Loading...
HomeMy WebLinkAboutCC Reso No 2007-012RESOLUTION NO. 2007-12 RESOLUTION OF FORMATION OF THE CITY COUNCIL OF THE CTTY OF LAKE ELSINORE DETERMINING THE VALIDITY OF PRIOR PROCEEDINGS AND ESTABLISHING CITY OF LAKE ELSINORE COMMIJNITY FACILITIES DISTRICT NO. 2006-9 (TRIESTE) WHEREAS, the City Council (the "Council") of the City of Lake Elsinore (the "City") has heretofore adopted Resolution No. 2006-205 ("Resolution of Intention") stating its intention to form City of Lake Elsinore Community Faciliries District No. 2006-9 (Trieste) (the "CFD") pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (the "Act"); and WHEREAS, a copy of the Resolution of Intention is on file with the City Clerlc and incorparated herein by reference; and WHEREAS, pursuant to the Act and in accordance with applicable laws, this Council held a public hearing on the formation of the CFD and the incurring of bonded indebtedness with respect to the CFD; and WHEREAS, at said hearing all persons not exempt from the Services Special Tax and the Special Tax desiring to be heard on all matters pertaining to the formation of the CFD were heard and a full and fair hearing was held; and WHEREAS, at said hearing evidence was presented to the Council on said matters befare it, and this Council at the conclusion of said hearing is fully advised in the premises. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: SECTION 1. Pursuant to Section 53325.1(b) of the Govemment Code, the Council finds and deternunes that the proceedings prior hereto were valid and in confornuty with the requirements of the Act. SECTION 2. A community facilities district to be designated "City of Lake Elsinore Community Facilities District No. 2006-9 (Trieste)" is hereby established pursuant to the Act. CITY COUNCIL RESOLUTION NO. 2007-12 PAGE 2 OF 6 SECTION 3. The description and map of the boundaries of the CFD on file in the Clerk's office and as described in the Resolution of Intention and incorporated herein by reference, shall be the boundaries of the CFD. The map of the proposed boundaries of the CFD has been recarded in the Office of the County Recarder of Riverside County, California (Book 69 of Maps of Assessment and Community Facilities District at page 77 and as Instrument No. 2006-0954592). SECTION 4. Except where funds are otherwise available, it is the intention of the Council to levy annually in accordance with procedures contained in the Act a special t~ (the "Services Special Tax") sufficient to finance a portion of the cost of providing parks, open space and storm drain maintenance services (the "Services") that are in addition to those provided in the territory within the CFD prior to the formation of the CFD and do not supplant services already available within the territory proposed to be included in the CFD, the costs of administering the levy and collection of the Services Special Tax and all other costs of the levy of the Services Special Tax, including any foreclosure proceedings, legal, fiscal and financial consultant fees, election costs, and all other administrative costs of the tax levy. The Services Special Tax will be secured by recordation of a continuing lien against all real property in the CFD. The schedule of the rate and method of apportionment and manner of collection of the Services Special Tax is described in detail in Exhibit "A" attached hereto and by this reference incorporated herein. The Services are mare fully described in the report presented to this Council at the public hearing (the "Report"). The Services Special Tax is apportioned to each parcel on the foregoing basis pursuant to Section 533253 of the Act. SECTION 5. The faciliries proposed to be financed by the CFD are public infrastructure facilities and other governmental facilities with an estimated useful life of five years or longer, which the CFD is authorized by law to consriuct, own or operate and that are necessary to meet increased demands placed upon the City as a result of development or rehabilitation occurring within the proposed CFD, including but not limited to City park and traffic signal improvements, City capital facilities fees, Elsinare Valley Municipal Water District water and sewer capital facilities fees and Lake Elsinare Unified School District capital fees, and related costs including designs, inspections, professional fees, annexation fees, connection CITI' COUNCIL RESOLUTION NO. 2007-12 PAGE 3 OF 6 fees and acquisition costs (the "Facilities"). Such Facilities need not be physically located within the CFD. The Facilities are more fully described in the Report. SECTION 6. Except where funds are otherwise available, it is the intenrion of the Council to levy annually in accordance with procedures contained in the Act a special tax (the "Special Tax") sufficient to pay for the costs of financing the acquisition and/or construction of the Facilities, including the principal of and interest on the bonds proposed to be issued to finance the Facilities and other periodic costs, the establishment and replenishment of reserve funds, the remarketing, credit enhancement and liquidity fees, the costs of administering the levy and collection of the Special Tax and all other costs of the levy of the Special Tax and issuance of the bonds, including any fareclosure proceedings, architectural, engineering, inspection, legal, fiscal, and financial consultant fees, discount fees, interest on bonds due and payable prior to the expiration of one year from the date of completion of facilities (but not to exceed two years), election costs and all costs of issuance of the bonds, including, but not limited to, fees for bond counsel, disclosure counsel, financing consultants and printing costs, and all other administrative costs of the tax levy and bond issue. The Special Tax will be secured by recordation of a continuing lien against all real property in the CFD. In the first year in which such a Special Ta~ is levied, the levy shall include a sum sufficient to repay to the City all amounts, if any, transferred to the CFD pursuant to Section 53314 of the Act and interest thereon. The schedule of the rate and method of apportionment and manner of collection of the Special Tax is described in detail in Exhibit "A" attached hereto and by this reference incorporated herein. The Special Tax is based upon the cost of financing the Facilities in the CFD, the demand that each parcel will place on the Facilities and the benefit (direct and/or indirect) received by each parcel from the Facilities. The Special Tax is apportioned to each parcel on the foregoing basis pursuant to Section 53325.3 of the Act. In the event that a portion of the property within the CFD shall become for any reason exempt, wholly or partially, from the levy of the Special Tax, the Council shall, on behalf of the CFD, increase the levy to the extent necessary upon the remaining property within the CFD which is not delinquent or exempt in order to yield the required payments, subject to the maximum tax. Under no circumstances, however, shall the Special Tax levied against any parcel used for private residential purposes be increased as a consequence of delinquency or default by the owner of any other parcel or parcels CITY COUNCIL RESOLUTION NO. 2007-12 PAGE 4 OF 6 within the CFD by mare than 10 percent. Furthermore, the maximum special tax authorized to be levied against any parcel used for private residential purposes shall not be increased over time in excess of 2 percent per year. SECTION 7. Upon recordation of a Notice of Special Tax Lien pursuant to Section 3114.5 of the Streets and Highways Code, a continuing lien to secure each levy of the Services Special T~ and the Special T~ shall attach to all real property in the CFD, and the lien with respect to the Special Tax shall continue in force and effect until the Special Taac obligation is prepaid ar otherwise permanently satisfied and the lien canceled in accordance with law, and the lien with respect to the Services Special Tax and the Special Tax shall continue in force and effect until collection of the Services Special Tax and the Special Tax by the CFD ceases. SECTION 8. Neither the proposed Services Special Tax nor the Special Tax to be levied in the CFD has been precluded by protests by owners of one-half or more of the land in the territory included in the CFD pursuant to Government Code Section 53324. SECTION 9. Pursuant to and in compliance with the provisions of Government Code Section 50075.1, the Council hereby establishes the foilowing accountabiliry measures pertaining to the levy by the CFD of the Services Special Tax and the Special Tax: (a) Such Services Special Tax and the Special Tax shall be levied for the specific purposes set forth herein. (b) The proceeds of the levy of such Services Special Tax and the Special Tax shall be applied only to the specific purposes set forth herein. (c) The CFD shall establish an account or accounts into which the proceeds of such Services Special Tax and the Special Tax shail be deposited. (d) The City Manager, or his or her designee, acting for and on behalf of the CFD, shall annually file a report with the Council as required pursuant to Government Code Section 50075.3. CITY COUNCIL RESOLUTION NO. 2007-12 PAGE 5 OF 6 SECTION 10. The City Manager, 130 S. Main Street, Lake Elsinare, California 92530, (951) 674-3124, or his designee, is designated to be responsible far preparing or causing to be prepared annually a current roll of Services Special Tax and the Special Tax levy obligations by assessor's parcel number and for estimating future Services Special Tax and the Special Tax levies pursuant to Section 53340.1 of the Government Code. SECTION 11. The voting procedure with respect to the imposition of the Services Special Taa~ and the Special Tax, incurring bonded indebtedness and establishing an appropriations lirrut of the CFD shall be by hand delivered or mailed ballot election. SECTION 12. The City Clerk is directed to certify and attest to this Resolution and to take any and all necessary acts to call, hold, canvass and certify an election ar elections on the incurring bonded indebtedness, the levy of the Special Tax, and the establishment of the appropriation limit. SECTION 13. This Resolution shall take effect from and after the date of its passage and adoption. PASSED, APPROVED AND ADOPTED this 23rd day of January 2007, by the following vote: AYES: COUNCILMEMBERS: BUCKLEY, HICKMAN, KELLEY, SCHIFFNER, MAGEE NOES: COUNCILMEMBERS: NONE ABSENT: COUNCILMEMBERS: NONE ABSTAIN: COUNCILMEMBERS: NONE obert E. Magee, City of Lake Els'v CITY COiTNCIL RESOLUTION NO. 2007-12 PAGE 6 OF 6 ATTEST: ~~~ ~~ Michelle Soto, Deputy City Clerk City of Lake Elsinore City Attomey Elsinore ExxiBiT a RATE AND METHOD OF APPORTIONMENT RATE AND METHOD OF APPORTIONMENT FOR COMMiINITY FACILITIES DISTRICT No. 2006-9 OF THE CITY OF LAKE ELSINORE (TRIESTE) A Special Tax shall be levied on all Assessor's Pazcels in CommuniTy Facilities DistrictNo. 2006-9 of the City oF Lake Elsinore ( Trieste) ("CFD No. 2006-9") and collected each Fiscal Year commencing in Fiscal Yeaz 2007-2008, in an amount determined through the application ofthis Rate and Method of Apportionment as described below. All of the real property in CFD No. 2006-9, unless exempted by law or by the provisions hereof, shall be taxed for the purposes, to the extent and in the manner herein provided. A. The terms hereinafter set foRh have the following meanings: "Acre" or "Acreage" means the land azea of an Assessor's Parcel as shown on or determined from the applicable Assessor's Parcel Map. Notwithstanding the foregoing, the Acreage attributable to a Condominium shall be computed by the CFD Administrator by dividing the total Acreage for the Final Subdivision in which the Condominium is located, less the Acreage for any Property Owner Association Property and/or Public Property, by the total number of Condominiums to be constructed within such Final Subdivision as determined from the applicable Condominium Plan. "AcY' means the Mello-Roos Community Facilities Act of 1982, being Chapter 2.5, Part 1, Division 2 of Title 5 of the California Govemment Code. "Administrative Expenses" means the following actual or reasonably estimated wsts directly related to the administration of CFD No. 2006-9: the costs of computing the Special Taxes and prepazing the annual Special Tax collection schedules (whether by the City or designee thereof or both); the costs of collecting the Special Taaces (whether by the City or otherwise); the costs of remitting the Special Tases to the Trustee; the costs ofthe Trustee (including its legal counsel) in the discharge ofthe duties required of it under the Indenture; the costs to the City, CFD No. 2006-9 or any designee thereof of complying with arbitrage rebate requirements; the costs to the City, CFD No. 2006-9 or any designee thereof of complying with disc]osure requirements of the City, CFD No. 2006-9 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. 2006-9 or any designee thereof related to an appeal of the Special Ta~c; the costs associated with the release of funds from an escrow account; and the City's annual administration fees and third party expenses. Adminishative Expenses shall also include amounts estimated by the CFD Administrator or advanced by the City or CFD No. 2006-9 for any other adminisVative purposes of CFD No. 2006-9, including attorney's fees and other costs related to commencing and pursuing to completion any foreclosure of delinquent Special Taxes. City of Lake Elsinore Novembe~ 7, 2006 Community Facilities Dislrrct No. 2006-9 (Trieste) Page I "Assessor's Parcel" means a lot or parcel, including but not limited to Condominiums, to which an Assessor's pazcel number is assigned as determined from an Assessor's Parcel Map or the applicable assessment roll. "Assessor's Parcel Map" means an official map of the County Assessor of the CounTy designating parcels by Assessor's Parcel number. "Assigned Special Tax for Facilities" means the Special Tas for Facilities for each Land Use Class of Developed Property, as determined in accordance with Section C.1.(b) below. "Authorized Facilities" means those facilities eligible to be funded by CFD No. 2006-9. "Backup Special Tax for Facilities" means the Special Tax forFacilities applicableto each Assessor's Parcel of Developed Property, as determined in accordance with Section C.1.(c) below. "Certificate of Occupancy" means a certificate issued by the City that authorizes the actual occupancy of a dwelling unit for habitation by one or more residents. "CFD Administrator" means an official of the City, or designee thereof, responsible for determining the Special Tax Requirement for Facilities, the Special Tax Requirement for Services as determined in accordance with Section I below, and providing for the levy and collection of the Special Tases. "CFD No. 2006-9" means Community Facilities District No. 2006-9 of the CiTy of Lake Elsinore (Trieste). "CF'D No. 2006-9 Bonds" means any bonds or other debt (as defined in Section 53317(d) of the Act), whether in one or more series, issued by CFD No. 2006-9 and secured solely by the Special Tax for Facilities levy on property within the boundazies of CFD No. 2006-9 under the Act. "City" means the City oFLake Elsinore "Condominium" means a unit meeting the statutory definition of a condominium contained in the Califomia Civil Code, Section 1351, and for which a condominium plan has been recorded pursuant to California Civil Code, Section 1352. "Condominium Plan" means a condominium plan as set forth in the Califomia Civil Code, Section 1352. "Council" means the City Council of the City of Lake Elsinore, ading as the legislative body of CFD No. 2006-9. "County" means the County of Riverside L5ty oJLake E(sinose November7, 2006 Communiry FacJifies Dishict No. 2006-9 (Triute) Page 2 "Developed Property" means, with respect to the Special Tax for Facilities, for each Fiscal Year, all Tasable Property, exclusive of Tasable Public Property and Taxable Property Owner Association Property, for which the Final Subdivision was recorded on or before January 1 ofthe prior Fiscal Yeaz and a building permit for new construction was issued on or before May 1 of the Fiscal Year preceding the Fiscal Year for which the Special Tas for Facilities is being levied. "Ntinal Subdivision" means a subdivision of property by recordation of (i) a final map, or portion thereof, approved by the City pursuant to the Subdivision Map Act (California Government Code Section 66410 et seg.) that creates individual lots for which building permits may be issued, or (ii) lot line adjustment approved by the City. "NSscal Year" means the period starting July 1 and ending on the following June 30. "Indenture" means the indenture, fiscal agent agreement, resolution or other insVUment pursuant to which CFD No. 2006-9 Bonds are issued, as modified, amended and/or supplemented from time to time, and any insVUment replacing or supplementing the same. "Land Use Class" means any of the classes listed in Table 1 below. "Maximum Special Tax for Facilities" means the mvcimum Special Tax for Facilities, detertnined in accordance with Section C below, that can be levied in any Fiscal Yeaz on any Assessor's Parcel. "Non-Residential Property" means all Assessor's Parcels of Developed Property for which a building permit permitting the construction of one or more non-residential units or facilities has been issued by the CiTy, and which is not otherwise Residential Property. "Outstanding Bonds" means all CFD No. 2006-9 Bonds which are deemed to be outstanding under the Indenmre. "Property Owner Association Property" means, for each Fiscal Year, (i) any property within the boundaries of CFD No. 2006-9 that was owned by a property owner association, including any master or sub-association, as of January 1 of the priot Fiscal Year, (ii) any property located in a Final Subdivision that was recorded as of the May 1 preceding the Fiscal Yeaz in which the Special Taac is being levied and which, as determined from such Final Subdivision, is or will be open space, a common azea recreation facility, or a private street, or (iii) any property which, as of the May 1 preceding the Fiscal Yeaz for which the Special Tax is being levied, has been conveyed, irrevocably dedicated, or irrevocably offered to a property owner's association, including any master or sub-association, provided such conveyance, dedication, or offer is submitted to the CFD Administrator by May 1 preceding the Fiscal Year for which the Special Tas is being levied. Notwithstanding the preceding, Property Owner Association Property shall not include any property on which Condominiums are or will be located. City ojLake E4sinore November 7, 2006 Community Facilifies D'uhict No. 2006-9 (Triute) page 3 "Proportionately" means for Developed Property that the ratio ofthe actual Special Tazc for Facilities levyto the Assigned Special Tvt for Facilities is equal for all Assessor's Pazcels of Developed Properiy. For Undeveloped Property, "Proportionately" means that the ratio of the actual Special Tax for Facilities levy per Acre to the Ma~cimum Special Ta~c for Facilities per Acre is equal for all Assessor's Parcels of Undeveloped Property. The term "Proportionately" may similarly be applied to other categories of Tasable Property as listed in Section D below. "Public Property" means property within the boundazies of CFD No. 2006-9 owned by, irrevocably offered or dedicated to, or over, through or under which an easement for purposes of public use has been granted, to the federal govemment, the State, the CounTy, the City, or any local govemment or other public agency, provided that any property leased by a public agency to a private entity and subject to taxation under Section 533401 of the Act shall be ta~ced and classified according to its use. "Residenrial Floor Area" means all of the square footage of living area within the perimeter of a residential structure, not inc]uding any carpoR, walkway, garage, overhang, patio, enclosed patio, or similar area. The determination of Residential Floor Area for an Assessor's Parcel shall be made by reference to the building permit(s) issued for such Assessor's Parcel. Such determination shall be final following the issuance of a Certificate of Occupancy for the dwelling unit. "Residential Property" means all Assessor's Pazcels of Developed Property for which a building permit permitting the construction thereon of one or more residential dwelling units has been issued by the CiTy. "Special Tax" means any of the special tases authorized to be levied by CFD No. 2006-9 pursuant to the Act. "Special Tax for Facilities" means the special tax to be levied in each Fiscal Yeaz on each Assessor's Parcel of Developed Property, Taxable Property Owner Association Property, Taxable Public Property, and Undeveloped Property to fund the Special Taac Requirement for Facilities. "Special Tax Requirement for Facilities" means that amount required in any Fiscal Year for CFD No. 2006-9 to: (i) pay debt service on all Outstanding Bonds due in the calendaz yeazcommencing in such Fiscal Year; (ii) pay periodic costs on the CFD No. 2006-9 Bonds, including but not limited to, credit enhancement and rebate payments on the CFD No. 2006-9 Bonds due in the calendar year commencing in such Fiscal Year; (iii) pay a proportionate share of Administrative Expenses; (iv) pay any amounts required to establish or replenish any reserve funds for all Outstanding Bonds; (v) pay for reasonably anticipated Special Tax for Facilities delinquencies based on the delinquency rate for the Special Tax for Facilities levy in the previous Fiscal Yeaz; (vi) pay directly for acquisition or construction of Authorized Facilities to the extent that the inclusion of such amount does not increase the Special Ta~c for Facilities levy on Undeveloped Property; less (vii) a credit for funds available to reduce City ojLake Elsinore November 7, 2006 Communiry Faci[itiu District No. 200b9 (Trieste) Page 4 the annual Special Tax for Facilities levy, as determined by the CFD Administrator pursuant to the Indenture. "State" means the State of Califomia. "Taxable Property" means all ofthe Assessor's Parcels within the boundaries of CFD No. 2006-9 which aze not exempt from the Special Tax for Facilities pursuant to law or Section E below. "Taxable Property Owner Association Property" means all Assessor's Parcels of Property Owner Association Property that aze not exempt pursuant to Section E below. "Taxable Public Property" means all Assessor's Parcels of Public Property that aze not exempt pursuant to Section E below. "Trustee" means the trustee or fiscal agent under the Indentwe. "Undeveloped Property" means, for each Fiscal Year, all Taxable Property not classified as Developed Property, Taxable Proper[y Owner Association Property, or Taxable Public Property. B. ASSIGNMENT TO LAND USE CATEGORIES Each Fiscal Year, all Taacable Property within CFD No. 2006-9 shall be classified as Developed Property, Taxable Public Property, Taxable Property Owner Association Property, or Undeveloped Proper[y, and shall be subject to the Special Tax for Facilities in accordance with this Rate and Method of Apportionment determined pursuant to Sections C and D below. Residential Property shall be assigned to Land Use Classes 1 through 3 as listed in Table 1 below based on the Residential Floor Area for each unit. Non-Residential Property shall be assigned to Land Use Class 4. C. MAXIMUM SPECIAL TAX FOR FACILITIES Prior to the issuance of CFD No. 2006-9 Bonds, the Assigned Special Tax for Facilities on Developed Property (set forth in Table 1), and the Backup Special Tax for Facilities attributable to a Final Subdivision, may be reduced in accordance with, and subject to the conditions set forth in this paragraph. If it is reasonably determined by the CFD Adminislrator that the overlapping debt burden (as defined in the Statement of Goals and Policies for the Use of the Mello-Roos CommuniTy Facilities Act of 1982 adopted by the Council, the "Goals and Policies") calculated pursuantto the Goals ar~d Policies based upon the Assigned Special Tax for Facilities on Developed Property exceeds the City's maacimum level objective set forth in such document, the Assigned Special Ta~c for Facilities on Developed Property, and the Backup Special Tas for Facilities attributable to a Final Subdivision, may be reduced to the amount necessary to satisfy the City's objective with respect to the masimum ovedapping debt burden level with the written consent of the CFD Administrator. The reductions permitted pursuant to this pazagraph shall be reflected in an City ojLake EJsinore November 7, 2006 Community Facilities Disdict No. 2006-9 (TriesteJ Pnge 5 amended notice of Special Tax lien which the City shall cause to be recorded by executing a certificate in substantially the form attached hereto as Eachibit "A". Develoned Pronertv (a) Maacimum Special Tas for Facilities The Maximum Special Tas for Facilities for each Assessor's Parcel classified as Developed Property shall be the greater of (i) the amount derived by application of the Assigned Special Tax for Facilities or (ii) the amount derived by application of the Backup Special Ta~c for Facilities. (b) Assigned Special Tax for Facilities The Assigned Special Tax for Facilities for each Land Use Class is shown below in Table 1. TABLE 1 Assigned Special Tax tor Facilities for Developed Property Community Facilities District No. 2006-9 ~T-~5~ r ~ ~~~~i~i~ ~~c€ ~ ~,~`~ ~,,.~i'~~~:.~.~~, ~ ~i' ~ ~'~' r1 ~~ ~ '~'~~~i.y~ ~ t~P ~ ~:~~ ~'a ~~~ ~~Ir ~ `4 ,,a, . _ § ~ ... ~"~'~. ~ ~' ~~~ a o~~~~`~ ~~~~a~~` ~~ ~ '~~ Y€~~~~i~ ~~o ~ ~d~~~~ "° ~~ -, ~ ~; ~..a , __- W_ ~ ~~_3 - ;,. 1 Residential Property More than 2,100 sq. ft. $3,085 per unit 2 Residential Property 1,800 - 2,100 sq. ft. $2,891 per unit 3 Residential Property Less than 1,800 sq. ft. $2,708 per unit 4 Non-Residential Property NA $30,518 per Acre (c) Backup Special Tax for Facilities The Backup Special Tax for Facilities attributable to a Final Subdivision will equal $31,966 multiplied by the Acreage of all Tasable Property, exclusive of any Tasable Proper[y Owner Association Property and Taxable Public Property, therein. The Backup Special Taac for Facilities for each Assessor's Parcel ofResidential Property shall be computed by dividing the Backup Special Ta~c for Facilities attributable to the applicable Final Subdivision by the number of Assessor's Parcels and/or residential units for which building pertnits for residential construction have or may be issued (i.e., the number or residential lots and/or units). The Backup Special Tas for Facilities for each Assessor's Parcel of Non-Residential Property therein shall equal $31,966 multiplied by the Acreage of such Assessor's Parcel. City ojLake Elsino~e November 7, 2006 Community Facilitlu DistrictNo. 2006-9 (T~ieste) Page 6 If a Final Subdivision includes Assessor's Parcels of Ta~cable Property for which building permits for both residential and non-residential construction may be issued, exclusive of Tasable Proper[y Owner Association Proper[y and Taxable Public Property, then the Backup Special Tax for Facilities for each Assessor's Parcel of Residential Property shall be computed exclusive of the Acreage and Assessor's Parcels of property for which building permits for non-residential construction may be issued. Notwithstanding the foregoing, if all or any portion of the Final Subdivision(s) described in the preceding paragraphs is subsequently changed or modified by recordation of a lot line adjustment or similar instrument, and only if the CFD Administrator determines that such change or modification results in a decrease in the number of Assessor's Parcels of Taxable Property for which building permiu for residertial construction have or may be issued within such Final Subdivision, then the Backup Special Tax for Facilities for each Assessor's Parcel of Developed Property that is part of the lot line adjustment or similar instnunent for such Final Subdivision shall be a rate per Acre as calwlated below. The Backup Special Tax for Facilities previously determined for an Assessor's Pazcel ofDeveloped Property that is not a part of the lot line adjustment or similaz instrument for such Final Subdivision shall not be recalculated. 1. Detertnine the total Backup Special Tax for Facilities anticipated to apply to the changed or modified portion of the Final Subdivision area prior to the change or modification. 2. The result of paragraph 1 above shall be divided by the Acreage of Taacable Property which is ultimately expected to exist in such changed or modified portion of the Final Subdivision area, as reasonably determined by the CFD Administrator. 3. The result of paragraph 2 above shall be the Backup Special Ta~c for Facilities per Acre which shall be applicable to Assessor's Parcels of Developed Property in such changed or modified portion of the Final Subdivision azea for all remaining Fiscal Yeazs in which the Special Tax for Facilities may be levied. (d) Multiple Land Use Classes In some instances an Assessor's Parcel ofDeveloped Property may contain more than one Land Use Class. The Maacimum Special Tax for Facilities levied on an Assessor's Parcel shall be the sum ofthe Mazcimum Special Tax for Facilities for all Land Use Classes located on that Assessor's Parcel. The CFD Administrator's allocation to each type of property shall be final. City ojGake Elsinore November 7, 2006 Community Facilities District No. 2006-9 (Trieste) Page 7 2. Taacable Propertv Owner Association Proner[v, Taxable Public Propertv, and Undeveloped Proner[v The Maximum Special Tas for Facilities for Taxable Property Owner Association Property, Taxable Public Property, and Undeveloped Property shall be $31,966 per Acre. D. METI30D OF APPORTIONMENT OF THE SPECIAL TAX FOR FACILITIES Commencing with Fiscal Year 2007-2008 and for each following Fiscal Year, the Council shall determine the Special Tax Requirement for Facilities and levy the Special Ta~c for Facilities until the amount of Special Tax for Facilities levy equals the Special Ta~c Requirement for Facilities. The Special Tax for Facilities shall be levied each Fiscal Year as follows: First: The Special Tax for Facilities shall be levied on each Assessor's Parcel of Developed Proper[y in an amount equal to 100% ofthe applicable Assigned Special Tax for Facilities; Second: If additional monies aze needed to satisfy the Special Ta~ Requirement for Facilities after the first step has been completed, the Special Tas for Facilities shall be levied Proportionately on each Assessor's Parcel of Undeveloped Property at up to 100% of the Maximum Special Tax for Facilities for Undeveloped Property; ~ Third: If additional monies are needed to satisfy the Special Tax Requirement for Facilities after the first two steps have been completed, then the levy of the Special Tax for Facilities on each Assessor's Parcel ofDeveloped Property whose Ma~imum Special Tas forFacilities is determined through the application of the Backup Special Tax for Facilities shall be increased in equal percentages from the Assigned Special Tax for Facilities up to the Maximum Special Tax for Facilities for each such Assessor's Parcel; Fourth: If additional monies are needed to satisfy the Special Ta~c Requirement for Facilities after the first three steps have been completed, then the Special Tax for Facilities shall be levied Proportionately on each Assessor's Parcel of Taxable Property Owner Association Property and Ta~cable Public Property at up to 100% of the Maximum Special Taac for Facilities for Taxable Property Owner Association Property or Taxable Public Property. Notwithstanding the above, the Council may, in any Fiscal Year, levy Proportionately less than 100% of the Assigned Special Tas for Facilities in step one (above), when (i) the Council is no longer required to levy the Special Tax for Facilities pursuant to steps two through four above in order to meet the Special Tax Requirement for Facilities; (ii) all authorized CFD No. 2006-9 Bonds have already been issued or the Council has covenanted that it will not issue any additional CFD No. 2006-9 Bonds (except refunding bonds) to be supported by the Special Tax for Facilities; and (iii) all Authorized Facilities have been constructed anNor acquired and all reimbursements to the developer for the construction and/or acquisition of such facilities have been paid as permitted by law. City ojLake Elsinore November 7, 2006 Community Faci[ities District No. 2006-9 (Trieste) Pa~e 8 Fur[her notwithstanding the above, under no circumstances will the Special Tar for Facilities levied against any Assessor's Parcel of Residential Property for which a Certificate of Occupancy has been issued be increased by more than ten percent as a consequence of delinquency or default by the owner of any other Assessor's Parcel within CFD No. 2006-9. E. No Special Taac for Facilities shall be levied on up to 2.3 Acres of Property Owner Association Property and/or Public Property in CFD No. 2006-9. Tax-exempt status will be assigned by the CFD Administrator in the chronological order in which property becomes Property Owner Association Property or Public Property. However, should an Assessor's Parcel no longer be classified as Proper[y Owner Association Property orPublic Property, its tax-exempt status will be revoked. Proper[y Owner Association Property or Public Properiy that is not exempt from Special Tax for Facilities under this section shall be subject to the levy of the Special Tax for Facilities and shall be ta~ced Proportionately as part of the fourth step in Section D above, at up to 100% of the Maximum Special Tax for Facilities for Taxable Property Owner Association Property or Taxable Public Property. F. MANNER OF COLLECTION The Special Tax for Facilities shall be collected in the same manner and at the same time as ordinary ad valorem property taxes; provided, however, that CFD No. 2006-9 may directly bill the Special Tax for Facilities, may collect the Special Tar for Facilities at a different fime 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 pertnitted by the Act. G. PREPAYMENT OF SPECIAL TAX FOR FACILITIES The following additional definitions apply to this Section G: "BuildouP' means, for CFD No. 2006-9, that all expected building permits for dwelling units to be constructed in CFD No. 2006-6 have been issued, as reasonably determined by the CFD Administrator. "CFD Public Facilities" means either $3,564,033 in 2006 dollazs, which shall increase by the Construction Inflation Index on July 1, 2007, and on each July 1 thereafter, or such lower number as (i) shall be determined by the CFD Administrator as sufficient to provide funding for all of the Authorized Facilities, or (ii) shall be determined by the Council concurzently with a covenant that it will not issue any more CFD No. 2006-9 Bonds (except refunding bonds) to be supported by the Special Tax for Facilities levy under this Rate and Method of Apportionment as described in Section D above. City ojLake ELrinore November 7, 2006 Community Faci[ities District No. 2006-9 (Trieste) Page 9 "Construction Inflation Index" means the annual percentage change in the Engineering News Record Building Cost Index for the City of Los Angeles, measured as ofthe calendar year which ends in the previous Fiscal Yeaz. In the event this index ceases to be published, the Construction Inflation Index shall be another index as determined by the CFD Administrator that is reasonably compazable to the Engineering News Record Building Cost Index for the City of Los Angeles. "Future Facili6es Costs" means the CFD Public Facilities minus (i) wsts of Authorized Facilities previously paid from the Lnprovement Fund, (ii) moneys currently on deposit in the Improvement Fund available to pay costs of Authorized Facilities, and (iii) moneys currently on deposit in an escrow fund that are expected to be available to finance the cost of Authorized Facilities. "Improvement Fund" means an account specifically identified in the Indenture to hold funds which aze currently available for expenditure to acquire or construct Authorized Facilities. "Previously Issued Bonds" means, for any Fiscal Year, all Outstanding Bonds that are deemed to be outstanding under the Indenture after the first interest and/or principal payment date following the current Fiscal Year. 1. Prepayment in FuII Only an Assessor's Parcel of Developed Properiy, or Undeveloped Property for which a building permit has been issued, may be prepaid. The obligation ofthe Assessor's Parcel to pay the Special Tax for Facilities may be permanently satisfied as described herein, provided that a prepayment may be made with respect to a particular Assessor's Parcel only if there aze no delinquent Special Tases with respect to such Assessor's Parcel at the time of prepayment. An owner of an Assessor's Parcel intending to prepay the Special Tax for Facilities obligation shall provide the CFD Administrator with written notice of intent to prepay. Within 30 days ofreceipt ofsuch written notice, the CFD Adminislrator shall notify such owner of the prepayment amount for such Assessor's Parcel. The CFD Administrator may charge a reasonable fee for providing this service. Prepayment must be made not less than 45 days prior to the next occurring date that notice of redemption of CFD No. 2006-9. Bonds from the proceeds of such prepayment may be given by the Trustee pursuant to the Indenture. The Special Tax for Facilities Prepayment Amount (defined below) shall be calculated as summazized below (capitalized terms as defined below): Bond Redemption Amount plus Redemption Premium plus Future Facilities Amount plus Defeasance Amount plus Administrative Fees and Expenses less Reserve Fund Credit City of Lake Elsittore November 7, 2006 Community F¢cilities Disuict Nn. 2006-9 (Tries[e) Page 10 less Capitalized Interest Credit Total: equals Special Taac for Facilities Prepayment Amount As of the proposed date of prepayment, the Special Tas for Facilities Prepayment Amount shall be calculated as follows: Paraeraph No.: 1. Confirm that no Special Tax delinquencies apply to such Assessor's Parcel. 2. For Assessor's Parcels of Developed Property, compute the Assigned Special Tas for Facilities and Backup Special Tax for Facilities. For Assessor's Pazcels of Undeveloped Property for which a building permit has been issued, compute the Assigned Special Tax for Facilities and Backup Special Tas for Facilities for that Assessor's Parcel as though it was already designated as Developed Properiy, based upon the building permit which has already been issued for that Assessor's Parcel. 3. (a) Divide the Assigned Special Taac for Facilities computed pursuant to pazagraph 2 by the total estimated Assigned Special Tax for Facilities for the entire CFD No. 2006-9 based on the Developed Property Special Tas for Facilities which could be levied in the current Fiscal Year on all expected development through Buildout of CFD No. 2006-9, excluding any Assessor's Pazcels which have been prepaid, and (b) Divide the Backup Special Tas for Facilities computed pursuant to paragraph 2 by the total estimated Backup Special Ta~c for Facilities at Buildout for the entire CFD No. 2006-9, excluding any Assessor's Parcels which have been prepaid. 4. Multiply the lazger quotient computed pursuant to paragraph 3(a) or 3(b) by the Previously Issued Bonds to compute the amount of Previously Issued Bonds to be retired and prepaid (the "Bond Redemption AmounP'). 5. Multiply the Bond Redemption Amount computed pursuant to paragraph 4 by the applicable redemption premium (e.g., the redemption price-100%), if any, on the Previously Issued Bonds to be redeemed (the "Redemp[ion Premium"). 6. Compute the current Future Facilities Costs. 7. Multiply the lazger quotient computed pursuant to paragraph 3(a) or 3(b) by the amount determined pursuant to paragraph 6 to compute the amount of Future Facilities Costs to be prepaid (the "Future Facilities AmounP'). 8. Compute the amount needed to pay interest on the Bond Redemption Amount from the first bond interest and/or principal payma~t date following the cwrent Fiscal Yeaz until the earliflst redemption date for the Previously Issued Bonds. City ojLake EGsinore November 7, 2006 Community Facilities Distrrct No. 2006-9 (Trieste) Page 11 9. DeterminetheSpecialTaxforFacilitiesleviedontheAssessor'sPazcelinthecurrent Fiscal Year which has not yet been paid. ~ 10. Compute the minimum amountthe CFD Administrator reasonably expects to derive from the reinvestment of the Special Tax for Facilities Prepayment Amount less the Future Facilities Amount and the Administrative Fees and Expenses (defined below) from the date of prepayment until the redemption date for the Previously Issued Bonds to be redeemed with the prepayment. 11. Add the amounts computed pursuant to paragaphs 8 and 9 and subtract the amount computed pursuant to pazagraph ] 0(the "Defeasance AmounP'). 12. The administrative fees and expenses of CFD No. 2006-9 are as calculated by the CFD Administrator and include the costs of computation ofthe prepayment, the costs to invest the prepayment proceeds, the costs of tedeeming CFD No. 2006-9 Bonds, and the costs of recording any notices to evidence the prepayment and the redemption (the "Administrative Fees and Expenses"). 13. The reserve fund credit (the "Reserve Fund CrediP') 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 Previously Issued Bonds as a result of the prepayment, or (b) the amount derived by subtrac[ing the new reseroe requirement (as defined in the Indenture) in effect after the redemption of Previously Issued 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. No Reserve Fund Credit shall be granted if the amount then on deposit in the reserve fund for the Previously Issued Bonds is below 100% ofthe reserve requirement (as defined in the Inderture). 14. If any capitalized interest for the Previously Issued Bonds will not have been expended as of the date immediately following the firs[ interest and/or principal payment following the current Fiscal Year, a capitalized interest credit shall be calculated by multiplying the lazger quotient computed pursuant to paragraph 3(a) or 3(b) by the expected balance in the capitalized interest fund or account under the Indenture after such first interest and/or principal payment (the "Capitalized Interest CrediP'). 15. The Special Tax for Facilities prepayment is equal to the sum of the amounts computed pursuant to pazagraphs 4, 5, 7, 11 and 12, less the amounts computed pursuant to paragraphs 13 and 14 (the "Special Tar for Facilities Prepayment Amount"). From the Special Tax for Facilities Prepayment Amount, the amounts wmputed pursuant to pazagraphs 4, 5, 11, 13 and 14 shall be deposited into the appropriate fund as established under the Indenture and be used to retire CFD No. 2006-9 Bonds or make debt service payments. The amount computed pursuant to paragraph 7 shall be deposited into the CYty oJLake Elsinore Novem6er 7, 2006 Community Fncilities D'ufric[No. 20069 (Trieste) P¢ge 12 Improvement Fund. The amount computed pursuant to paragaph 12 shall be retained by CFD No. 2006-9. The Specia] Tax for Facilities Prepayment Amount may be insufficient to redeem a full $5,000 increment of CFD No. 2006-9 Bonds. In such cases, the increment above $5,000 or integral multiple thereof will be retained in the appropriate fund established under the Indenture to be used with the next prepayment of CFD No. 2006-9 Bonds or to make debt service payments. As a result of the payment of the wrzent Fiscal Yeaz's Special Tax for Facilities levy as determined under paragraph 9(above), the CFD Administrator shall remove the current Fiscal Year's Special Tax for Facilities levy for such Assessor's Pazcel from the County tax rolls. With respect to any Assessor's Pazcel that is prepaid, the Council shall cause a suitable notice to be recorded in compliance with the Act, to indicate the prepayment of the Special Tax for Facilities and the release of the Special Tax for Facilities lien on such Assessor's Parcel, and the obligation ofsuch Assessor's Parcel to paythe Special Ta~c forFacilities shall cease. Notwithstanding the foregoing, no Special Tas for Facilities prepayment shall be allowed unless, at the time of such proposed prepayment, the amount of Maximum Special Tax for Facilities that may be levied on Tasable Properiy within CFD No. 2006A (after excluding 2.3 Acres of Property Owner Association Properiy and/or Public Property in CFD No. 2006- 9 as set for[h in Section E) both prior to and after the proposed prepayment is at least equal to the sum of (i) the Administrative Expenses, as defined in Section A above, and (ii) 110 times maximum annual debt service, in each remaining Fiscal Year on the Outstanding Bonds. 2. Prepayment in Part The Special Tax for Facilities on an Assessor's Parcel of Developed Property or an Assessor's Parcel of Undeveloped Proper[y for which a building permit has been issued may be partially prepaid. The amount of the prepayment shall be calculated as in Section G.I; except that a partial prepayment shall be calculated according to the following formula: PP =[(PE - A) x F] + A These terms have the following meaning PP = the partial prepayment. PE = the Special Ta~c for Facilities Prepayment Amount calculated according to Section G.1. F= the percentage, expressed as a decimal, by which the owner of the Assessor's Parcel is partially prepaying the Special Tax for Facilities. A= the Administrative Fees and Expenses calculated according to Section G.1. City ojLake E[sinore November 7, 2006 Community Fncilities District No. 2006-9 (Trieste) Page 73 The owner of any Assessor's Parcel who desires such prepayment shall notify the CFD Administrator of such owner's intent to partially prepay the Special Tas for Facilities and the percentage by which the Special Taac for Facilities shall be prepaid. The CFD Administrator shal I provide the owner with a statement of the amount required for the partial prepayment of the Special Tax for Facilities for an Assessor's Parcel within 30 days ofthe request and may charge a reasonable fee for providing this service. With respect to any Assessor's Parcel that is partially prepaid, the Council shall (i) distribute the funds remitted to it according to Section G.1, and (ii) indicate in the records of CFD No. 2006-9 that there has been a partial prepayment of the Special Tas for Facilities and that a portion of the Special Taac for Facilities with respect to such Assessor's Parcel, equal to the outstanding percentage (1.00 - F) of the remaining Maacimum Special Tax for Facilities, shal I continue to be levied on such Assessor's Parcel pursuant to Section D above. H. TERM OF SPECIAL TAX FOR FACILITIES The Special Tax for Facilities shall be levied for a period not to exceed forty years commencing with Fiscal Year 2007-2008, provided however that the Special Tax for Facilities will cease to be levied in an earlier Fiscal Yeaz if the CFD Administrator has determined (i) that all required interest and principal payments on the CFD No. 2006-9 Bonds have been paid; (ii) all Authorized Facilities have been constructed and/or acquired and all reimbursements to the developer for the construction and/or acquisition of such Facilities have been paid as permitted by law; and (iii) al] other obligations ofCFD No. 2006- 9 have been satisfied. I. SPECIAL TAX FOR SERVICES The following additional definitions apply to this Section L• "Developed Multifamily Unit" means a residential dwelling unit within a building in which each of the individual dwelling units has or shall have at least one common wall with another dwelling unit and a building permit has been issued by the City for such dwelling unit on or prior to May 1 preceding the Fiscal Year in which the Special Tax for Services is being levied. "Developed Single Family UniN' means a residential dwelling unit other than a Developed Multifamily Unit on an Assessor's Parcel for which a building permit has been issued by the City on or prior to May 1 preceding the Fiscal Year in which the Special Tax for Services is being levied. "Maximum Special Tax for Services" means the maximum Special Tax for Services that can be levied by CFD No. 2006-9 in any Fiscal Yeaz on any Assessor's Parcel. "Operating Fund" means a fund that shall be maintained for CFD No. 2006-9 for any Fiscal Year to pay for the actual costs of maintenance related to the Service Area, and the applicable Administrative Expenses. City ojLake EGsinore November 7, 2006 Community Facilifies Uistrict No. 2006-9 (Trieste) Ppge 14 "Operafing Fuud Balance" means the amount of funds in the Operating Fund at the end of the preceding Fiscal Yeaz. "Service Area" means parks, open space, and storm drains. "Special Tax for Services" means any of the special taaces authorized to be levied within CFD No. 2006-9 pursuant to the Ad to fund the Special Tas Requirement for Services. "Special Tax Requirement for Services" means the amount determined in any Fiscal Year for CFD No. 2006-9 equal to (i) the budgeted costs directty related to the Service Area, including maintenance, repair and replacement of certain components of the Service Area which have been accepted and maintained or are reasonably expected to be accepted and maintained during the current Fiscal Year, (ii) pay a proportionate share of Administrative Expenses, and (iii) anticipated Special Tax for Services delinquencies based on the delinquency rate for the Special Tax for Services levy in CFD No. 2006-9 for the previous Fiscal Year, less (iv) the Operating Fund Balance, as determined by the CFD Administrator. 1. Rate and Met6od of Apportionment of the Special Tax for Services Commencing with Fiscal Year 2007-2008 and for each subsequent Fiscal Year, the Council shall levy the Special Tax for Services on (i) all Assessor's Pazcels containing a Developed Single Family Unit or Developed Multifamily Unit and (ii) all Assessor's Parcels of Non- Residential Property, up to the applicable Maximum Special Tas for Services to fund the Special Tax Requirement for Services. The Maximum Special Tax for Services for Fiscal Year 2007-2008 shall be $251.78 per Developed Single Family Unit, $125.89 per Developed Multifamily Unit, and $567A2 per Acre for each Assessor's Parcel of Non-Residential Proper[y. On each July 1, commencing July 1, 2008, the Maximum Special Tax for Services shall be increased by two percent (2.00%) of the amount in effect in the prior Fiscal Year. 2. Duration of the Speciel Tax for Services The Special Taac for Services shall be levied in perpetuity to fund the Special Tax Requirement for Services, unless no longer required as determined at the sole discretion of the Council. 3. Coliection of the Special Tax for Services The Special Taac for Services shall be collected in the same manner and at the same time as ordinary ad va[orem property taxes, provided, however, that CFD No. 2006-9 may collect the Special Tax for Services at a different time or in a different manner if necessary to meet its funding requirements. City ojLake Elsinore November 7, 2006 Community Facilities District No. 2006-9 (Trieste) Page IS J. APPEALSAND INTERPRETATIONS Any landowner or resident who feels that the amount of the Special Tax levied on their Assessor's Parcel is in error may submit a written appeal to CFD No. 2006-9. The CFD Adminisffator shall review the appeal and if the CFD Administrator concurs, the amount of the Special Tax levied shall be appropriately modified. The Council may interpret this Rate and Method of AppoRionment for pwposes of clarifying any ambiguity and make determinations relative to the annual adminisUation of the Special Tas and any landowner or resident appeals. Any decision of the Council shal] be final and binding as to all persons. K:ICLfEMS2LShopoJJGrouplTYiesIeIFMAITriesreCFORNADroJl2.doc . 2evised: 3:',<',.O[Il.i_____________________________"_"_"...._"_"____-__________________"""'""""'"'_' "__ D¢let2tl:l1/30/06 C}ty ojLnke Elsrnore November 7, 2006 Communiry Faci[ities DislrictNo. 2006-9 (Trreste) Page 76 EXHIBIT A CERTIFICATE TO AMEND SPECIAL TAX FOR FACILITIES CITY OF LAKE ELSINORE AND CFD No. 2006-9 CERTIFICATE 1. Pursuant to Section C of the Rate and Method of Apportionment, the City of Lake Elsinore ("CiTy") and Community Facilities District No. 2006-9 of the CiTy ofLake Elsinore ("CFD No. 2006-9") hereby agree to a reduction in the Assigned Special Tas for Facilities for Developed Property, and the Backup Special Tas for Facilities attributable to a Final Subdivision within CFD No. 2006-9: (a) The information in Table 1 relating to the Assigned Special Tax for Facilities for Developed Property within CFD No. 2006-9 shall be modified as follows: ~ ~r~~~p~'jti~~, RS~s~.'~--i~.S`4 . ~~~~,~x _. _., ~ `t~''~Sa.~' ~~ ~a. ~ b~,'r,' z~ t:'(~ ~'~~~ s{ ~~ ,* _----~~C.l'L~,}~t3I~'~s~-,.~, '~ _ °_~.. .. .. -x:. ~ f'F"t. ~~i~~ ~ ~. ~.~ ~~~~~~. ~-~ w,~,:~ ~'' ~H ~v , ~ ~ .~x, M~ . 't~+~ ~'l~ Ci{`il - " ~h ~.S ~~E'~T.~::_ ° 1 Residential Proper[y More than 2,100 sq. ft. $_ per unit 2 Residential Property 1,800 - 2,100 sq. ft. $ per unit 3 Residential Property Less than 1,800 sq. ft. $_ per unit 4 Non-Residential Property NA $ per Acre (b) The Backup Special Tax for Facilities adributable to a Final Subdivision within CFD No. 2006-9, as stated in Section C1.(c), shall be reduced from $31,966 per Acre to $ per Acre. 2. The Special Tas for Facilities may only be modified prior to the first issuance of CFD No. 2006- 9 Bonds. 3. Upon execution of the Certificate by the City and CFD No. 2006-9, the Ciry shall cause an amended notice of Special Tax lien for CFD No. 2006-9 to be recorded reflecting the modifications set forth herein. By execution hereof, the undersigned acknowledges, on behalf of the City and CFD No. 2006-9, receipt of this Certificate and modification ofthe Rate and Method of Apportionment as set forth in this Cer[ificate. CITY OF LAKE ELSINORE CFD Administrator COMMLJNITY FACII,ITIES DISTRICT NO. 2006-9 OF THE CITY OF LAKE ELSINORE