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HomeMy WebLinkAboutCC RES 06-67 RESOLUTION NO. 06-67 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUSTIN OF INTENTION TO ESTABLISH A COMMUNITY FACILITIES DISTRICT AND TO AUTHORIZE THE LEVY OF SPECIAL TAXES WHEREAS, the City Council (the "City Council") of the City of Tustin (the "City") has received a written petition (the "Petition") from Moffett Meadows Partners, LLC, Tustin Villas Partners, LLC, William Lyon Homes, Inc., ORA Astoria, LLC, MW Housing Partners III, L.P., Lennar Homes of California, Inc., KB Homes Coastal, Inc. and ORA Ciara, LLC (collectively, the "Landowners" and individually, each a "Landowner") requesting the institution of proceedings for the establishment of a community facilities district (the "Community Facilities District"); WHEREAS, the Landowners have represented and warranted to the City Council that they are the owners of all of the area of land proposed to be included within the Community Facilities District; WHEREAS, under the Mello-Roos Community Facilities Act of 1982 (the "Act"), the City Council is authorized to establish the Community Facilities District; WHEREAS, Section 533 14.9 of the Act provides that, at any time either before or after the formation of a community facilities district, the legislative body may accept advances of funds from any source, including, but not limited to, private persons or private entities and may provide, by resolution, for the use of those funds for any authorized purpose, including, but not limited to, paying any cost incurred by the local agency in creating a community facilities district; WHEREAS, Section 53314.9 of the Act further provides that the legislative body may enter into an agreement, by resolution, with the person or entity advancing the funds, to repay all or a portion of the funds advanced, as determined by the legislative body, with or without interest, under all the following conditions: (a) the proposal to repay the funds is included in both the resolution of intention to establish a community facilities district adopted pursuant to Section 53321 of the Act and in the resolution of formation to establish a community facilities district pursuant to Section 53325.1 of the Act, (b) any proposed special tax is approved by the qualified electors of the community facilities district pursuant to the Act, and (c) any agreement shall specify that if the qualified electors of the community facilities district do not approve the proposed special tax, the local agency shall return any funds which have not been committed for any authorized purpose by the time of the election to the person or entity advancing the funds; WHEREAS, the City and Marble Mountain Partners, LLC. ("Marble Mountain") have entered into a Cooperative Agreement, dated February 7, 2005 (the "Cooperative Resolution No. 06-67 Page 1 of 33 Agreement"), that provides for the advancement of funds by Marble Mountain to be used to pay costs of construction of certain public facilities proposed to be financed by the Community Facilities District, and provides for the reimbursement to Marble Mountain of such funds advanced, with interest, from the proceeds of bonds issued by the Community Facilities District; WHEREAS, the City desires to include in this Resolution, in accordance with Section 53314.9 of the Act, the proposal to repay funds pursuant to the Cooperative Agreement; WHEREAS, the City and Lennar Homes of California, Inc. ("Lennar Homes") are entering into a Deposit and Reimbursement Agreement, dated as of June 1, 2006 (the "Deposit Agreement"), that provides for the advancement of funds by Lennar Homes to be used to pay costs incurred in connection with the establishment of the Community Facilities District and the issuance of special tax bonds thereby, and provides for the reimbursement to Lennar Homes of such funds advanced, without interest, from the proceeds of any such bonds issued by the Community Facilities District; and WHEREAS, the City desires to include in this Resolution, in accordance with Section 53314.9 of the Act, the proposal to repay funds pursuant to the Deposit Agreement; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Tustin as follows: Section 1. The City Council hereby finds that the Petition is signed by the requisite number of owners of land proposed to be included in the Community Facilities District. Section 2. The City Council proposes to establish a community facilities district under the terms of the Act. The boundaries of the territory proposed for inclusion in the Community Facilities District are described in the map showing the proposed Community Facilities District (the "Boundary Map") on file with the City Clerk of the City (the "City Clerk"), which boundaries are hereby preliminarily approved and to which map reference is hereby made for further particulars. The City Clerk is hereby directed to sign the original Boundary Map and record, or cause to be recorded, the Boundary Map with all proper endorsements thereon in the office of the Orange County Recorder within 15 days of the date of adoption of this Resolution, all as required by Section 3111 of the California Streets and Highways Code. Section 3. The name proposed for the Community Facilities District is "City of Tustin Community Facilities District No. 06-1 (Tustin Legacy/Columbus Villages)." Section 4. The public facilities (the "Facilities") proposed to be financed by the Community Facilities District pursuant to the Act are described under the caption "Facilities" on Exhibit A hereto, which is by this reference incorporated herein. Those Resolution No. 06-67 Page 2 of 33 Facilities proposed to be purchased as completed public facilities are described under the caption "Facilities to be Purchased" on Exhibit A hereto. The services (the "Services") proposed to be financed by the Community Facilities District pursuant to the Act are described under the caption "Services" on Exhibit A hereto. The incidental expenses proposed to be incurred are identified under the caption "Incidental Expenses" on Exhibit A hereto. All or any portion of the Facilities may be financed through a financing plan, including, but not limited to, a lease, lease-purchase or installment-purchase arrangement. Section 5. Except where funds are otherwise available, a special tax sufficient to pay for all Facilities and Services, secured by recordation of a continuing lien against all nonexempt real property in the Community Facilities District, will be annually levied within the Community Facilities District. The rate and method of apportionment of the special tax (the "Rate and Method"), in sufficient detail to allow each landowner within the proposed Community Facilities District to estimate the maximum amount that he or she will have to pay, is described in Exhibit B attached hereto, which is by this reference incorporated herein. The conditions under which the obligation to pay the special tax may be prepaid and permanently satisfied are specified in the Rate and Method. The special tax will be collected in the same manner as ordinary ad valorem property taxes or in such other manner as the City Council shall determine, including direct billing of the affected property owners. The tax year after which no further special tax to pay for public facilities will be levied against any parcel used for private residential purposes is specified in the Rate and Method. Under no circumstances shall the special tax to pay for public facilities 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 Community Facilities District by more than 10%. For purposes of this paragraph, a parcel shall be considered "used for private residential purposes" not later than the date on which an occupancy permit for private residential use is issued. Section 6. Pursuant to Section 53344.1 of the Act, the City Council hereby reserves to itself the right and authority to allow any interested owner of property within the Community Facilities District, subject to the provisions of said Section 53344.1 and to those conditions as it may impose, and any applicable prepayment penalties as prescribed in the bond indenture or comparable instrument or document, to tender to the Community Facilities District treasurer in full payment or part payment of any installment of the special taxes 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 7. The City Council hereby fixes Monday, July 17, 2006, at 7:00 p.m., or as soon thereafter as the City Council may reach the matter, at 300 Centennial Way, Tustin, California, as the time and place when and where the City Council will conduct a public hearing on the establishment of the Community Facilities District. Resolution No. 06-67 Page 3 of 33 Section 8. The City Clerk is hereby directed to publish, or cause to be published, a notice of said public hearing one time in a newspaper of general circulation published in the area of the Community Facilities District. The publication of said notice shall be completed at least seven days prior to the date herein fixed for said hearing. Said notice shall contain the information prescribed by Section 53322 of the Act. Section 9. The levy of said proposed special tax shall be subject to the approval of the qualified electors of the Community Facilities District at a special election. The proposed voting procedure shall be by mailed or hand-delivered ballot among the landowners in the Community Facilities District, with each owner having one vote for each acre or portion of an acre such owner owns in the Community Facilities District. Section 10. Each officer of the City who is or will be responsible for providing one or more of the proposed types of Facilities or Services is hereby directed to study, or cause to be studied, the proposed Community Facilities District and, at or before said public hearing, file a report with the City Council containing a brief description of the public facilities and services by type which will in his or her opinion be required to adequately meet the needs of the Community Facilities District, and his or her estimate of the cost of providing the Facilities and Services. Such officers are hereby also directed to estimate the fair and reasonable cost of the Facilities proposed to be purchased as completed public facilities and of the incidental expenses proposed to be paid. Such report shall be made a part of the record of said public hearing. Section 11. Marble Mountain has heretofore advanced certain funds, and may advance additional funds, which have been or may be used to pay costs of construction of certain of the Facilities. The City Council proposes to repay all or a portion of such funds expended for such purpose, solely from the proceeds of special tax bonds of the Community Facilities District, pursuant to the Cooperative Agreement. The Cooperative Agreement is hereby incorporated herein as though set forth in full herein. Section 12. Lennar Homes has heretofore advanced certain funds, and may advance additional funds, which have been or may be used to pay costs incurred in connection with the establishment of the Community Facilities District and the issuance of special tax bonds thereby. The City Council proposes to repay all or a portion of such funds expended for such purpose, solely from the proceeds of such bonds, pursuant to the Deposit Agreement. The Deposit Agreement is hereby incorporated herein as though set forth in full herein. Section 13. The officers, employees and agents of the City are hereby authorized and directed to take all actions and do all things which they, or any of them, may deem necessary or desirable to accomplish the purposes of this Resolution and not inconsistent with the provisions hereof. Section 14. This Resolution shall take effect immediately upon its adoption. Resolution No. 06-67 Page 4 of 33 APPROVED and ADOPTED by the City Council of the City of Tustin on June 5, 2006. ATTEST: ~e~ City Clerk STATE OF CALIFORNIA ) COUNTY OF ORANGE ) SS CITY OF TUSTIN ) I, Pamela Stoker, City Clerk and ex-officio Clerk of the City Council of the City of Tustin, California, do hereby certify that the whole number of the members of the City Council of the City of Tustin is five; that the above and foregoing Resolution No. 06-67 was duly passed and adopted at a regular meeting of the Tustin City Council, held on the 5th day of June, 2006 by the following vote: COUNCILMEMBER AYES: COUNCILMEMBER NOES: COUNCILMEMBER ABSTAINED: COUNCILMEMBER ABSENT: nA'Uli'R'1' NONE NONE ~Ar.F.NJ AMAN'1'F, ~nNF., KAWASHTMA ..l.5.l. .lQl (0) --LO.l NnNli' ~ City Clerk Resolution No. 06-67 Page 5 of 33 EXHIBIT A FACILITIES, FACILITIES TO BE PURCHASED, SERVICES AND INCIDENTAL EXPENSES Facilities The types of facilities proposed to be financed by the Community Facilities District are street improvements, including grading, paving, curbs and gutters, sidewalks, street signalization and signage, street lights and parkway and landscaping related thereto, storm drains, utilities, public parks and recreation facilities, public library facilities, fIre protection facilities and equipment and land, rights-of-way and easements necessary for any of such facilities. Facilities to be Purchased The types of facilities to be purchased as completed facilities are street improvements, including grading. paving, curbs and gutters, sidewalks. street signalization and signage, street lights and parkway and landscaping related thereto, storm drains, utilities, public parks and recreation facilities, public library facilities, fIre protection facilities and equipment and land, rights-of-way and easements necessary for any of such facilities. Services The types of services proposed to be fInanced by the Community Facilities District are police protection services, fIre protection services, ambulance and paramedic services, recreation program services, maintenance of parks, parkways and open space and flood and storm protection services. Incidental Expenses The incidental expenses proposed to be incurred include the following: (a) the cost of planning and designing public facilities to be fInanced, including the cost of environmental evaluations of those facilities; (b) the costs associated with the creation of the Community Facilities District, issuance of bonds, determination of the amount of ta'{es, collection of taxes, payment of taxes, or costs otherwise incurred in order to carry out the authorized purposes of the Community Facilities District; and (c) any other expenses incidental to the construction, completion, and inspection ofthe authorized work. US_WEST.297JJJ594 A-I Resolution No. 06-67 Page 6 of 33 EXHffiIT B PROPOSED RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX US_ WEST:29731359.4 B-1 Resolution No. 06-67 Page 7 of 33 FINAL RATE AND METHOD OF APPORTIONMENT FOR CITY OF TUSTIN COMMUNITY FACILITIES DISTRICT NO. 06-1 (TUSTIN LEGACY/COLUMBUS VILLAGES) A Special Tax shall be levied on all Assessor's Parcels in the City of Tustin Community Facilities District No. 06-1 (Tustin Legacy/Columbus Villages) ("CFD No. 06-1 ") and collected each Fiscal Year commencing in Fiscal Year 2006-2007, in an amount determined through the application ofthe Rate and Method of Apportionment as described below. All of the real property in CFD No. 06-1, 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 ofan 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. The square footage of an Assessor's Parcel is equal to the Acreage of such parcel multiplied by 43,560. "Act" means the Mello-Roos Community Facilities Act of 1982, being Chapter 2.5, Division 2 of Title 5 of the California Government Code. "Administrative Expenses" means the following actual or reasonably estimated costs directly related to the administration of CFD No. 06-1: the costs of computing the Special Taxes 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 County 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 Indenture; the costs to the City, CFD No. 06-1 or any designee thereof of complying with arbitrage rebate requirements; the costs to the City, CFD No. 06-1 or any designee thereof of complying with City, CFD No. 06-1 or obligated persons disclosure requirements of applicable federal and state securities laws and the Act; the costs associated with preparing Special Tax disclosure statements and responding to public inquiries regarding the Special Taxes; the costs of the City, CFD No. 06-1 or any designee thereof related to an appeal of the Special Tax; the costs associated with the release of funds from any escrow account; and the City's annual administration fees and third party expenses. Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 06-1 for any other administrative purposes of CFD No. 06-1, including attorney's fees and other costs related to commencing and pursuing to completion any foreclosure as a result of delinquent Special Taxes. "Affordable Units" means residential dwelling units located on one or more Assessor's Parcels of Residential Property that are subject to deed restrictions, resale restrictions, and/or regulatory agreements recorded in favor of the City providing for affordable housing. Affordable Units shall be further classified as Moderate Income, Lower Income, or Very City of Tustin - Tustin Legacy/Columbus Vii/ages CFD No. 06-1 Resolution No. 06-67 Page 8 of 33 May 31, 1006 Page 1 Low Income (as defined in Sections 50079.5, 50093, and 50105 of the California Health and Safety Code.) Before the annexation of the Future Annexation Area, the total number of Affordable Units in Zone 1 shall not exceed 71 Moderate Income units, 117 Lower Income Units and 61 Very Low Income units and the total number of Affordable Units in Zone 2 shall not exceed 30 Moderate Income units and 12 Very Low Income units. After the annexation of the Future Annexation Area, the total number of Affordable Units in Zone 1 shall not exceed 80 Moderate Income units, 125 Lower Income Units and 61 Very Low Income units and the total number of Affordable Units in Zone 2 shall not exceed 30 Moderate Income units and 12 Very Low Income units. Affordable Units constructed within each Zone within the CFD shall be designated by the CFD Administrator in the chronological order in which the building permits for such units are issued within that Zone. However, iffor either Zone, the total number of Affordable Units constructed in anyone of the three affordable income categories exceeds the amount stated above for such income category, then the units exceeding such total shall not be considered Affordable Units and shall be assigned to a Land Use Class based on the type of use and Residential Floor Area for each such unit. "Assessor's Parcel" means a lot or parcel shown in an Assessor's Parcel Map with an assigned Assessor's Parcel number. "Assessor's Parcel Map" means an official map of the County Assessor of the County designating parcels by Assessor's Parcel number. "Authorized Services" means those authorized services proposed to be financed by CFD No. 06-1 pursuant to the Act and listed in Exhibit A to this Rate and Method of Apportionment. "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. 06-1 under the Act. "CFD Administrator" means an official of the City, or designee thereof, responsible for determining the Special Tax Requirement for Facilities and the Special Tax Requirement for Services and providing for the levy and collection of the Special Taxes. "CFD No. 06-1" means City of Tustin Community Facilities District No. 06-1 (Tustin Legacy/Columbus Villages). "City" means the City of Tustin. "Consumer Price Index" means, for each Fiscal Year, the Consumer Price Index published by the U.S. Bureau of Labor Statistics for "All Urban Consumers" in the Los Angeles- Anaheim - Riverside Area, measured as of the month of December in the calendar year which ends in the previous Fiscal Year. In the event this index ceases to be published, the Consumer Price Index shall be another index as determined by the CFD Administrator that is reasonably comparable to the Consumer Price Index for the City of Los Angeles. City of Tustin - Tustin Legacy/Columbus Villages CFD No. 06-1 May 31, 1006 Resolution N&.tD6Z67 Page 9 of 33 "Council" means the City Council of the City, acting as the legislative body ofCFD No. 06- I. "County" means the County of Orange. "Developed Property" means, for each Fiscal Year, all Taxable Property, exclusive of Taxable Public Property and Taxable Property Owner Association Property, for which the Final Subdivison was recorded on or prior to January I of the prior Fiscal Year and a building permit for new construction was issued after January 1,2005 and prior to May I of the prior Fiscal Year. "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 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 permits may be issued without further subdivision. "Fiscal Year" means the period starting July I and ending on the following June 30. "Future Annexation Area" means the property designated as Future Annexation Area on the boundary map for CFD No. 06-1, as identified in Exhibit B. "Indenture" means the indenture, fiscal agent agreement, resolution or other instrument pursuant to which Bonds are issued, as modified, amended and/or supplemented from time to time. "Land Use Class" means any of the classes listed in Table I below. "Maximum Special Tax" means the maximum Special Tax A and/or maximum Special Tax B, as applicable. "Maximum Special Tax A" means the Maximum Special Tax A determined in accordance with Section C below, that can be levied in any Fiscal Year on any Assessor's Parcel within CFD No. 06-1. "Maximum Special Tax B" means the Maximum Special Tax B determined in accordance with Section C below, that can be levied in any Fiscal Year on any Assessor's Parcel within CFD No. 06-1. "Non-Residential Property" means all Assessor's Parcels of Developed Property for which a building permit permitting the construction of one or more non-residential units or facilities has been issued by the City. "Outstanding Bonds" means all Bonds which are deemed to be outstanding under the Indenture. City of Tustin - Tustin Legacy/Columbus Villages Re,(df~iNll. r<l~106-67 Page 10 of 33 May 31,2006 Page 3 "Property Owner Association Property" means, for each Fiscal Year, any property within the boundaries of CFD No. 06-1 that was owned by a property owner association, including any master or sub-association, as of January I of the prior Fiscal Year. "Proportionately" means, for Developed Property, that the ratio of the actual Special Tax A levy to the Maximum Special Tax A is equal for all Assessor's Parcels of Developed Property and that the ratio of the actual Special Tax B levy to the Maximum Special Tax B is equal for all Assessor's Parcels of Developed Property. For Undeveloped Property, "Proportionately" means that the ratio of the actual Special Tax A levy per Acre to the Maximum Special Tax A per Acre is equal for all Assessor's Parcels of Undeveloped Property. The term "Proportionately" may similarly be applied to other categories of Taxable Property as listed in Section E below. "Public Property" means property within the boundaries of CFD No. 06-1 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 government or other public agency, provided that any property leased by a public agency to a private entity and subject to taxation under Section 53340.1 of the Act shall be taxed and classified according to its use. "Residential Floor Area" means all of the square footage of living area within the perimeter of a residential structure, 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 wch Assessor's Parcel. "Residential Property" means all Assessor's Parcels of Developed Property for whkh a building permit permitting the construction thereon of one or more residential dwelling units has been issued by the City. "Single Family Attached Property" means all Assessor's Parcels of Residential Property for which building permits have been issued for attached residential units. "Single Family Detached Property" means all Assessor's Parcels of Residential Property for which building permits have been issued for detached residential units. "Special Tax" means the Special Tax A and/or Special Tax B, as applicable. "Special Tax A" means the special tax to be levied in each Fiscal Year on each Assess~r's Parcel of Taxable Property within CFD No. 06-1 to fund the Special Tax Requirement for Facilities. "Special Tax A Buydown" means a mandatory bond principal buydown payment made by the property owner to reduce the amount of Outstanding Bonds to compensate for a loss of Special Tax A revenues resulting from the construction of fewer residential dwelling mits, smaller residential dwelling units, or a modified amount of non-residential Acreage, as determined in accordance with Section D below. City of Tustin - Tustin Legacy/Columbus Villages CFD No. 06-1 May 31, 2006 R"~nllltinn Nf1lmfl7 Page 11 of 33 "Special Tax H" means the special tax to be levied in each Fiscal Year on each Assessor's Parcel of Taxable Property within CFD No. 06-1 to fund the Special Tax Requirement for Services. "Special Tax Requirement for Facilities" means that amount required in any Fiscal Year for CFD No. 06-1 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 Bonds, including but not limited to, credit enhancement and rebate payments on the Bonds due in the calendar year commencing in such 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 A delinquencies based on the delinquency rate for the Special Tax A 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 Tax for Facilities levy on Undeveloped Property; less (vii) a credit for funds available to reduce the annual Special Tax A levy, as determined by the CFD Administrator pursuant to the Indenture. "Special Tax Requirement for Services" means that amount required in any Fiscal Year for CFD No. 06-1 to (i) pay directly for Authorized Services due in the calendar year commencing in such Fiscal Year; (ii) pay a proportionate share of Administrative Expenses; less (iii) a credit for funds available to reduce the annual Special Tax B levy, as determined by the CFD Administrator. "State" means the State of California. "Taxable Property" means all of the Assessor's Parcels within the boundaries ofCFD No. 06-1 which are not exempt from the Special Tax pursuant to law or Section F below. "Taxable Property Owner Association Property" means, for each Fiscal Year, all Assessor's Parcels of Property Owner Association Property that are not exempt from the Special Tax pursuant to Section F below. "Taxable Public Property" means, for each Fiscal Year, all Assessor's Parcels of Public Property that are not exempt from the Special Tax pursuant to Section F below. "Trustee" means the trustee or fiscal agent under the Indenture. "V ndeveloped Property" means, for each Fiscal Year, all Taxable Property not classified as Developed Property, Taxable Public Property or Taxable Property Owner Association Property . "Zone" means Zone I or Zone 2, as applicable. "Zone 1" means the land geographically identified as Tract 16851 on a map filed in Book 877, Pages 33 through 50 of Miscellaneous Maps, and as Instrument Number 200600148498, in Records of Orange County, California, excepting therefrom lots 242, 243, City of Tustin - Tustin Legacy/Columbus Villages Re,((,f~iAfti.rQ~lo6-67 Page 12 of 33 May 31, 2006 Page 5 244,245,332,333,341,342,346,348,349,350,351,352, 353, 354, 355, 361, F (portion), G (portion), Z, AA, AB, AC, AM (portion), AN, AO, AP, AQ, AR, BA, BB (portion), ZA, ZB and DDL. "Zone 2" means the land geographically identified as Tract 16582 on a map filed in Book 874, Pages 1 through 30 of Miscellaneous Maps, and as instrument number 200500867370 in Records of Orange County, California. B. ASSIGNMENT TO LAND USE CATEGORIES Each Fiscal Year, all Taxable Property within each Zone shall be classified as Developed Property, Taxable Public Property, Taxable Property 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, D, and E below. C. MAXIMUM SPECIAL TAX 1. Developed Property (a). Maximum Soecial Tax The Maximum Special Tax A and the Maximum Special Tax B for tach Land Use Class in each Zone is shown below in Tables 1 and 2. fhe Maximum Special Tax for each Assessor's Parcel classified as Developed Property shall be the Maximum Special Tax A plus Maximum Special Tax B applicable to such Assessor's Parcel for the Zone in which the Assessor's Parcel is located. City of Tustin - Tustin Legacy/Columbus Villages CFD No. 06-1 May 31, 2006 Resolution Nfflm67 Page 13 of 33 TABLE 1 Maximum Special Tax for Developed Property in Zone 1 City of Tustin Community Facilities District No. 06-1 (Tustin Legacy/Columbus Villages) Fiscal Year 2006-2007 I Single Family Detached Property > 3,600 s.f. $3,256 per unit $1,950 per unit 2 Single Family Detached Property 3,226 - 3,600 s.f. $2,843 per unit $1,725 per unit 3 Single Family Detached Property 2,851 - 3,225 s.f. $2,50 per unit $1,538 per unit 4 Single Family Detached Property 2,476 - 2,850 s.f. $2,498 per unit $1,425 per unit 5 Single Family Detached Property 2,101 - 2,475 s.f. $2,229 per unit $1,245 per unit 6 Single Family Detached Property <= 2,100 s.f. $2,217 per unit $1,170 per unit 7 Single Family Attached Property > 2,550 s.f. $2,410 per unit $1,335 per unit 8 Single Family Attached Property 2,301 - 2,550 s.f. $2,338 per unit $1,260 per unit 9 Single Family Attached Property 2,051 - 2,300 s.f. $2,217 per unit $1,170 per unit 10 Single Family Attached Property 1,801 - 2,050 s.f. $1,905 per unit $1,020 per unit II Single Family Attached Property 1,551- 1,800 s.f. $1,352 per unit $795 per unit 12 Single Family Attached Property <= 1,550 s.f. $895 per unit $600 per unit 13 Senior Units NA $734 per unit $488 per unit 14 Affordable Units - Moderate NA $350 per unit $600 per unit IS Affordable Units - Low NA $200 per unit $200 per unit 16 Affordable Units - Very Low NA $50 per unit $50 per unit 17 Non-Residential Property NA $22,478 per Acre $6,000 per Acre City of Tustin - Tustin Legacy/Columbus Villages Re~liM'r+ IQfr.106-67 Page 14 of 33 May 31, 2006 Page 7 TABLE 2 Maximum Special Tax for Developed Property in Zone 2 City of Tustin Community Facilities District No. 06-1 (Tustin Legacy/Columbus Villages) Fiscal Year 2006-2007 I Single Family Detached Property > 4,300 s.f. $7,448 per unit $2,250 per unit 2 Single Family Detached Property 3,951 - 4,300 s.f. $6,988 per unit $2,115 per unit 3 Single Family Detached Property 3,601 - 3,950 s.f. $6,629 per unit $2,01Oper unit 4 Single Family Detached Property 3,251 - 3,600 s.f. $6,118 per unit $1,860 per unit 5 Single Family Detached Property 2,901 - 3,250 s.f. $5,094 per unit $1,560 per unit 6 Single Family Detached Property 2,551 - 2,900 s.f. $4,838 per unit $1,485per unit 7 Single Family Detached Property <= 2,550 s.f. $4,582 per unit $1,410 per unit 8 Single Family Attached Property > 1,800 s.f. $3,268 per unit $1,O:W per unit 9 Single Family Attached Property 1,601 - 1,800 s.f. $2,961 per unit $9:>0 per unit 10 Single Family Attached Property <= 1,600 s.f. $2,449 per unit $nO per unit 11 Affordable Units - Moderate NA $350 per unit $600 per unit 12 Affordable Units - Very Low NA $50 per unit $50 per unit 13 Non-Residential Property NA $39,534 per Acre $6,000 per Acre (b). Increase in the Maximum Soecial Tax On each July 1, commencing on July 1,2007 the Maximum Special Tax A, identified in Tables 1 and 2 above, be increased by an amount equal to two percent (2%) of the amount in effect for the previous fiscal year. On each July I, commencing on July 1, 2007, the Maximum Special Tax B listed in Tables I and 2 above shall be increased based on the percentage chang: in the Consumer Price Index, with a maximum annual increase of six pen ent (6%) and a minimum annual increase of two percent (2%) per Fiscal Y,~ar. City of Tustin - Tustin Legacy/Columbus VUlages CFD No. 06-1 May 31,2006 Resolution N&llllai67 Page 15 of 33 (c). Multiple Land Use Classes In some instances an Assessor's Parcel of Developed Property may contain more than one Land Use Class. The Maximum Special Tax levied on an Assessor's Parcel shall be the sum of the Maximum Special Taxes for all Land Use Classes located on that Assessor's Parcel. 2. Undeveloped Property, Taxable Public Property, and Taxable Property Owner Association Property (a). Maximum Special Tax A The Fiscal Year 2006-2007 Maximum Special Tax A for Undeveloped Property, Taxable Public Property, and Taxable Property Owner Association Property shall be $40,377 per Acre. (b). Maximum Special Tax B The Fiscal Year 2006-2007 Maximum Special Tax B for Undeveloped Property, Taxable Public Property, and Taxable Property Owner Association Property shall be $6,000 per Acre. (c). Increase in the Maximum Special Tax A and Special Tax B On each July I, commencing on July 1,2007 the Maximum Special Tax A for Undeveloped Property, Taxable Public Property, and Taxable Property Owner Association Property, shall be increased by an amount equal to two percent (2%) of the amount in effect for the previous fiscal year. On each July I, commencing on July I, 2007, the Maximum Special Tax B for Undeveloped Property, Taxable Public Property, and Taxable Property Owner Association Property, shall be increased based on the percentage change in the Consumer Price Index, with a maximum annual increase of six percent (6%) and a minimum annual increase of two percent (2%) per Fiscal Year. D. SPECIAL TAX A BUYDOWN All of the requirements of this Section D, which describes the need for a Special Tax A Buydown that may result from a change in development as determined pursuant to this Section D, shall only apply after the sale of Bonds by CFD No. 06-1. The following definitions apply to this Section D: "Certificate of Satisfaction of Special Tax A Buydown" means a certificate from the CFD Administrator stating that the property described in such certificate has sufficiently met the Special Tax A Buydown Requirement for such property as calculated under this Section D. City of Tustin - Tustin Legacy/Columbus Villages Rp.~"'iNf+ 1%-106-67 Page 16 of 33 May 31,2006 Page 9 "Letter of Compliance" means a letter from the CFD Administrator allowing the issuance of building permits based on the prior submittal ofa request for Letter of Compliance by a property owner. "Special Tax A Buydown Requirement" means the total amount of Special Tax A Buydown necessary to be prepaid to permit the issuance of building permits listed in a request for Letter of Compliance, as calculated under this Section D. "Update Property" means an Assessor's Parcel of Undeveloped Property for which a building permit has been issued. For purposes of all calculations in this Section D, Update Property shall be taxed as if it were already Developed Property during the current Fiscal Year. 1. Request for Letter of Compliance The CFD Administrator must submit a Letter of Compliance to the City for a specific Assessor's Parcel or lot prior to the issuance by the City of a building permit for the construction of any residential and/or non-residential development on that Assessor's Parcel or lot. If a Letter of Compliance has not yet been issued, and a property owner wishes to request a building permit for an Assessor's Parcel or lot, the property owner must first request a Letter of Compliance from the CFD Administrator. The request from the property owner shall contain a list of all building permits currently being requested, the Assessor's Parcels or tract and lot numbers on which the construction is to take place, and the Residential Floor Area (for each residential dwelling unit) or the Acreage (for each non- residential parcel) associated with each building permit. 2. Issuance of Letter of Compliance Upon the receipt of a request for Letter of Compliance, the CFD Administrator shall assign each building permit identified in such request to Land Use Classes I through 17 for Zone I and Land Use Classes I through 13 for Zone 2 as listed in Tables 3 and 4 below, based on the type of use and the Residential Floor Area identified for each such building permit. When using Table 3, if Bonds are secured solely by parcels in the portion of Zone I that does not include the Future Annexation Area, the column entitled "Expected Units Without Future Annexation Area" shall be utilized for purposes of this analysis. If Bonds are secured by all of Zone I, including the Future Annexation Area, the column entitled "Expected Units Including Future Annexation Area" shall be utilized for purposes of this analysis. If the CFD Administrator determines (i) that the number of building permits requested for each Land Use Class, plus those building permits previously issued for each Land Use Class, will not cause the total number of residential units or non-residential Acreage within any such Land Use Class to exceed the number of units or Acreage for such Land Use Class identified in Tables 3 and 4 below, and (ii) that the total number of residential dwelling units anticipated to be constructed pursuant to the current development plan for CFD No. 06-1 will not be less than 989 for Zone I and 465 for Zone 2 prior to the annexation of the Future Annexation Area and not less than 1,075 for Zone I and 465 for Zone 2 after the annexation of the Future Annexation Area, then a Letter of Compliance shall be submitted to the City by the CFD Administrator approving the issuance of the requested building permits. This Letter City of Tustin - Tustin Legacy/Columbus Villages CFD No. 06-1 May 31, 2006 Resollltion rlWt:<ol9.67 Page 17 of 33 of Compliance shall be submitted by the CFD Administrator within ten days of the submittal of the request for Letter of Compliance by the property owner. However, should (i) the building permits requested, plus those previously issued, cause the total number of residential units or non-residential Acreage within any such Land Use Class to exceed the number of units or non-residential Acreage for such Land Use Class identified in Tables 3 and 4 below, or (ii) the CFD Administrator determine that changes in the development plan may cause a decrease in the number of residential dwelling units within CFD No. 06-1 to below 989 dwelling units in Zone I or 465 dwelling units in Zone 2 before the annexation of the Future Annexation Area or below 1,075 dwelling units in Zone I or 465 dwelling units in Zone 2 after the annexation of the Future Annexation Area, then a letter of Compliance will not be issued and the CFD Administrator will be directed to determine if a Special Tax A Buydown shall be required. TABLE 3 Expected Dwelling Units per Land Use Class and Non-Residential Acreage City of Tustin Community Facilities District No. 06-1 (Tustin Legacy/Columbus Villages) Zone 1 I Single Family Detached Property > 3,600 s.f. 10 units 10 units 2 Single Family Detached Property 3,226 - 3,600 s.f. 61 units 62 units 3 Single Family Detached Property 2,851 - 3,225 s.f. 66 units 67 units 4 Single Family Detached Property 2,476 - 2,850 s.f. 25 units 27 units 5 Single Family Detached Property 2,101 - 2,475 s.f. 86 units 86 units 6 Single Family Detached Property <= 2,100 s.f. 31 units 31 units 7 Single Family Attached Property > 2,550 s.f. 27 units 27 units 8 Single Family Attached Property 2,301 - 2,550 sJ. 9 units 9 units 9 Single Family Attached Property 2,051 - 2,300 s.f. 24 units 24 units 10 Single Family Attached Property 1,801 - 2,050 s.f. 32 units 38 units 11 Single Family Attached Property 1,551 - 1,800 s.f. 164 units 217 units 12 Single Family Attached Property <= 1,550 s.f. 118 units 124 units 13 Senior Units NA 87 units 87 units City of Tustin - Tustin Legacy/Columbus Villages RAQ/,\;N/+ l<l~lnn-n7 Page 18 of 33 May 31, 2006 Page /I 14 15 16 17 Affordable Units - Moderate NA NA NA NA 71 units 117 units 61 units 80 units 125 units Affordable Units - Low Affordable Units - Very Low Non-Residential Property o Acres 61 units o Acres TABLE 4 Expected Dwelling Units per Land Use Class and Non-Residential Acreage City of Tustin Community Facilities District No. 06-1 (Tustin Legacy/Columbus Villages) Zone 2 I Single Family Detached Property > 4,300 s.f. 20 units 2 Single Family Detached Property 3,951 - 4,300 s.f. 37 units 3 Single Family Detached Property 3,601 - 3,950 s.f. 26 units 4 Single Family Detached Property 3,251 - 3,600 s.f. 23 units 5 Single Family Detached Property 2,901 - 3,250 s.f. 51 units 6 Single Family Detached Property 2,551 - 2,900 s.f. 107 units 7 Single Family Detached Property <= 2,550 s.f. 15 units 8 Single Family Attached Property > 1,800 s.f. 51 units 9 Single Family Attached Property 1,601 - 1,800 s.f. 85 units 10 Single Family Attached Property <= 1,600 s.f. 8 units II Affordable Units - Moderate NA 30 units 12 Affordable Units - Very Low NA 12 units 13 Non-Residential Property NA o Acres City of Tustin - Tustin Legacy/Columbus Villages CFD No. 06-1 May 31, 2006 Resnllltinn ~'lllll67 Page 19 of 33 3. Calculation of Special Tax A Buydown If a Special Tax A Buydown calculation is required as a result of item 2, above, the CFD Administrator shall review the current development plan for CFD No. 06-1 in consultation with the current property owners for all remaining Undeveloped Property in CFD No. 06-1, and shall prepare an updated version of Tables 3 and 4 identifying the revised number of units or non-residential Acreage anticipated within each Land Use Class. The CFD Administrator shall not be responsible for any delays in preparing the updated Tables 3 and 4 that result from a refusal on the part of one or more current property owners of Undeveloped Property to provide information on their future development. The CFD Administrator shall then review the updated Tables 3 and 4 and determine the Special Tax A Buydown Requirement, if any, to be applied to the property identified in the request for Letter of Compliance to assure the CFD's ability to collect Special Taxes equal to 110% debt service coverage on the Outstanding Bonds, plus the cost of annual CFD administration. The calculations shall be undertaken by the CFD Administrator as follows: Step I. Compute the sum of the Maximum Special Tax A to be levied on all Developed Property and Update Property within CFD No. 06-1, plus the sum ofthe Maximum Special Tax A to be levied on all future development as identified in the current development plan as determined by the CFD Administrator in consultation with the property owner. Step 2. Determine the amount of Special Tax A required to provide 110% debt service coverage on the Outstanding Bonds, plus any other costs associated with the Special Tax Requirement for Facilities. Step 3. If the total sum computed pursuant to step I is greater than or equal to the amount computed pursuant to step 2, then no Special Tax A Buydown will be required and a Letter of Compliance shall immediately be issued by the CFD Administrator for all of the building permits currently being requested. If the total sum computed pursuant to step I is less than the amount computed pursuant to step 2, then continue to step 4. Step 4. Determine the Maximum Special Tax A shortfall by subtracting the total sum computed pursuant to step I from the amount computed pursuant to step 2. Divide this Maximum Special Tax A shortfall by the amount computed pursuant to step 2. Step 5.The Special Tax A Buydown Requirement shall be calculated using the prepayment formula described in Section 1.1, with the following exceptions: (i) skip Paragraphs I, 2 and 3, and begin with Paragraph 4; (ii) the Bond Redemption Amount in Paragraph 4 of the prepayment formula described in Section 1.1 shall equal the product of the quotient computed pursuant to step 4 above times the Previously Issued Bonds, as defined in Section 1.1; (iii) the City of Tustin - Tustin Legacy/Columbus Villages Rp.~~P, ~106-67 Page 20 of 33 May 31, 2006 Page 13 Capitalized Interest Credit described in Paragraph 12 of Section 1.1 shall be $0; and (iv) any payments of the Special Tax A Buydown (less Administrative Fees and Expenses) shall be disbursed pursuant to the Indenture. The Special Tax A Buydown computed under step 5 shall be billed directly to the property owner of each Assessor's Parcel identified in the request for Letter of Compliance and shall be due within 30 days of the billing date. If the Special Tax A Buydown is not paid within 45 days of the billing date, a delinquent penalty of 10 percent shall be added to the Special Tax A Buydown. Upon receipt of the Special Tax A Buydown payment, the CFD Administrator shall issue a Letter of Compliance and a Certificate of Satisfaction of Special Tax A Buydown for the subject property. 4. Costs and Expenses Related to Implementation of Special Tax A Buydown The property owner of each Assessor's Parcel identified in the request for Letter of Compliance shall pay all costs of the CFD Administrator or other consultants required to review the application for building permits, calculate the Special Tax A Buydown, issue Letters of Compliance or any other actions required under Section D. Such payments shall be due 30 days after receipt of invoice by such property owner. A deposit may be required by the CFD Administrator prior to undertaking work related to the Special Tax A Buydown. E. METHOD OF APPORTIONMENT OF THE SPECIAL TAX 1. Special Tax A Commencing with Fiscal Year 2006-2007 and for each following Fiscal Year, the Council shall determine the Special Tax Requirement for Facilities and shall levy the Special Tax A until the total Special Tax A levy equals the Special Tax Requirement for Facilities. The Special Tax A shall be levied each Fiscal Year as follows: First: The Special Tax A shall be levied Proportionately on each Assessor's Parcel of Developed Property at up to 100% of the applicable Maximum Special Tax A; Second: If additional monies are needed to satisfy the Special Tax Requirement for Facilities after the first step has been completed, the Special Tax A shall be levied Proportionately on each Assessor's Parcel of Undeveloped Property at up to 100% of the Maximum Special Tax A 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 Special Tax A shall be levied Proportionately on each Assessor's Parcel of Taxable Property Owner Association Property at up to the Maximum Special Tax A for Taxable Property Owner Association Property; City of Tustin - Tustin Legacy/Columbus Villages CFD No. 06-1 May 31, 2006 Resolution ilIft:'Illlt67 Page 21 of 33 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 A shall be levied Proportionately on each Assessor's Parcel of Taxable Public Property at up to the Maximum Special Tax A for Taxable Public Property. 2. Special Tax B Commencing with Fiscal Year 2006-2007 and for each following Fiscal Year, the Council shall levy the Special Tax B until the total Special Tax B levy equals the Special Tax Requirement for Services. The Special Tax B shall be levied each Fiscal Year as follows: First: The Special Tax B shall be levied Proportionately on each Assessor's Parcel of Developed Property at up to 100% of the applicable Maximum Special Tax B; Second: If additional monies are needed to satisfY the Special Tax Requirement for Services after the first step has been completed, the Special Tax B shall be levied Proportionately on each Assessor's Parcel of Undeveloped Property at up to 100% of the Maximum Special Tax B for Undeveloped Property. F. EXEMPTIONS 1. Special Tax A Prior to Annexation of Future Annexation Area No Special Tax A shall be levied on up to 0.13 Acres of Public Property and up to 31.01 Acres of Property Owner Association Property in Zone I, and on up to 0.16 Acres of Public Property and up to 30.31 Acres of Property Owner Association Property in Zone 2. Tax- exempt status will be assigned by the CFD Administrator in the chronological order in which property becomes Public Property and Property Owner Association Property within each Zone. However, should an Assessor's Parcel no longer be classified as Public Property or Property Owner Association Property, its tax-exempt status will be revoked. Public Property or Property Owner Association Property that is not exempt from the Special Tax A under this section shall be subject to the levy of the Special Tax A and shall be taxed Proportionately as part of the third and fourth steps in Section E.I. 2. Special Tax A After Annexation of Future Annexation Area No Special Tax A shall be levied on up to 0.20 Acres of Public Property and up to 32.80 Acres of Property Owner Association Property in Zone I, and on up to 0.16 Acres of Public Property and up to 30.31 Acres of Property Owner Association Property in Zone 2. Tax- exempt status will be assigned by the CFD Administrator in the chronological order in which property becomes Public Property and Property Owner Association Property within each Zone. However, should an Assessor's Parcel no longer be classified as Public Property or Property Owner Association Property, its tax-exempt status will be revoked. City of Tustin - Tustin Legacy/Columbus Villages ReQ"lJtiNA- ff&106-67 Page 22 of 33 May 31,2006 Page 15 Public Property or Property Owner Association Property that is not exempt from the Special Tax A under this section shall be subject to the levy of the Special Tax A and shall be taxed Proportionately as part of the third and fourth steps in Section E. I. 3. Special Tax D No Special Tax B shall be levied on Public Property or Property Owner Association Property . G. APPEALS AND INTERPRETATIONS Any landowner or resident who feels that the amount of the Special Tax levied on such landowner's or resident's Assessor's Parcel is in error may submit a written appeal to CFD No. 06-1. The CFD Administrator shall review the appeal and if the CFD Administrator concurs, the amount of the Special Tax levied shall be appropriately modified. The Council may interpret this Rate and Method of Apportionment of Special Tax for purposes of clarifying any ambiguity and make determinations relative to the amount of Administrative Expenses and any landowner or resident appeals. Any decision of the Council shall be final and binding as to all persons. H. MANNER OF COLLECTION Special Tax A and Special Tax B will be collected in the same manner as ordinary ad valorem property taxes or in such other manner as the Council shall determine, including direct billing of the affected property owners. The Special Tax A Buydown shall be directly billed to the property owner at the time such Special Tax is being levied. I. PREPAYMENT OF SPECIAL TAX A The following additional definitions apply to this Section I: "Duildout" means, for CFD No. 06- I, that all expected building permits have been issued. "CFD Public Facilities" means either $42,949,043 in 2006 dollars, which shall increase by the Construction Inflation Index on July I, 2007, 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. 06- I under the authorized bonding program for CFD No. 06- I, or (ii) shall be determined by the City Council concurrently with a covenant that it will not issue any more CFD No. 06-1 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 Index" means the annual percentage change in the Engineering News Record Building Cost Index for the City of Los Angeles, measured as of the calendar year which ends in the previous Fiscal Year. In the event this index ceases to be published, the Construction Inflation Index shall be another index as determined by the CFD City of Tustin - Tustin Legacy/Columbus Villages CFD No. 06-1 May 31,2006 Rp.snllltinn ~qjjl67 Page 23 of 33 Administrator that is reasonably comparable to the Engineering News Record Building Cost Index for the City of Los Angeles. "Future Facilities Costs" means the CFD Public Facilities minus (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 Fund" means an account specifically identified in the Indenture to hold funds which are currently available for expenditure to acquire or construct CFD Public Facilities eligible under the Act. "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 of Developed Property, or Taxable Property Owner Association Property, Taxable Public Property or Undeveloped Property for which a building permit has been issued, may be prepaid. The obligation of the Assessor's Parcel to pay the Special Tax for Facilities may be permanently satisfied as described herein, provided that a prepayment may be made with respect to a particular Assessor's Parcel only ifthere 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 for Facilities 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 redemption ofCFD No. 06-1 Bonds from the proceeds of such prepayment may be given by the Trustee pursuant to the Indenture. The Special Tax B may not be prepaid. The Special Tax A 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 Expenses Reserve Fund Credit Capitalized Interest Credit Special Tax A Prepayment Amount City of Tustin - Tustin Legacy/Columbus Villages R.,(;.lf!.\;\\;'f+ fKir10R_R7 Page 24 of 33 May 31, 1006 Page 17 As of the proposed date of prepayment, the Special Tax A Prepayment Amount shall be calculated as follows: Paral!:raph No.: 1. Confirm that no Special Tax delinquencies apply to such Assessor's Parcel. 2. For Assessor's Parcels of Developed Property, Taxable Property Owner Association Property, or Taxable Public Property for which a building permit has been issued, compute the Maximum Special Tax A for the current Fiscal Year applicable for the Assessor's Parcel to be prepaid. For Assessor's Parcels of Undeveloped Property for which a building permit has been issued, compute the Maximum Special Tax A for the current Fiscal Year applicable 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 Parcel. 3. Divide the Maximum Special Tax A computed pursuant to paragraph 2 by the total estimated Maximum Special Tax A for the entire CFD No. 06-1 based on the Developed Property Special Tax A which could be levied in the current Fiscal Year on all expected development through Buildout of CFD No. 06-1, excluding any Assessor's Parcels which have been prepaid. 4. Multiply the quotient computed pursuant to paragraph 3 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 paragraph 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 quotient computed pursuant to paragraph 3 by the amount determined 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 Year until the earliest redemption date for the Previously Issued Bonds. 9. Determine the Special Tax A levied on the Assessor's Parcel 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 Tax A Prepayment Amount less the Future Facilities Amount and the Administrative Fees and Expenses (defined below) from City 0/ Tustin - Tustin Legacy/Columbus Villages CFD No. 06-1 May 31, 2006 Resolution iIlw:<ollt67 Page 25 of 33 the date of prepayment until the redemption date for the Previously Issued Bonds to be redeemed with the prepayment. I I . 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 ofCFD No. 06-1 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. 06- I Bonds, and the costs of recording any notices to evidence the prepayment and the redemption (the "Administrative Fees and Expenses"). 13. If reserve funds for the Previously Issued Bonds, if any, are at or above 100% of the reserve requirement (as defined in the Indenture) on the prepayment date, a reserve fund credit shall be calculated as a reduction in the applicable reserve fund for the Previously Issued Bonds to be redeemed pursuant to the prepayment (the "Reserve Fund Credit'~. No Reserve Fund Credit shall be granted if reserve funds are below 100% of the reserve requirement. 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 quotient computed pursuant to paragraph 3 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 Tax A prepayment is equal to the sum of the amounts computed pursuant to paragraphs 4, 5, 7, I I and 12, less the amounts computed pursuant to paragraphs I3 and 14 (the "Special Tax A Prepayment Amount"). From the Special Tax for Facilities Prepayment Amount, the amounts computed pursuant to paragraphs 4, 5, I I, I3 and 14 shall be deposited into the appropriate fund as established under the Indenture and be used to retire CFD No. 06- I 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. 06-1. The Special Tax for Facilities Prepayment Amount may be insufficient to redeem a full $5,000 increment of CFD No. 06-1 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. 06- I Bonds or to make debt service payments. As a result of the payment of the current Fiscal Year's Special Tax A levy as determined under paragraph 9 (above), the CFD Administrator shall remove the current Fiscal Year's Special Tax A 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 City of Tustin - Tustin Legacy/Columbus Villages Rp.!i1o!lIMIf+ ~106_67 Page 26 of 33 May 31, 2006 Page 19 recorded in compliance with the Act, to indicate the prepayment of the Special Tax A and the release of the Special Tax A lien on such Assessor's Parcel, and the obligation of such Assessor's Parcel to pay the Special Tax A shall cease. Notwithstanding the foregoing, no Special Tax A prepayment shall be allowed unless, at the time of such proposed prepayment, the amount of Maximum Special Tax A that may be levied on Taxable Property within CFD No. 06-1 (after excluding Public Property and Property Owner Association Property in Zone I and Zone 2 as set forth in Section F) both prior to and after the proposed prepayment is at least 1.1 times the maximum annual debt service on all Previously Issued Bonds, plus the cost of annual CFD administration. 2. Prepayment in Part The Special Tax A on an Assessor's Parcel of Developed Property or an Assessor's Parcel of Taxable Property Owner Association Property, Taxable Public Property, or 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 1. I; except that a partial prepayment shall be calculated according to the following formula: PP=PExF. These terms have the following meaning: PP = the partial prepayment PE = the Special Tax A Prepayment Amount calculated according to Section 1. I F = the percentage, expressed as a decimal, by which the owner of the Assessor's Parcel is partially prepaying the Special Tax A. 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 A and the percentage by which the Special Tax A shall be prepaid. The CFD Administrator shall provide the owner with a statement of the amount required for the partial prepayment of the Special Tax A 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 Council shall (i) distribute the funds remitted to it according to Section 1.1, and (ii) indicate in the records ofCFD No. 06-1 that there has been a partial prepayment of the Special Tax A and that a portion of the Special Tax A with respect to such Assessor's Parcel, equal to the outstanding percentage (1.00 - F) of the remaining Maximum Special Tax A, shall continue to be levied on such Assessor's Parcel pursuant to Section E.1. Notwithstanding the foregoing, no Special Tax A prepayment shall be allowed unless, at the time of such proposed prepayment, the amount of Maximum Special Tax A that may be levied on Taxable Property within CFD No. 06-1 (after excluding Public Property and Property Owner Association Property in Zone I and Zone 2 as set forth in Section F) both City of Thstln - Tustin Legacy/Columbus Villages CFD No. 06-1 May 31, 2006 Resolution iIIf1:~67 Page 27 of 33 prior to and after the proposed prepayment is at least 1.1 times the maximum annual debt service on all Previously Issued Bonds, plus the cost of annual CFD administration. J. TERM OF SPECIAL TAX The Special Tax A shall be levied for a period not to exceed forty years commencing with Fiscal Year 2006-2007. The Special Tax B shall be levied as long as necessary to meet the Special Tax Requirement for Services. K:\CLIENTS2\Tustin.Cit\TustinMCAS\Lennar\RMA \Lennar_ 8.doc City of Tustin - Tustin Legacy/Columbus Villages Re&Jf~M'",. rtlfr.106-67 Page 28 of 33 May 31, 2006 Page 21 EXHIBIT A AUTHORIZED SERVICES The types of services proposed to be financed by CFD No. 06-1 are police protection services, fire protection services, ambulance and paramedic services, recreation program services, maintenance of parks, parkways and open space and flood and storm protection services. Resolution No. 06-67 Page 29 of 33 EXHIBIT B BOUNDARY MAP Resolution No. 06-67 Page 30 of 33 SHEET 1 OF 3 PROPOSED BOUNDARIES OF CITY OF TUSTIN COMMUNITY FACILITIES DISTRICT NO. 06-1 (TUSTIN LEGACY / COLUMBUS VILLAGES) ® COUNTY OF ORANGE ?r� STATE OF CALIFORNIA _ w P ��* Future Annexations Zone One i Area, Y" See Sheet 2 .' Reference is hereby made to the Assessor maps of the County of Orange and Tract Maps Nos. 16581 and 16582 for a description of the lines and dimensions of each lot and parcel. Zone Two EI'dC See Sheet 3� Proposed Boundaries of City of Tustin Community Facilities District No. 06.1 (Tustin Legacy Columbus Villages) ' Fre Cr e J ed by -juoJ Tau seiq :< 4ss__cies_ In (1) Filed in the office of the City Clerk of the City of Tustin this day of , 2006. Pamela Stoker, City Clerk (2) 1 hereby certify that the within map showing the proposed boundaries of City of Tustin Community Facilities District No. 06-1 (Tustin Legacy / Columbus Villages), County of Orange, State of California, was approved by the City Council of the City of Tustin at a regular meeting thereof, held on the day of 2006, by its Resolution No. Pamela Stoker, City Clerk (3) Filed this _ day of , 2006, at the hour of o'clock _m, in Book of Maps of Assessment and Community Facilities Districts at page and as Instrument No. in the office of the County Recorder of the County of Orange, State of California. Tom Daly County Clerk -Recorder of County of Orange By Deputy Fee Exempt recording requested, per CA Government Code §6103 SHEET 2 OF 3 PROPOSED BOUNDARIES OF CITY OF TUSTIN N COMMUNITY FACILITIES DISTRICT NO. 06-1 W (TUSTIN LEGACY/ COLUMBUS VILLAGES) COUNTY OF ORANGE STATE OF CALIFORNIA Zone One contains all of Tract 16851 as shown on ' map filed in Book 877, Pages 33 through 50 of Miscellaneous Maps, and as Instrument Number 200600148498, recorded on March 6, 2006 in Record! yam' y r J ,o of Orange County, California, Excepting therefrom Lots 242, 2433 244, 245, 3325 333, 3419 342, 3463 3483 349, 3503 351, 352, 353, 3549 355, 361, F (portion), G (portion), Z. AA, AB AC AM(portion),AN AO AP AO AR BA BB .T f (portion), ZA, ZB and DOL which are in this CFD's /y`n Future Annexation Area. 17 One �'9T W yup 1 s / �_ 1�x �i ♦ �Q� Assessor Parcel Numbers in N ♦ yf Zone One (Columbus Square) : �I r �f 430-282-08 Future —�� ,�,y,;N _, �j 430-282-18 (portion) Annexation F�. 430-282-19 (portion) Area 434-061-22 434-061-53 434-061-54 Proposed Boundaries of City of Tustin Community Facilities District No. 06-1 (Tustin Legacy / Columbus Villages)-rForeb t,, a,d Tc v W CD W W O W W SHEET 3 OF 3 Assessor Parcel Numbers in Zone Two (Columbus Grove Tustin): 434-062-08 434-062-09 434-062-16 434-062-20 PROPOSED BOUNDARIES OF CITY OF TUSTIN COMMUNITY FACILITIES DISTRICT NO. 06-1 (TUSTIN LEGACY / COLUMBUS VILLAGES) COUNTY OF ORANGE STATE OF CALIFORNIA Zone Two contains all of Tract 16582 as shown on a map filed in Book 874, Pages 1 through 30 of Miscellaneous Maps, and as instrument number 200500867370, recorded on October 10, 2005 in Records of Orange County, California. E :- E P,l E Proposed Boundaries of City of NOMMENNE Tustin Community Facilities District No. 06-1 (Tustin Legacy / Columbus Villages) 4 '�. Zone_ Two': =repercJ L Le>d T�usia'e_,