
ii) by two percent (2.0%), whichever is greater.
b. Multiple Land Use Categories
In some instances an Assessor's Parcel of Developed Property may contain more than one Land Use
Category. The Maximum Special Tax B (Contingent) that can be levied on an Assessor's Parcel shall be
the sum of the Maximum Special Tax B (Contingent) that can be levied for each Land Use Category
located on that Assessor's Parcel. For an Assessor's Parcel that contains more than one land use, the
Acreage of such Assessor's Parcel shall be allocated to each type of property based on the amount of
Acreage designated for each land use as determined by reference to the site plan approved for such
Assessor's Parcel. The CFD Administrator's allocation to each type of property shall be final.
2. Approved Property and Undeveloped Property
The Maximum Special Tax B (Contingent) for each Assessor’s Parcel of Approved Property and
Undeveloped Property for Fiscal Year 2016‐2017 is identified in Table 3 below:
TABLE 3
MAXIMUM SPECIAL TAX B (CONTINGENT) RATES
Maximum Special Tax B
(Contingent)
Per Acre
$495
On each July 1, commencing on July 1, 2017 the Maximum Special Tax B (Contingent) for Approved
Property and Undeveloped Property shall increase by i) the percentage increase in the Consumer Price
Index (All Items) for Los Angeles ‐ Riverside ‐ Orange County (1982‐84 = 100) since the beginning of the
preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater.
M. METHOD OF APPORTIONMENT OF ANNUAL SPECIAL TAX
Commencing with Fiscal Year 2016‐2017 and for each following Fiscal Year, the Council shall determine the
Special Tax B (Contingent) Requirement and shall levy the Special Tax B (Contingent) on all Assessor’s Parcels
of Taxable Property until the aggregate amount of Special Tax B (Contingent) equals the Special Tax B
(Contingent) Requirement. The Special Tax B (Contingent) shall be levied for each Fiscal Year as follows:
Step One: The Special Tax B (Contingent) shall be levied Proportionately on all Assessor’s Parcels of
Developed Property up to 100% of the applicable Maximum Special Tax to satisfy the
Special Tax B (Contingent) Requirement;
City of Lake Elsinore
Community Facilities District No. 2015‐5 (Trieste) Page 14
Step Two: If additional moneys are needed to satisfy the Special Tax B (Contingent) Requirement after
the first step has been completed, the Special Tax B (Contingent) shall be levied
Proportionately on each Assessor’s Parcel of Approved Property at up to 100% of the
Maximum Special Tax B (Contingent) for Approved Property;
Step Three: If additional monies are needed to satisfy the Special Tax B (Contingent) Requirement after
the first two steps has been completed, the Special Tax B (Contingent) shall be levied
Proportionately on all Assessor’s Parcels of Undeveloped Property up to 100% of the
Maximum Special Tax B (Contingent) for Undeveloped Property.
N. DURATION OF SPECIAL TAX B (CONTINGENT)
The Special Tax B (Contingent) shall be levied in perpetuity to fund the Special Tax B (Contingent)
Requirement, unless no longer required as determined at the sole discretion of the City Council.
O. MANNER OF COLLECTION OF SPECIAL TAX B (CONTINGENT)
The Special Tax B (Contingent) shall be collected in the same manner and at the same time as ordinary ad
valorem property taxes, provided, however, that CFD No. 2015‐5 may collect the Special Tax B (Contingent)
at a different time or in a different manner if necessary to meet its funding requirements.
P. APPEALS OF SPECIAL TAXES
Any taxpayer may file a written appeal of the Special Taxes on his/her Assessor’s Parcel(s) with the CFD
Administrator, provided that the appellant is current in his/her payments of Special Taxes. During pendency
of an appeal, all Special Taxes previously levied must be paid on or before the payment date established
when the levy was made. The appeal must specify the reasons why the appellant claims the Special Tax is in
error. The CFD Administrator shall review the appeal, meet with the appellant if the CFD Administrator
deems necessary, and advise the appellant of its determination. If the CFD Administrator agrees with the
appellant, the CFD Administrator shall grant a credit to eliminate or reduce future Special Taxes on the
appellant’s Assessor’s Parcel(s). No refunds of previously paid Special Taxes shall be made.
The CFD Administrator shall interpret this Rate and Method of Apportionment and make determinations
relative to the annual levy and administration of the Special Taxes and any taxpayer who appeals, as herein
specified.
City of Lake Elsinore
Community Facilities District No. 2015‐5 (Trieste) Page 15
EXHIBIT “A”
DESCRIPTION OF AUTHORIZED SPECIAL TAX B SERVICES
COMMUNITY FACILITIES DISTRICT NO. 2015‐5 (Trieste)
OF THE CITY OF LAKE ELSINORE
The services which may be funded with proceeds of Special Tax B (Contingent) of CFD No. 2015‐5, as
provided by Section 53313 of the Act, will include all costs attributable to maintaining, servicing, repairing
and/or replacing streetlight improvements (may include reserves for replacement) in public street right‐of‐
ways areas officially dedicated for public use.
The authorized Special Tax B Services include the maintenance and lighting of parks, parkways,
streets, roads and open space, which maintenance and lighting services may include, without limitation,
furnishing of electrical power to street lights; repair and replacement of damaged or inoperative light bulbs,
fixtures and standards.
In addition to payment of the cost and expense of the forgoing services, proceeds of Special Tax B
(Contingent) may be expended to pay “Administrative Expenses,” as said term is defined in the Rate and
Method of Apportionment.
B-1
DOCSOC/1767091v3/022042-0008
ATTACHMENT “B”
Types of Facilities
to Be Types of Facilities
to Be Financed by Community
Facilities District No. 2015-5 of the City of Lake Elsinore
The proposed types of public facilities and expenses to be financed by the District
include:
The construction, purchase, modification, expansion, rehabilitation and/or improvement
of (i) drainage, library, park, roadway and other public facilities of the City, including the
foregoing public facilities which are included in the City’s fee programs with respect to such
facilities and authorized to be financed under the Mello-Roos Community Facilities Act of 1982,
as amended (the “City Facilities”) and (ii) water and sewer facilities including the acquisition of
capacity in the sewer system and/or water system of the Elsinore Valley Municipal Water District
which are included in Elsinore Valley Municipal Water District’s water and sewer capacity and
connection fee programs (the “Water District Facilities” and together, with the City Facilities, the
“Facilities”), and all appurtenances and appurtenant work in connection with the foregoing
Facilities, including the cost of engineering, planning, designing, materials testing, coordination,
construction staking, construction management and supervision for such Facilities, and to
finance the incidental expenses to be incurred, including:
a. The cost of engineering, planning and designing the Facilities;
b. All costs, including costs of the property owner petitioning to form the District,
associated with the creation of the District, the issuance of the bonds, the determination of the
amount of special taxes to be levied and costs otherwise incurred in order to carry out the
authorized purposes of the District; and
c. Any other expenses incidental to the construction, acquisition, modification,
rehabilitation, completion and inspection of the Facilities.
Capitalized terms used and not defined herein shall have the meaning set forth in the
Rate and Method of Apportionment of Special Taxes for the District.
B-2
DOCSOC/1767091v3/022042-0008
Types of Services
to Be Financed by Community
Facilities District No. 2015-5 of the City of Lake Elsinore
The services which may be funded with proceeds of Special Tax B (Contingent)
of CFD No. 2015‐5, as provided by Section 53313 of the Act, will include all costs attributable to
maintaining, servicing, repairing and/or replacing streetlight improvements (may include
reserves for replacement) in public street right‐of ways areas officially dedicated for public use.
The authorized Special Tax B Services include the maintenance and lighting of parks,
parkways, streets, roads and open space, which maintenance and lighting services may
include, without limitation, furnishing of electrical power to street lights; repair and replacement
of damaged or inoperative light bulbs, fixtures and standards.
In addition to payment of the cost and expense of the forgoing services, proceeds of Special
Tax B (Contingent) may be expended to pay “Administrative Expenses,” as said term is defined
in the Rate and Method of Apportionment
C-1
DOCSOC/1767091v3/022042-0008
ATTACHMENT “C”
BALLOT PROPOSITIONS
COMMUNITY FACILITIES DISTRICT NO. 2015-5
OF THE CITY OF LAKE ELSINORE (TRIESTE)
SPECIAL TAX AND SPECIAL BOND ELECTION
July 26, 2016
PROPOSITION A: Shall Community Facilities District
No. 2015-5 of the City of Lake Elsinore (Trieste) (the
“District”) incur an indebtedness and issue bonds in the
maximum principal amount of $2,700,000, with interest
at a rate or rates not to exceed the maximum interest
rate permitted by law, to finance the Facilities and the
Incidental Expenses described in Resolution No. 2016-
067 of the City Council of the City of Lake Elsinore
establishing the District?
PROPOSITION B: Shall a special tax with a rate and
method of apportionment as provided in Resolution No.
2016-067 of the City Council of the City of Lake Elsinore
establishing the District be levied to pay for the Facilities,
Services, Incidental Expenses and other purposes
described in Resolution No. 2016-067, including the
payment of the principal of and interest on bonds issued
to finance the Facilities and Incidental Expenses?
YES______
NO_______
YES______
NO_______
PROPOSITION C: For each year commencing with
Fiscal Year 2016-2017, shall the appropriations limit, as
defined by subdivision (h) of Section 8 of Article XIII B of
the California Constitution, for Community Facilities
District No. 2015-5 be an amount equal to $2,700,000?
YES______
NO_______