HomeMy WebLinkAboutItem No. 16 - Intention to Establish CFD 2023-1
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REPORT TO CITY COUNCIL
To:Honorable Mayor or Members of the City Council
From:Jason Simpson, City Manager
Prepared by:Shannon Buckley, Assistant City Manager
Date:January 10, 2023
Subject:Intention to Establish Community Facilities District No. 2023-1 of the
City of Lake Elsinore (Lakeside)
Recommendation
1. ADOPT A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE,
CALIFORNIA, STATING THE INTENTION TO ESTABLISH COMMUNITY FACILITIES
DISTRICT NO. 2023-1 OF THE CITY OF LAKE ELSINORE (LAKESIDE); and
2. ADOPT A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE,
CALIFORNIA, STATING THE INTENTION TO INCUR BONDED INDEBTEDNESS FOR
COMMUNITY FACILITIES DISTRICT NO. 2023-1 OF THE CITY OF LAKE ELSINORE
(LAKESIDE)
Background
The property to be included within proposed Community Facilities District No. 2023-1 of the City
of Lake Elsinore (Lakeside) (“CFD No. 2023-1” or the “District”) is located on the northeast corner
of Grand Avenue and Riverside Drive, in the western part of the City of Lake Elsinore (the
“Property”) (see the attached project map). Collectively, the Property is approximately 35 gross
acres with plans to be entitled for 140 single family residential lots. The Property is currently
owned by Tri Pointe Homes IE-SD, Inc. (the “Property Owner”).
The Property Owner has requested that the City form CFD No. 2023-1 to encompass the Property
in accordance with the Mello-Roos Community Facilities Act of 1982, as amended (the “Act”), to
finance the costs of certain public improvements through the levy of a special tax and the issuance
of bonds. The maximum amount of bonded indebtedness proposed is $9 million.
Intention to Establish CFD No. 2023-1
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The Property Owner has requested that the boundaries of CFD No. 2023-1 include the area
described in Attachment A of the Resolution of Intention to Establish CFD No. 2023-1 presented
at this meeting (the “Resolution of Intention”), and that special taxes be levied within the
boundaries of the District in accordance with the Rate and Method of Apportionment (the “RMA”)
described in Attachment C to the Resolution of Intention.
Discussion
The Resolution of Intention is the first step in the process of forming CFD No. 2023-1. The
attached Resolutions declare the City’s intention to establish CFD No. 2023-1, its intention to
incur bonded indebtedness by CFD No. 2023-1, and call for a public hearing. A public hearing
on the matter will take place on February 21, 2023, and at that time the Council will formally
consider the establishment of CFD No. 2023-1, and hold elections on the approval of the special
taxes and the need to incur bonded indebtedness within CFD No. 2023-1.
Fiscal Impact
The Property Owner has made a deposit to pay for the costs of the formation proceedings which
may be reimbursed to the Property Owner in accordance with a reimbursement agreement with
the Property Owner. If established and subject to necessary Council and voter approvals, CFD
No. 2023-1 will annually levy special taxes on all of the taxable property within the District in
accordance with the RMA (as attached to the Resolution of Intention). Such special taxes will be
used to pay for the costs of facilities, debt service on bonds and administration of CFD No. 2023-1.
Any bonds issued by CFD No. 2023-1 are not obligations of the City and will be secured solely
by the Special Taxes levied within CFD No. 2023-1.
The RMA provides that the annual special tax rates will range from $3,228 for home sizes less
than 1,900 square feet to $3,564 for home sizes greater than 2,100 square feet, which rates
escalate at 2% per year.
Attachments
Attachment 1 - Resolution of Intention to Establish CFD 2023-1
Attachment 2 - Resolution of Intention to Incur Debt
Attachment 3 - Landowner Petition
Exhibit A - Project Map
Attachment 4 - Reimbursement Agreement
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RESOLUTION NO. __________
RESOLUTION OF INTENTION OF THE CITY COUNCIL OF THE
CITY OF LAKE ELSINORE TO ESTABLISH COMMUNITY
FACILITIES DISTRICT NO. 2023-1 OF THE CITY OF LAKE
ELSINORE (LAKESIDE), TO AUTHORIZE THE LEVY OF A
SPECIAL TAX TO PAY THE COSTS OF ACQUIRING OR
CONSTRUCTING CERTAIN FACILITIES AND TO PAY DEBT
SERVICE ON BONDED INDEBTEDNESS
Whereas, the City of Lake Elsinore (the “City”) received a petition signed by the owners of all of
the land within the boundaries of the territory which is proposed for inclusion in a proposed
community facilities district, which petition meets the requirements of Sections 53318 and 53319
of the Government Code of the State of California; and
Whereas, the City Council of the City (the “City Council”) desires to adopt this resolution of
intention as provided in Section 53321 of the Government Code of the State of California to
establish a community facilities district consisting of the territory described in Attachment “A”
hereto and incorporated herein by this reference, which the City Council hereby determines
shall be known as “Community Facilities District No. 2023-1 of the City of Lake Elsinore
(Lakeside)” (“Community Facilities District No. 2023-1” or the “District”) pursuant to the Mello-
Roos Community Facilities Act of 1982, as amended, commencing with Section 53311 of the
Government Code (the “Act”) to finance (1) the purchase, construction, modification, expansion,
improvement or rehabilitation of certain real or other tangible property described in Attachment
“B” hereto and incorporated herein by this reference, including all furnishings, equipment and
supplies related thereto (collectively, the “Facilities”), which Facilities have a useful life of five
years or longer, and (2) the incidental expenses to be incurred in connection with financing the
Facilities and forming and administering the District (the “Incidental Expenses”); and
Whereas, the City Council further intends to approve an estimate of the costs of the Facilities
and the Incidental Expenses for Community Facilities District No. 2023-1; and
Whereas, it is the intention of the City Council to consider financing the Facilities and the
Incidental Expenses through the formation of Community Facilities District No. 2023-1 and the
issuance of bonded indebtedness in an amount not to exceed $9,000,000 with respect to the
Facilities and the Incidental Expenses and the levy of a special tax to pay for the Facilities and
the Incidental Expenses (the “Special Tax”) and to pay debt service on the bonded
indebtedness, provided that the bond sale and such Special Tax levy are approved at an
election to be held within the boundaries of Community Facilities District No. 2023-1;
Whereas, the City desires to enter into a reimbursement agreement with Tri Pointe Homes IE-
SD, Inc., a California corporation (the “Developer”), the form of which is on file with the City
Clerk (the “Reimbursement Agreement”), to provide for the reimbursement of certain amounts
advanced by the Developer in connection with the formation of the District;
Whereas, the District and the Developer propose to enter into a joint community facilities
agreements (the “JCFA”) with Elsinore Valley Municipal Water District (the “Water District”)
relating to certain facilities proposed to be financed by the District and owned and operated by
the Water District, and the District expects to enter into the JCFA prior to the approval of the
issuance of bonds pursuant to the Act;
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NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE DOES
HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS:
Section 1. The above recitals are true and correct.
Section 2. A community facilities district is proposed to be established under the terms of the
Act. It is further proposed that the boundaries of the community facilities district shall be the
legal boundaries as described in Attachment “A” hereto, which boundaries shall, upon
recordation of the boundary map for the District, include the entirety of any parcel subject to
taxation by the District, and as depicted on the map of the proposed Community Facilities
District No. 2023-1 which is on file with the City Clerk. The City Clerk is hereby directed to sign
the original map of the District and record it with all proper endorsements thereon with the
Assessor-County Clerk-Recorder of the County of Riverside within 15 days after the adoption of
this resolution, all as required by Section 3111 of the Streets and Highways Code of the State of
California.
Section 3. The name of the proposed community facilities district shall be “Community
Facilities District No. 2023-1 of the City of Lake Elsinore (Lakeside).”
Section 4.The Facilities proposed to be provided within Community Facilities District No.
2023-1 are public facilities as defined in the Act, which the City and the Water District, with
respect to certain water and sewer facilities, are authorized by law to construct, acquire, own
and operate. The City Council hereby finds and determines that the description of the Facilities
herein is sufficiently informative to allow taxpayers within the proposed District to understand
what the funds of the District may be used to finance. The Incidental Expenses expected to be
incurred include the cost of planning and designing the Facilities, the costs of forming the
District, issuing bonds and levying and collecting the Special Tax within the proposed District.
The Facilities may be acquired from one or more of the property owners within the District as
completed public improvements or may be constructed from bond or Special Tax proceeds.
All or a portion of the Facilities may be purchased with District funds as completed public
facilities pursuant to Section 53314.9 or as discrete portions or phases pursuant to Section
53313.51 of the Act and/or constructed with District funds pursuant to Section 53316.2 of the
Act. Any portion of the Facilities may be financed through a lease or lease-purchase
arrangement if the District hereafter determines that such arrangement is of benefit to the
District.
Section 5.Except where funds are otherwise available, it is the intention of the City Council
to levy annually in accordance with the procedures contained in the Act the Special Tax,
secured by recordation of a continuing lien against all nonexempt real property in the District,
sufficient to pay for: (i) the Facilities and Incidental Expenses; and (ii) the principal and interest
and other periodic costs on bonds or other indebtedness issued to finance the Facilities and
Incidental Expenses, including the establishment and replenishment of any reserve funds
deemed necessary by the District, and any remarketing, credit enhancement and liquidity facility
fees (including such fees for instruments which serve as the basis of a reserve fund in lieu of
cash). The rate and method of apportionment and manner of collection of the Special Tax are
described in detail in Attachment “C” attached hereto, which Attachment “C” is incorporated
herein by this reference. Attachment “C” allows each landowner within the District to estimate
the maximum amount of the Special Tax that may be levied against each parcel. In the first
year in which such Special Tax is levied, the levy shall include an amount sufficient to repay to
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the District all amounts, if any, transferred to the District pursuant to Section 53314 of the Act
and interest thereon.
If the Special Tax is levied against any parcel used for private residential purposes, (i) the
maximum Special Tax rate shall be specified as a dollar amount which shall be calculated and
established not later than the date on which the parcel is first subject to the Special Tax
because of its use for private residential purposes and shall not be increased over time, except
as set forth in Attachment “C” hereto, (ii) such Special Tax not shall be levied after fiscal year
2069-70, as described in Attachment “C” hereto, and (iii) under no circumstances will the
Special Tax levied in any fiscal year against any such parcel used for private residential uses be
increased as a consequence of delinquency or default by the owner or owners of any other
parcel or parcels within the District by more than ten percent (10%) above the amount that
would have been levied in that fiscal year had there never been any such delinquencies or
defaults.
The Special Tax is based on the expected demand that each parcel of real property within
proposed Community Facilities District No. 2023-1 will place on the Facilities and on the benefit
that each parcel derives from the right to access the Facilities. The City Council hereby
determines that the proposed Facilities are necessary to meet the increased demand placed
upon the City and the existing infrastructure in the City as a result of the development of the
land proposed for inclusion in the District. The City Council hereby determines the rate and
method of apportionment of the special tax with respect to the Special Tax set forth in
Attachment “C” to be reasonable. The Special Tax is apportioned to each parcel on the
foregoing basis pursuant to Section 53325.3 of the Act and such special tax is not on or based
upon the value or ownership of real property. In the event that a portion of the property within
Community Facilities District No. 2023-1 shall become for any reason exempt, wholly or
partially, from the levy of the Special Tax specified on Attachment “C,” the City Council shall, on
behalf of Community Facilities District No. 2023-1, cause the levy to be increased, subject to the
limitation of the maximum Special Tax for a parcel as set forth in Attachment “C,” to the extent
necessary upon the remaining property within proposed Community Facilities District No. 2023-
1 which is not exempt in order to yield the Special Tax revenues required for the purposes
described in this Section 5. The obligation to pay the Special Tax may be prepaid only as set
forth in Section G of Attachment “C” hereto.
Section 6. A public hearing (the “Hearing”) on the establishment of the proposed
Community Facilities District No. 2023-1, the proposed rate and method of apportionment of the
Special Tax and the proposed issuance of bonds to finance the Facilities and the Incidental
Expenses shall be held at 7:00 p.m., or as soon thereafter as practicable, on February 21, 2023,
at the City Cultural Center, 183 North Main Street, Lake Elsinore, California. Should the City
Council determine to form the District, a special election will be held to authorize the issuance of
the bonds and the levy of the special tax in accordance with the procedures contained in
Government Code Section 53326. If held, the proposed voting procedure at the election will be
a landowner vote with each landowner who is the owner of record of land within the District at
the close of the Hearing, or the authorized representative thereof, having one vote for each acre
or portion thereof owned within the proposed District. Ballots for the special election may be
distributed by mail or by personal service.
Section 7. At the time and place set forth above for the Hearing, the City Council will receive
testimony as to whether the proposed Community Facilities District No. 2023-1 shall be
established and as to the method of apportionment of the special tax and shall consider:
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(a) if an ad valorem property tax is currently being levied on property within proposed
Community Facilities District No. 2023-1 for the exclusive purpose of paying principal of or
interest on bonds, lease payments or other indebtedness incurred to finance construction of
capital facilities; and
(b) if the capital facilities to be financed and constructed by Community Facilities District No.
2023-1 will provide the same services as were provided by the capital facilities mentioned in
subsection (a); and
(c) if the City Council makes the findings specified in subsections (a) and (b) above, it will
consider appropriate action to determine whether the total annual amount of ad valorem
property tax revenue due from parcels within Community Facilities District No. 2023-1, for
purposes of paying principal and interest on the debt identified in subsection (a) above, shall not
be increased after the date on which Community Facilities District No. 2023-1 is established, or
after a later date determined by the City Council with the concurrence of the legislative body
which levied the property tax in question.
Section 8. At the time and place set forth above for the Hearing, any interested person,
including all persons owning lands or registered to vote within proposed Community Facilities
District No. 2023-1, may appear and be heard.
Section 9. Each City officer who is or will be responsible for providing the Facilities within
proposed Community Facilities District No. 2023-1, if it is established, is hereby directed to
study the proposed District and, at or before the time of the above-mentioned Hearing, file a
report with the City Council containing a brief description of the public facilities by type which will
in his or her opinion be required to meet adequately the needs of Community Facilities District
No. 2023-1 and an estimate of the cost of providing those public facilities, including the cost of
environmental evaluations of such facilities and an estimate of the fair and reasonable cost of
any Incidental Expenses to be incurred.
Section 10. The District may accept advances of funds or work-in-kind from any source,
including, but not limited to, private persons or private entities, for any authorized purpose,
including, but not limited to, paying any cost incurred in creating Community Facilities District
No. 2023-1. The District may enter into an agreement with the person or entity advancing the
funds or work-in-kind, to repay all or a portion of the funds advanced, or to reimburse the person
or entity for the value, or cost, whichever is less, of the work-in-kind, as determined by the City
Council, with or without interest.
Section 11. The City Clerk is hereby directed to publish a notice (the “Notice”) of the Hearing
pursuant to Section 6061 of the Government Code in a newspaper of general circulation
published in the area of proposed Community Facilities District No. 2023-1. The City Clerk is
further directed to mail a copy of the Notice to each of the landowners within the boundaries of
the District at least 15 days prior to the Hearing. The Notice shall contain the text or a summary
of this Resolution, the time and place of the Hearing, a statement that the testimony of all
interested persons or taxpayers will be heard, a description of the protest rights of the registered
voters and landowners in the proposed district and a description of the proposed voting
procedure for the election required by the Act. Such publication shall be completed at least
seven (7) days prior to the date of the Hearing.
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Section 12. The reasonably expected maximum principal amount of the bonded
indebtedness to be incurred by the District for the Facilities and Incidental Expenses is Nine
Million Dollars ($9,000,000).
Section 13. The form of the Reimbursement Agreement is hereby approved. The Mayor, the
City Manager, or their written designees are hereby authorized and directed to execute and
deliver the Reimbursement Agreement in the form on file with the City Clerk with such changes,
insertions and omissions as may be approved by the officer or officers executing such
agreement, said execution being conclusive evidence of such approval.
Section 14. Except to the extent limited in any bond resolution or trust indenture related to the
issuance of bonds, the City Council hereby reserves to itself all rights and powers set forth in
Section 53344.1 of the Act (relating to tenders in full or partial payment).
Section 15. This Resolution shall be effective upon its adoption.
Passed and Adopted on this 10th day of January, 2023.
_____________________________
Natasha Johnson, Mayor
Attest:
_____________________________
Candice Alvarez, MMC
City Clerk
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STATE OF CALIFORNIA )
COUNTY OF RIVERSIDE ) ss.
CITY OF LAKE ELSINORE )
I, Candice Alvarez, MMC, City Clerk of the City of Lake Elsinore, California, do hereby certify
that Resolution No. 2023-______ was adopted by the City Council of the City of Lake Elsinore,
California, at the Regular meeting of January 10, 2023 and that the same was adopted by the
following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
________________________________
Candice Alvarez, MMC
City Clerk
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ATTACHMENT A
BOUNDARY MAP
B-1
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ATTACHMENT B
Types of Facilities
to Be Financed by Community
Facilities District No. 2023-1 of the City of Lake Elsinore (Lakeside)
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, fire, roadway, traffic, administration and community center facilities,
marina/lakeside and animal shelter facilities, 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, 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.
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ATTACHMENT C
RATE AND METHOD OF APPORTIONMENT FOR
COMMUNITY FACILITIES DISTRICT NO. 2023-1
OF THE CITY OF LAKE ELSINORE
(LAKESIDE)
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. 2023-1 (Lakeside) ("CFD No. 2023-1”).
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 CFD No. 2023-1, by applying the appropriate Special Tax for Developed
Property, Approved Property, Undeveloped Property, and Provisional Undeveloped 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:
“Accessory Dwelling Unit” means a residential unit of limited size including a smaller second
unit that shares an Assessor’s Parcel as a Single Family Residential Property with a stand-
alone Residential Unit.
"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. 2023-1: 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 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. 2023-1
or any designee thereof of complying with arbitrage rebate requirements; the costs to the City,
CFD No. 2023-1 or any designee thereof of complying with disclosure requirements of the City,
CFD No. 2023-1 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. 2023-
1 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. 2023-1 for any other administrative purposes
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of CFD No. 2023-1, 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, (ii) and has an assigned Assessor’s Parcel Number from the County
shown on an Assessor’s Parcel Map for the individual lot included on the Final Map, and (iii) that
have not been issued a building permit on or before May 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.
"Assessor’s Parcel Number" means that number assigned to an Assessor’s Parcel by the
County for purposes of identification.
"Assigned Special Tax" means the Special Tax of that name described in Section D below.
"Backup Special Tax" 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 of CFD No. 2023-1 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 permit document(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 to the
Assessor’s Parcel, provided that following such determination the Maximum Special Tax 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” or “CFD No. 2023-1” means Community Facilities District No. 2023-1 (Lakeside
Highlands) established by the City under the Act.
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“CFD Administrator" means an official of the City, or designee thereof, responsible for
determining the Special Tax Requirement, and providing for the levy and collection of the
Special Taxes.
“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. 2023-1.
“Condominium Plan" means a condominium plan as set forth in the California Civil Code,
Section 6624.
"County" means the County of Riverside.
"Developed Property" means all Assessor’s Parcels 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) has an Assessor’s Parcel Number from the County shown on an
Assessor’s Parcel Map for the individual lot included on the Final Map, and (iii) a Building Permit
for new construction was issued on or before May 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.
"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
6624 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.
"Maximum Special Tax" means for each Assessor’s Parcel, the maximum Special Tax,
determined in accordance with Section D below, that can be levied by CFD No. 2023-1 in any
Fiscal Year on such Assessor’s Parcel.
“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 for which a building
permit(s) was issued or will be issued for a non-residential use. The CFD Administrator shall
make the determination if an Assessor’s Parcel is Non-Residential Property.
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"Partial Prepayment Amount" means the amount required to prepay a portion of the Special
Tax obligation for an Assessor’s Parcel, as described in Section G.2.
"Prepayment Amount" means the amount required to prepay the Special Tax obligation in full
for an Assessor’s Parcel, as described in Section G.1.
“Proportionately” means for Taxable Property that is (i) Developed Property, that the ratio of
the actual Special Tax levy to the Assigned Special Tax is the same for all Assessor’s Parcels of
Developed Property, (ii) Approved Property, that the ratio of the actual Special Tax levy to the
Maximum Special Tax is the same for all Assessor’s Parcels of Approved Property, and (iii)
Undeveloped Property, or Provisional Undeveloped Property, that the ratio of the actual Special
Tax levy per Acre to the Maximum Special Tax per Acre is the same for all Assessor’s Parcels
of Undeveloped Property, or Provisional Undeveloped Property, as applicable.
"Provisional Undeveloped Property" means all Assessor’s Parcels of Taxable Property that
would otherwise be classified as Exempt Property pursuant to the provisions of Section F, but
cannot be classified as Exempt Property because to do so would be reduce the Acreage of all
Taxable Property below the required minimum Acreage set forth in Sections F.
"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. An Accessory
Dwelling Unit that shares an Assessor’s Parcel with a Single Family Residential Property shall
not be considered a Residential Unit for purposes of this RMA.
“Single Family Residential Property” means all Assessor’s Parcels of Residential Property
other than Multifamily Property.
"Special Tax" or “Special Taxes” means any of the special taxes authorized to be levied
within CFD No. 2023-1 pursuant to the Act to fund the Special Tax Requirement.
"Special Tax Requirement " means the amount required in any Fiscal Year to pay: (i) the debt
service or the periodic costs on all outstanding Bonds due in the Calendar Year that
commences in such Fiscal Year, (ii) Administrative Expenses, (iii) the costs associated with the
release of funds from an escrow account, (iv) any amount required to replenish any reserve
funds established in association with the Bonds, (v) an amount equal to any anticipated shortfall
due to Special Tax delinquencies, and (vi) for the collection or accumulation of funds for the
acquisition or construction of facilities authorized by CFD No. 2023-1 or the payment of debt
services on Bonds anticipated to be issued, provided that the inclusion of such amount does not
cause an increase in the levy of Special Tax on Approved Property or Undeveloped Property as
set forth in Steps Two or Three of Section E., less (vii) any amounts available to pay debt
service or other periodic costs on the Bonds pursuant to the Indenture.
"Taxable Property" means all Assessor’s Parcels within CFD No. 2023-1, 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.
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“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, Provisional Undeveloped Property.
B. SPECIAL TAX
Commencing Fiscal Year 2022-2023 and for each subsequent Fiscal Year, the City Council
shall levy Special Taxes on all Taxable Property, up to the applicable Maximum Special Tax, to
fund the Special Tax Requirement.
C. ASSIGNMENT TO LAND USE CATEGORY FOR SPECIAL TAX
Each Fiscal Year, beginning with Fiscal Year 2022-2023, each Assessor’s Parcel within CFD
No. 2023-1 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 Provisional Undeveloped Property.
Assessor’s Parcels of Developed Property shall further be classified as Residential Property or
Non-Residential Property. Each Assessor’s Parcel of Residential Property shall further be
classified as a Single Family Residential Property, or Multifamily Property. Each Assessor’s
Parcel of Single Family Residential Property shall be further categorized into Land Use
Categories based on its Building Square Footage and assigned to its appropriate Assigned
Special Tax rate.
In the event that an Assessor’s Parcel for which one or more Building Permits have been issued
and the County has not yet assigned final Assessor’s Parcel Number(s) to the Residential
Unit(s) (in accordance with the Final Map or Condominium Plan) on such Assessor’s Parcel, the
amount of the Special Tax levy on such Assessor’s Parcel for each Fiscal Year shall be
determined as follows: (1) the CFD Administrator shall first determine an amount of the
Maximum Special Tax levy for such Assessor’s Parcel, based on the classification of such
Assessor’s Parcel as Undeveloped Property; (2) the amount of the Special Tax levy for the
Residential Units on such Assessor’s Parcel for which Building Permits have been issued shall
be determined based on the Developed Property Special Tax rates and shall be taxed as
Developed Property in accordance with Step 1 of Section E below; and (3) the amount of the
Special Tax levy on the Taxable Property in such Assessor’s Parcel not subject to the Special
Tax levy in clause (2) shall be equal to: (A) the percentage of the Maximum Special Tax rate
levied on all other Undeveloped Property multiplied by the total of the amount determined in
clause (1), less the amount determined in clause (2).
D. MAXIMUM SPECIAL TAX
1. Developed Property
The Maximum Special Tax for each Assessor’s Parcel of Single Family Residential Property
in any Fiscal Year shall be the greater of (i) the Assigned Special Tax or (ii) the Backup
Special Tax.
The Maximum Special Tax for each Assessor’s Parcel of Non-Residential or Multifamily
Residential Property shall be the applicable Assigned Special Tax described in Table 1 of
Section D.
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a. Assigned Special Tax
Each Fiscal Year, each Assessor’s Parcel of Single Family Residential Property, Multifamily
Property or Non-Residential shall be subject to an Assigned Special Tax. The Assigned
Special Tax applicable to an Assessor's Parcel of Developed Property shall be determined
pursuant to Table 1 below.
TABLE 1
ASSIGNED SPECIAL TAX FOR DEVELOPED PROPERTY
FISCAL YEAR 2022-2023
Land Use Category
Taxable
Unit Building Square Footage
Assigned
Special Tax
Per Taxable
Unit
1. Single Family Residential Property RU Less than 1,900 sq. ft $3,228.00
2. Single Family Residential Property RU 1,900 sq. ft to 2,100 sq. ft $3,366.00
3. Single Family Residential Property RU Greater than 2,100 sq. ft $3,564.00
4. Multifamily Property Acre N/A $48,372.00
5. Non-Residential Property Acre N/A $48,372.00
On each July 1, commencing July 1, 2023, the Assigned Special Tax rate for Developed
Property shall be increased by two percent (2.00%) 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 levied on an Assessor’s Parcel shall be the sum
of the Maximum Special Tax 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
The Backup Special Tax for an Assessor’s Parcel within a Final Map classified as Single
Family Residential Property shall be $3,766 per Residential Unit.
Notwithstanding the foregoing, if all or any portion of the applicable Final Maps and/or
condominium plan contained within the boundaries of CFD No. 2023-1 is subsequently
changed or modified, then the Backup Special Tax for Single Family Residential Property or
Approved Property in such Final Map or condominium plan area that is changed or modified
shall be recalculated as follows:
1. Determine the total Backup Special Taxes anticipated to apply to the changed or
modified Final Map or condominium plan area prior to the change or modification.
2. The result of paragraph 1 above shall be divided by the total number of Residential Units
constructed and/or anticipated to be constructed within such changed or modified Final
Map or condominium plan area, as reasonably determined by the CFD Administrator.
The result of paragraph 2 is the Backup Special Tax per Residential Unit which shall be
applicable to Assessor’s Parcels of Single Family Residential Property or Approved Property
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in such changed or modified Final Map or condominium plan area contained within the
boundaries of CFD No. 2023-1.
Notwithstanding the foregoing, the Backup Special Tax for an Assessor’s Parcel of
Developed Property for which a certificate of occupancy has been granted may not be
revised.
On each July 1, commencing July 1, 2023, the Backup Special Tax rate shall be increased by
two percent (2.00%) of the amount in effect in the prior Fiscal Year.
2. Approved Property
The Maximum Special Tax for each Assessor’s Parcel of Approved Property expected to be
classified as Single Family Property shall be the Backup Special Tax computed pursuant to
Section D.1.c above.
The Maximum Special Tax for each Assessor’s Parcel of Approved Property expected to be
classified as Multifamily Residential Property or Non-Residential Property shall be $48,372
per Acre.
On each July 1, commencing July 1, 2023, the Maximum Special Tax rate for Approved
Property shall be increased by two percent (2.00%) of the amount in effect in the prior Fiscal
Year.
3. Undeveloped Property and Provisional Undeveloped Property
The Maximum Special Tax for each Assessor’s Parcel of Undeveloped Property and
Provisional Undeveloped Property that is not Exempt Property shall be equal to the product
of $48,372 multiplied by the Acreage of such Assessor’s Parcel.
On each July 1, commencing July 1, 2023, the Maximum Special Tax rate for Undeveloped
and Provisional Undeveloped Property shall be increased by two percent (2.00%) of the
amount in effect in the prior Fiscal Year.
E. METHOD OF APPORTIONMENT OF THE SPECIAL TAX
Commencing Fiscal Year 2022-2023 and for each subsequent Fiscal Year, the City Council
shall levy Special Taxes on all Taxable Property in accordance with the following steps:
Step One: The Special Tax shall be levied Proportionately on each Assessor’s Parcel of
Developed Property at up to 100% of the applicable Assigned Special Tax rates
in Table 1 to satisfy the Special Tax Requirement.
Step Two: If additional moneys are needed to satisfy the Special Tax Requirement after the
first step has been completed, the Special Tax shall be levied Proportionately on
each Assessor’s Parcel of Approved Property at up to 100% of the Maximum
Special Tax applicable to each such Assessor’s Parcel as needed to satisfy the
Special Tax Requirement.
Step Three: If additional moneys are needed to satisfy the Special Tax Requirement after the
first two steps have been completed, the Annual Special Tax shall be levied
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Proportionately on each Assessor’s Parcel of Undeveloped Property up to 100%
of the Maximum Special Tax applicable to each such Assessor’s Parcel as
needed to satisfy the Special Tax Requirement.
Step Four: If additional moneys are needed to satisfy the Special Tax Requirement after the
first three steps have been completed, then the Special Tax levy on each
Assessor's Parcel of Developed Property for which the Maximum Special Tax is
the Backup Special Tax shall be increased Proportionately from the Assigned
Special Tax up to 100% of the Backup Special Tax as needed to satisfy the
Special Tax Requirement.
Step Five: If additional moneys are needed to satisfy the Special Tax Requirement after the
first four steps have been completed, the Special Tax shall be levied
Proportionately on each Assessor’s Parcel of Provisional Undeveloped Property
up to 100% of the Maximum Special Tax applicable to each such Assessor’s
Parcel as needed to satisfy the Special Tax Requirement.
Notwithstanding the above, 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 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 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
9.84 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 9.84
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 9.84 Acres will be
classified as Provisional Undeveloped Property, and will be subject to Special Tax pursuant to
Step Five in Section E.
G. PREPAYMENT OF SPECIAL TAX
The following additional definitions apply to this Section G:
“CFD Public Facilities” means $8,000,000 expressed in 2022 dollars, which shall increase by
the Construction Inflation Index on July 1, 2023, 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
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authorized bonding program for CFD No. 2023-1, 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 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 to be financed by CFD No. 2023-1.
“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 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 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.
1. Prepayment in Full
The Maximum Special Tax 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 Property 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, or Provisional
Undeveloped Property that are not Exempt Property pursuant to Section F. The Maximum
Special Tax obligation applicable to an Assessor’s Parcel may be fully prepaid and the
obligation to pay the Special Tax 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 obligation for such Assessor’s Parcel shall
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):
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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
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
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, Property Owner’s Association Property, or
Provisional Undeveloped Property to be prepaid compute the Maximum Special Tax for the
Assessor’s Parcel.
3. Divide the Maximum Special Tax derived pursuant to paragraph 2 by the total amount
of Special Taxes that could be levied at the Maximum Special Tax at build out of all
Assessor’s Parcels of Taxable Property based on the applicable Maximum Special Tax for
Assessor’s Parcels of Developed Property not including any Assessor’s Parcels for which
the Special Tax 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 prepayments.
9. Determine the Special Taxes levied on the Assessor’s Parcel in the current Fiscal Year
which have not yet been paid.
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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 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 prepayments of Outstanding Bonds or to make debt service payments.
As a result of the payment of the current Fiscal Year’s Special Tax levy as determined pursuant
to paragraph 9 above, the CFD Administrator shall remove the current Fiscal Year’s Special Tax
levy for the Assessor’s Parcel from the County tax roll. With respect to any Assessor’s Parcel for
which the Maximum Special Tax 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 obligation and the release of the Special Tax lien for the Assessor’s Parcel, and the
obligation to pay the Special Tax for such Assessor’s Parcel shall cease.
Notwithstanding the foregoing, no Special Tax prepayment shall be allowed unless the amount
of Maximum Special Tax 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.
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Tenders of Bonds in prepayment of the Maximum Special Tax 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 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 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
obligation for the Assessor’s Parcel shall notify the CFD Administrator of (i) such owner’s intent
to partially prepay the Maximum Special Tax obligation, (ii) the percentage of the Maximum
Special Tax 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 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 for the Assessor’s Parcel and that a portion of the Maximum Special Tax
obligation equal to the remaining percentage (1.00 - F) of the Maximum Special Tax obligation
will continue to be levied on the Assessor’s Parcel pursuant to Section E.
H. TERMINATION OF SPECIAL TAX
For each Fiscal Year that any Bonds are outstanding the Special Tax shall be levied on all
Assessor’s Parcels subject to the Special Tax. The Special Tax shall cease not later than the
2069-2070 Fiscal Year, however, Special Tax will cease to be levied in an earlier Fiscal Year if
the CFD Administrator has determined (i) that all the required interest and principal payments
on the CFD No. 2023-1 Bonds have been paid; (ii) all authorized facilities of CFD No. 2023-1
have been acquired and all reimbursements to the developer have been paid, (iii) no delinquent
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Special Tax remain uncollected and (iv) all other obligations of CFD No. 2023-1 have been
satisfied.
I. MANNER OF COLLECTION
The Special Tax shall be collected in the same manner and at the same time as ordinary ad
valorem property taxes, provided, however, that CFD No. 2023-1 may collect Special Taxes 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.
J. 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.
4866-1141-0239v4/022042-0046
RESOLUTION NO. _________
RESOLUTION OF INTENTION OF THE CITY COUNCIL OF THE
CITY OF THE CITY OF LAKE ELSINORE TO INCUR BONDED
INDEBTEDNESS IN AN AMOUNT NOT TO EXCEED $9,000,000
WITHIN PROPOSED COMMUNITY FACILITIES DISTRICT NO.
2023-1 OF THE CITY OF LAKE ELSINORE (LAKESIDE)
Whereas, the City Council of the City of Lake Elsinore (the “City Council”) upon receipt of a
petition as provided in Section 53318 of the Government Code of the State of California
instituted proceedings to form Community Facilities District No. 2023-1 of the City of Lake
Elsinore (Lakeside) (“Community Facilities District No. 2023-1” or the “District”) pursuant to the
Mello-Roos Community Facilities Act of 1982 (the “Act”), as amended, pursuant to Resolution
No. 2023-___ (the “Resolution of Intention to Establish”) adopted by the City Council on the date
hereof to finance (1) the purchase, construction, modification, expansion, improvement and/or
rehabilitation of public facilities identified in Attachment “A” hereto and incorporated herein by
this reference, including all furnishings, equipment and supplies related thereto (collectively, the
“Facilities”) and (2) the incidental expenses to be incurred in financing the Facilities and forming
and administering the District (the “Incidental Expenses”); and,
Whereas, the City Council estimates that the amount required to finance the Facilities and
Incidental Expenses is approximately $9,000,000; and,
Whereas, in order to finance the Facilities and Incidental Expenses, the City Council intends to
authorize the issuance of bonds in the maximum aggregate principal amount of $9,000,000, the
repayment of which is to be secured by special taxes levied in accordance with Section 53328
of the Act on all property in the proposed Community Facilities District No. 2023-1, other than
those properties exempted from taxation in the rate and method of apportionment set forth in
Attachment “C” to the Resolution of Intention to Establish.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE
DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS:
Section 1. The above recitals are true and correct.
Section 2. It is necessary to incur bonded indebtedness within the boundaries of proposed
Community Facilities District No. 2023-1 in an amount not to exceed $9,000,000 to finance the
costs of the Facilities and Incidental Expenses, as permitted by the Act.
Section 3. The indebtedness will be incurred for the purpose of financing the costs of the
Facilities and the Incidental Expenses, including, but not limited to, the funding of reserve funds
for the bonds, the financing of costs associated with the issuance of the bonds and all other
costs and expenses necessary to finance the Facilities which are permitted to be financed
pursuant to the Act.
Section 4. It is the intent of the City Council to authorize the sale of bonds in one or more
series, in the maximum aggregate principal amount of $9,000,000 and at a maximum interest
rate not in excess of 12 percent per annum, or a higher rate not in excess of the maximum rate
permitted by law at the time that the bonds are issued. The term of the bonds of each series
shall be determined pursuant to a resolution of this City Council acting in its capacity as the
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legislative body of the District authorizing the issuance of the bonds of such series, but such
term shall in no event exceed 35 years from the date of issuance of the bonds of such series, or
such longer term as is then permitted by law.
Section 5. A public hearing (the “Hearing”) on the proposed issuance of bonded
indebtedness shall be held at 7:00 p.m. or as soon thereafter as practicable, on February 21,
2023, at the City Cultural Center, 183 North Main Street, Lake Elsinore, California.
Section 6. At the time and place set forth in this Resolution for the Hearing, any interested
persons, including all persons owning land or registered to vote within proposed Community
Facilities District No. 2023-1, may appear and be heard.
Section 7. The City Clerk is hereby directed to publish a notice (the “Notice”) of the Hearing
pursuant to Section 6061 of the Government Code in a newspaper of general circulation
published in the area of the proposed Community Facilities District No. 2023-1. Such
publication shall be completed at least seven days prior to the date of the Hearing. The City
Clerk is further directed to mail a copy of the Notice to each of the landowners within the
boundaries of proposed Community Facilities District No. 2023-1 at least 15 days prior to the
Hearing.
Passed and Adopted on this 10th day of January, 2023.
_____________________________
Natasha Johnson, Mayor
Attest:
_____________________________
Candice Alvarez, MMC
City Clerk
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4866-1141-0239v4/022042-0046
STATE OF CALIFORNIA )
COUNTY OF RIVERSIDE ) ss.
CITY OF LAKE ELSINORE )
I, Candice Alvarez, MMC, City Clerk of the City of Lake Elsinore, California, do hereby certify
that Resolution No. 2023-______ was adopted by the City Council of the City of Lake Elsinore,
California, at the Regular meeting of January 10, 2023 and that the same was adopted by the
following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
________________________________
Candice Alvarez, MMC
City Clerk
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4866-1141-0239v4/022042-0046
ATTACHMENT A
Types of Facilities
to Be Financed by Community
Facilities District No. 2023-1 of the City of Lake Elsinore (Lakeside)
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, fire, roadway, traffic, administration and community center facilities,
marina/lakeside and animal shelter facilities, 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, 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.
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4895-0022-9184v3/022042-0046
PETITION TO THE CITY COUNCIL OF THE CITY OF LAKE
ELSINORE REQUESTING INSTITUTION OF PROCEEDINGS
FOR ESTABLISHMENT OF A COMMUNITY FACILITIES
DISTRICT (COMMUNITY FACILITIES DISTRICT NO. 2023-1 OF
THE CITY OF LAKE ELSINORE (LAKESIDE))
1. The undersigned (the “Owner”) owns all of the land depicted and described in
Exhibit A hereto (the “Property”), which land is expected to be all of the land included within the
boundaries of a community facilities district hereby proposed to be established. The Property is
located within the City of Lake Elsinore (the “City”) in the County of Riverside.`
2. The Owner requests that the City Council of the City (the “City Council”) institute
proceedings to establish a community facilities district to be known as “Community Facilities
District No. 2023-1 of the City of Lake Elsinore (Lakeside)” (referred to herein as the “District”)
pursuant to Chapter 2.5 (commencing with Section 53311), Part 1, Division 2, Title 5, of the
Government Code of the State of California, commonly known as the “Mello-Roos Community
Facilities Act of 1982” (the “Act”) to include all of the Property.
3. The boundaries of the territory which is proposed for inclusion in the District are
those described and depicted in Exhibit A hereto.
4. The Owner requests that the proposed District be used to finance the
construction, purchase, modification, expansion and/or improvement of (i) drainage, library,
park, fire, roadway, traffic, administration and community center facilities, marina/lakeside and
animal shelter facilities, 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 Act 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.
5. The Owner further requests that the City Council authorize the levy of special
taxes in the District to pay the costs of the Facilities and the incidental costs described in
paragraph 4 above (the “Special Tax”) and to pay principal of, interest and premium, if any, on
the bonds in order to contribute to the financing of the Facilities and costs described in
paragraph 4 above.
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4895-0022-9184v3/022042-0046
6. The Owner further requests that, upon the sale of bonds, the City Council, as
legislative body of the District, annually levy Special Taxes on the property within the District for
the construction, acquisition and rehabilitation of the Facilities, for the payment of the aggregate
amount of principal of and interest owing on the bonds in each fiscal year, including the
maintenance of reserves therefor, and for the payment of administrative expenses of the
District.
7. The Owner has advanced to the City the amounts necessary to pay for the costs
related to the formation of the District, which amounts will be reimbursed, without interest, from
the proceeds of the first sale of the bonds, if any. The reimbursement of such amounts is
expected to be governed by the terms of that certain Reimbursement Agreement to be entered
into by and between the City and the Owner relating to the District. If bonds are not sold, the
City will have no obligation to reimburse amounts expended for costs incurred, but will
reimburse any unexpended amounts advanced by the Owner as set forth in the Reimbursement
Agreement.
8. This petition may be executed in counterparts.
Dated: January __, 2023
TRI POINTE HOMES IE-SD, INC., a California
corporation
By:
Michael C. Taylor, President
A-1
4895-0022-9184v3/022042-0046
EXHIBIT A
BOUNDARY MAP AND LEGAL DESCRIPTION
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4895-0022-9184v3/022042-0046
Real property in the City of Lake Elsinore, County of Riverside, State of California, described as
follows:
Riverside County Assessor Parcel Nos.:
379-060-005
379-060-022
379-060-027
MACY STWINDOVER CT
SERENA WAYTILLER LN
HILLSTFAIRVIEW STCALIFORNIA STULLA
LN
RIVERSIDE DRGRANDAVE
·|}þ74
^_
LAKESHOREDR 3RDS T
N IC HOLS RD
MACY STMCVICKERCANYONPARKRD
MAINSTLASH
S
T
RIVERSIDE DRGUN NERSONSTROLANDO RDOHIO STAMBER LNPASADENA ST
SKYLINEDRLAKEST§¨¦15
·|}þ74
CFD NO. 2023-1 (LAKESIDE)PROJECT MAP
4877-7611-1936v4/022042-0046
REIMBURSEMENT AGREEMENT
RE PROPOSED
COMMUNITY FACILITIES DISTRICT NO. 2023-1
OF THE CITY OF LAKE ELSINORE (LAKESIDE)
THIS REIMBURSEMENT AGREEMENT RE PROPOSED COMMUNITY FACILITIES
DISTRICT NO. 2023-1 OF THE CITY OF LAKE ELSINORE (LAKESIDE) (the “Agreement”)
dated as of January 1, 2023, is entered into by and between the City of Lake Elsinore, a general
law city organized and existing under the laws and constitution of the State of California (the
“City”), and Tri Pointe Homes IE-SD, Inc., a California corporation (the “Owner”).
R E C I T A L S :
A. The Owner own approximately 34.81 acres of land described in Exhibit A
attached hereto (the “Property”) for which the Owner desires to include within proposed
Community Facilities District No. 2023-1 of the City of Lake Elsinore (Lakeside) (the “District”) to
be established by the City pursuant to the Mello-Roos Community Facilities Act of 1982
(Government Code Section 53311 et seq.) (the “Act”).
B. The City and the Owner are desirous of entering into this Agreement in order to
provide a mechanism by which the Owner may advance certain costs related to the cost of
formation of the District, and to provide that such District, if formed, will reimburse the Owner for
the amounts advanced hereunder.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual promises and covenants set forth
herein, the parties hereto agree as follows:
1. Recitals. Each of the above recitals is incorporated herein and is true and
correct.
2. Potential Formation of the District and Issuance of Bonds.
(a) At the request of the Owner, the City will undertake to form the District.
The City will retain, at the Owner’s expense, the necessary consultants to analyze the proposed
formation of the District and issuance of bonds, including an engineer, special tax consultant,
financial advisor, bond counsel, market absorption consultant, appraiser and other consultants
deemed necessary by the City. In addition, City staff time spent in connection with the
formation of the District and the issuance of bonds shall be at Owner’s expense.
(b) In order to begin the process of analyzing the potential formation of the
District, the Owner has advanced to the City a sum totaling $50,000. From time to time, the
Owner shall make additional advances to the City within 15 days following receipt from the City
of a request for an additional advance to cover the costs of forming the District and/or issuing
bonds. In the event the Owner does not deliver the requested amount to the City within such
15-day period, the City will have no obligation to proceed with the analysis or bond issue unless
and until such additional advance is received. The Owner shall have the right to notify the City
at any time, in writing, of its intention to abandon the formation of the District or the issuance of
bonds. Upon receipt of such notice, the City shall instruct its consultants to cease work as soon
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4877-7611-1936v4/022042-0046
as practicable. The Owner shall be responsible to pay all costs and expenses incurred by the
City or any City consultant or advisor prior to the date on which the City’s consultants are
notified of the Owner’s notice of abandonment. Notwithstanding a decision of the Owner to
abandon the formation of the District or the issuance of bonds, the City may, in its sole
discretion, elect to proceed with formation of the District and/or the issuance of bonds with funds
other than those of the Owner; provided, however, that, in executing this Agreement, the Owner
shall not be deemed to have waived their right to object to the formation of the District or the
issuance of bonds.
(c) The City will provide to the Owner on request a summary of how the
advances have been spent and the unexpended balance remaining. The amounts advanced by
the Owner will be reimbursable to the Owner, without interest, from the proceeds of bonds
issued by the District when and if the District is formed. In the event that bonds are not issued
to provide a source of reimbursement to the Owner, the City shall have no liability to the Owner
to reimburse them for any of amounts previously advanced by the Owner and expended by the
City in accordance with this Agreement.
3. Reimbursement Procedure. The City shall return any funds which have been
advanced by the Owner which are not expended on the purposes set forth in Section 2 above.
Such returned funds shall be without interest.
4. Abandonment of CFD Formation Process. The Owner understands that any
formation of the District shall be in the sole discretion of the City. No provision of this
Agreement shall be construed as a promise, warranty or agreement by the City to form the
District, to annex the Property to any other district or improvement area of the City or to issue
any bonds. The City shall have no liability to Owner for its decision not to form the District or
issue bonds.
5. Indemnification and Hold Harmless. The Owner hereby assumes the defense of,
and indemnifies and saves harmless, jointly and severally, the City and each of its officers,
directors, employees and agents, from and against all actions, damages, claims, losses or
expenses of every type and description to which they may be subjected or put, by reason of, or
arising out of any acts or omissions taken by the Owner or any of the Owner’s officers,
employees, contractors and agents with respect to the formation of the District.
6. Notices. Any notice to be provided pursuant to this Agreement shall be delivered
to the following addresses:
Owner Tri Pointe Homes IE-SD, Inc.
1250 Corona Pointe Court, Suite 600
Corona, California 92879
Attention: Chris Willis
Telephone: (951) 396-0426
Email: Chris.Willis@TriPointeHomes.com
City: City of Lake Elsinore
130 South Main Street
Lake Elsinore, CA 92530
Attn: City Manager
Telephone: (951) 674-3124
Email: jsimpson@lake-elsinore.org
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4877-7611-1936v4/022042-0046
With a copy to: Stradling Yocca Carlson & Rauth
660 Newport Center Drive, Suite 1600
Newport Beach, CA 92660
Attention: Brian Forbath, Esq.
Telephone: (949) 725-4193
Email: bforbath@stradlinglaw.com
Each party may change its address for delivery of notice by delivering written notice of
such change of address to the other party.
7. Assignment. The Owner may assign its interest in this Agreement at any time
provided, however, that the Owner shall provide written evidence of any assignment to the City.
8. Severability. If any part of this Agreement is held to be illegal or unenforceable
by a court of competent jurisdiction, the remainder of this Agreement shall be given effect to the
fullest extent permitted by law.
9. Entire Agreement. This Agreement contains the entire agreement between the
parties with respect to the matters provided for herein.
10. Amendments. This Agreement may be amended or modified only by written
instrument signed by all parties.
11. Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original.
12. Governing Law. This Agreement and any dispute arising hereunder shall be
governed by and interpreted in accordance with the laws of the State of California.
13. No Third Party Beneficiaries. No person or entity shall be deemed to be a third
party beneficiary hereof, and nothing in this Agreement (either express or implied) is intended to
confer upon any person or entity, other than the City and the Owner, any rights, remedies,
obligations or liabilities under or by reason of this Agreement.
14. Singular and Plural; Gender. As used herein, the singular of any word includes
the plural, and terms in the masculine gender shall include the feminine.
15. Termination. This Agreement shall terminate and be of no further force and
effect on December 1, 2027 unless expressly amended by the parties; provided, however, that
the Owner’s obligations under Section 5 shall survive the termination and the City’s obligation to
provide reimbursement in accordance with Section 3 for expenses incurred prior to the
termination date shall also survive termination.
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4877-7611-1936v4/022042-0046
IN WITNESS WHEREOF, the parties have executed this Agreement on the day and
year first above written.
CITY OF LAKE ELSINORE, a political subdivision
of the State of California
By:
City Manager
ATTEST:
By:
Candice Alvarez, City Clerk
TRI POINTE HOMES IE-SD, INC., a
California corporation
By:____________
Michael C. Taylor, President
APPROVED AS TO FORM:
CITY ATTORNEY
By:
A-1
4877-7611-1936v4/022042-0046
EXHIBIT A
DESCRIPTION OF PROPERTY
Real property in the City of Lake Elsinore, County of Riverside, State of California, described as
follows:
Riverside County Assessor Parcel Nos.:
379-060-005
379-060-022
379-060-027