Loading...
HomeMy WebLinkAboutCC Reso No 2004-77RESOLUTION NO. 2004 -77 RESOLUTION OF INTENTION OF THE CITY GOUNCIL OF THE CITY OF LAKE ELSINORE TO ESTABLISH CITY OF LAKE ELSINORE COMMUNITY FACILITIES DISTRICT NO. 2004-3 (ROSETTA GANYOl~ AND DESIGNATING IMPROVEMENT AREAS WITHIN SAID COMMUNITY FACILITIES DISTRICT WHEREAS, the City Council (the "Council") of the City of Lake Elsinore (the "City") has received a petition (the "Petition") requesting the institution of proceedings for (i) formation of a community facilities district (the "CFD") pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (the "AcY'), (ii) designation of improvement areas within the CFD, (iii) authorization of issuance of bonds for each improvement area within the CFD, and (iv) establishment of an appropriations limit for each improvement area within the CFD; and WHEREAS, the Council has determined that the Petition complies with the requirements of Government Code Section 53318(c) and now intends to initiate such proceedings; and WHEREAS, it is the intention of the Council to finance the acquisition and construction of the Facilities (as defined below) ar any combination thereof through the formation of the CFD, sixbjeet to the authorization of bonds and the levy of a special tax to pay lease payments, installment purchase payments or other payments, or principal and interest on bonds, being approved at an election to be held within the boundaries of each improvement area within the CFD; W$BREAS, pursuant to Section 53350 of the Act, the Council may designate a portion or portions of the CFD as one or more improvement areas for purposes of financing of, or contributing to the financing of, specified public facilities; WHEREAS, the Council intends to provide fot the annexation in the future oF territory (the "Future Annexation Area") to Improvement Area No. 2 of the CFD; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: ,~'~ Sectid~~ 1. The Council hereby determines to institute proceedings for the formation of a cornmunity facilities district under the terms of the Act. The exterior boundaries of the CFD are her'eby specified and described to be as shown on that certain map now on file in the office of the Clerk entitled "Proposed Boundary of Community Facilities District No. 2004-3 of the City of Lake Elsinore (Rosetta Canyon)," which map indicates by a boundazy line the extent of the territory included in the proposed community facilities district and shall govern for all details as to the extent of the CFD. On the original and one copy of the map of such CFD on file in the City Clerk's office, the City Clerk shall endorse the certificate evidencing the date and adoption of this resolution. The City Clerk shall file the original of such map in her office and, within fifteen (15) days after the adoption of this Resolution, the City Clerk shall file a copy of such map so endorsed in the records of the County Recorder, County of Riverside, State of California. 45445788.4 Section 2. The Future Annexation Area may be annexed in the future only with the unanimous approval of the owner or owners of each parcel or pazcels at the time that parcel or those parcels aze annexed. Section 3. The name of the proposed CFD shall be "City of Lake Elsinore Community Facilities District No. 2004-3 (Rosetta Canyon)." Section 4. The Council hereby designates the portions of the CFD as described in Exhibit A attached hereto, as Improvement Area No. 1 and Improvement Area No. 2 of the CFD. 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, storm drain, water and sewer facilities, fire station, fire equipment, City fees and fees of the Elsinore Valley Municipal Water District, and related costs including designs, 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 tax (the "Special Taac") sufficient to pay for the costs of financing the acquisition and/or construction of the Facilities, including the principal of and interest on the bonds proposed to be issued to finance the Faciliries and ofher 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 Taac and all other costs of the levy of the Special Taac 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 expication 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, inciuding, but not limited to, fees for bond counsel, disclosure counsel, financing consultants and printing costs, and all other administrative costs of the taa~ levy and bond issue. The Special Tax will be secured by recordation of a continuing lien against all non-exempt real property in the CFD. In the first year in which such a Special Tax is levied, the levy shall include a sum sufficient to repay to the City ali 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 Taac is described in detail in Exhibit B attached hereto and by this reference incorporated herein. The Special Taac is based upon the cost of financing the Facilities in the CFD, the demand that each pazcel will place on the Facilities and the benefit (direct and/or indirect) received by each parcel from the Facilities. The Special Taac is apportioned to each parcel on the foregoing basis pursuant to Section 533253 of the Act. In the event that a portion of the properiy within the CFD shall become for any reason exempt, wholly or partially, from fhe levy of the Special Ta~c, the Council shall, on behalf of the CFD, increase the levy to the extent necessary upon the remaining property within the CFD which is not delinquent or exempt in order to yield the required payments, subject to the asaas~as.a 2 maximum tax. Under no circumstances, however, shall the Speciat 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 CFD by more than 10 percent. Furthermore, the maximum special tax authorized to be levied against any parcel used for private residential purposes shall not be increased over time in excess of 2 percent per year. Section 7. The Council hereby finds that the proposed Facilities are necessary to meet increased demands put upon the City as a result of the new development or rehabilitation within the proposed CFD. Section 8. A public hearing (the "Hearing") on the establishment of the CFD and the proposed rate and method of apportionment of the Special Tax shall be held on February 8, 2005, at 7:00 p.m., or as soon thereafter as practicable, at the chambers of the Council, 183 North Main Street, Lake Elsinore, California 92530. Section 9. At the time and place set forth above for the hearing, any interested person; including all persons owning lands or registered to vote within th~ proposed CFD, may appear and be heard. Section 10. Each City officer who is or will be responsible for the Facilities to be financed by the CFD, if it is established, is hereby directed to study the proposed CFD and, at or before the tiine of the above-mentioned Hearing, file a report with the Council, and which is to be made a part of the record of the Hearing, containing a brief description of the Facilities by type which will in his or her opinion be required to adequately meet the needs of the CFD and his or her estimate of the cost of providing the Facilities. The City Manager is directed to estimate the fair and reasonable cost of all incidental expenses, including the cost of planning and designing the Facilities to be financed pursuant to the Act, including the cost of envitonmental evaluations of such facilities, all costs associated with the creation of the CFD, issuance of bonds, determination of the amount of any special taaces, collection of any special tases, or costs otherwise incuired in order to carry out the authorized purposes of the City with respect to the CFD, and any other expenses incidental to the construction, completion and inspection of the authorized work to be paid through the proposed financing. Section 11. The City may accept advances of funds from any sources, including private persons or private entities, and is authorized and directed to use such funds for any authorized purpose, including any cost incurred by the City in crearing the CFD. The City may enter into an agreement to repay all of such funds as are not expended or committed for any authorized purpose at the time of the election on the levy of the Special Tax, if the proposal to levy such taic should fail, and to repay all of such fixnds advanced if the levy of the Special Tas shall be approved by the qualified electors of the CFD. Section 12. The City Clerk is hereby directed to publish a notice ("Notice") of the Hearing pursuant to Section 6061 of the Govemment Code in a newspaper of general circulation published in the azea of the proposed CFD. Such Notice shall contain information set forth in Section 53322 of the Act. Such publication shall be completed at least 7 days prior to the date of the Hearing. asaas~ss.a 3 Section 13. The Clerk may send a copy of the Notice by first-class mail, postage prepaid, to each registered voter and to each landowner within proposed CFD as shown on the last equalized assessment roll. Said mailing shall be completed not less than fifteen (15) days prior to the date of the Hearing. Section 14. Pucsuant to Section 53344.1 of the Act, the Council hereby reserves to itself, in its sole discretion, the right and authority by subsequent resolution to allow any owner of property within the CFD, subject to the provisions of Section 53344.1 of the Act and those conditions as iY may impose, and any applicable prepayment penalties as prescribed in the bond indenture or compazable instrument or document, to tender to the CFD treasurer in full payment or part payment of any installment of the special taaces or the interest or penalties thereon which may be due or delinquent, but for which a bill has been received, any bond or other obligation secured thereby, the bond or other obligation to be taken at par and credit to be given for the accrued interest shown thereby computed to the date of tender. Section 15. The voting procedure with respect to the establishment of the CFD and the imposition of the special tax shall be by hand delivered ballot election. PASSED, APPROVED AND ADOPTED this 28th day of December. , 2004. CITY OF L LSINORE By: ~ Title: Mayor ATT$ST: City Clerk of the City of Lakti Elsinore APPROVED AS TO FORM: rbaza I,e' ol , City Attorney 45445788.4 STATE OF CALIFOI2NIA ) ) ss. COUNTY OF RIVERSIDE ) I, Vicki Kasad, City Clerk of the City of Lake Elsinore, do hereby certify that the foregoing Resolution was duly adopted by the City Council of said City at a regulaz meeting thereof held on the Zsth day of December , 2004, and that it was so adopted by the following vote: AYES: COUNCILMEMAERS: BUCKLEY, AICKMAN, KELLEY, SCHIFFNER, MAGEE NOES: COUNCILMEMBERS: NONE ABSENT: COUNCILMEMBERS: NONE ABSTAIN: COUNCILMEMBERS: NONE By: City Clerk of the City of Lake Elsinore 45445788.4 EXHIBIT A IMPROVEMENT AREASBOUNDARY MAP asaas>ea.a ZONE MAP COMMUNITY FACILITIES DISTRICT No. 2004-3 OF THE CITY OF LAKE ELSINORE (ROSETTA CANYON) ZONE 1 COUNTY OF RIVERSIDE, (TRACT 25477) STATE OF CALIFORNIA IMPROVEMENT ZONE 2 (TRACT 25476) IMPROVEMENT haNin Mna xo scpic irrrun oimacT awNO~nr Commualty Facllltles Dletrict No. 2004-9 of tLe Clty ot Lake Eleiaora (Roeetts Cnnyoa) LroVN21 0~ ~e, c11DOiNL 94M 1 Oi 1 EXHIBIT B RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX 45445788.4 FOURTH DRAFT RATE AND METHOD OF APPORTIONMENT FOR CITY OF LAKE ELSINORE COMMUNTTY FACILITIES DISTRICT No. 2004-3 IMPROVEMENT AR~A No. 1(ROSETTA CANYOl~ A Special Tax shall be levied on all Assessor's Parcels in City of Lake Elsinore Community Faciliries District No. 2004-3 (Improvement Area No. 1) (Rosetta Canyon) ("CFD No. 2004-3 (IA No. 1)") and collected each Fiscal Year commencing in Fiscal Year 2005-2006, in an amount determined through the application of the Rate and Method of Apportionment as described below. All ofthe real property in CFD No. 2004-3 (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. DEFINITIONS The terms hereinafter set forth have the following meanings: "Acre or Acreage" means the land area of an Assessor's Parcel as shown on an Assessor's Parcel Map, or if the land area is not shown on an Assessor's Parcel Map, the land area shown on the applicable final map, parcel map, condominium plan, or other recorded County parcel map. "Act" means the Mello-Roos CommuniYy Facilifies Act of 1982, being Chapter 2.5, Division 2 of Title 5 of the California Govemment Code. "Administrative Expenses" means the following actual or reasonably estimated costs directly related to the admimstration of CFD No. 2004-3 (IA No. 1): the costs of computing the Special Taaces andpreparing the annual Special Tas collection schedules (whetherbythe Cify or designee thereof or both); the costs of collecting the Special Taxes (whether by the City or otherwise); the costs of remittuig the Special Taaces to the Trustee; the costs of the Trustee (including its legal counsel) in the discharge of the duties cequired of it under the Indenture; the costs to the City, CFD No. 2004-3 (TA No. 1) ot any designee thereoF of complying with azbitrage rebate requirements; the costs to the City, CFD No. 2004-3 (IA No. 1) or any designee thereof of complying with disclosure requirements of the City, CFD No. 2004-3 (IA No. 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 Taaces; the costs of the City, CFD No. 2004-3 (IA No. 1) or any designee thereof related to an appeal of the Special Taac; the costs associated with the release of funds from an escrow account; and the City's annual administration fees and third pariy expenses. Administrative Expenses shall also include amounts estimated by the CFD Administrator or advanced by the City or CFD No. 2004-3 (IA No. 1) for any other administrative purposes of CFD No. 2004-3 (IA No. 1), including attomey's fees and other costs related to commencing and pursuing to complerion any foreclosure of delinquent Special Taxes. "Assessor's Parcel" means a lot or pazcel shown in an Assessor's Parce],_I~i~~yi~ an assigned Assessor's Parcel number. - °° " City ofLake E[sinore ~ December 16, 2004 CFD No. 2004-3 (IA Na. 1) Page 1 "Assessor's Parcel Map" means an official map of the County Assessor of the County designating pazcels by Assessor's Parcel number. "Assigned Special Tax" means the Special T~ for each Land Use Class of Developed Property in each Zone, as deternuned in accordance with Section C.l.b. below. "Authorized Facilities" means those authorized improvements, as listed on Exhibit "A" to the Resolution of Formation. "Backup Special Tax" means the Special Tax applicable to each Assessor's Parcel of Developed Property, as determined in accordance with Section C.l.d. below. "CFD Administrator° means an official of the City, or designee thereof, responsible for detemuning the Special Tax Requirement and providing for the levy and collection of the Special Ta~ces. "CFD No. 2004-3" means City of Lake Elsinore Community Facilities District No. 2004-3 (Rosetta Canyon). "CFD No. 2004-3 (IA No. 1)" means Improvement Area No. 1 of CFD No. 2004-3, as identified on the boundary map for CFD No. 2004-3. "CFD No. 2004-3 (IA No. l) Bonds" means any bonds or other debt (as defined in Section 53317(d) of the Act), whether in one or more series, issued by CFD No. 2004-3 and secured solely by Special Taxes levied on property within the boundaries of CFD No. 2004-3 (IA No. 1) under the Act. "City" means the City of Lake Elsinore. "City Council" means the City Council of the City of Lake Elsinore, acting as the legislative body of CFD No. 2004-3 (IA No. 1). "County" means the County of Riverside. "Developed Property" means, for each Fiscal Year, all Taacable Properiy, exclusive of Taacable Public Property and Tasable Property Owner Associarion Property, for which the Final Subdivision was iecorded on or before January 1 of the prior Fiscal Yeaz and a building permit for new consiruction was issued after January 1, 2004 and on or before May 1 of the Fiscal Yeaz preceding the Fiscal Year for which the Special Taxes are being levied. "Final Subdivision" means a subdivision ofproperty 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 1352 that creates individual lots for which building aP.s~ts ~,v Ei~_ issued without fiirther subdivision. City ofLake E[sinore ' December 16, 2004 CFD No. 2004-3 (IA No. 1) Page 2 "Fiscal 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. 2004-3 (IA No. 1) Bonds ue 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. "Maximum Special Tax" means the maximum Special Ta1c, 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 Parcels ofDeveloped Property for which a building permit permitting the construction of one or more non-residential units ar facilities has been issued by the City. "Outstanding Bonds ° means all CFD No. 2004-3 (IA No. 1) Bonds which are deemed to be outstanding under the Indenture. "Property Owner Association Property" means, for each Fiscal Yeaz, anypropertywitlvn the boundaries of CFD No. 2004-3 (TA No. 1) that was owned by a property owner association, inoluding any master or sub-association, as ofJanuary 1 ofthe prior Fiscal Year. "Proportionately" means for Developed Property that the ratio of the actual Special Tax levy to the Assigned Special Tax is equal for all Assessor's Parcels ofDeveloped Property, ot where the Backup Special Tas is being levied, that the ratio ofthe actual Special Ta1c levy to the Maximum Special Taac is equal for all Assessor's Parcels upon which a Backup Special T~ is being levied. For Undeveloped Property, "Proportionately" means that the ratio of the actual Special Taac levy per Acre to the Maacimum Special Tax per Acre is equal for all Assessor's Pazcels of Undeveloped Property. The term "Proportionately" may similarly be applied to other categories of Taxable Properiy as listed in Section D below. "Public Property" means properiy within the boundazies of CFD No. 2004-3 (IA No. 1) owned by, inevocably offered or dedicated to, or over, through or under which an easement for putposes of public right-of-way has been granted, to the federal government, the State, the County, the City, or any local goverrunent or other public agency, provided that any properiy leased by a public agency to a private entity and subject to taacation under Section 53340.1 of the Act shall be taiced and classified according to its use. "Residential Floor Area" means all of the square footage of living azea within the perimeter of a residential shucture, not including any carport, walkway, garage, overhang, patio, enclosed patio, or similar area. The determination of Residential Floor Area for an Assessor's Parcel shall be made by reference to the building permit(s) issued for such Assessor's Pazcel. City ofLakeElsinore ~ December 16, 2004 CFD No. 2004-3 (IA No. 1) page g "Residential Property" means all Assessor's Parcels of Developed Property for which a building pernut permitting the construction thereon of one or more residential dwelling units has been issued by the City. "Resolutiou of Formation" means the Resolution of Formation for CFD No. 2004-3 (IA No. 1). "Special Tax" means the special ta~c to be levied in each Fiscal Year on each Assessor's Parcel of Developed Properry, Taacable Property Owner Association Property, Taxable Public Property, and Undeveloped Property to fund the Special Taac Requirement. "Special Tax Requirement" means that amount required in any Fiscal Year for CFD No. 2004-3 (IA No. 1) to: (i) pay debt service on all Outstanding Bonds due in the calendar year commencing in such Fiscal Yeaz; (ii) payperiodic costs on the CFD No. 2004-3 (IA No. 1) Bonds, including but not limited to, credit enhancement and rebate payments on the CFD No. 2004-3 (IA No. 1) Bonds due in the calendar year commencing in sdch Fiscal Year; (iii) pay 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 delinquencies based on the delinquency rate for the Special Tax levy in the previous Fiscal Year; (vi) pay directly for acquisition or construction of Authorized Facilities to the extent that the inclusion of such amount does not increase the Special Taac levy on Undeveloped Properiy; less (vii) a credit for funds available to reduce the annual Special Tax levy, as determined by the CFD Administrator pursuant to the Indenture. "State" means the State of California. "Taxable Property" means all of the Assessor's Pazcels within the boundaries of CFD No. 2004-3 (IA No. 1) which are not exempt from the Special Tax pursuant to law or Section E below. "Taxa6le Property Owner Association Property" means all Assessor's Parcels of Property Owner Association Property that are not exempt pursuant to Section E below. "Taxable Public Property" means all Assessor's Parcels of Public Properiy that are not exempt pursuant to Section E below. "Trustee" means the trustee, fiscal agent, or paying agent under the Indenture. "Undeveloped Property" means, for each Fiscal Year, all Talcable Properlynot classified as Developed Property, Taacable Property Owner Association Property, or Taacable Public Property. "Zone" means Zone 1 or Zone 2, as applicable. "Zone 1" means the land geographically identified within the boundaries of zone 1 as delineated in E~ibit A to this Rate and Method of Apportionment. City of Lake E[sinore December I6, 2004 CFD No. 2004-3 (IA No. I) _ page q "Zone 2" means the land geographically identified within the boundaries of zone 2 as delineated in Exhibit A to this Rate and Method of Apportionxnent. B. ASSIGNMENT TO LAND USE CATEGORIES Each Fiscal Year, all Taxable Properiy within CFD No. 2004-3 (IA No. 1) shall be assigned to a Zone and fiuther classified as Developed Property, Taacable Public Properiy, Taxable Properiy Owner Association Property, or Undeveloped Property, and shall be subject to Special Taxes in accordance with this Rate and Method of Apportionment determined pursuant to Sections C and D below. Residential Property shall be assigned to Land Use Classes 1 through 11 as listed in Table 1 below based on the Residential Floor Area for each unit. Non-Residential Property shall be assigned to Land Use Class 12. C. MAXIMUM SPECIAL TAX RATE 1. Developed Property a. Masimum Special Taac The Masimum Special Taz~ for each Assessor's Parcel classified as Developed Property shall be the greater of (i) the amount derived by application of the Assigned Special Taac or (ii) the amount derived by application of the Backup Special Tas. b. Assigned Special Tax The Assigned Special Tax for each Land Use Class is shown below in Table L Ciry of Lake Elsinore December l6, 2004 CFD No. 2004-3 (IA No. I) Page 5 TABLE 1 Assigned Special Taxes for Developed Property Community Facilities District No. 2004-3 c: Increase in the Assigned Special Taac The Assigned Special Taaces identified in Table 1 above shall be applicable for Fiscal Year 2005-2006, and shall increase thereafter, commencing on July 1, 2006 and on July 1 of each Fiscal Yeaz thereafter, by an amount equal to two percent (2%) of the Assigned Special Taac for the previous Fiscal Year. d. Backup Suecial Ta~c The Fiscal Yeaz 2005-2006 Backup Special Tax ariributable to a Final Subdivision in Zone 1 or Zone 2 will equal $16,285 multiplied by the Acreage of alt Taxable Properly, exclusive of any Tasable Properiy Owner Association Property and Taacable Public Property, therein. The Backup Special Tax for each Assessor's Parcel of Residential Property shall be computed by dividing the Backup Special Tax 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 City of Lake Elsinore December 16, 2004 CFD No. 2004-3 (IA No. 1) Page 6 Improvement Area No. 1 Fiscal Year 2005-2006 residential lots). The Backup Special Taac for each Assessor's Parcel ofNon- Residential Property therein shall equal $16,285 multiplied by the Acreage of such Assessor's Parcel. If a Final Subdivision includes Assessor's Pazcels of Taxable Property for which building permits for both residential and non-residential construction may be issued, exclusive of Taxable Property Owner Association Property and Taxable Public Property, then the Backup Special Taac for each Assessor's Parcel ofResidential Property shall be computed exclusive ofthe Acreage and Assessor's Parcels of property for which building pernuts for non-residential construction may be issued. Notwithstanding the foregoing, if all or any portion of the Final Subdivision(s) described in the preceding paragraphs is subsequently changed or modified, then the Backup Special Tas for each Assessor's Parcel of Developed Pcoperty in such Final Subdivision area that is changed or modified shall be a rate per square foot of Acreage calculated as follows: Determine the total Backup Special Taxes anticipated to apply to tlie changed or modified Final Subdivision area prior to the change or modification. '' 2. The result of paragraph 1 above shall be divided by the Acreage of ~, Taacable Property which is ultimately expected to exist in such changed or modified Final Subdivision area, as reasonably determined by the CFD Administrator. The result of paragraph 2 above shall be divided by 43,560. The result is the Backup Special Ta1c per squaze foot of Acreage which shall be applicable to Assessor's Parcels of Developed Property in such changed or modified Final Subdivision area for all remaining Fiscal Years in which the Special Tax may be levied. i. Release of Obligation to Pay and Disclose Backup Special Tax All Assessors' Parcels within CFD No. 2004-3 (IA No. 1) will be relieved simultaneously and permanently from the obligation to pay and disclose the Backup Special Taic if the CFD Administrator determines that the annual debt service required for the Outstanding Bonds, when compared to the Assigned Special Tases that may be levied against all Assessors' Parcels of Developed Property result in 110% debt service coverage (i.e., the Assigned Special T~es that may be levied against all Developed Property in each remaining Fiscal Yeaz based on then existing development in CFD No. 2004-3 (IA No. 1) is at least equal to the sum of (i) the Administrative City of Lake Slsinore December 16, 2004 CFD No. 2004-3 (L4 No. I) __ ____ _,_, Page 7 Expenses and (ii) 1.10 times maximum annual debt service, in each remaining Fiscal Year on the Outstanding Bonds). e. Increase in the Backu~Special Tax On each July 1, commencing on July 1, 2006, the Backup Special Taac shall be increased by an amount equal to two percent (2%) of the Backup Special Tax for the previous Fiscal Year. f. Multinle Land Use Classes In some instances an Assessor's Pazcel of Developed Property may contain mare than one Land Use Class. The Maximum Special Ta~c levied on an Assessor's Parcel shall be the sum of the Ivlaximum Special Tax for all Land Use Classes located on that Assessor's Parcel. The CFD Administrator's allocation to each type of property shall be final. 2. Taxable Property Owner Association Property, Taxable Public Property, and Undeveloped Property The Fiscal Yeaz 2005-2006 Malcimum Special Tax for Taacable Property Owner Association Property, Tasable Public Property, and Undeveloped Properiy in Zone 1 or Zone 2 shall be $16,285 per Acre, and shall increase thereafter, commencing on July 1, 2006 and on July 1 of each Fiscal Year thereafter, by an amount equal to two percent (2%) of the Maximum Special Tas for the previous Fiscal Year. D. METHOD OF APPORTIONMENT OF THE SPECIAL TAX Commencing with Fiscal Year 2005-2006 and for each following Fiscal Year, the City Council shall levy the Special Tax until the amount of Special Ta~ces levied equals the Special Tax Requirement. The Special Tas shall be levied each Fiscal Yeaz as follows: First: The Special Ta~c shall be levied on each Assessor's Parcel of Developed Property in Zone 1 and Zone 2 in an amount equal to 100% of the applicable Assigned Special Tax; Second: If additional monies aze needed to satisfy the Special Taac Requirement after the first step has been completed, the Special Tax shall be levied Proportionately on each Assessor's Parcel of Undeveloped Property in Zone 1 and Zone 2 at up to 100% of the applicable Maacimum Special Tas for Undeveloped Property; Third: If additional monies are needed to satisfy the Special Taac Requirement after the first hvo steps have been completed, then the levy of the Special Tax on each Assessor's Pazcel of Developed Property in Zone 1 and Zone 2 whose Masimum Special T~ is determined through the application of the Backup Special Tax shall be increased Proportionately from the Assigned Special Taac up to the M~imum Special Taac for each such Assessor's Parcel; City of Lake Elsinore December 16, 2004 CFD No. 2004-3 (7A No. IJ pagg g Fourth: If additional monies are needed to satisfy the Special Tax Requirement after the first three steps haue been completed, then the Special Tax shall be levied Proportionately on each Assessor's Parcel of Talcable Property Owner Association Property and Taxable Public Propeity in Zone 1 and Zone 2 at up to tHe applica6le Maacimum Special Tax for Taacable Properiy Owner Association Property or Talcable Public Property. Notwithstanding the above the City Council may, in any Fiscal Year, levy Proportionately less than 100% of the Assigned Special Tas in step one (above), when (i) the City Council is no longer required to levy the Special Tas pursuant to steps two through four above in order to meet the Special Tax Requirement; and (ii) all authorized CFD No. 2004-3 (IA No. 1) Bonds have akeady been issued or the City Council has covenanted that it will not issue any additional CFD No. 2004-3 (IA No. 1) Bonds (except refunding bonds) to be supported by the Special Talc. Further notwithstanding the above, under no circumstances will the Special Taa[ levied against any Assessor's Parcel of Residential Property for which an occupancy permit for private residential use 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 wittun CFD No: 2004-3 (IA No. 1). E: EXEMPTIONS No SpeciaL Taac shall be levied on up to 127.43 Acres of Properiy Owner Association Property and/or Public Property in CFD No. 2004-3 (IA No. 1). Taac-exempt status will be assigned by the CFD Administrator in the chronological order in which property becomes Property Owner ?,ssociation Property or Public Property. However, should an Assessor's Pazcel no longer be classified as Property Owner Associarion Property or Public Property, its tax-exempt sfatus will be revoked. Property Owner Associarion Property or Public Property that is not exempt from Special Taxes under this section shall be subject to the lery of the Special Tax and shail be taxed Proportionately as part ofthe fourth step in Section D above, at up to 100% of the applicable Maximum Special Tax for Taacable Property Owner Association Property or Taacable Public Property. F. MANNER OF COLLEGTION The Special Tax shall be collected in the same manner and at the same time as ordinary ad valorem properly taJCes; provided, however, that CFD No. 2004-3 (IA No. 1) may directly bill the Special Tas, may collect Special Taaces 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 Pazcels as permitted by the Act. City of Lake E[sinore - ~ecember l6, 2004 CFD No. 2004-3 (IA No. 1) ~--- Page 9 G. APPEALS Any landowner or resident who feels that the amount of the Special Tax levied on their Assessor's Parcel is in error may submit a written appeal to CFD No. 2004-3 (IA No. 1). The CFD Administrator shall 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 Apportionment for purposes of clarifying any ambiguity and make determinations relative to the annual administration ofthe Special Tas and any landowner or resident appeals. Any decision of the City Council shall be final and binding as to all persons. H. PREPAYMENT OF SPECIAL TAX The following definitions apply to this Section H: "Buildout" means, for CFD No. 2004-3 (IA No. 1), that all expected building permits have been issued. "CFD Public Facilities" means either $16,190,781 in 2004 dollars, which shall increase by the Construction Inflation Index on July 1, 2005, and on each July 1 thereafter, or such lower number as (i) shall be determined by the CFD Admiuisfrator as sufficient to provide the public facilities to be provided by CFD No. 2004-3 (IA No. 1) under the authorized bonding program far CFD No. 20043 (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. 2004-3 (IA No. 1) Bonds (except refunding bonds) to be supported by the Special TaJCes levied under this Rate and Method of Apportionment as described in Section D. "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 yeaz which ends in the previous Fiscal Year. In the event this index ceases to be published, the Construcfion Inflation Index shall be another index as determined by the CFD Administrator that is reasonably compazable to the Engineering News Record Building Cost Index for the City of Los Angeles. "Future 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 F~nd" means an account specifically identified in the Indenture to hold funds which aze currently available for expenditure to acquire or construct CFD Public Facilities eligible under the Act. Ci[y of Lake Elsinore ~ -- December 16, 2004 CFD No. 2004-3 (IA No. 1) Page 10 . ~ s-~ ~ ~1F-r . "Previously Issued Bouds" means, for any Fiscal Year, all Outstanding Bonds that are deemed to be outstanding under the Indenture after the first interest and/or principal payment date following the current Fiscal Year. 1. Prepayment in Full Only an Assessor's Pazcel ofDeveloped Property, or Undeveloped Property for which a building permit has been issued, may be prepaid. The obligation of the Assessor's Parcel to pay any Special Tas may be permanently satisfied as described herein, provided that a prepayment may be made with respect to a particular Assessor's Parcel only if there 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 Special Tax obligation shall provide the CFD Administrator with written notice of intent to prepay. Within 30 days of receipt of such written notice, the CFD Administrator shall notify such owner of the prepayment amount for such Assessor's Parcel. The CFD Administrator may charge a reasonable fee for providing this service. Prepayment must be made not less than 45 days prior to the next occurring date that notice of redemprion of CFD No. 2004-3 (IA No. 1) Bonds from the proceeds of such prepayment may be given by the Trustee pursuant to the Indenture. The Special Ta~c Prepayment Amount (defined below) shall be calculated as summarized below (capitalized terms as defined below): Bond Redemption Amount plus plus plus plus less less Total: equals Redemption Premium Future Facilities Amount Defeasance Amount Administrative Fees and Expeuses Reserve Fund Credit Canitalized Interest Credit Prepayment Amount As of the proposed date of prepayment, the Special Tax Prepayment Amount shall be calculated as follows: ParaEraph No.: Confirm that no Special Taac delinquencies apply to such Assessor's Parcel. 2. For Assessor's Parcels of Developed Property, compute the Assigned Special Taac and Backup Special Taac. For Assessor's Parcels of Undeveloped Properly for which a building perxnit has been issued, compute the Assigned Special Tax and Backup Special Tax for that Assessor's Parcel as though it was already designated as Developed Property, based upon the building permit which has already been issued for that Assessor's Pazcel. Ciry ofLake Elsinore December 16, 2004 CFD No. 2004-3 (IA No. I) _ Page 11 (a) Divide the Assigned Special Tax computed pursuant to paragraph 2 by the total esrimated Assigned Special Taxes for the entire CFD No. 2004-3 (IA No. 1) based on the Developed Property Special Taxes which could be levied in the current Fiscal Year on all expected development through Buildout of CFD No. 2004-3 (IA No. 1), excluding any Assessor's Parcels which have been prepaid, and (b) Divide the Backup Special Tax computed pursuant to paragraph 2 by the total estimated Backup Special Taxes at Buildout for the entire CFD No. 2004-3 (IA No. 1), excluding any Assessor's Parcels which have been prepaid. 4. Multiply the larger quotient computed pursuant to paragraph 3(a) or 3(b) by the Previously Issued Bonds to compute the amount of Previously Issued Bonds to be retired and prepaid (the "Bond Redemption 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 redeeined (the "Redemption Premium"). 6. Compute the current Future Facilities Costs. 7. Multiply the lazger quotient computed pursuant to pazagraph 3(a) or 3(b) by the amount deteimined pursuant to paragraph 6 to compute the amount of Future Facilities Costs to be prepaid (the "Future Facilities Amount"). 8. Compute 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 Yeaz until the earliest redemprion date for the Previously Issued Bonds. 9. Determine the Special Taac levied on the Assessor's Pazcel in the current Fiscal Year which has not yet been paid. 10. Compute the minimum amount the CFD Admiuisirator reasonably expects to derive from the reinvestment of the Special Taac Prepayment Amount less the Future Facilities Amount and the Administrative Fees and Expenses (defined below) from the date of prepayment until the redemption date for the Previously Issued Bonds to be redeemed with the prepayxnent. 11. Add the amounts computed pursuant to paragraphs 8 and 9 and subtract the amount computed pursuant to paragraph 10 (the "Defeasance Amount"). 12. The administrative fees and expenses of CFD No. 2004-3 (IA No. 1) are as calculated by the CFD Administrator and include the costs of computation of the prepayment, the costs to invest the prepayment proceeds, the costs of redeeming CFD No. 2004-3 City of Lake Elsinore `~ December 16, 2004 CFD No. 2004-3 (IA No. 1) - . Page l2 (IA No. 1) Bonds, and the costs of recording any norices to evidence the prepayment and the redemption (the "Administrative Fees and Expenses"). 13. The reserve fund credit (the "Reserve Fund CrediP') shall equal the lesser of: (a) the expected reduction in the reserve requirement (as defined in the Indenture), if any, associated with the redemption of Previously Issued Bonds as a result of the prepayment, or (b) the amount derived by subtracting the new reserve requirement (as defined in the Indenture) in effect after the redemption of Previously Issued Bonds as a result of the prepayment &om the balance in the reserve fund on the prepayment date, but in no event shall such amount be less than zero. No Reserve Fund Credit shall be granted if the amount then on deposit in the reserve fund for the Previously Issued Bonds is below 100% of the reserve requirement (as defined in the Indenture). 14. If any capitalized interest for the Previously Issued Bonds will not have been expended as of the date immediately following the first 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) ar 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 Credit"). 15. The Special Tas 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 pazagraphs 13 and 14 (the "Prepayment Amount"). From the Prepayment Amount, the amounts computed pursuant to paragraphs 4, 5, 11, 13 and 14 shall be deposited into the appropriate fund as established under the Indenture and be used to retire CFD No. 2004-3 (IA No. 1) Bonds or make debt service payments. The amount computed pursuanf to paragraph 7 shall be deposited into the Improvement Fund. The amount computed pursuant to pazagraph 12 shall be retained by CFD No. 2004-3 (IA No. 1). The Special Taac Prepayment Amount maybe insufficient to redeem a full $5,000 increment of CFD No. 2004-3 (IA No. 1) Bonds. In such cases, the increment above $5,000 or integral mulriple thereof will be retained in the appropriate fund established under the Indenture to be used with the next prepayment of CFD No. 2004-3 (IA No. 1) Bonds or to make debt service payments. As a tesult of the payment of the current Fiscal Year's Special Tas levy as determined under paragraph 9(above), the CFD Administrator shall remove the current Fiscal Yeaz's Special Taac 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 notice to be recorded in compliance with the Act, to indicate the prepayment of the Special Tas and the release of the Special Tax lien on such Assessor's Parcel, and the obligation of such Assessor's Pazcei to pay the Special Ta~c shall cease. City of Lkke Elsinore - December 16, 2004 CFD No. 2004-3 (IA No. I) . Page 13 _ ~ ~a~-i ~ . __ Notwithstanding the foregoing, no Special Tax prepayment shall be allowed unless, at the time of such proposed prepayment, the amount of Maacimum Special Taxes that may be levied on Ta~cable Property within CFD No. 2004-3 (IA No. 1) (after excluding 127.43 Acres of Property Owner Association Property and/or Public Properiy in CFD No. 2004-3 (IA No. 1) as set forth in Section E) both prior to and after the proposed prepayxnent is at least equal to the sum of (i) the Administrative Expenses and (ii) 1.10 times maximum annual debt service, in each remaining Fiscal Year on the Outstanding Bonds. 2. Prepayment in Part The Special Tax on an Assessor's Pazcel of Developed Properiy 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 H.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 Prepayment Amount calculated according to Section H.1. F= the percentage, expressed as a decimal, by which the owner of the Assessor's Pazcel is partially prepaying the Special Tas. A= the Administrative Fees and Expenses calculated according to Secrion H.l. The owner of any Assessor's Parcel who desires such prepayment shall notify the CFD Administrator of such owner's intent to partially prepay the Special Tas and the percentage by which the Special Taac shall be prepaid. The CFD Administrator shall provide the owner with a statement of the amount required for the partial prepayment of the Special Taac for an Assessor's Parcel within 30 days of the request and may charge 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 H.1, and (ii) indicate in the records of CFD No. 2004-3 (IA No. 1) that there has been a partial prepaym0nt of the Special Tax and that a portion of the Special Taac with respect to such Assessor's Pazcel, equal to the outstanding percentage (1.00 - F) of the remaining Maacnnum Special Taac, shall continue to be levied on such Assessor's Parcel pursuant to Section D. City ofLakeElsinore December 16, 2004 CFD No. 2004-3 (IA No, l) Page 14 I. TERM OF SPECIAL TAX The Special Tax shall be levied for a period not to exceed forty yeazs commencing with Fiscal Year 2005-2006, provided however that Special Taaces will cease to be levied in an eazlier Fiscal Yeaz if the CFD Administrator has determined (i) that all required interest and principal payments on the CFD No. 2004-3 (IA No. 1) Bonds have been paid; and (ii) all Authorized Facilities have been constructed. K:\Clients2\Centez~ROSetta CanyonVvfello~RMAVA1DrattRMA_4.doc Revised: /2/20/04 City of Lake Elsinore ~~ December 16, 2004 CFD No. 2004-3 (IA No. l) Page75 EXHIBIT A MAP OF ZONE 1 AND ZONE 2 IMPROVEMENT AREA ZONE MAP COMMUNITY FACILITIES DISTRICT No. 2004-3 OF THE CITY OF LAKE ELSINORE (ROSETTA CANYON) zoNE i COUNTY OF RIVERSIDE, (TRACT 25477) STATE OF CALIFORNIA ___ ZONE 2 (TRACT 25476) IMPROVEMENT ~'7CINIIY MAP NO SCAIE ICf:FNM1 ~ ~ISIRICT BWNUMY Communify Facllltlae Diettlet No. 2004-9 of tha City af Iake Eleinora ~ (Roeetta Ceayon) COUNRY 01 91YO81DE~ 'W1JtO8NL HEeel 1 Ot 1 THIRD DRAFT RATE AND METHOD OF APPORTIONMENT FOR CITY OF LAKE ELSINORE COMMUNTTY FACILITIES DISTRICT No. 2004-3 IMPROVEMENT AREA No. 2(ROSETTA CANY01~ A Special Ta1c shall be levied on all Assessor's Parcels in City of Lake Elsinore Community Faciliries District No. 2004-3 (Improvement Area No. 2) (Rosetta Canyon) ("CFD No. 2004-3 (IA No. 2)") and collected each Fiscal Year commencing in Fiscal Yeaz 2005-2006, in an amount determined through the application of the Rate and Method of Apportionment as described below. All of the real property in CFD No. 2004-3 (IA No. 2), 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. DEFINITIONS The terms hereinafter set forth have the following meanings: "Acre or Acreage" means the land area of an Assessor's Patcel as shown on an Assessor's Parcel Map, or if the land azea is not shown on an Assessor's Parcel Map, the land area shown on the applicable final map, pucel map, condominium plan, or other recorded County parcel map. "Act" means the Mello-Roos Community Facilities Act of 1982, being Chapter 2.$, Division 2 of Title 5 of the California Government Code. "Administrative Expenses" means the following actual or reasonably estimated costs directly related to the adminishation of CFD No. 2004-3 (IA No. 2): the costs of computing the Special Tases 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 City or otherwise); the costs of remitting the Special Taxes to the Trustee; the costs of the Trustee (including its legal counsel) in the discharge of the duties required of it under the Indentiure; the costs to the City, CFD No. 2004-3 (IA IVo. 2) ot any designee thereof of complying with azbitrage rebate requirements; the costs to the City, CFD No. 2004-3 (TA No. 2) or any designee thereof of complying with disclosure requirements of the City, CFD No. 2004-3 (IA No. 2) 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 regarding the Special Taxes; the costs of the City, CFD No. 2004-3 (IA No. 2) 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. Adiniuistrative Expenses shall also include amounts estimated by the CFD Administrator or advanced by the City or CFD No. 2004-3 (IA No. 2) for any other administrative purposes of CFD No. 2004-3 (IA No. 2), including attorney's fees and other costs related to commencing and pursuing to completion any foreclosure of delinquent Special Taaces. "Assessor's Parcel" means a lot or pazcel shown in an Assessor's Parcel Map with an assigned Assessor's Parcel number. - City of Lake E[sinore December 16, 2004 CFD No. 2004-3 (IA No. 2) Page 1 "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" means the Special Taac for each Land Use Class of Developed Property in each Zone, as determined in accordance with Section C.l.b. below. "Authorized Facilities" means those authorized improvements, as listed on Exhibit "A" to the Resolution of Formation. "Backup Special Tax" means the Special Tax applicable to each Assessor's Parcel of Developed Property, as determined in accordance with Section C.l.d. below. "CFD Administrator" means an official of the City, or designee thereof, responsible for determining the Special Taac Requirement and providing for the levy and collection of the Special Taxes. "CFD No. 2004-3" means City of Lake Elsinore Community Facilities District No. 2004-3 (Rosetta Canyon). "CFD No. 2004-3 (IA No. 2)" means Improvement Area No. 2 of CFD No. 2004-3, as identified on the boundary map for CFD No. 2004-3. "CFD No. 2004-3 (IA No. 2) Bonds" means any bonds or other debt (as defined in Section 53317(d) of the Act), whether in one or more series, issued by CFD No. 2004-3 and secured solelybySpecial Taaces levied on property within the boundaries ofCFD No. 2004-3 (IA No. 2) undec the Act. "City" means the City of Lake Elsinore. "CityCouncil" means the City Council ofthe CityofLake Elsinore, acting as the legislarive body of CFD No. 2004-3 (IA No. 2). "County" means the County of Riverside. "Developed Property° means, for each Fiscal Year, all Taxable Property, exclusive of Ta~cable Public Properiy and Taacable Property Owner Association Property, for which the Final Subdivision was recorded on or before January 1 of the prior Fiscal Yeaz and a building permit for new construction was issued after January 1, 2004 and on or before May 1 of the Fiscal Yeaz preceding the Fiscal Year for which the Special Taxes are being levied. "Final Subdivision" means a subdivision of property by recordation of a final map, parcel map, or lot line adjustment, pursuant to the Subdivision Map Act (California Govemment Code Section 66410 et seq.) or recordation of a condomuuum plan pursuant to California Civil Code 1352 that creates individual lots for which building permits may be issued without further subdivision. City of Lake E[sinore December 16, 2004 CFD No. 2004-3 (IA No. 2) page Z "Fiscal 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. 2004-3 (IA No. 2) Bonds are 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. "Maximum Special Tax" means the maximum Special Tax, deternuned 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 Properiy for which a building permit permitting the conshuction of one or more non-residential units or facilities has been issued by the City. "Outstanding Bonds" means all CFD No. 2004-3 (IA No. 2) Bonds which are deemed to be outstanding under the Indenture. "Property Owner Association Property" means, for each Fiscal Yeaz, anyproperiy within the boundaries of CFD No. 2004-3 (IA No. 2) that was owned by a property owner association, including any master or sub-association, as ofJanuary 1 ofthe prior Fiscal Year. "Proportionately" means far Developed Property that the ratio of the actual SpecialTaac levy to the Assigned Special Tax is equal for all Assessor's Pazcels of Developed Property, or where the Backup Special Taac is being levied, that the ratio ofthe actual Special Tas levy to the Masunum Special T~ is equal for all Assessor's Parcels upon which a Backup Special Taac is being levied. For Undeveloped Property, "Proportionately" means that the ratio of the actual Special Talc levy per Acre to the Maximum Special Taac per Acre is equal for all Assessor's Pazcels of Undeveloped Property. The term "Proportionately" may similarly be applied to other categories of Taacable Property as listed in Section D below. "Public Property" means property within the boundaries of CFD No. 2004-3 (IA No. 2) owned by, irrevocably offered or dedicated to, or over, through or under which an easement for purposes of public right-of-way has been granted, to the federal government, the State, the County, the City, or any local governmenf or other public agency, provided that any property leased by a public agency to a private entity and subject to taacation under Section 53340.1 of the Act shall be taxed and classified according to its use. "Residential Floor Area" means all of the square footage of living area within the perimeter of a residential structute, not including any carport, walkway, garage, overhang, patio, enclosed patio, or similaz azea. The determination of Residenrial Floor Area for an Assessor's Pazcel shall be made by reference to the building pernut(s) issued for such Assessor's Parcel. City of Lake Elsinore ~~~ December I6, 2004 CFD Nn. 2004-3 (IA No. 2) page 3 "Residential Property" means all Assessor's Parcels of Developed Property for which a building permit permitting the construcrion thereon of one or more residential dwelling units has been issued by the City. "Resotution of Formation" means the Resolution of Formarion for CFD No. 2004-3 (IA No. 2). "Special Tax" means the special tax to be levied in each Fiscal Year on each Assessor's Parcel of Developed Properiy, Tasable ProperlyOwner Association Properly, Taxable Public Property, and Undeveloped Property to fund the Special Taac Requirement. "Special Tax Requirement" means that amount required in any Fiscal Year for CFD No. 2004-3 (IA No. 2) to: (i) pay debt service on all Outstanding Bonds due in the calendar year commencing in such Fiscal Year; (ii) pay periodic costs on the CFD No. 2004-3 (IA No. 2) Bonds, including but not lnnited to, credit enhancement and rebate payments on the CFD No. 2004-3 (IA No. 2) Bonds due in the calendaz year commencing in such Fiscal Yeaz; (iii) pay Administrative Expenses; (iv) pay any amounts required to establish or replenish any reserve funds for all Outstanding Bonds; (v) pay for reasonably anticipated Special Taac delinquencies based on the delinquency rate for the Special Tax levy in the previous Fiscal Year; (vi) pay directly for acquisirion or construction of Authorized Facilities to the extent that the inclusion of such amount does not increase the Special Taac levy on Undeveloped Property; less (vii) a credit for funds available to reduce the annual Special Tax levy, as determined by the CFD Administrator pursuant to the Indenture. "State" means the State of Califomia. "Taxable Property" means all of the Assessor's Parcels within the boundaries of CFD No. 2004-3 (IA No. 2) which are not exempt from the Special Taac pursuant to law or Section E below. °Taxable Property Owner Association Property" means all Assessor's Parcels of Property Owner Association Property that are not exempt pursuant to Section E below. "Taxable Public Property" means all Assessor's Parcels of Public Property that are not exempt pursuant to Section E below. "Trustee" means the trustee, fiscal agent, or paying agent undet the Indenture. "Undeveloped Property" means, for each Fiscal Yeaz, all Tasable Property not classified as Developed Property, Taacable Property Owner Association Property, or Taxable Public Property: --- "Zone" means Zone 1 or Zone 2, as applicable. "Zone i" means the land geographically identified within the boundaries of zone 1 as delineated in Exhibit A to this Rate and Method of Apportionment. ~City ~of Lake Elsinore December 16, 2004 CFD No. 2004-3 (IA No. 2) Page 4 "Zone 2" means the land geographically identified within the boundaries of zone 2 as delineated in Exhibit A to this Rate and Method of Apportionment. B. ASSIGNMENT TO LAND USE CATEGORIES Each Fiscal Year, all Tasable Properiy within CFD No. 2004-3 (IA No. 2) shall be assigned to a Zone and fixrther classified as Developed Property, Taxable Public Property, Taacable Property Owner AsSOCiation Properiy, or Undeveloped Properiy, and shall be subject to Special Taaces in accordance with this Rate and Method of Apportionxnent determined pursuant to Sections C and D below. Residential Property shall be assigned to Land Use Classes 1 through 11 as listed in Table 1 below based on the Residential Floor Area for each unit. Non-Residential Properiy shall be assigned to Land Use Class 12. C. MAXIMUM SPECIAL TAX RATE 1. Developed Property a M~unum Special Taac The Maacimum Special Ta~c for each Assessor's Parcel classified as Developed Properiy shall be the greater of (i) the amount derived by application of the Assigned Special Ta1c or (ii) the amount derived by application of the Backup Special Taac. b. Assigu~pecial Tas The Assigned Special Tax for each Land Use Class is shown below in Table 1. City of Ldke Elsinors ~ ~ December 16, 2004 T CFD Na. 2004-3 (IA Na 2) Page 5 TABLE 1 Assigned Special Taxes for Developed Property Community Facilities District No. 2004-3 Improvement Area No. 2 Fiscal Year 2005-2006 c. Increase in the Assigned Special Taac The Assigned Special Tases identified in Ta61e 1 above shall be applicable for Fiscal Year 2005-2006, and shall increase thereafter, commencing on July 1, 2006 and on July 1 of each Fiscal Year thereafter, by an amount equal to two percent (2%) of the Assigned Special Tax for the previous Fiscal Year. d. Backup Snecial Tax The Fiscal Yeaz 2005-2006 Backup Special Tax attributable to a Final Subdivision in Zone 1 or Zone 2 will equal $19,868 multiplied by the Acreage of all Taxable Property, exclusive of any Taacable Property Owner Association Properiy and T~able Public Property, therein. The Backup Special Taac for each Assessor's Parcel of Residential Property shall be computed by dividing the Backup Special Taac attributable to the applicable Final Subdivision by the number of Assessor's Parcels for which building permits for residential conshuction have or may be issued (i.e., the number or City of Lake E[sinore Decem6er 16, 2004 CFD tVo. 2004-3 (IA No. 2) - = Page 6 residential lots). The Backup Special Tu~ for each Assessor's Pazcel ofNon- Residential Property therein shall equal $19,868 multiplied by the Acreage of such Assessor's ParceL If a Final Subdivision includes Assessor's Parcels of Talcable Properiy for which building permits for both residential and non-residential construction may be issued, exclusive of Taxable Property Owner Association Property and Tasable Public Properiy, then the Backup Special Tax for each Assessor's Parcel of Residential Property shall be computed exclusive ofthe Acreage and Assessor's Parcels of properry for which building permits for non-residential construction may be issned. Notwithstanding the foregoing, if all or any portion of the Final Subdivision(s) described in the preceding pazagraphs is subsequently changed or modified, then the Backup Special Tas for each Assessor's Pazcel of Developed Property in such Final Subdivision azea that is changed or modified shall be a rate per square Foot of Acreage calculated as follows: 1. Deternune the total Backup Special Taaces anticipated to apply to the changed or modified Final Subdivision area prior to the change or modification. 2. The result of paragraph 1 above shall be divided by the Acreage of Taxable Property which is ultimately expected to exist in such changed or modified Final Subdivision area, as reasonably determined by the CFD Administrator. The result ofpazagraph 2 above shall.be divided by 43,560. The result is the Backup Special Taac per square foot of Acreage which shall be applicable to Assessor's Parcels of Developed Property in such changed or modified Final Subdivision area for ali remaining Fiscal Years in which the Special Talc may be levied. i. Release of Obligation to Pay and Disclose Backup Special Tax All Assessors' Parcels within CFD No. 2004-3 (IA No. 2) will be relieved simultaneously and permanently from the obligation to pay and disclose the Backup Special Taz if the CFD Administrator determines that the annual debt service required for the Outstanding Bonds, when compared to the Assigned Special Taxes that may be levied against all Assessors' Pazcels of Developed Property result in 110% debt service coverage (i.e., the Assigned Special T~es that may be levied against all Developed Property in each remaining Fiscal Year based on then existing development in CFD No. 2004-3 (IA No. 2) is at least equal to the sum of (i) the Admivistrative City of Lake E[sinore December 16, 2004 CFD No. 2004-3 (IA No. 2) page 7 Expenses and (ii) 1.10 times malcimum annual debt service, in each remaining Fiscal Year on the Outstanding Bonds). e. Increase in the Backup Snecial Taac On each July 1, commencing on July l, 2006, the Backup Special Tax shall be increased by an amount equal to two percent (2%) of the Backup Special Tax for the previous Fiscal Year. Multiule Land Use Classes In some instances an Assessor's Parcel of Developed Properiy may contain more than one Land Use Class. The Maximum Special Talc levied on an Assessor's Parcel shall be the sum of the Ma~cimum Special T~ for all Land Use Classes located on that Assessor's Parcel. The CFD Administrator's allocation to each Cype of property shall be final. 2. Taxable Property Owner Association Property, Taxable Public Property, and Undeveloped Property The Fiscal Yeaz 2005-2006 Maximum Special Taac for Taxable Properry Owner Association Property, Taacable Public Property, and Undeveloped Properly in Zone 1 ot Zone 2 shall be $19,868 per Acre, and shall increase thereafter, commencing on July 1, 2006 and on July 1 of each Fiscal Yeaz thereafter, by an amount equal to two percent (2%) of the Maximum Special Tax for the previous Fiscal Year. D. METI30D OF APPORTIONMENT OF THE SPECIAL TAX Commencing with Fiscal Year 2005-2006 and for each following Fiscal Year, the City Gouncil shall levy the Special Tax until the amount of Special Taxes levied equals the Special Taic Requirement. Tfie Special Taac shall be levied each Fiscal Yeaz as follows: First: The Special Tax shall be levied on each Assessor's Parcel of Developed Property in Zone 1 and Zone 2 in an amount equal to 100% of the applicable Assigned Special Tax; Second: If additional monies are needed to satisfy the Special TaJC Requirement after the first step has been completed, the Special Tas shall be levied Proportionately on each Assessor's Pazcel of Undeveloped Property in Zone 1 and Zone 2 at up to 100% of the applicable Maacimum Special Taic for Undeveloped Properiy; Third: If additional monies are needed to sarisfy the Special Ta1c Requirement after the first two steps have been completed, then the levy of the Special Tax on each Assessor's Parcel of Developed Property in Zone 1 and Zone 2 whose Ma~cunum Special Tax is determined ' through fhe application of the Backup Special T~ shail be increased Proportionately from the Assigned Special Tax up to the Maximum Special T~ for each such Assessor's Parcel; Ciry ofLake Elsinore r = December 16, 2004 CFD No. 2004-3 (IA No. 2) Pag¢ g -- - --±~_L _ _ Fourth: If additional monies are needed to satisfy the Special Tax Requirement after the first three steps have been completed, then the Special Ta1c shall be levied Proportionately on each Assessor's Pazcel of Tu~able Property Owner Association Property and Taacable Public Property in Zone 1 and Zone 2 at up to the applicable Maximum Special Tax for Taxable Property Owner Association Property or Taxable Public Property. Notwithstanding the above the City Council may, in any Fiscal Yeaz, lery Proportionately less than 100% ofthe Assigned Special Taac in step one (above), when (i) the City Council is no longer required to levy the Special Tax pursuant to steps two through four above in order to meet the Special Tas Requirement; and (ii) all authorized CFD No. 2004-3 (IA No. 2) Bonds have already been issued or the City Council has covenanted that it wiil not issue any additional CFD No. 2004-3 (IA No. 2) Bonds (except refunding bonds) to be supported by the Special Tax. Further notwithstanding the above, under no circumstances will the Special Tax levied against any Assessor's Parcel of Residential Properly for which an occupancy permit for private residential use has been issued be increased by more than ten percent as a consequence of delniquency or default by the owner of any other Assessor's Parcel within CFD No. 2004-3 (IA No. 2). E. EXEMPTIONS No Special Tas shall be levied on up to 74.81 Acres of Properly Owner Association Property and/or Public Property in CFD No. 2004-3 (IA No. 2). Taac-exempt status will be assigned by the CFD Administrator in the chronological order in which property becomes Property Owner Association Properiy or Public Property. However, should an Assessor's Pazcel no longer be classified as Property Owner Association Property or Public Property, its taac- exempt status will be revoked. Property Ownet Association Properiy or Public Property that is not exempt from Special Taxes under this section shall be subject to the levy of the Special Taac and shall be taaced Proportionately as part of the fourth step in Section D above, at up to 100% of the applicable Maizunum Special Tax for Taacable Property Owner Association Property or Taacable Public Properry. F. MANNER OF COLLECTION The Special Tu~ shall be collected in the same manner and at the same time as ordinary ad valorem property taates; provided, however, that CFD No. 2004-3 (IA No. 2) may directly bill the Special Ta~c, may coliect Special Taxes at a different tixne or in a different manner if necessary to meet its fmancial obligations, and may covenant to foreclose and may actually foreclose on delinquent Assessor's Parcels as permitted by the Act. City of Lake Elsinore _ December 16, 2004 CFD No. 2004-3 (IA No. 2) - -_ Page 9 _.-L~ ^ . G. APPEALS Any landowner or resident who feels that the amount of the Special Taac levied on their Assessor's Pazcel is in error may submit a written appeal to CFD No. 2004-3 (IA No. 2). The CFD Administrator shall review the appeal and if the CFD Administrator concurs, the amount of the Special Taac levied shall be appropriately modified. The City Council may interpret this Rate and Method of Apportionment for purposes of clarifying any ambiguity and make deternunations relative to the annual administration of the Special Taac and any landowner or resident appeals. Any decision of the City Council shall be final and binding as to all persons. H. PREPAYMENT OF SPECIAL TAX The following definitions apply to this Section H: "BuildouY' means, far CFD No. 2004-3 (IA No. 2), that all expected building pernuts have been issued. "CFD Public Facilities" means either $17,514,938 in 2004 dollars, which shall increase by the Construction Inflarion Index on July 1, 2005, and on each July 1 thereafter, or such lower number as(i) shall be determined by the CFD Administrator as sufficient to provide the public facilities to be provided by CFD No. 2004-3 (IA No. 2) under the authorized bonding program for CFD No. 2004-3 (IA No. 2), or (ii) shall be determined by the City Council concurrently with a covenant that it will not issue any more CFD No. 2004-3 (IA No. 2) Bonds (except refunding bonds) to be supported by the Special Taaces levied under this Rate and Ivlethod of Apportionment as described in Section D. "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 yeaz which ends in the previous Fiscal Year. In the event this index ceases to be published, the Construction Inflafion Index shall be another index as determined by the CFD Aditiiuistrator that is reasonably compazable to the Engineering News Record Building Cost Index for the City of L,os Angeles. "Future Facilities Costs" means the CFD Public Facilities minus (i) public facility costs previously paid from the unprovement Fund, (ii) moneys currently on deposit in the Iinprovement Fnnd, 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 Fund" means an account specifically identified in the Indenture to hold funds which aze currently available for expenditure to acquire or construct CFD Public Facilities eligible under the Act. Ciry of Lake Elsinore December 16, 2004 CFD No. 2004-3 (IA No. 2) Page 10 "Previously Issued Bonds" means, for any Fiscal Year, all Outstanding Bonds that are deemed to be outstanding under the Indenture after the first interest and/or principal payment date following the current Fiscal Year. 1. Prepayment in Full Only an Assessor's Parcel ofDeveloped Properiy, or Undeveloped Property for which a building permit has been issued, may be prepaid. The obligation ofthe Assessor's Pazcel to pay any Special Tax may be permanently satisfied as described herein, provided that a prepayment may be made with respect to a particular Assessor's Parcel only if there are no delinquent Special Tases with respect to such Assessor's Parcel at the time of prepayment. An owner of an Assessor's Parcel intending to prepay the Special Tax obligation shall provide the CFD Administrator with written notice of intent to prepay. Within 30 days of receipt of such written notice, the CFD Administrator shall notify such owner of the prepayxnent amount for such Assessor's Parcel. The CFD Administrator may charge a reasonable fee for providing this service. Prepayment must be made not less than 45 days prior to the next occurring date that notice of redemption of CFD No. 2004-3 (IA No. 2) Bonds from the proceeds of such prepayment may be given by the Trustee pursuant to the Indenture. The Special Tax Prepayinent Amount (defined below) shall be calculated as snnuYiarized below (capitalized terms as defined below): Bond Redemption Amount plas plus plus plus less less Total: equals Redemption Premium Future Facilities Amount Defeasance Amount Administrative Fees and Expenses Reserve Fund Credit Canitalized Interest Credit Prepayment Amount As of the proposed date of prepayment, the Special Ta1c Prepayment Amount shall be calculated as follows: Paraeraph No.: 1. Confirin that no Special Taac delinquencies apply to such Assessor's Pazcel. 2. For Assessor's Pazcels of Developed Property, compute the Assigned Special Tax and Backup Special Tas. For Assessor's Parcels ofUndeveloped Property for which a building permit has been issued, compute the Assigned Special Tas and Backup Special Tas for that Assessor's Parcel as though it was already designated as Developed Property, based upon the building permit which ha~al~a~}(~t~}~sued for that Assessor's Pazcel. '- _ Gity of Lake Elsinore December I6, 2004 CFD No. 2004-3 (IA No. 2) pap¢ II (a) Divide the Assigned Special Tax computed pursuant to paragraph 2 by the total estimated Assigned Special Taaces for the entire CFD No. 20043 (IA No. 2) based on the Developed Property Special Taaces which could be levied in the current Fiscal Year on all expected development through Buildout of CFD No. 2004-3 (IA No. 2), excluding any Assessor's Parcels which have been prepaid, and (b) Divide the Backup Special Tax computed pursuant to pazagraph 2 by the total estimated Backup Special Taxes at Buildout for the entire CFD No. 2004-3 (IA No. 2), excluding any Assessor's Parcels which have been prepaid. 4. Multiply the lazger quotient computed pursuant to paragraph 3(a) or 3(b) by the Previously Issued Bonds to compute the amount oF Previously Issued Bonds to be retired and prepaid (the "Bond Redemption 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. Multiply the larger quotient computed pursuant to paragraph 3(a) or 3(b) by the amount determined pursuant to pazagraph 6 to compute the amount of Future Facilities Costs to be prepaid (the "Future Facilities AmounP'). 8. Compnte the amonnt 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 Previously Issued Bonds. 9. Determine tfie Special Taac levied on the Assessor's Parcel in the current Fiscal Yeaz which has not yet been paid. 10. Compute the minimum amount the CFD Administrator reasonably expects to derive from the remvestment of the Special Tax Prepayment Amount less the Future Facilities Amount and the Administrative Fees and Expenses (defined below) from the date of prepayment until the redemption date for the Previously Issued Bonds to be redeemed wifh the prepayment. 11. Add the amounts computed pursuant to pazagraphs 8 and 9 and subtract the amount computed puisuant to paragraph 10 (the "Defeasance AmounP'). 12. The administrative fees and expenses of CFD No. 2004-3 (IA No. 2) are as calculated by the CFD Administrator and include the costs of computation of the prepayment, the costs to invest the prepayment proceeds, the costs ofredeenr~~~il~}~ie.~~4-3 City ofLake Elsinore Decem6er 16, 2004 CFD No. 2004-3 (IA No. 2) page IZ (IA No. 2) Bonds, and the costs ofrecording any notices to evidence the prepayment and the redemption (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 Previously Issued 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 Previously Issued Bonds as a result of the prepayment from the balance in the reserve fund on the prepayxnent date, but in no event shall such amount be less than zero. No Reserve Fund Credit shall be granted if the amount then on deposit in the reserve fund for the Previously Issued Bonds is below 100% of the reserve requirement (as defined in the Indenture). 14: If any capitalized interest for the Previously Issued Bonds will not have been expended as of the date ixnmediately following the first interest and/or principal payment following the current Fiscal Year, a capitalized interest credit shall be calculated by multiplying the larger quotienY computed parsuant to pazagraph 3(a) or 3(b) by the expected balance in the capitalized interest fund or account under the Indenture aftet such first interest and/or principal payment (the "Capitalized Interest CrediP'): 15. The Special Taac prepayment is eqnal to the sum of tfie amounts computed pursuant to paragraphs 4, 5, 7, 11 and 12, less the amounts computed pursuant to pazagraphs 13 and 14 (the "Prepayment Amount"). From the Prepayment Amount, the amounts computed pursuant to paragraphs 4, 5, 11, 13 and 14 sha11 be deposited into the appropriate fund as established under the Indenture and be used to retire CFD No. 2004-3 (1A No. 2) 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 paragraph 12 shall be retained by CFD No. 2004-3 (IA No. 2). The Special Tas Prepayment Amount may be insufficient to redeem a full $5,000 increment of CFD No. 2004-3 (IA No. 2) Bonds. In such cases, the increment above $5,000 or integral multiple thereof will be retained in the appropriate fund established under the Indenture to be used with the next prepayment of CFD No. 2004-3 (IA No. 2) Bonds or to make debt service payments. As a result of the payment of the current Fiscal Year's Special Tax levy as determined under paragraph 9(above), the CFD Administrator shall remove the current Fiscal Yeaz's Special Tax levy for such Assessor's Parcel from the County taac rolls. With respect to any Assessor's Pazcel that is prepaid, the City Council shall cause a suitable notice to be recorded in compliance with the Act, to indicate the prepayment of the Special Ta1c and the release of the Special Taac lien on such Assessor's Pazcel, and the obligation of such Assessor's Parcel to pay the Special Taac shall cease. --- ° n City of Lake E[sinore ~ -; December 16, 2004 CFD No. 2004-3 (IA No. 2) -`~ ~ Page 13 Notwithstanding the foregoing, no Special Tax prepayment shall be allowed unless, at the time of such proposed prepayment, the amount of Maacimum Special Taaces that may be levied on Taxable Property within CFD No. 2004-3 (IA No. 2) (after excluding 74.81 Acres of Properiy Owner Association Property and/or Public Property in CFD No. 2004-3 (IA No. 2) as set forth in Section E) both prior to and after the proposed prepayxnent is at least equal to the sum of (i) the Admimstrative Expenses and (ii) 1.10 times maacimum annual debt service, in each remaining Fiscal Year on the Outstanding Bonds. 2. Prepayment in Part The Special Tas on an Assessor's Parcel 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 theprepayment shall be calculated as in Section H.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 Tas Prepayment Amount calculated according to Section H.1. F= the percentage, expressed as a decimal, by which the owner of the Assessor's Pazcel is partially prepaying.the Special Ta~c. A= the Admuustrative Fees and Expenses calculated according to Section H. L The owner of any Assessor's Parcel who desires such prepayment shall notify the CFD Administrator of such owner's intent to partially prepay the Special Tax and the percentage by which the Special Tax shall be prepaid. The CFD Administrator shall provide the owner with a statement of the amount required for the partial prepayment of the Special Tas for an Assessor's Pazcel 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) distribute the funds remitted to it according to Section H.1, and (ii) indicate in the records of CFD No. 2004-3 (IA No. 2) that there has been a partial prepayment of the Special Tas and that a portion of the Special Tas with respect to such Assessor's Pazcel, equal to the outstanding percentage (1.00 - F) ofthe remaining Maacimum Special Taac, shall continue to be levied on such Assessor's Pazcel pursuanf to Section D. City ofLake Elsinore December 16, 2004 CFD No. 2004-3 (IA No. 2) page 1¢ I. TERM OF SPECIAL TAX The Special Tax shall be levied for a period not to exceed forty years commencing with Fiscal Year 2005-2006, provided however that Special Taaces will cease to be levied in an earlier Fiscal Year if the CFD Administrator has determined (i) that all required interest and principal payments on the CFD No. 2004-3 (IA No. 2) Bonds have been paid; and (ii) all Authorized Facilities have been constructed. " K:\Clients2\CentexVtosetta Can}ronVdelloV2MA\IA2DraftRMA_3.doc Revised: /2/20/04 City ofLdke Elsinore December 16, 2004 CFD No. 2004-3 (IA No. 2) Page IS STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) SS: CITY OF LAKE ELSINORE ) I, VICHI KASAD, CITY CLERK OF THE CITY OF LAKE ELSINORE, CALIFORNIA, DO HEREBY CERTIFY that the foregoing Resolution duly adopted by the City Council of the City of Lake Elsinore at a Regular Meeting oF said Councii on the 28h of December, 2004, and that it was so adopted by the following vote: AYES: COUNCILMEMBERS: HICKMAN, KELLEY, MAGEE, SCHIFFNER,BUCKLEY NOES: COUNCILMEMBERS: ABSENT: COUNCILMEMBERS: AB AIN: COUNCILMEMBERS: , ~ VICHI KASAD, C, CITY CLERK/ HUMAN RESOURCES DIRECTOR CITY OF LAKE ELSINORE (SEAL) STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) SS: CITY OF LAKE ELSINORE) NONE NONE NONE I, VICHI KASAD, CITY CLERK OF THE CITY OF LAKE ELSINORE, DO HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of Resolution No. 2004-77 of said Council, and that the same has not been amended or repealed. DAT . December 30, 2004 ~M}~~ ~~"'v~f VI HI KASA , CMC, CITY CLERK/ HUMAN RESOURCES DIRECTOR CITY OF LAKE ELSINORE (SEAL)