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HomeMy WebLinkAboutCC Reso No 2007-158RESOLUTION NO. 2007-158 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE DETERMIIVING THE VALIDTTY OF PRIOR PROCEEDINGS RELAT7NG TO ANNEXATION OF CERTAIN PROPERTY INTO IMPROVEMENT AREA NO. 1 OF THE CITY OF LAKE ELSINORE COMMUNITY FACILITIES DISTRICT NO. 2006-1 (SiTMMERL~ WHEREAS, the City Council (the "Council") of the City of Lalce Elsinare (the "City") has previously established the City of Lake Elsinore Community Facilities District No. 2006-1 (Sununerly) (the "CFD") and designated areas within the CFD as Improvement Area No. l, Improvement Area No. 2 and Improvement Area Na 3, all pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (the "Act"); and WHEREAS, the Council has heretofore adopted Resolution No. 2007-136 ("Resolution of Intenrion") stating its intention to annex certain property (the "Annex Area") into Improvement Area No. 1; and WHEREAS, a copy of the Resolution of Intention is on file with the City Clerk and incorporated herein by reference; and WHEREAS, pursuant to the Act and in accordance with applicable laws, this Council held a public hearing on the annexation of Annex Area into Improvement Area No. 1; and WHEREAS, at said hearing all persons not exempt from the Special Tax desiring to be heard on all matters pertaining to the annexation of Annex Area into Improvement Area No. 1 were heard and a full and fair hearing was held; and WHEREAS, at said hearing evidence was presented to the Council on said matters before it, and this Council at the conclusion of said hearing is fully advised as to such matters. 1 CITY COUNCIL RESOLUTION NO. 2007-158 PAGE 2 OF 5 NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: SECTION 1. The Council finds and determines that the proceedings prior hereto were valid and in confornuty with the requirements of the Act. SECTION 2. The Annex Area is hereby annexed into Improvement Area No. 1. SECTION 3. The description and map of the boundaries of the Annex Area on file in the City Clerk's office and as described in the Resolution of Intention and incorporated herein by reference, shall be the boundaries of the Annex Area. The map of the proposed boundaries of the Annex Area has been recorded in the Office of the County Recorder of Riverside County, California (Book 71 of Maps of Assessment and Community Facilities District at page 96 and as Instrument No. 2007-0522373). 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 tax (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 Annex Area prior to the annexation of the Annex Area into Improvement Area No. 1 and do not supplant services already available within the territory proposed to be included in the Annex Area, the costs of administering the levy and collection of the Services Special T~ 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 T~ will be secured by recordation of a continuing lien against all real properiy in the Annex Area. 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 Special TaJC is apportioned to each parcel on the foregoing basis pursuant to Section 533253 of the Act. 2 CITY COiTNCIL RESOLUTION NO. 2007-158 PAGE 3 OF 5 SECTION 5. The facilities proposed to be financed by each improvement area of 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 construct, 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 streets, streetscape, park and recreation facilities, storm drain, other City facilities and fees, water and sewer facilities and fees of the Elsinore Va11ey Municipal Water District, and related costs including design, inspections, professional fees, annexation fees, connection fees and acquisition costs (the "Facilities"). Such Facilities need not be physically located within the CFD. SECTION 6. 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 taa~ (the "Special Tax") sufficient to pay for the costs of financing the acquisition and/or consiruction of the Facilities, including the principal of and interest on the bonds proposed to be issued to finance the Faciliries 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 foreclosure 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 Annex Area. In the first year in which such a Special Tax 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 apportioned to each parcel pursuant to Section 53325.3 of the Act. In the event that a portion of the properiy within an improvement area of 3 CITY COLTNCIL RESOLUTION NO. 2007-158 PAGE 4 OF 5 the CFD shall become for any reason exempt, wholly or parhially, 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 same improvement area of 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 within the same improvement area of the CFD by more than 10 percent. Furthermore, the maximum special t~ 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 Taa~ and the Special Tax shall attach to all real property in the Annex Area, and the lien with respect to the Special Tax shall continue in force and effect until the Special Tax obligation is prepaid or 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 sha11 continue in force and effect until collection of the Services Special Tax and the Special T~ by the CFD ceases. SEC'l'ION 8. Neither the proposed Services Special T~ nor the Special Tax to be levied in the Annex Area has been precluded by protests by owners of one-half or more of the land in the territory included in the Annex Area pursuant to Government Code Section 53324. SECTION 9. The voting procedure with respect to the imposition of the Services Special Tax and the Special Tu~ shall be by hand delivered or mailed ballot election. SECTION 10. The Interim 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 or elections on the incurring bonded indebtedness, the levy of the Special Tax, and the establishment of the appropriation limit. 4 PASSED, APPROVED, AND ADOPTED at a regular meeting of the City Council of the City of Lake Elsinore, California, on this 28~' day of A~ust 2007. ~ ~ ~2~ERT E. ME MAYOR CITY OF LAKE ATTEST: ~V MICHELLE SOTO INTERIM CITY CLERK APPROVED AS TO FORM: Y i~T•'~/\,C.L,.._ BARBARA ZEID LEIBOLD CITY ATTORNEY STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss. CITY OF LAKE ELSINORE ) I, MICHELLE SOTO, Interim City Clerk of the City of Lake Elsinore, California, hereby certify that Resolution No. 158 was adopted by the City Council of the City of Lake Elsinore at a regular meeting held on the 28th day of August 2007, and that the same was adopted by the following vote: AYES: MAYOR ROBERT E. MAGEE MAYOR PRO TEM DARYL HICKMAN COUNCILMEMBER THOMAS BUCKLEY COUNCILMEMBER GENIE KELLEY COUNCILMEMBER ROBERT SCHIFF NER . NOES: NONE ABSTAIN: NONE ABSENT: NONE ~ MICHELLE SOTO INTERIM CITY CLERK 5 EXHIBIT A RATE AND METHOD OF APPORTIONMENT OF SERVICES SPECIAL TAX AND SPECIAL TAX (IMPROVEMENT AREA NO.1) RATE AND METHOD OF APPORTIONMENT FOR CITY OF LAKE ELSINORE COMMiJNITi' FACILITIES DISTRICT No. 2006-1 IMPROVEMENT AREA No. l (STJNIlVIERL~ A Special Tax shall be levied on all Assessor's Pazcels in City of Lake Elsinore Community Facili6es District No. 2006-1 (Summerly) ("CFD No. 2006-1 (IA No. 1)") and collected each Fiscal Year commencing in Fiscal Year 2006-2007, in an amount determined through the application of this Rate and Method of Apportionment as described below. All of the real property in CFD No. 2006-1 (IA No. 1), 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 forth have the following meanings: "Acre or Acreage" means the land area of an Assessor's Pazcel 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. "Act° 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 costs directly related to the administration of CFD No. 2006-1 (IA No. 1): the costs of computing the Special Taaces and preparing the annual Special Tax collection schedules (whether by the City or designee thereof or both); the costs of collecting the Special Taxes (whether by the Cily or otherwise); the costs of remitting the Special Taxes to the Trustee; the costs of the Trustee (including its legal counsel) in the dischazge of the duties required of it under the Indenture; the costs to the City, CFD No. 2006-1 (IA No. 1) or any designee thereof of complying with azbitrage rebate requirements; the costs to the City, CFD No. 2006-1 (IA No. 1) ar any designee thereof of complying with disclosure requirements of the City, CFD No. 2006-1 (IA No. 1) or obligated persons associated with applicable federal and state securiries laws and the Act; the costs associated with preparing Special Tax disclosure statements and responding to public inquiries regazding the Special Taaces; the costs of the City, CFD No. 2006-1 (IA No. 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 aduiinistration fees and third party expenses. Administrative Expenses shall also include amounts estixnated by the CFD Admiuistrator or advanced by the City or CFD No. 2006-1(IA No. 1) for any other administrarive purposes of CFD No. 2006-1 (IA No. 1), including City oflake Elsinore Community Facilities District No. 2006-1 January 16, 2006 Improvement Area No: 1(Summerly) Page 1 Agenda Item No. ~_ Page ~ of ~ b attorney's fees and other costs related to commencing and pursuing to completion any foreclosure of delixxquent Special Taxes. "Assessor's Parcel" means a lot or parcel shown in an Assessor's Parcel Map with an assigned Assessor's Pazcel number. "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 Tax for Facilities for each Land Use Class of Developed Properiy, as deternuned in accordance with Section C.1.(b) below. "Authorized Facilities" means those authorized improvements, as listed in an exhibit to the Resolurion of Formation. "Backup Special Tax for Facilities" means the Special Tax for Facilities applicable to each Assessor's Pazcel of Developed Property, as detemrined in accordance with Section C.1.(c) below. "Certiticate 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 Taac Requirement for Facilities, the Special Tax Requirement for Services as deterxnined in accordance with Section I below, and providing for the levy and collection of the Special Taaces. "CF'D No. 2006-1" means City of Lake Elsinore Community Facilities District No. 2006-1 (Sutvmerly). "CFD No. 2006-1 (IA No. 1)" means Improvement Area No. 1 of CFD No. 2006-1, as identified on the boundary map for CFD No. 2006-1. "CFD No. 2006-1 (IA No. l) Bonds" means any bonds or other debt (as defined in Section 53317(d) ofthe Act), whether in one or more series, issued by CFD No. 2006-1(IA No. 1) and secured solely by the Special Tax for Facilities levy on property within the boundaries of CFD No. 2006-1 (IA No. 1) under the Act. "City" means the City of Lake Elsinore. City of Lake Elsinore Community Faci[Uies District No. 2006-1 January 16, 2006 Improvement Area No. I(Summerly) page Z Agenda Item No. ~~ Page t~ of 1D "City Council" means the City Council of the City of Lake Elsinore, acring as the legislarive body of CFD No. 2006-1 (IA No. 1). "County" means the County of Riverside. "D.eveloped Property" means, with respect to the Special Tax for Facilities, for each Fiscal Yeaz, all Taxable Property, exclusive of Taxable Public Properiy and Taacable PropertyOwner Association Property, for which the Final Subdivision was recorded on or before January 1 of the prior Fiscal Year and a building permit for new construcrion was issued on or before May 1 of the Fiscal Yeaz preceding the Fiscal Year for which the Special Tax for Facilities is being levied. "ISnal Subdivision" means (i) a final map, or portion thereof, approved by the Citypursuant to the Subdivision Map Act (California Government Code Section 66410 etseq.) that creates individual lots for which building permits may be issued, or (ii) for condominiums, a final map, or portion thereof, approved by the City and a condominium plan recorded pursuant to California Civil Code Section 1352 that creates individual lots for which building peimits may be issued. "FYscal Year" means the period starting July 1 and ending on the following June 30. "Indenture" means the indenture, fiscal agent agreement, resolution or other instrument pursuant to which CFD No. 2006-1(IA No. 1) Bonds aze issued, as modified, amended and/or supplemented from time to time, and any instrument 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 ma~cixnum Special Tax for Facilities, determined in accordance with Section C below, that can be levied in any Fiscal Year on any Assessor's Parcel. "Non-Residential Property" means all Assessor's Pazcels ofDeveloped Property forwluch a building permit pernutting the construction of one or more non-residential units or facilities has been issued by the City. "Outstanding Bonds" means all CFD No. 2006-1(IA No. 1) Bonds which are deemed to be outstanding under the Indenture. City of Lake Elsinore Community FaciliNesDisdict No. 2006-1 January 16, 2006 Improvement Area No. I(Summerly) Page 3 Agenda Item No. ~_ Page ~ of J ~ "Property Owner Association Property" means, for each Fiscal Yeaz, any propertywithin the boundaries of CFD No. 2006-1 (IA No. 1) that was owned by a properry owner association, including any mast0r or sub-associarion, as of January 1 of the prior Fiscal Year. "Proportionately" means for Developed Propertythat the ratio ofthe actual Special Tax for Faciliries levy to the Assigned Special Tax for Facilities is equal for all Assessor's Pazcels of Developed Property. For Undeveloped Property, "Proportionately" means that the ratio ofthe actual Special Tax for Facilities levy per Acre to the Maximum Special Tax for Facilities per Acre is equal for all Assessor's Pazcels ofUndeveloped Property. The term "Proportionately" may sunilazly be applied to other categories of Taxable Property as listed in Section D below. "Public Property" means, for each Fiscal Year, (i) any property within the boundaries of CFD No. 2006-1(IA No. 1) 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 government, the State, the County, the City, the Lake Elsinore Unified School District, or any local government or other public agency as of 7anuary 1 of the previous Fiscal Yeaz, provided that any property leased by a public agency to a private entity and subject to taacation under Secrion 53340.1 of the Act shall be taxed and classified according to its use; or (ii) any property within the boundaries of CFD No. 2006-1 (IA No. 1) that was encumbered, as of January 1 of the previous Fiscal Year, by an unxnanned utility easement maldng impractical its utilization for other than the purpose set forth in the easement. "Residential Floor Area" means a11 of the square footage of living area within the perimeter of a residential structure, not including any carport, walkway, gazage, overhang, pario, enclosed patio, or similaz azea. The determination ofResidential F1oorArea for anAssessor's Pazcel shall be made by reference to the building permit(s) issued for such Assessor's Pazcel. "Residential Property" means all Assessor's Parcels of Developed Properry for wluch a building pernut pernutting the construction thereon of one or more residential dwelling units has been issued by the City. !'Resolution of Formarion" means the resolution of formation for CFA No. 2006-1(IA No. 1). "Special Tax" means any of the special ta~ces authorized to be levied by CFD No. 2006-1(IA No. 1) 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 Associarion Property, City of Lake E[sinore Commuxity Faci[ities District No. 2006-I January 16, 2006 Improvement Area No. 1(Summerly) Page 4 Agenda Item No. 2 ~ Page ~ of ~ Taxable Public Property, and Undeveloped Property to fund the Special Tax Requirement for Facilities. "Special Tax Requirement for Facilities" means that amount required in anyFiscal Year for CFD No. 2006-1 (IA No. 1) to: (i) pay debt service on all Outstanding Bonds iiue in the calendar year commencing in such Fiscal Year; (ii) pay periodic costs on the CFD No. 2006-1 (IA No. 1) Bonds, including but not limited to, credit eiiliazicement and rebate payments on the CFD No. 2006-1 (IA No. 1) Bonds due in the calendar year comxnencing in such Fiscal Yeaz; (iii) pay a proportionate shaze 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 Faciliries 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 Tax for Facilities levy on Undeveloped Properry; less (vii) a credit for funds available to reduce the annual Special Tax for Facilities levy, as detennined by the CFD Administrator pursuant to the Indenture. "State" means the State of California. "Taxable Property" means all of the Assessor's Parcels within the boundaries of CFD No. 2006-1(IA No. l) which aze not exempt from the Special Tas for Facilities pursuant to law or Secrion B below. "Taxable Property Owner Association Property" means all Assessor's Pazcels ofProperty Owner Association Properry that are 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 hustee or fiscal agent under the Indenture. "Undeveloped Property" means, for each Fiscal Year, all Taxable Property not classified as Developed Property, Taxable Property Owner Association Property, or Taxable Public Property. B. ASSIGNMENT TO LAND USE CATEGORIES Each Fiscal Year, all Taacable Property within CFD No. 2006-1 (IA No. 1) shall be classified as Developed Property, Taxable Public Properly, Taxable Properry Owner Association Property, or Undeveloped Property, and shall be subject to Special Taxes in accordance with this Rate and Method of Apportionment deteimined pursuant to Sections C and D below. City ofLake E[sinore Community Facilities Dishict No. 2006-I January 16, 2006 Imprnvement Area No. 1(Summerly) Page 5 Agenda Item No. 2~_ Page ~~" of~0 Residential Property shall be assigned to Land Use Classes l through 7 as listed in Table 1 below based on the Residential Floor Area for each unit. Non-Residential Property sha11 be assigned to Land Use Class 8. With respect to Residential Property, the Residential Floor Area shall be determined from the most recent building pernut issued prior to the issuance of a Certificate of Occupancy for such Assessor's Parcel. C. MAXIMUM SPECIAL TAX FOR FACILITIES Prior to the issuance of CFD No. 2006-1 (IA No. 1) Bonds, the Assigned Special Taac for Facilities on Developed Property (set forth in Table 1), and the Backup Special Tax for Facilities amibutable to a Final Subdivision, may be reduced in accordance with, and subj ect to the conditions set forth in this pazagraph. If it is reasonably deternvned by the CFD Administrator that the overlapping debt burden (as defined in the Statement of Goals and Policies for the Use ofthe Mello-Roos Community Facilities Act of 1982 adopted bythe City Council, the "Goals and Policies") calculated pursuant to the Goals and Policies based upon the Assigned Special Tax for Facilities on Developed Property exceeds the City's maximum level objective set forth in such docuxnent, the Assigned Special Tax for Facilities on Developed Property, and the Backup Special Taac for Facilities attributable to a Final Subdivision, may be reduced to the amount necessary to satisfy the City's objective with respect to the maximum overlapping debt burden level with the written consent of the CFD Administrator. The xeductions permitted pursuant to this paragraph shall be reflected in an amended Notice of Special Tas Lien which the City sha11 cause to be recorded by executing a certificate in substantially the form attached hereto as EaLhibit "A". 1. Develoned Propertv (a) Maximum Special Tax for Faciliries The Maximum Special Tax for Facilities for each Assessor's Pazcel classified as Developed Properry shall be the greater of (i) the amount derived by application of the Assigned Special Tax for Faciliries or (ii) the amount derived by application of the Backup Special Tax for Facilities. (b) Assigned Special Tax for Facilities The Fiscal Year 2006-2007 Assigned Special Tax for Facilities for each Land Use Class is shown below in Table 1. Ciry ofLake Elsinore Community Faci[ities District No. 2006-1 January 16, 2006 Improvement Area No. 1(Summerly) Page 6 Agenda Item No. ~_ Page ~S of -~d TABLE 1 Crty ofLake Elsinare Community Facilities Drstrict No. 2006-1 January 16, 2006 Improvement Area No. 1(Summerly) Page 7 Agenda Item No. ~_ Page ~~ of 10 Assigned Special Tax for Facilities for Developed Property Community Facilities District No. 2006-1 FYscal Year 2006-2007 (c) Backup Special Tax for Faciliries The Fiscal Yeaz 2006-2007 Backup Special Taac for Facilities ariributable to a Final Subdivision will equal $18,348, multiplied by the Acreage of all Taxable Property, exclusive of any Taxable Property Owner Associarion Property and Taxable Public Property, therein. The Backup Special Tax for Facilities for each Assessor's Pazcel of Residential Property sha11 be computed by dividing the Backup Special Tax for Facilities attributable to the applicable Final Subdivision by the number of Assessor's Parcels for which building permits for residential construction have or may be issued (i.e., the number or residential lots). The Backup Special Taac for Faciliries for each Assessor's Parcel ofNon-Residential Property therein shall equal $18,348, multiplied by the Acreage of such Assessor's Pazcel. If a Final Subdivision includes Assessor's Parcels of Taxable Properry for wlrich building pernuts for both residential and non-residential construction may be issued, exclusive of Taxable Property Owner Association Property and Taacable Public Property, then the Backup Special Tax for Facilities for each Assessor's Pazcel of Residenrial Property shall be computed exclusive of the Acreage and Assessor's Parcels ofproperty for which building pernuts for non-residential conslructionmaybe issued. Notwithstanding the foregoing, if all or any portion of the Final Subdivision(s) described in the preceding pazagraphs is subsequently changed or modified by recordation of a lot line adjustment or similaz instrmuent, and only if the CFD Admiiustrator determixies that such change or modification results in a decrease in the number of Assessor's Pazcels of Taxable Property for which building permits for residenrial construction have or may be issued within such Final Subdivision, then the Backup Special Tas for Facilities for each Assessor's Parcel of Developed Property that is part of the lot line adjustment or similar inshument for such Fina1 Subdivision shall be a rate per Acre as calculated below. The Backup Special Tax for Facilities previously detennined for an Assessor's Parcel ofDeveloped Properiy that is not a part of the lot line adjustment or similar instrument for such Fina1 Subdivision shall not be recalculated. Determine the total Backup Special Tax for Facilities anticipated to apply to the changed or modified portion ofthe Final Subdivision area prior to the change or modification. City nfLake Elsinore Community Facrlities District No. 2006-1 January I6, 2006 Improvement Area No. 1(Summerly) Page 8 Agenda Item No. ~_ Page / 7 of ~ 2. The result of pazagraph 1 above shall be divided by the Acreage of Taarable 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. The result of pazagraph 2 above shall be the Backup Special T~ for Facilities per Acre which shall be applicable to Assessor's Pazcels of Developed Property in such changed or modified portion of the Final Subdivision azea for all remaining Fiscal Years in which the Special Tax for Facilities may be levied. (d) Release of Obligarion to Pay and Disclose Backup Special Tax. All Assessor's Parcels within CFD No. 2006-1 (IA No. 1) will be relieved simultaneously and permanently from the obligation to pay and disclose the backup Special Tax if the CFD Administrator determines that the annual debt service required for the Outstanding Bonds, when compared to the Assigned Special taates that may be levied against all Assessor's Pazcels of Developed Property results in 110% debt service coverage (i.e., the Assigned Special Taxes that may be levied against all Developed Property in each remaining Fiscal Yeaz based on then existing development in CFD No. 2006-1 (IA No. 1) is at least equal to the sum of (i) the tldministrative Expenses and (ii) 1.10 times maxnnwn annual debt service, in each remaining Fiscal Year on the Outstanding Bonds). (e) Increase in the Assigned Special Tax for Facilities and Backup Special Tax for Facilities The Fiscal Yeaz 2006-2007 Assigned Special Tax for Facilities, identified in Table 1 above, and Backup Special Tax for Faciliries shall increase thereafter, commencing on July 1, 2007 and on July 1 of each Fiscal Year thereafter, by an amount equal to two percent (2%) of the amount in effect for the previous Fiscal Year. ( fl Multiple Land Use Classes In some instances an Assessor's Pazcel of Developed Property may contain more than one Land Use Class. The Maximuxn Special Ta~c for Facilities levied on an Assessor's Parcel shall be the sum of the Maximum Special Tax for Facilities for a11 Land Use Classes located on that Assessor's Pazcel. The CFD Admnustrator's allocationto each type of property shall be final. City of Lake Elsinore Community Facilities District No. 2006-1 January 16, 2006 Improvement Area No. 1(Summerly) Page 9 Agenda Item No. ~_ Page ~ of ~ a 2. Taxable Properiv Owner Association Proneriv, Taxable Public Pronertv and Undeveloped Pronertv The Fiscal Year 2006-2007 Masimum Special Tax for Facilities for Taxable Properiy Owner Associarion Property, Taxable Public Property, and Undeveloped Property shall be $18,348 per Acre and sha1T increase thereafter, commencing on July 1, 2007 and on July 1 of each Fiscal Yeaz thereafter, by an amount equal to two percent (2%) of the Maacimum Special Tax for Facilities in effect for the previous Fiscal Yeaz. D. METHOD OF APPORTIONMENT OF THE SPECIAL TAX FOR FACILITIES Commencing with Fiscal Year 2006-2007 and for each following Fiscal Yeaz, the City Council sha11 deterniiue the Special Tax Requirement for Faciliries and levy the Special Tax for Facilities until the amount of Special Tax for Facilities levy equals the Special Tax 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 Property in an amount equal to 100% of the applicable Assigned Special Ta~c for Facilities; Second: If additional monies aze needed to sarisfy the Special Tax Requirement for Facilities after the first step has been completed, the Special Tax for Facilities shall be levied Proportionately on each Assessor's Pazcel of Undeveloped Property at up to 100% of the Maximum Special Tas 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 Faciliries on each Assessor's Parcel of Developed Property whose Maximum Special Tax for Facilities is deternrined through the application of the Backup Special Tax for Facilities shall be increased in equal percentages from the Assigned Special Tax for Faciliries up to the Maximum Special Tax for Faciliries for each such Assessor's Pazcel; Fourth: If additional monies are needed to satisfy the Special Tax 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 Properiy Owner Association Property and Taxable Public Properiy at up to 100% of the Maacimum Special Tax for Facilities for Taxable Property Owner Association Property or Taxable Public Property. Notwithstanding the above, the City Council may, in any Fiscal Yeaz, levy Proportionately less than 100% of the Assigned Special Tax for Faciliries in step one (above), when (i) the City Council is no longer required to levy the Special Tax for Facilities pursuant to steps two City ofLake Elsinore Community Faci[ities District No. 2006-1 January 16, 2006 Improvement Area Na. I(Summer[y) Page 10 Agenda Item No. 2 ~ Page ~ of ~o through four above in order to meet the Special Tax Requirement for Facilities; (ii) all authorized CFD No. 2006-1 (IA No. 1) Bonds have already been issued or the City Council has covenanted that it will not issue any additional CFD No. 2006-1(IANo. l) Bonds (except refunding bonds) to be supported by the Special Taac for Facilities; and (iii) all Authorized Facilities have been constructed and/or acquired. Further notwithstanding the above, under no circumstances will the Special Tax for Facilities levied against any Assessor's Pucel of Residential Properiy 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 wiUrin CFD No. 2006-1 (IA No. 1). E. EXEMPTIONS No Special Tax for Facilities shall be levied on up to 25.1 Acres of Property Owner Association Property and/ar Public Property in CFD No. 2006-1 (IA No. 1). Tax-exempt status will be assigned by the CFD Administrator in the chronological order in which properry becomes Property Owner Association Property or Public Property. However, should an Assessor's Pazcel no longer be classified as Property Owner Association Property or Public Property, its tax-exempt status will be revoked. Properiy Owner Association Property or Public Property 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 taxed Proportionately as part of the fourth step in Section D above, at up to 100% of the Maacnnum Special Tax for Faciliries for Taxable Property Owner Association Property or Taa~able Public Property. F. MANNER OF COLLECTION The Special Ta~c for Facilities shall be collected in the same manner and at the same time as ordinary ad valorem properiy taxes; provided, however, that CFD No. 2006-1(IA No. l) may directly bill the Special Tax for Facilities, 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 pernutted by the Act. G. EREPAYMENT OF SPECIAL TAX FOR FACILITIES The following additional definitions apply to this Section G: City ofLake Elsinore Community Facilities District No. 2006-1 January 16, 2006 Improvement Area No.1(Summerly) Page ll Agenda Item No. 2 ~ Page o of ~~ "Buildout" means, for CFD No. 2006-1 (IA No. 1), that all expected building permits have been issued. "CFD Public Facilities" means either $18,635,000 in 2006 dollars, which shall increase by the Construction Inflation Index on July 1, 2007, and on each July 1 thereafter, or such lower number as(i) shall be determined by the CFD Administrator as sufficient to pmvide the public facilities to be provided by CFD No. 2006-1(IA No. 1) under the authorized bonding program for CFD No. 2006-1 (IA No. 1), or (ii) shall be determined by the City Council concurrently with a covenant that it will not issue any more CFD No. 2006-1 (IA No. 1) Bonds (except refunding bonds) to be supported by the Special Tax for Facilities levy under this Rate and Method of Apportionment as described in Section D above. "Construction Inflation Indes" means the annual percentage change in the Engineering News Record Building Cost Index for the City of Los Angeles, measured as of the calendar year which ends in the previous Fiscal Yeaz. In the event this index ceases to be published, the Construction Inflation Index shall be another index as determined by the CFD Aduiinistrator that is reasonably compazable to the Engineering News Record Building Cost Index for the City of Los Angeles. "Future Facilities Costs" means the CFD Public Facilities minus (i) public facility costs previously paid from the Improvement Fund, (ii) moneys currently on deposit in the Improvement Fund, and (iii) moneys currently on deposit in an escrow fund that are expected to be available to finance the cost of CFD Public Facilities. "Improvement ~nd" means an account speci$cally identified in the Indenture to hold funds which aze currently available for expenditure to acquire or construct CFD Public Facilities eligible under the Act. "Previously Issued Bonds" means, for any Fiscal Yeaz, all Outstanding Bonds that aze deemed to be outstanding under the Indenhue after the first interest and/or principal payxnent date following the current Fiscal Yeaz. 1. Prepayment in Full Only an Assessor's Parcel of Developed Properiy, or Undeveloped Property for wluch a building permit has been issued, may be prepaid. The obligation of the Assessor's Pazcel 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 particulaz Assessor's Parcel only if there aze no delinquent Special Taxes with respect to such Assessor's Pazcel at the tune ofprepayment. An owner of an Assessor's Pazcel intending to prepay the Special Ta~c for Facilities obligation shall provide the CFD Adxninistrator with written notice of intent to prepay. Within 30 days City ofLake E[sinore Community FaciliNes District No. 2006-I Januaty 16, 2006 Improvement Area No. l(Summerly) Page 12 Agenda Item No. ~ Page ~ of .~~ prepay. Within 30 days of receipt of such written notice, the CFD Aduiinistrator sha11 norify such owner of the prepayment amount for such Assessor's Parcel. The CFD Administrator may chazge a reasonable fee for providing this service. Prepayment must be made not less than 45 days prior to the next occurriug date that notice of redexnprion of CFD No. 2006-1(IA No. 1) Bonds from the proceeds of such prepayment may be given by the Trustee pursuant to the Indenture. The Special Tax for Faciliries Prepayment Amount (defined below) shall be calculated as summarized below (capitalized terms as defined below): Bond Redemption Amount plus Redemption Premium plus Future Facilities Amount plus Defeasance Amount plus Admiuistrarive Fees and Expenses less Reserve Fund Credit less Canitalized Interest Credit Total: equals Special Tax for Facilities Prepayment Amount As of the proposed date of prepayment, the Special Taac for Facilities Prepayment Amount shall be calculated as follows: Paraerauh No.: 1. Confirm that no Special Tax delinquencies apply to such Assessor's Pazcel. 2. For Assessor's Parcels ofDeveloped Properry, compute the Assigned Special Tax for Facilities and Backup Special Tax for Facilities. For Assessor's Pazcels of Undeveloped Property for which a building pemut has been issued, compute the Assigned Special Tax for Facilities and Backup Special Tax for Facilities for that Assessor's Pazcel as though it was already designated as Developed Property, based upon the building permit which has already been issued for that Assessor's Pazcel. 3. (a) Divide the Assigned Special Taac for Facilities computed pursuant to paragraph 2 by the total estimated Assigned Special Tazc for Facilities for the entire CFD No. 2006- 1(IA No. 1) based on the Developed Properiy Special Tax for Facilities which could be levied in the current Fiscal Yeaz on all expected development through Buildout of CFD No. 2006-1 (IA No. 1), excluding any Assessor's Parcels which have been prepaid, and City ofLake E[sinare Community Faci[ities District No. 2006-1 ' January 16, 2006 ImprovementArea No. 1(Summer[y) PaSe 13 Agenda Item No. ~_ Page ~a of 38' (b) Divide the Backup Special Tax for Facilities computed pursuant to pazagraph 2 by the total estimated Backup Special Tax for Facilities at Buildout for the entire CFD No. 2006-1 (IA No. 1), exCluding any Assessor's Pazcels which have been prepaid. 4. Multiply the lazger quotient computed pursuant to pazagraph 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 Amount"). 5. Multiply the Bond Redemption Amount computed pursuant to pazagraph 4 by the applicable redemption premium (e.g., the redemption price-100%), if any, on the Previously Issued Bonds to be redeemed (the "Redemption Premium"). 6. Compute the current Future Facilities Costs. 7. Multiply the larger quorient computed pursuant to paragraph 3(a) or 3(b) by the amount determined pursuant to paragraph 6 to compute the amount ofFuture Facilities Costs to be prepaid (the "Future Facilities AmounP'). 8. Compute the amount needed to pay interest on the Bond Redexnption Amount from the Srst bond interest and/or principal payment date following the current Fiscal Yeaz until the earliest redemption date for the Previously Issued Bonds. 9. Detertnine the Special Tax for Facilities levied on the Assessor's Pazcel in the current Fiscal Year which has not yet been paid. 10. Compute the minimum amount the CFD Administrator reasonably expects to derive from the reinvestment of the Special Tas for Facilities Prepayment Amount less the Future Facilities Amount and the Administrative Fees and Expenses (defined below) from the date of prepayment until the redemprion date for the Previously Issued Bonds to be redeemed with the prepayment. 11. Add the amounts computed pursuant to pazagraphs 8 and 9 and subtract the amount computed pursuant to pazagraph 10 (the "Defeasance AmounP'). 12. The administrarive fees and expenses of CFD No. 2006-1 (IA No. 1) 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 redeeming CFD No. 2006-1(IA No. 1) Bonds, and the costs ofrecording anynotices to evidence the prepayment and the redemption (the "Administrative Fees and Expenses"). City ofLake Elsinore Coromunity Faci[ittes District No. 2006-1 January 16, 2006 Improvement Area No. l(Summerly) Page 14 Agenda Item No. ~_ Page ~3 of ~~ 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 Previously Issued Bonds as a result of the prepayment, or (b) the amount derived by subtracting the new reserve requirement (as defined in the Indenhxre) 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 ~xnd Credit shall be granted if the amount then on deposit in the reserve fund for the Previously Issued Bonds is below 100% of the reserve requirement (as defined in the Indenture). 14. If any capitalized interest for the Previously Issued Bonds will not haue been expended as of the date immediately following the fust interest and/or principal payment following the current Fiscal Year, a capitalized interest credit shall be calculated by multiplying the larger 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 Cr.edit"). 15. The Special Tax for Facilities prepayment is equal to the sum of the amounts computed pursuant to paragraphs 4, 5, 7, 11 and 12, less the amounts computed pursuant to paragraphs 13 and 14 (the "Special Tax for Facilities Prepayment AmounP'). From the Special Taac for Facilities Prepayment Axnount, the amounts computed pursuant to pazagraphs 4, 5,11,13 and 14 shall be deposited into the appmpriate fund as established under the Indenture and be used to retire CFD No. 2006-1 (IA No. 1) Bonds or make debt service payments. The amount computed pursuant to paragraph 7 shall be deposited into the Improvement Fund. The amount computed pursuant to pazagraph 12 shall be retained by CFD No.2006-1 (IANo. 1). The Special Tax for Facilities Prepayment Amount maybe insufficient to redeem a full $5,000 increment of CFD No. 2006-1(IA No. l) Bonds. In such cases, the increment above $5,000 ar integral multiple thereof will be retained in the appropriate fund established under the Indenture to be used with the next prepayment of CFD No. 2006-1 (IA No. 1) Bonds or to make debt service payments. As a result of the payment of the current Fiscal Yeaz's Special Tax for Facilities levy as determined under paragraph 9(above), the CFD Administrator shall remove the current Fiscal Xear's Special T~ for Facilitzes levy for such Assessor's Parcel from the County tax rolls. With respect to any Assessor's Parcel that is prepaid, the City Council shall cause a suitable noiice to be recorded in compliance with the Act, to indicate the prepayment of the Speciafl T2x for Facilities and the release of the Special Taac for Faailities lien on such Assessor's City ofLake Elsinore Community Faci[ities District No. 2006-1 ./aeunry t o, :~uo~ d~xprovementArea li'o. 1(Summer[y) ~age 13 ~~^~~n~ Agenda Item No. ~ ~_ ~~ge ~~ of ~~ Assessor's Parcel, and the obligarion of such Assessor's Parcel to pay the Special Tax for Faciliries shall cease. Notwithstanding the foregoing, no Special Tax for Facilities prepayment sha11 be allowed unless, at the time of such proposed prepayment, the amount of Maximum Special Tax for Facilities that may be levied on Taxable Property within CFD No. 2006-1 (IA No. 1) (after excluding 25.1 Acres ofProperty Owner Associarion Property and/or Public Propertyin CFD No. 2006-1 (IA No. 1) as set forth 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) 1.10 times maximum annual debt service, in each remaining Fiscal Yeaz on the Outstanding Bonds. 2. Prepayment in Part The Special Ta~c for Facilities on an Assessor's Pazcel of Developed Property or an Assessor's Parcel of Undeveloped Property for which a building permit has been issued may be partially prepaid. The amount of the prepayment shall be calculated as in Section G.1; except that a partial prepayment shall be calculated according to the following formula: PP=[(PE-A)xF]+A These terms have the following meaning: PP = the partial prepayment. PE = the Special Tax 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 Administrarive Fees and Expenses calculated according to Secrion G.1. The owner of any Assessor's Parcel who desires such prepayment sha11 notify the CFD Administrator of such owner's intent to partially prepay the Special Tax for Faciliries and the percentage by which the Special Tax for Facilities shall be prepaid. The CFD Adxninistrator shall 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 of the request and may chazge a reasonable fee for providing this service. With respect to any Assessor's Parcel that is partially prepaid, the City Council shall (i) dishibute the funds remitted to it according to Section G.1, and (ii) indicate in the records of CFD No. 2006-1 (IA No. l) that there has been a partial prepayment of the Special Tax for Facilities and that a portion of the Special Ta~c for Facilities with respect to such Assessor's Parcel, equal to the outstanding percentage (1.00 - F~ of the remaining Maximum Special Taac for Facilities, shall continue to be levied on such Assessor's Parcel pursuant to Section D above. City of Lake Elsrnore Communiry Faci[ities District No. 2006-1 January 16, 2006 , Improvement Area Na. I(Summerly) Page 16 - Agenda Item No. ~_ Page ~~of ~~ H. TERM OF SPECIAL TAX FOR FACILITIES The Special Tax for Facilities shall be levied for a period not to exceed forry years commencing with Fiscal Yeaz 2006-2007, provided however that the Special Tax for Facilities will cease to be levied in an eazlier Fiscal Yeaz if the CFD Admiiustrator has determined (i) that all required interest and principal payments on khe CFD No. 2006-1 (IA No. 1) Bonds have been paid; (ii) all Authorized Facilities haue been acquired and all reimbursements to the developer have been paid; and (iii) all other obligations of CFD No. 2006-1 (IA No. 1) have been sarisfied. I. SPECIAL TAX FOR SERVICES The following additional definitions apply to this Section I: "Developed Multifamily Unit" means a residenrial 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 pernvt has been issued by the City for such dwelling unit on or prior to May 1 preceding the Fiscal Yeaz in which the Special Tax for Services is being levied. "Developed Single Family Unit" means a residential dwelling unit other than a Developed Multifamily [Jnit on an Assessor's Pazcel 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. 2006-1 (IA No. 1) in any Fiscal Year on any Assessor's Parcel. "Operating N~nd" means a fund that shall be maintained for CFD No. 2006-1(IANo. l) for any Fiscal Year to pay for the actual costs of maintenance related to the Service Area, and the applicable Administrative Expenses. "Operating ~nd Balance" means the amount of funds in the Operating Fund at the end of the preceding Fiscal Yeaz. "Service Area" means pazks, open space, and storm drains. "Special Tax for Services" means any of the special taxes authorized to be levied within CFD No. 2006-1 (IA No. 1) pursuant to the Act to fixnd the Special Tax Requirement for Services. City ofLake Elsinore Community Facilities Drstiict No. 2006-1 January 16, 2006 ImprovementArea No. 1(Summer[y) POge 1~ Agenda Item No. ~_ Page -2~ of / d "Special Tax Requiren for CFD No. 2006-1 (IA Area, including mainten Area which have been ac maintained during the ci for Services" means the aznount deternvned in any Fiscal Year 1) equal to (i) the budgeted costs directly related to the Service ;, repair and replacement of certain components of the Service ed and maintained or are reasonably expected to be accepted and rt Fiscal Yeaz, (ii) pay a proportionate shaze of Administrative Expenses, and (iii) antici ated Special Tax for Services delinquencies based on the delinquency rate for the Sp~cial Tazc for Services levy in CFD No. 2006-1 (IA No. 1) for the previous Fiscal Year, less (iv) the Operating Fund Balance, as determined by the CFD Administrator. I 1. Rate and Method a~f Apportionment of the Special Tax for Services Commencing with Fiscal ear 2006-2007 and for each subsequent Fiscal Yeaz, the City Council shall levy the Spe ial Tax for Services on (i) all Assessor's Parcels containing a Developed Single Family 't or Developed Multifamily Unit and (ii) all Assessor's Pazcels ofNon-Residential Prope , up to the applicable Maximum Special Tas for Services to fund the Special Tax Requireme t for Services. The Maximuxn Special T for Services for Fiscal Year 2006-2007 shall be $246.84 per Developed Single Fasnily nit, $123.42 per Developed Multifamily Unit, and $555.90 per Acre for each Assessor's P~ cel of Non-Residential Properiy. On each July 1, coxnmen increased by two percent 2. Duration of the The Special Tax for Se for Services, unless no 3. Collection of the The Special Tax for Servi~ ordinary ad valorem prope collect the Special Tax for meet its funding requirem~ July 1, 2007, the Maximum Special Tax for Services shall be D%) of the amount in effect in the prior Fiscal Yeaz. Tax for Services shall be levied in perpehxity to fund the Special Taac Requirement required as determined at the sole discretion of the City Council. Tax for Services sha11 be collected in the same manner and at the same time as taxes, provided, however, that CFD No. 2006-1 (IA No. 1) may vices at a different time or in a different manner if necessary to City ofLake Elsinore Community Facil' 'es District No. 2006-1 January 16, 2006 Improvement Area No.1(Summerly) Page I8 Agenda Item No. ~~ Page ~ of 1~ J. APPEALS AND INTERPRETATIONS Any landowner or resident who feels that the amount of the Special Taac levied on their Assessor's Parcel is in error may submit a written appeal to CFD No. 2006-1 (IA No. 1). The CFD Administrator sflall review the appeal and if the CFD Administrator concurs, the amount of the Special Tas levied shall be appropriately modified. The City Council may interpret this Rate and Method of Apportionxnent for purposes of clarifying any ambiguity and make determinations relative to the annual administration ofthe Special Ta1c and any landowner or resident appeals. Any decision of the City Council shall be final and binding as to all persons. GSty of Lake Elsinore Community Facilities Districr No. 2006-1 January 16, 2006 Improvement Area No. 1(Summerly) Page 19 Agenda Item No. Z~ Page Zg of 3B` EXHIBIT A CERTIFICATE TO AMEND SPECIAL TAX FOR FACILITIES Agenda Item No. Z, ~ Page a9 of~u CITY OF LAKE ELSINORE AND CFD No. 2006-1 (IA No. 11 CERTIFICATE 1. Pursuant to Secrion C of the Rate and Method of Apportionment, the City of Lake Elsinare and City of Lake Elsinore Community Facilities District No. 2006-1("CFD No. 2006-1 (IA No. 1)") hereby agree to a reduction in the Assigned Special Tax for Facilities for Developed Property, and the Backup Special Ta~c for Facilities ariributable to a Final Subdivision within CFD No. 2006-1 (IA No. 1): (a) The information in Table 1 relating to the Assigned Special Tax for Facilities for Developed Property within CFD No. 2006-1 (IA No. 1) shall be modified as follows: (b) The Backup Special Tas for Facilities attributable to a Final Subdivision wiUvn CFD No. 2006-1 (IA No. 1), as stated in Section C.1.(c), shall be reduced from $18,348 per Acre to $ per Acre. (c) The Ma~cimuxn Special Tax for Faciliries for Taxable Property Owner Association Properry, Taxable Public Property, and Undeveloped Properiy within CFD No. 2006-1 (IA No. 1), as stated in Section C.2, sha11 be reduced from $18,348 per Acre to $ per Acre. 2. The Special Tax for Facilities may only be modified prior to the first issuance of CFD No. 2006-1 (IA No. 1) Bonds. 3. Upon execurion of the Certificate by the City of Lake Elsinore and landowner(s), the City shall cause an amended notice of Special Taac lien for CFD No. 2006-1 (IA No. 1) to be recorded reflecting the modifications set forth herein. By execution hereof, the undersigned acknowledges, on behalf of the City of Lake Elsinore and CFD No. 2006-1 (IA No. 1), receipt of this Certificate and modification of the Rate and Method of Apportionment as set forth in this Certificate. CTTY OF LAKE ELSINORE By: CFD Adniinistrator Landowner(s) Date: Agenda Item No. ~_ Page ~D of et0