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HomeMy WebLinkAbout2014-04-15; City Council; 21567; Council Guidance Policy 33 Financing ImprovementsCITY OF CARLSBAD - AGENDA BILL AB# MTG. DEPT. 21,567 4/15/14 ASD COUNCIL GUIDANCE ON POLICY 33, FINANCING OF PUBLIC IMPROVEMENTS DEPT. HEAD CITY ATTY. ^ CITY MGR. RECOMMENDED ACTION: Accept presentation from the Administrative Services Director on Policy 33, Financing of Public Improvements, and receive Council guidance on the application of Policy 33. ITEM EXPLANATION: Council Policy 33 was updated and combined with Council Policy 38 in 2002 and addresses the financing of public improvements and, specifically, special district formation. The Policy adopted requirements for the financing of public improvements, including value to lien ratios and maximum tax rates, in order to bolster the creditworthiness of these financing districts. The policy specifically addresses Community Facility Districts, Assessment Districts, and Bridge and Thoroughfare Districts as vehicles for the financing of public improvements. Over the past year, city staff has been working with Bent-West, LLC, to address the financing of public improvements. Bent-West is seeking exemptions from the following three requirements of Policy 33; 1. 3. That special taxes of a proposed Community Facilities District (CFD) not be required to be prepaid prior to sale of residential properties. That eligible costs prior to the request to begin work on district formation relating to public improvements be allowable for public financing of a CFD, and That costs for land acquisition associated with Zone 15 mitigation be allowed for public financing. The attached letter from Bent-West, LLC explains each of these requests. Staff will provide further explanation ofthe history, intent, and requirements of Policy 33 during this workshop. FISCAL IMPACT: None. ENVIRONMENTAL IMPACT: The proposed presentation does not constitute a "project" within the meaning of the California Environmental Quality Act and, therefore, do not require environmental review. EXHIBITS: 1. Letter from Bent West, LLC Re: Proposed College Blvd. and Cannon Rd. CFD (Zone 15) - Request for Policy 33 Determinations. DEPARTMENT CONTACT: Chuck McBride 760-602-2430 FOR CITY CLERKS USE ONLY. / COUNCIL ACTION: APPROVED CONTINUED TO DATE SPECIFIC • DENIED /n CONTINUED TO DATE UNKNOWN • CONTINUED • RETURNED TO STAFF • WITHDRAWN • OTHER - SEE MINUTES • AMENDED • Exhibit 1 BENT WEST, LLC 5796 ARMADA DRIVE CARLSBAD, CALIFORNIA 92008 March 3], 2014 Chuck McBride, Finance Director City of Carlsbad 1635 Faraday Ave. Carlsbad, CA 92008 Re: Proposed Collese Blvd. and Cannon Road CFD (Zone 15) - Request for Policv 33 Determmations Dear Mr. McBride: As one ofthe landowners within Local Facilities Management Zone 15 in the City of Carlsbad, Bent-West, LLC ("West") has been working on the design, engineering and permitting ofthe extension of College Blvd. and Cannon Road and other major infrastructure serving all of Zone 15 (the "Zone 15 Improvements"). As you know, although Zone 15 currently includes at least seven other large property owners, West is willing to advance the funds necessary to construct the Zone 15 Improvements if a public financing district can be established in Zone 15 that will spread the cost of the Zone 15 Improvements on a fair share basis to all property within Zone 15 and provide the funding source for reimbursing Bent-West for its advance of those costs. For the past 14 months, we have been working with the City's Finance staff in a pre-application process to develop the framework of such a financing district. We are neariy ready to submit a fomial application to the City for the establishment ofthe district but believe it is prudent to first obtain the City Council's detennination of a few threshold items relating to City Council Policy 33. These items are essential to the viability of the proposed financing district. Zone 15 CFD Framework We have detemiined the appropriate vehicle for spreading the cost of the Zone 15 Improvements among the property in Zone 15 is a community facilities district (the "Zone 15 CFD"). A community facilifies district is one of three types of financing districts covered by Policy 33. It is the preferred approach here because (1) it pennits all ofthe costs to be spread to benefitted properties within Zone 15 through the levy of special taxes, (2) allows for the issuance of bonds in series secured by the special taxes to repay the costs advanced by West and (3) allows the amount and timing of the special taxes tliat are actually levied on property within the Zone 15 CFD to match the development status of particular properties. With respect to this last, very important point, the Zone 15 CFD would assure the City and participating landowners that property that had not yet been enfitled for development would not be taxed. #137746 vl Jl Mr. McBride March 31, 2014 Page 2 Policv 33 Determinadons At this time, we are requesfing that the City Council make the following three determinations: (1) that the special taxes ofthe Zone 15 CFD shall not be required to be prepaid prior the sale of the individual residential lots; (2) that all eligible costs relating to the Zone 15 Improvements incurred after June 1, 2007 be included in the Zone 15 CFD; and (3) that the Zone 15 CFD eligible costs may include the cost of the acquisition of land required for the constiuction or mitigation of Zone 15 Improvements, whether or not the land is owned by a landowner participating in the Zone 15 CFD. . Each of these requested Policy 33 determinations are described in gi-eater detail below. 1 Permit the pass-through of Zone 15 CFD special taxes Section 14 of Policy 33 states as follows: "It is the City's desire that any assessment or special tax obligation be discharged prior to the sale of individual lots. Under this policy, property owners of residential land within a Community Facilities Distiict must discharge the special tax obligation applicable to the property prior to the sale of individual lots. For commercial/industrial property within a CFD and any property within an assessment distiict, the City Council may approve a pass-through ofthe obligation to a prospective purchaser at the City's sole discretion." The Zone 15 CFD is expected to include commercial, rental residential and for-sale residential uses. If the City Council requires that the special tax obligation ofthe Zone 15 CFD be discharged prior to the sale of residential lots to homebuyers, the Zone 15 CFD will not be able to issue bonds to fund the Zone 15 Improvements. This will render the Zone 15 CFD useless as a financing vehicle. A policy requiring a mandatory prepayment of CFD special taxes is extremely unusual. Virtually every CFD established in the State pemiits the pass-through of special taxes to residential and non-residential end users. C:FDS have been fonned throughout San Diego County - - ti-om Oceanside to Chula Vista and by school districts, community services districts, cities and the County itself - - that permit the pass-through of special taxes. In recent years, the City Council itself has approved fhe pass-through of special taxes and assessments in establishing the Robertson Ranch East^Calavera Hills assessment district ("AD No. 2003-1") and Community Facilities District No. 3 ("CFD No. 3"). In each case, the City Council determined that die assessment and special tax obligation of those districts did not need to be discharged #137746 vl 3 Mr. McBride March 31, 2014 Page 3 prior to die sale of individual residential, commercial, or industrial lots. AD No. 2003-1 includes the Robertson Ranch East and Calavera Hills residential communities and was established to finance extensions of College Blvd. and Cannon Road. CFD No. 3 includes three different office/industrial projects and was established to finance improvements to Melrose Drive, Faraday Avenue and Palomar Airport Road. Like AD No. 2003-1 and CFD No. 3, the Zone 15 CFD is being established to finance major portions of the City's circulation infrastixicture and will include for-sale residential, rental apartments and commercial uses. Our assumption is that the City will require a special tax disclosure program to ensure that die annual special tax obligation is fully disclosed to potential purchasers similar to that required by the City tbr AD No. 2003-1 and CFD No. 3. In addition, every landowner in die Zone 15 CFD will have the right to prepay and permanently satisfy the special tax obligation, in whole or in part at any time, if it does not wish to assume the annual special tax payments. Therefore, pursuant to Section 1 of Policy 33, we request that the City Council grant an exception to the pass-through provisions of Section 14 of Policy 33 and allow the pass-through of the Zone 15 CFD special taxes to all end users subject to: (i) City Council approval of a disclosure program similar to that required for AD No. 2003-1 and CFD No. 3 and (ii) the ability of any landowner with the Zone 15 CFD to voluntarily discharge the special tax obligation, in whole or in part. 2 Allow the Zone 15 CFD to finance eligible costs incurred relating to the Zone 15 Improvements and Zone 15 CFD at any time after June 1.2007. Sections 3.(B) and (G) of Policy 33 state that costs that are ineligible to be financed through a financing district, include "administrative or overhead expenses, financial consultant or legal fees incurred by an applicant for fonnation of a Special District" and "costs incurred prior to the City Council's acceptance of a request to begin work on the fomiation of a Special District, a reimbursement, or acquisition agreement, or the adoption of a resolution of intention to form the Special District, whichever comes first." West has fi-onted well over $1,000,000 in costs relating to the Zone 15 Improvements and the Zone 15 CFD since June 1, 2007. It would be fiindamentally unfair to not allow West to include those costs, as reviewed and validated by City Staff, in the Zone 15 CFD so that all benefited Zone 15 landowners would pay their fair share of the eligible costs. The fundamental difference between the proposed Zone 15 CFD and all other single landowner-driven financing districts in the City is that in this case, you have a multiple landowner CFD where a single landowner has been willing to advance a significant amount of costs for the benefit of all landowners. Consequentiy, those costs should be spread on a fair share basis among all landowners within the Zone 15 CFD and not limited to costs that may be incurred after an arbitrary date or event. #137746 vl Mr. McBride March 31, 2014 Page 4 Therefore, pursuant to Section 1 of Policy 33, we request that the City Council permit all costs incurred by Bent-West relating to the Zone 15 Improvements and the formation of the Zone 15 CFD since June 1, 2007 be authorized costs eligible to be financed through Zone 15 CFD, subject to City Staff review and validation of the speciflc costs. 3 Allow the acquisition of land for the construction or mitigation of Zone 15 Improvements. Section 3.(J) of Policy 33 provides that a financing district cannot finance the acquisition of "on-site right-of-way and easements." For example, there are approximately 4 acres of land owned by one of the Zone 15 landowners that are required as a wetiands creation site in order to mitigate the impacts of certain Zone 15 Improvements. The cost of acquiring the required land should be spread among all of the Zone 15 landowners on a fair share basis tiirough the Zone 15 CFD just as all other costs of the Zone 15 Improvements would be spread. In this manner, all landowners would be required to shoulder their fair share of those costs as opposed to requiring a single landowner to shoulder 100% ofthe burden. Therefore, pursuant to Section 1 of Poiicy 33, we request that the City Council determine that the eligible costs of the Zone 15 CFD shall include the cost of land required for the construction or mitigation of the Zone 15 Improvements, excluding right-of-way required for College Blvd. and Cannon Road and subject to City Staff determination that the eligible costs to be included for such land shall not exceed the fair market value of the land and any severance costs. As stated above, the three determinations we are asking the City Council to make at this time are threshold detenninations in tiie establishment ofthe Zone 15 CFD. We understand that once a formal application is submitted to the Zone 15 CFD, it will be reviewed by the City's Policy 33 committee and additional waivers or determinations with respect to Policy 33 may be requested ofthe City Council before the Zone 15 CFD could be formed. We look forward to continuing to work with the City in providing much needed infrastructure to serve Zone 15. Very traly yours, /• Dennis O'Brien Member #137746VI All Receive - Agenda Item # For the Information ofthe: CJTY COUNCIL Bent-West, LLC 5796 Armada Drive Suite 300 Carlsbad, California 92008 ACMJ-^^ GA _Jl GC Date 4/14 City Manager «^ April 14,2014 Honorable Mayor Matt HaU City of Carlsbad 1200 Carlsbad Village Drive Carlsbad, CA 92008 RE: AB#21,567 - City Council Guidance on Policy 33 - Financing of Public Improvements Dear Mayor Hall: In reference to our original request letter dated March 31, 2014 and addressed to Mr. Chuck McBride, Bent-West LLC would like to respectfully request that the Council limit their discussion at tomorrow's Workshop to the first requested determination relating to Council Policy No. 33. Specifically, That the City Council grant an exception to the pass-through provisions of Section 14 of Policy 33 and allow the pass-through of the Zone 15 CFD special tax to all end users subject to: (1) City Council approval of a disclosure program similar to that required for AD No. 2003-01 and (2) the ability ofany landowner within the Zone 15 CFD to voluntarily discharge the special tax obligation, in whole or in part. West is in the process of obtainmg additional information on the other two requested exceptions and would like the opportunity to be able to present this additional information for consideration a future City Council workshop. Thank you for your attention and your understanding in this matter. We look forward to seeing you and the other Members of the City Council at tomorrow's Workshop. Sincerel Steve Powell Project Manager Cc: Mark Packard Keith Blackburn Lorraine Wood Michael Schumacher Kathy Dodson Chuck McBride Date: ^A^/tH- Distribution: City Clerk ^ Asst. City Glerk Deputy Clerk _ Book Bent-West, LLC 5796 Annada Drive, Suite 300 Carisbad, California 92008 Receive - Agenda Item # For the Information of the: CITY COUNCIL ACM^mCA^j^CC y /'•fe City Manager April 9, 2014 Mayor Matt Hall City of Carlsbad 1200 Carlsbad Village Drive Carlsbad, CA 92008 Re: Council Workshop of AprU 15, 2014 Date- Distribution: City Clerk Asst City Clerk Deputy Cierk Pook Deal- Mr. Mavor: We are writing to again express our thanks for your time and input (and that of the other City Council Members) during our meetings earlier this week. The "determination items" that West Development has asked the Council to consider at the referenced Workshop are of great importance to West's efforts to set the stage for the construction of College Boulevard Reach A and improvements relating thereto...and we want to take this opportunity to addi-ess a couple of questions that you raised during our Monday meeting. With regard to the requested determination that a ''pass-thi-ough" element be approved for die proposed Community Facility District ("CFD"): 1. You asked about prior approvals by the City Council for such a pass-thixiugh to "for-sale" residential properties as part of other public financing districts that have been formed in lhe Ciiy. We have attached documents that were used by lhe City in forming Assessment District No. 2003-01 (tbr College Boulevard and Cannon Road East, which improvements were required for tiie Calavera Hills 11/ Robertson Ranch East residential developments). The attached documents include: (a) l he Agenda Bill for the referenced district, which document contains a recommendation from the City's Special District Review Committee that the Cily "...allow a pass-through of the assessment amount to the prospective purchasers of the individual lots." (Please see the yellow-highlighted portions of the Agenda Bill for all of the SDRC recommendations relating to the pass-through.) Similar pass-throughs have been approved for other financing districts within the City as stated at the end of the 3'''* pai-agraph on the 2"^ page ofthe Agenda Bill - - "This request is aiso consistent with tlie actions taken by the City Council on similar districts in the past." Mayor Hall April 9,2014 Page 2 (b) The Special Assessment Agreement Disclosure Agreement that is discussed in the highlighted portions of the Agenda Bill. As we stated during our Monday meeting. West is committed to inclusion of any reasonable disciosiu:e requirements regarding a pass-through of the Zone 15 CFD special tax to homebuyers, including the form of Disclosure Agreement used in the Calavenk Hills II/Robertson Ranch East assessment district. (c) City '^i^cil Resolution No. 2003-245, which resolution was adopted by the Council; on September <^ 2003 and which resolution provided for a pass-through of the assessment to prospective pur^ asers ofthe individual lots in Robertson Ranch East. >fts.;tiie;re .is no praGtie.dl difference between tiie pass-through of an assessment of an Assessment.^l^isMct and. a «j5ecial tax of a CFD, we believe that the above referenced .- reconimend^ti^n^'and'approvals contained in the documents can be readily applied to the Zone 15 CFD and we urge the Council to make such detennination at next Tuesday's Workshop. — 2. At our Monday meeting, you also asked about the financial "impact" on individual prospective homebuyers that would result from a pass-through of the special tax. Following our meeting. West requested that its financial consultant prepare a conservative estimate of the amount of the special tax that would result from including all of tiie requested improvements in the Zone 15 CFD. While City Finance Dept. staff and West representatives have not yet found a means to be able to inciude the RCOA Replacement Site Improvements in the proposed CFD, we included the cost of those improvements in the attached Total Tax Rate Analysis (the "Tax Analysis Documents") so that the most conservative-estimate ofthe special tax could be calculated. Please note that the Tax Analysis was done for both the Cantarini Ranch and the Holly Springs single-family lot developments. This was done because the Cantarini development will be assessed for costs for both "District-Wide" and "Specific" improvements while the Holly Springs development will be assessed only for "District-Wide" improvements. If approved, the special tax pass-through for the Rancho Milagro development and the expected Kato/Mandana developments will likely be similar to the Holly Springs special tax. As you wil! see in the both ofthe Tax Analysis Documents, the estimated total of taxes, assessments and special taxes appearing on property tax bills for the single-family developments is well below the maximum allowed threshold of 1.8% of the initial sales price for the single- family homes that will be constructed in the Zone 15 developments. Given the costs of land, entitiements and subdivision infrastructure and given the location and environment of the proposed developments and the anticipated size and amenities of the homes to be constmcted in these developments, it is expected that the average sales price of the homes/lots will be a minimum of $1,500,000 and the aggregate taxes, special taxes and assessments will be approximately 1.32% in Cantaiini Ranch and 1.23% in the other for-sale residential projects. As wc discussed in our meetings this week, it is our expectation that the purchasers of homes in the Zone 15 single-family developments will be sophisticated and experienced homebuyers who will understand the contents ofany and all disclosure documents that they are Mayor Hall April 9. 2014 Page 3 provided. Further, such homebuyers will understand that the special tax can be paid off at any time...our calculations indicate diat the "pay-off" amount any time in the first couple of years after purch^ will be approximately $36,500 in Cantarini Ranch and $18,500 in Holly Springs. Rancho Milagro and the expected Kato and Mandema developments. We ai-e most hopeful tiiat the above answers to your questions and the attached docimientation will help the Counci! to make a determination that tiie requested pass-through element can be included in the fina! fonnation of the Zone 15 CFD. Thank you again for your consideration in this matter. Sincerely, Steve Pow'ell. Projeci Manager SP/hs Enclosures: Agenda Bill Disclosure .Agi-eement Council Resolution \o. 2003-245 Tax Analysis for Cantarini Ranch Tax Analysis for Holly Springs, et. al. copy to: Dr. Mark Packard. Vice-Mayor Mr. Keith Blackburn, Council Member Ms. Lorraine Wood, Council Member .Mr. Mike Schumacher. Council Member Mr. Chuck Mc Bride, Director of Administrative Services Mr. Dennis O'Brien, President of West Paitners „ 5 CITY OF CARLSBAD - AGENDA BILL AB# 17,310 MTG. 9/16/03 DEPT. FIN TITLE: ASSESSINENT DISTRICT NO. 2003-01 (COLLEGE BOyi£VARO AND CANNON ROM) EAST) FINAL PUBUC HEARING, CONFIRMATION OF THE ASSESSMENTS. APPROVAL OF THE FORM OF THE FIRST fiMEHZmEHT TO THE ACQUISmONff^lNANCMMG AGREE>«NT MiO SPECIAL ASSESSMENT IMSTRICT DISCLOSURE AGREEMENT mp RELATED ACTIONS DEPT. HO"^ Jj6==r CITY ATTY. CITYMGRT^J^ O O CC a. < z O o < -J o z D O O RECOMMENDED ACTION: Adopt Resolution No. 2QQ3-?44 approving ttie final report of ttie assessment engineer, declaring the results of the assessment ballot tabulation, confwming the assessments and ordering the acquiation tw constructbn of improvem^its, togettier with appurtenances, in Assessment Oistrict No. 2003-01 (College Boulevard and Cannon Road East). Adopt Resolution No. 2003-245 approving the fonn of tiie First Amendmwit to Acquisttion^inancing Agreement and Special Assessment Distncl Disclosure Agreenrient for Assessment District No. 2003-01 (College Boutevard and Cannon Road East). ITEM EXPLANATION: On July 15, 2003, the City Cojncil adopted a resolution stating its intent to form an assessment district to fund certain public improvements necessary to serve the Calavera Hills and Robertson Ranch East developments. At that time, the City Council also adopted a map of the proposed assessment district, passed on the preliminary report by the assessment engineer, set ttie date for this public hearing and ordered ttie initiation of the assessment ballot proceedings. This agenda item contains ttie finai actions necessary to complete the assessment disWct formation, confirm tiie assessments on ttie parens of land within the assessment district, approve the First Amendment to Acquisition/Financing Agreement and the Specif Assessment Disbict Disclosure Agreement The purpose of the assessment district is to establish a mectianism to finance the acquisition or construction of the public improvements and to spread the cost of ttie public improvem^ts among properties v^ich will specially benefit firom ttie improvements based upon the special benefit received by each such property. The boundaries of the proposed assessment district are shown on the location map and include the Calavera Hills II development consisting of Villages E-1. H, K, L-2, R, U, W, X, and Y with 689 proposed residential units, 2 community facilities, and several homeowners association recreation lots. The boundaries also indude tiie Robertson Ranch East development, currently owned by Calavera Hills II LLC, consisting of approximately 500 proposed residential units, community recreation and several homeowners' association recreation lots. The improvements proposed to be acquired by the City from the proceeds of bonds issued for the assessmwit district include 4 lanes of College Boulevard from Carisbad Village Drive to Cannon Road induding sewer, water, recycled water and dry utilities; 4 lanes of Cannon Road from El Camino Real to CoUege Boutevard including sewer, water, and diy utilities; storm drain detention basin 8JB and stonn drain line 8JA (less any improvements be reimbursed to tiie developer from Master Plan Local Drainage Area Fees); and related costs for environmentat acquisition and creation of mitigation lands, engineering, and inspection. As required by Coundl Policy 33, ttie City's Spedal District Review Committee has reviewed this asses^ent district. Tlie Committee iinds ttiat it complies witti the tenns and conditions of the CounaTs policy, vwth the clarifications and findings noted below, and recommends that the City Councii proceed with tiie formation of ttie assessment district. Page 2 of Agenda Bill No. 17.310 The exceptions to Policy 33 are as foltowre: • Paragraph 8 of Policy 33 requires that all property proposed to be mdudaj within the assessment district "shall have recent environmenta! review arKi approval of ail land use entitiements such as zoning, master plans, or Local Fadlities Mans^ement Rans and regulatory f^rmtts. The City Coundl may approve a ^jedal distiict that mdudes some land without sudi approvals if the improvements to be financed are consistent witti the General Plan, and if the City Council finds ttie improvements are required in the public interest." The r»cessary entitlements have been obtained for the Calavera Hills portion of the proposed assessment distiict (see "Environmental Review" belc««) Such entitiements have not been ot}tained f<M- Robertson Randi East. Calavera Hills 11 LLC has submitted an application for af^roval of a mast^ plan for Roberteon Ranch and City staff has requested certain revisions to the proposed master plan. The primary improvements proposed to be financed through the assessment district include the extension of College Boulevard arnl Cannon Road, both important links in ttie City's traffic droNation system and designated as major arterials on the Circulation El^ent of tiie City's General Plan Staff. therefc«re, supports a finding by ttie City Coundl that the improvements are consistent vwth the Genenal Plan and are required in the public interest. • Parasfmfih 14 (rf PoUcy 33 stales ttv^ M is i^ City's d^te tt)at any assess to the hcmifllKtyersrt ttie City's sole <fet^^ TN^devetoperhasrecpK^tobe^cwvedto pass 0irc»||^ ivs amesssmrA io #» prtMSpBcttve purdiasers of ttie tmNvlchtEri lols. The Ot/s ^pe^ Dlibrlct Rofvisw Corm«ilee has reMmted ttiis («(}iH»8t and reocRrnnemls tt«rt the CUfy ComtM wf^prme Ht smce, as ret^umi PQli<^ the et^imaisd loiai msnoupi of temes, asamamnlbs and ^3ed»i taxes mppeanng m ttH» f»K^MHty tax bM wffi rat eateaed 1.8 p^cant of ttie InMkrf sades prtee of any rraider^ dw^tog unit to i^Kiii pioapec^ homeowner. TNa RMlueat m ci»i8is%»it wntti ttie a(^ons taken by ttie City CcHmdl on i^Kar dt^ritits in thefMnt. V^ivm ttie araeiKmier^ are pemntted to be f^esed ttiim^ to ttie resider^ fiom^xiyers. Policy 33 rec|uims that ttie devetop»- pmnde fuM arKt oon^stote d^tosure of ttie assessment disttkt to sudi prGKH>eclive pun^ias»s. Tha iErttadied Spedd AsH^Ksment Distncl DtscAosure Agree»n4»it wtt provide for stidh notice arid staff f«oon'mien(te ajf^tnsvat of the agreernerit t>y t$i^ Coundl. Ilie significant eiemenUi ofthe agreement are as fi:iMovvs: > Devekjper disclose to prospective purchaser ttie total estimated asse^ment fien amount, w^natod mmuei paymerte on tie property tax tNH and ttie dur^m of pa^nents unl8 ttie a!^M»nieni bOTKte a>« pand in fttf. > [^iW)N^»er wil fKOvide ttie ofdm to the prospedtve pi^diaser to t^ttvar acc^ ttie assa^mi&t li«fi and nial<» tt% a»inua} pa^T»nts on tt«e prop^ taKtM pay^olf ttie t«Uii mmmsxmrA lien, plus pn^yment pena^^, inters diai^gi^ ar«3 other charts, at ttie t^ of dose of escrow. > Devii^oper ^ incorporate ttie mnrnt cd assessment tien vrlto ttie advertised sa^ price of tt^ home and dearly disdose ttie p^s-ttirough option in any sales literature, tn addition, a notice of tiie assessment shiEirtI l»e prominentty displayed in an sales offices ofi^ing units for sale. Page 3 of Agenda Bill No. 17,310 First Amendment to AcouisHion/Fifiancinq Aqreement On December 3, 2CX32, ttie City Coundl approved the ^re«i^t (tiie "Aaiuisition/Finaidng Agreement") vwth Calavera HiHs II LLC (ttie<levelO|»r) fof ttie acquisition, constiiiction. and finandng of improvements to Cannon Road East and College Boulevard and to master drainage plan fadlities BJB and BJA for Financing District No. 01-02 (which has ance been renamed Assessment Oistrict No. 2003-01). Under the agre^ent, the developer must constoid the improvements to the City's standards and ttie City will acquire qualifying improvements subject to the approval of the City Engineer sotety from tiie proceeds of bonds issued for the assessment district. The proposed First Amendment to Acquiation/Finandng Agreement is virtually Identical to provisions approved by tiie City and included in ttie Acquisition/Financing Agreement for Assessment CNstrid No. 2002-01 (Poinsettia Lane East) w^ich was approved shortly after December 3, 2002. The significant changes to ttie Acquisition/Financing Agreement are as follow/s: > An improvement may be deem«l "substantially complete" and, ttierefore, eligible for payment even though it is subject to the comfrfetion of a punch list of items. > The amount to be paid for an improvement shaH be the lesser of the actual cost paW or ttie amount shown in ttie final engineer's report; as amended prior to the sate of hoods to reflect redudksns in liens paki by the developer or f^operty owner. > The developer shall be paid percent amounts of constixictran and need not show actual payments for the cost of (i) developer's overiiead, constmction management, and supervision at 4.5%, (ii) premiums for improvement and performance bonds at 15%. and (iii) premiums pakj for blanket liability Insurance at 1.8%. > The developer will have one diance, at teast 120 da^ before bond sate or such later date approved by the Finance Director, to eliminate the Iten amount for any parcels by redudng the amount he will be paid for the improvemaits. > The formation of the assessment district and constructton of improvements does not vest any rights to the existing land use aM>rovais for ttie property being assessed or to any particular level, type or intensity development or use. ENVIRONMENTAL REVIEW: This assessment distrid has been deemed to be a "project" subject to tiie requirements of the California Environmental Quality Ad (CEQA) since tiie levy of assessments and the issuance of bonds secured by such assessn^ts are committed to a spedfic project which may result in a potentially significant physical impact on the environment. On January 15, 2002, the City Council adopted Resolution No. 2002-016 w/hich ceriSfied the Environmental Impad Report, CEQA findings of fad, statements of oveniding considerations, a mitigation monitoring and reporting program, and afHproving a general plan amendment, master plan amendment, Zone 7 Local Facilittes Management Plan Amendment, zone change, master tentative map and hillside development permit witiiin the Calavera Hills Master Plan on property generally located south of the City of OceansWe and west of Lake Calavera in tiie northeast quadrant of the City (Case No. EIR 98-02/GPA. 99-03/MP, 150(H)/LFMP. 87-07(A)/ZC. 01-01/CT. 00-02/HOP 00-02), The EIR that was approved by tiie City Coundl included all of tiie improvements that are proposed to be acquired by the assessment district. Potentia% significant impacts in the areas of air quality, bidogical resources, cultural resources and hydrotogy/water quality wiil be mitigated through tiie incorporation of mitigation measures contained in the above documents which are on file with and can be reviewed at the Pianntng Department. 3 Page 4 of Agenda Bill No. 17.310 FISCAL IMPACT: The assessment distiict tax-exempt bonds, scheduled to be sold in two sertes, will fijnd ttie acqui^ion or construdion of the proposed improvements and related costs. The first series of bonds, v^ich are estimated to be sdd in ttie ^trmg of 2004, wili indude all as^ssments in the Calavera Hills II de^^p^1ent in an amount of approximate $12.83 nniliion. The second se^es of bonds, vy^idi virill not be sold until the Robertson Ranch East prqierty begins to develop, will be approximately $11.04 million. The tot^ amount of bonds vwll equal approwmately $23.87 million. This amount indudes fomiation costs, d^t issuance costs, and the estaWishment of a 9% debt service reserve fund. The total cost has been reduced ft-om approximat^y $24.2 million, as shovwi in the prsliminafy assessment engine^s report, due to favorabte constaiction bids received on this pr<:^'ed. The City is not responsible for the funding oftiie construction of any of the improvements induded in the assessment distrid. The improvements will be constmded by the developer and acquired by tiie City witii tiie proceeds of the bonds. The bond ftjnds used to acquire the improvements VIAII not indude tiiat portion of the costs of such improvemente representir^ (a) the general benefit to be derived from ttie arterial roadways, consisting of tfie center 2 lanes, and (b) the spedal beiefit attributed to parcels of land to be owned by public agencies, non-profit organizations, homeowner's associations and property located outside of the assessment distrid in Robertson Ranch West virtiich is fronting on Cannon Road and propo»Kl as a publk: park and elementary school. The developer will contribute ttiat portion of such costs representing sudi gen^l benefit and such spedal benefit. The developer may request a reimbursement agreement for the cost of the spedal benefit for tiie property k>cated outside of ttie assessment distiid in Robertson Ranch West. The reimbursennent would be paid by the owner of the Robertson Ranch West property, not by the City. The assessment lien amounts on individual single-family homeowners are estimated to range from $16,503 to $28,151. Hovwever. as required by City Policy 33, the estimated total amount of taxes, assessments and special taxes af^ysamg on ttie property tax bill will not exceed 1.8 percent of the initial sales price of any residential dvi^ling unit. Homeowners may choose to pay-off the assessment lien at any time. The annual payments, which wiil t>e colteded on tiie tax roll, are estimated to range from $1,344 to $2,293. EXHIBITS: 1. Location Map. 2. Order of Procedure. 3. Resolution No. 2003-244 approwng the final report of the assessment engineer, declaring the results of the assessment ballot tabulation, confirming the assessments and ordering the acquisition or construdion of improvements, together with appurtenances, in Assessment District No. 2003-01 (College Boulevard and Cannon Road East). 4. Resolution No. 2003-245 approving the form of the First Amendment to Acquisition/Financing Agreement and Spedal Assessment District Disclosure Agreement for Assessment Distrid No. 2003-01 (College Boulevard and Cannon Road East). 5. First Amendment to Acquisition/Financing Agreement. 6. Special Assessment Distrid Disdosure Agreement. 7. Final Engineer's Report dated July 31,2003. DEPARTMENT CONTACT: Lisa Hildabrand, (760) 602-2430, lhild@.d.r^dsbad.ca.us Recording Requested By and when Recorded Mail to: City of Carlsbad 1200 Carisbad Village Drive Carlsbad, CA 92008 Attn: City Clerk SPECIAL ASSESSMENT DISTRICT DISCLOSURE AGREEMENT This Agreement entered into as of tliis 16"' day of September, 2003 by and between the City of Cadsbad, a municipal corporation ("City") and MclVOllin Montara, LLC, a Delaware limited liabiiity company ("Developer"). WHEREAS, Developer has petitioned the City Council of the City to initiate and the City has imtiated proceedings for the formation of a special assessment district pursuant to the terms and provisions ofthe "Municipal Improvement Act of 1913", being Division 12 ofthe Streets and Highways Code ofthe State of California, said special assessment district known and designated as ASSESSMENT DISTRICT NO 2003-01 (College Boulevard and Cannon Road East) (hereinafter referred to as the "Assessment District"); and WHEREAS, the City has adopted policies relating to the utilization of Assessment District financing which require Developer to extinguish the lien on any parcel created as a resuh of the confirmation of assessments of the Assessment District prior to the close of escrow on the sale of such parcel to a residential home buyer unless Developer shall have provided flill disclosure of the existence ofthe assessment lien, the amount thereof, the annual assessment installments, the duration ofthe assessment lien and such other information as may be required by the City, and has provided the residential home buyer with the option to (a) take title subject to the applicabie Assessment District special assessment against their parcel, or (b) discharge the special assessment obligation prior to or concurrent with the close of such escrow; and WHEREAS, the parties hereto have entered into this Disclosure Agreement to establish the terms and conditions v/hich must be satisfied by Developer should it desire to allow residential home buyers to take title subject to the assessment obligation established for any parcel or parcels v/ithin the Assessment District. NOW, THEREFORE, IT IS MUTUALLY AGREED BY .AJO .BETWEEN IHE PARTIES AS FOLLOWS: Section 1. The above recitals are all true and correct. 9/11/03 9009. u H&O: #10357 vl Section 2. Developer owns property proposed to be subject to assessment obligations within the boundaries of the Assessment District. Developer's property is described and set forth in the attached, referenced and incorporated Exhibit "A". Section 3. The escrow for the sale to any residential home buyer of any lot or parcel, including condominium unit, within the Assessment District shall not close or titie to such parcel be otherwise conveyed to such residential home buyer without first causing the assessment lien created as a result of the confirmation of the Assessment District, if any, on such parcel to be extinguished except as provided for herein below. An assessment lien on a parcel within the Assessment District proposed to be sold to a residential home buyer need not be extinguished prior to the close of the escrow for the sale or other conveyance to such residential home buyer if Developer shall have given the residential home buyer a copy of the Notice of Special Assessment and Pre-Payment Option Election, the form of which is attached hereto as Exhibit "B" and incorporated herein by this reference, and such Notice shall have been duly executed by the residential home buyer or buyers and deposited into escrow. Section 4. Developer shall incorporate the amount of assessment lien into the advertised sales price ofthe home and clearly disclose the pass-through option in any sales literature. Sales literature for this purpose shall not be deemed to include media advertising, billboards, signs or other like advertisements. In addition, notice of the assessment in a form and size similar to Exiiibit "C" shall be pronainently displayed in all sales offices offering units for sale that are subject to the Assessment District lien. /// /// /// /// /// /// /// /// /// /// /// /// 9/11/03 9009.14 H&O:f;i0357vl Section 5. This obligation shall be binding on all heirs, assigns or successors-in-interest ofthe parties hereto, and the City shall cause a copy ofthis Agreement to be recorded in the Office ofthe County Recorder upon its execution. S«;tion 6. Developer shall indemnify and hold harmless the City of Carlsbad from any claims arising out of Developer's failure to adequately perfonn under the provisions of this A^eement. of / INWrrNES IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the / J Cm 2007. CITY OFC State of Cal By: McMillin Montara, LLC a Delaware limited lijJjility company By: McMillin Management Services, LP a Califomia liability partnership Its: Manager By: Coticy McKliljin Construction Services, Inc A Cali^ji^^r^rporation Its: Gener By: Its: By: Its: (Ail signatures must be notarized) H&O: #7222 v4 _j a notary STATE OF CALEFORMA ) ) ss. COLWY OF ) On before me, public in and for said State, person^y appeared , personally known to me (or proved to me on the basis of satisfectory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instalment the person(s), or the entity upon behalf of wliich the person(s) acted, executed the instmment. WITNESS my hand and official seal. Signature . (Seal) STATE OF CALIFORNIA ) ) ss. COUNTY OF _________ ) On before me, ^ a notaiy public in and for said State, personally appeared , personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the withjn instrument and acknowledged to me that he/she/they executed the same m his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instalment the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. WITNESS my hand and official seai. Signature (Seal) 9.1 i '03 9009 14 H&O: '(103,57 vl EXHIBIT A DE.SCRIPTrON OF SUBJECT PROPERTY THE LAND REFERRED TO HEREIN IS SITUATED IN THE STATE OF CALIFORNIA, COCNTY OF SAN DIEGO, AND IS DESCRfBED AS FOLLOWS: LEGAL DESCRIPTION OF VILLAGE K LOTS 1 THROUGH 84. INCLUSIVE. OF CARLSBAD TRACT NO. 01-02, CALAVERA HILLS VILLAGE K. IN THE CITY OF CARLSBAD. COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 14622. FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JULY 1, 2003. LEGAL DESCRIPTION OF VILLAGE L-2 LOTS 1 THROUGH 14, INCLUSIVE. OF CARLSBAD TRACT NO. 01-02, CALAVERA HILLS VILLAGE ^-2'. IN THE CITY OF CARLSBAD, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 14623. FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY. JULY 2,2003. LEGAL DESCRIPTION OF VILLAGE R BEING A SUBDIVISION OF A PORTION OF LOT 168 AND THE REMAINDER PARCEL OF CARLSBAD TRACT NO. 83-19 CALAVERA HILLS VILLAGE "T", IN THE CITY OF CARLSBAD. COUNTY OF SAN DIEGO. STATE OF CALIFORNIA. ACCORDING TO MAP THEREOF NO. 12951. FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY ON JULY 16,1992. SAID PROPERTY BEING DESCRIBED AS PARCEL A IN A CERTIFICATE OF COMPLIANCE RECORDED SEPTEMBER 20. 2000 AS FILE NO. 2000-0503706 OF OFFICIAL RECORDS OF SAID SAN DIEGO COUNTY. S'26.1>3 <50O9 14 H&O '•-"222 v4 EXHIBIT B NOTICE OF SPECIAL ASSESSMENT AND PRE-PAYMEINT OPTION ELECTION Assessmeat District No. 2003-1 (College Boulevard aad Cannon Road East) of the City of Carlsbad TO: THE PROSPECTIVE PURCHASER OF THE REAL PROPERTY KNOWN AS; Lot Number: Tract Number: Street Address: Estimated Original Assessment Lien: $ THIS IS A NOTIFICATION TO YOU PRIOR TO YOUR PURCHASING THIS PROPERTY. This property is within the above-named assessment district. The Cityof Carlsbad has issued bonds for the assessment district to finance the acquisition or constniction of certain public improvements that are of direct and special benefit to property within the assessment district. The bonds wil! be repaid from annual assessment installments on property within the assessment district. The property is subject to annual assessment installments of the assessment district that will appear on your property tax bills, but which are in addition to the regular property taxes and any other charges and levies that will be listed on the property tax bill. If you fail to pay assessment installments when due each year, the property may be foreclosed upon and sold. The annual assessment installment against this property for the - tax year is dollars ($ ). Assessment installments will be collected each year on your property tax bill in semi-annual installments until die assessment bonds arc repaid in tax year The pubhc facilities lhat arc being paid for by the money received from the sale of bonds that are being r^aid by the assessments are: * Roadway improvements to College Blvd. and Cannon Road generally consisting of grading and paving of streets, installation of curbs, gutters, sidewalks, guardrail, signing and .striping, storai drainage pipelines and other facilities, water, sewer aaid reclaimed H&a- mil v4 waler mains, dry utilities, environmental mitigation, landscaping of medians, parkways and adj^ent slopes and other g^purtenant worics; and • Storm drain improvements including a storm water detention basin east of College Boulevard noith oftiie easterly extension of Cannon Road. These facilities may not yet have all been constructed or acquired and it is possible that some of such facilities may never be constructed or acquired. YOU SHOULD TAKE THIS ASSESSMENT AND THE BENEFTTS FROM THE PUBLIC FACILmES FOR WHICH IT PAYS INTO ACCOUNT IN DECIDING WHETHER TO BUY THIS PROPERTY. YOU MAY OBTAIN A COPY OF THE RESOLUTION CONFIRMING ASSESSMENTS (RESOLUTION NO. 2003- ) THAT SPECIFIES MORE PRECISELY HOW THE ASSESSMENTS ARE APPORTIONED AMONG PROPERTIES IN THE ASSESSMENT DISTRICT FROM THE CITY OF CARLSBAD BY CALLING (760 ) OR ON THE CITY WEBSITE AT WWW.CLCARLSBAD.CA.US. THERE MAY BE A CHARGE FOR THIS DOCUMENT NOT TO EXCEED THE ESTIMATED REASONABLE COST OF PROVIDING THE DOCUMENT. PRE-PAYMENT OPTION ELECTION When you purchase the property, you will be solely responsible for the payment of the assessment. Prior to the close of escrow, you have the option to elect to either (a) pay off the assessment obligation in semi-annual assessment installments ("Option (a)") diuing the temi of the bonds or (b) pre-pay the entire assessment obligation at the close of escrow on the sale of the property to you in order to extinguish the assessment lien ("Option (b)"). If you elect Option (a) the assessment on the property will be collected in semi- annual installments which will be included in the property tax bill for the property. The annual assessment installments are estimated to be approximately $ per year to be collected through tax year - . In the event you elect Option (b), the amount required to pay-off the assessment in order to extinguish the assessment lien will be detemiined at the close of escrow. 8/26/09009.14 H&O. t>7Z22 v4 RECEIPT, ACKNOWLEDGEMENT AND PAYMENT OPTION ELECTION By signing this Notice, Buyer acknowledges that; !. The property that Buyer is purchasing is located within the boundaries of Assessment District No. 2003-01 (College Boulevard and Cannon Road East). 2. Buyer has had an opportumty to read and review this Notice, and has received a copy of this Notice prior to opening escrow for the purchase of the property, or, if received after the opening of such escrow, with sufficient time for Buyer to make any reasonable inquiries that Buyer deems necessary regarding the assessment against the property prior to the close of escrow. BUYER UNDERSTANDS THAT BUYER MAY TERMINATE THE CONTRACT TO PURCHASE OR DEPOSIT RECEIPT AFTER RECEIVING THIS NOTICE FROM THE OWNER OR AGENT SELLING THE PROPERTY. THE CONTRACT MAY BE TERMINATED WITHIN THREE DAYS IF THE NOTICE WAS RECEIVED IN PERSON OR WITHIN FIVE DAYS AFTER IT WAS DEPOSITED IN THE MAIL BY GIVING WRITTEN NOTICE OF THAT TERMINATION TO THE OWNER OR AGENT SELLING THE PROPERTY. 3. Buyer hereby elects the following option (check one): (a) pay the assessment in annual installments estimated to be approximately $ per year through the tax year - . (b) pay-off the entire assessment lien at one time at the close of escrow for the Property. The amount will be determined in escrow. The pay-off amount may include prepayment penalties, interest charges and other charges so that it may exceed the original assessment lien amount. /// /// /// /// /// /// 9/1 1.'03 9009.14 H&O; #10357 vl /// If Buyer elects Option (a), Buyer assumes the assessment against the property, and vvill be solely responsible for the payment of such assessment for as long as the Buyer owns the property and Seller shall have no liability for such payment. Further Buyer agrees to the amount and purpose of the assessment on the property and that Buyer forever waives any right of complaint of protest to the City pertaining to the nature, extent, duration and amount ofthe assessment against the property. Notwithstanding Buyer's election of Option (a) at this time, Buyer may pay the entire assessment at any time in the fiiture if Buyer so chooses. BUYER Name (Please Print) Signature Date Name (Please Print) Signature Date A COPY OF THIS EXECUTED NOTICE OF SPECUL ASSESSMENT AND PRE- PAYMENT OPTION ELECTION SHALL BE PROVIDED TO THE FINANCE DIRECTOR OF THE CITY AT THE CLOSE OF ESCROW. Please mail executed copy to: Finance Director City of Carlsbad 1635 Faraday Avenue Carlsbad, CA 92008 9/1 1/03 9009.14 H&O: Si0357 v! EXHIBIT C (Example of Sales Office sign - Use no smaller than Font size 30 for heading and 20 for textl NOTICE OF SPECIAL TAXES AND ASSESSMENTS The homes being sold in (name of development) are within Carlsbad Assessment District No. 2003-01 (College Boulevard and Cannon Road East) and the Carlsbad Unified School District Community Facilities District No. and are subject to an assessment lien and special taxes. This may require the homeowner to make semi-annual payments of assessment installments and special taxes over a terni of 30 or more years. The payments are made at the same tune and in the same manner as your property taxes. More information can be found in the Notice of Special Assessment and Pre- Payment Option Election form and the Notice of Special Tax, both of which must be read and signed prior to purchasmg a (name of Development) home. Your sales representative will provide a copy of these Notices and is available to answer questions. 9<'l 1'03 9O09. U H&O- ;n0357 vl EXHIBIT C (Example of Price Sheet Nodce - Use no small than Font size 12 for Notice) Price Sheet First home $_ Second home $_ Third home $_ Fourth home $ Norice: The homes being sold in fnanie of development) are within Assessment District No. 2003-01 (College Boulevard and Cannon Road East) and are subject to an assessment lien of approximately $ . This may require the homeowner to make annual payments of approximately $ over a term of 30 or more years. More information can be found in the Notice of Special Assessment and Pre-Payment Option Election form. Please see your sales representative for a copy of the Notice. 9/1 l.TO 9009.14 H&O; rf 10357 vl 1 2 3 4 5 6 7 8 9 10 11 12 13 U 15 16 17 18 19 20 21 22 23 24 25 26 27 28 RESOLUTION NO. 2003-245 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, APPROVING THE FORM OF THE FIRST AMENDMENT TO THE ACQUISITION/FINANCING AGREEMENT AND SPECIAL ASSESSMENT DISTRICT DISCLOSURE AGREEMENT FOR ASSESSMENT DISTRICT NO. 2003-01 (COLLEGE BOULEVARD AND CANNON ROAD EAST). WHEREAS, the City Councii of the City of Carisbad, Califomia, pursuant to the provisions of lhe Division 12 of the Streets arvi Highways Code of the State of Califomia (the Municipal Improvement Act of 1913) (the "improvement Act*) has undertaken proceedings to form and has formed an Assessment District for the purpose of financing tiie acquisition or construction of certain works of improvement, togettier with af^urtenances, such special assessment district known and designated as Assessment District No. 2003-01 (College Boulevard and Cannon Road East) (the "Assessment District"); and WHEREAS, the City Council did prewusly approve an Acquisition/Financing Agreement (the "Acquisition/Financing Agreemenf) made and entered into December 11, 2002 by and between the Crty of Carisbad and Calavera HiHs II LLC (the "Developer") to establish the terms and conditions upon which the Improvements (as defined in the Acquisition/Financing Agreement) would be acquired by the City; and WHEREAS, the City and the Developer desire to amend the Acquisition/Financing Agreement by entering into the First Amendment to the Acquisition/Financing Agreement, the form of which has been presented to the City Council (the "First Amendment"); and WHEREAS, the Developer requested that the assessments be permitted to pass-through to the purchasers of individual lots within the Assessment District; and WHEREAS, the City Council has af^roved the pass-through of such assessments subject to the approval by the City Council of a disclosure program as required by paragraph 16 of the City Council's Policy 33; and WHEREAS, the City and the Developer desire to enter into a Spedal Assessment District Disclosure Agreement, the fomi of which has been presented to the City Council (the "Disclosure Agreement"), to establish such a disdosure program. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Cartsbad, Califomia, as follows: 1. The above recitals are all true and correct. 2. The fomi of First Amendment to the Acquisition/Financing Agreement, herewith submitted, is approved substantially in the fomi submitted. The Mayor is hereby authorized to execute the flnal form of such agreement on behalf of the City. The City Manager, subject to tie review of the City Attomey and Bond Counsel, is authorized to approve changes in such agreement deemed to be in the best interests of the City, approval of sudi changes to be evidenced by the execution of sudi agreement. 3. The form of Disclosure Agreement, herewith submitted, is approved sirtsstantially in the form submitted. The Mayor is hereby authorized to execute the final form of such agreement on behalf of the City. The City Manager, subject to the review of the City Attorney and Bond Counsel, is auttiorized to approve changes in such agreement deemed to be in the best interests of the City, approval of such dianges to be evidenced by ihe execution of such agreement. PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City of Cartsbad on the i6th day of SEPTEMBER , 2003 by the following vote, to wit: AYES: Council Members Lewis, Finnila, Kulchin, Hall, Packard NOES: None ABSENT: N< CLAUDE A. L ATTEST ^ LORRAINE M. W^fcTD, City Cleric f (SEAL) Page 2 of Resolution No. 2003-245 City of Carlsbad Cantarini Ranch Derivation of Required Annual Special Tax to Fund Eligible City Facilities April 9,2014 Unit Count Annual Special Tax per Unit Total Annual Bond Revenue Total Annual Special Taxes for Bonding (((1) - $25,000 Admin. Chg.)/110%) (Bond Amount (6.50% for 30 Years, Amortized over 29 Years) Undenwriter's Discount (2.00%) Reserve Fund (Annual Debt Service Amount) Capitalized Interest (12 Months) Incidental Costs (Estimate) Total Net Construction Proceeds (a) 105 $ 3,600 378,002 $ 320,911 $ 4,190,671 (83,813) (378,002) (272,394) (250,000) $ 3,206,462 Footnotes: (a) Proceeds will be applied $1,460,418 in district wide improvements and $1,746,044 in project specific improvements. District wide improvements includes RCOA relocation costs and dry utilities. (1) City of Carlsbad Cantarini Ranch Total Tax Rate Analysis April 9, 2014 Home Prices and Combmed Tax Rates: Cantarini Ranch Estimated Home Price $ 1,500000 Ad-Valorem Tax Rate (1.00%) $ 15,000 Unified Bond Carisbad- Prop B 1997 A (0.01301%) (a) 195 Unified Bond Carisbad - Prop P (0.05777%) (b) 867 MWD D/S Remainder of SDCWA (0.00350%) (c) 53 Vector Disease Control (d) 6 Mosquito Surveillance Charge (e) 3 CWA Water Availability (f) 10 Ltg/Landscape Zone M (Estimate) (g) 50 MWD WTR Standby Charge (h) 12 Proposed CFD Special Tax (i) 3,600 Total Annual Property Taxes $ 19,795 Property Taxes as % of Home Value 1.32% Footnotes: (a) This amount represents the FY 2013-2014 ad-valorem taxes for the Carisbad Unified Schooi District Prop B Bond. (b) This amount represents the FY 2013-2014 ad-valorem taxes for the Carlsbad Unified School District Prop P Bonds. (c) This amount represents the FY 2013-2014 assigned special tax to repay Metro Water District G.O. Debt. (d) This amount represents the FY 2013-2014 tax assessment for San Diego Vector Disease Control. (e) This amount represents the FY 2013-2014 tax assessment to provide Mosquito Surveillance to San Diego County. (f) This amount represents the FY 2013-2014 tax assessment for County Water Authority Water Availability. (g) This estimate represents the FY 2013-2014 tax assessment for a future City of Carlsbad Lighting and Landscape Maintenance District. (h) This amount represents the FY 2013-2014 tax assessment for Metro Water District standby charge. (i) This amount represents the annual assigned special tax per unit for a proposed City of Carlsbad CFD for facilities. City of Carlsbad Holly Springs Derivation of Required Annual Special Tax to Fund Eligible City Facilities April 9, 2014 Unit Count Annual Special Tax per Unit Total Annual Bond Revenue Total Annual Special Taxes for Bonding (((1) - $25,000 Admin. Chg.)/110%) (Bond Amount (6.50% for 30 Years, Amortized over 29 Years) Undenwriter's Discount (2.00%) Reserve Fund (/\nnual Debt Service Amount) Capitalized Interest (12 Months) Incidental Costs (Estimate) Total Net Construction Proceeds (a) 42 2,307 96,906 $ 65,369 $ 853,631 (17,073) (96,906) (55,486) (100,000) $ 584,167 Footnotes: (a) Proceeds will be applied towards $584,167 in district wide improvements. District wide improvements includes RCOA relocation costs and dry utilities. (1) City of Carlsbaci Holly Springs Total Tax Rate Analysis April 9, 2014 /. Home Pnces and Combined Tax Rates: Estimated Home Price Ad-Valorem Tax Rate (1.00%) Unified Bond Carisbad- Prop B 1997 A (0.01301 %) (a) Unified Bond Carisbad - Prop P (0.05777%) (b) MWD D/S Remainder of SDCWA (0.00350%) (c) Vector Disease Control Mosquito Surveillance Charge (e) CWA Water Availability (f) Ltg/Landscape Zone M (Estimate) (9) MWD WTR Standby Charge (h) Proposed CFD Special Tax (i) Total Annual Property Taxes Property Taxes as % of Home Value Holly Springs $ 1,500,000 $ 15,000 195 867 53 6 3 10 50 12 2,307 $ 18,502 1.23% Footnotes: (a) This amount represents the FY 2013-2014 ad-valorem taxes for the Carlsbad Unified School District Prop B Bond. (b) This amount represents the FY 2013-2014 ad-valorem taxes for the Carisbad Unified School District Prop P Bonds. (c) This amount represents the FY 2013-2014 assigned special tax to repay Metro Water District G.O. Debt. (d) This amount represents the FY 2013-2014 tax assessment for San Diego Vector Disease Control. (e) This amount represents the FY 2013-2014 tax assessment to provide Mosquito Surveillance to San Diego County. (f) This amount represents the FY 2013-2014 tax assessment for County Water Authority Water Availability. (g) This estimate represents the FY 2013-2014 tax assessment for a future City of Carlsbad Lighting and Landscape Maintenance District. (h) This amount represents the FY 2013-2014 tax assessment for Metro Water District standby charge. (i) This amount represents the annual assigned special tax per unit for a proposed City of Carisbad CFD for facilities. CARLSBAD UNIFIED SCHOOL DISTRICT WETLAND MITIGATION AREA MANDANA KATO MANDANA CANTARINI RANCH HOLLY SPRINGS KATO R. MILAGRO DOS COLINAS WAL-MART LUBLINEREQ. CTR. SOUTH RCOA P-4 BARLOW EQ. CTR. NORTH MDRRCOA P-3 EQ. CTR. EAST PRIVATE RDCOLLEGE BL C A N N O N R D EL CAM REAL SALK AVCAM HILLS DRIM P A L A D R FOXTAIL LP LEISURE VILLAGE WYDASSIA WYGLEN AVPALMER WY F A R A D A Y A V WHI PTAI L LOOPSEQUOIA CRESTPUBLIC TRAILTIMBER TLWHI TE BIRCH DRA L IC A N T E W Y GALICIA WYJACKSPAR DRBRYANT DRLAMIA W Y PINDAR WYD O N JU A N D R ANDROS WYARCADIA WYARAPAHO PLSUNNY CREEK RDDON LORENZO DRFERMI CTP U B L I C R D REDWOOD CRESTLINDOS WYRHODES WYCOYOTE CT M Y C E N A E W Y MILETUS WY THEBES WYCOLLINOS WYLEMNOS WYELM RIDGE DRLINDSAY DRPOSEIDON WYAGORA WY KALAMIS WYBROWNING RD MORGAN RDLERKAS W Y PAT M O S W Y WOLVERINE TR ATHOS WY CAESENA WY DON ORTEGA DRS H ELLE Y PL T I L O S W YBERGEN PEAK PLORION STAEGINA WY NEWTON DRDON PABLO DR DON CARLOS DRDON ALBERTO DRMARATHON WYHILLTO P STPINEWOOD RDC O R IN T H I A W Y COUGAR DRDON DIABLO DR G A ZE LLE C T DON LUIS DR BOBCAT CT DON FELIPE DR SPANISH OAK WYSPENCER LN PYLOS WY LANYARD PLPRIVATE R D Z O N E 1 5 P A R T I C I P A T I N G P R O P E R T I E S Parcel lines were derived from SanGIS data and are notsurvey accurate. Some parcel lines can be positionally off upto 40.00'. The data shown hereon has been compiled fromthe sources listed and is not based on a field survey byHunsaker and Associates San Diego, Inc. Imagery source:ESRI World Imagery Disclaimer: This map should not be used for Engineering,Survey, or Site-Specific Analysis. Reasonable effort hasbeen made to assure the accuracy of the data provided;nevertheless some data may not be accurate. Hunsaker andAssociates San Diego, Inc. assumes no liability orresponsibility arising from the use of, or reliance upon thisinformation. Map prepared by J. Elmore R:\0848 VICINITY MAP 0 200 400 600 800100Feet 1 in = 400 ft 11City of CarlsbadCouncil Policy 33April 15, 2014 Policy 38•Adopted in 1987•Focused on Community Facilities Districts•Growth management financing recommendation•Policy 38 (amended) Policy 33Some of the significant requirements:•65 percent proponent approval•1.8 percent maximum tax rate•4:1 value to lien ratio•Projects in existing fee programs excluded•Pre‐formation costs not authorized•Minimum stage of development Policy 33 PrincipalsSome principals include:•To protect the public interest•To ensure fairness in the application of the assessments, special taxes, or fees to current and future property owners•To ensure the creditworthiness of any Special District debt•To protect the city’s credit rating and financial position•SimplicityThis policy does not supersede any law, but the intent is to further restrict or clarify its use. CFD vs ADCFDPublic improvementsCan finance public services, including police, fire, and librariesAssessment DistrictPublic improvements providing special benefitTechnically allowed for maintenance of AD facilities, but seldom used CFD vs ADCFDSpecial tax –does not have to be apportioned on the basis of benefitBoundaries are flexible2/3 vote requiredAssessment DistrictAssessment cannot exceed the reasonable cost of the special benefit conferredBoundaries are fixedMajority protest CFD vs ADCFDSpecial tax levied on tax bill up to a maximum rateDifferent tax rate for undeveloped property allowableAssessment DistrictAssessment can only be levied for debt service and admin chargesAssessment on undeveloped land based on potential use Bent‐WestPolicy 33 Exemptions1. Allow the pass‐through of special taxes under a proposed CFD2. Allow eligible costs back to June 1, 20073. Allow the acquisition of land for the construction or mitigation of improvements Bent‐WestPolicy 33 Exemptions1.  CFD formation and special tax pass‐through•Section 13 states “…applicable special tax to pay for public improvements against any parcel used for private residential purposes must be discharged prior to the sale of the individual lot.” Bent‐WestPolicy 33 Exemptions1.  CFD formation and special tax pass‐through•Section 14 states “For commercial/industrial property within a CFD and any property within an AD, the City Council may approve a pass‐through of the obligation…” Bent‐WestPolicy 33 Exemptions2. Allow eligible costs back to June 1, 2007•Section 3 defines ineligible costs:–Administrative or overhead expenses (S 3.B)–Costs incurred prior to request to begin work (S 3.G) Bent‐WestPolicy 33 Exemptions3. Allow acquisition of land for construction or mitigation•Section 3 defines ineligible costs:–On site right‐of‐way and easements (S 3.J) Bent‐WestPolicy 33 Exemptions•Section 4 states “Any exceptions to the criteria of this policy will be approved only upon an express finding by the City Council that the proposed Special District is so effected with a public interest that the city should assist in providing tax‐free financing … in order to satisfy a public need.” Council Guidance