Loading...
The URL can be used to link to this page
Your browser does not support the video tag.
Home
My WebLink
About
2015-02-17; City Council; 21864; Council Guidance Financing Public Improvements Zone 15
CITY OF CARLSBAD - AGENDA BILL AB# 21,864 COUNCIL GUIDANCE ON FINANCING OF PUBLIC IMPROVEMENTS IN LOCAL FACILITIES MANAGEMENT PLAN ZONE 15 DEPT. DIRECTOR y^f^/y MTG. 02/17/15 COUNCIL GUIDANCE ON FINANCING OF PUBLIC IMPROVEMENTS IN LOCAL FACILITIES MANAGEMENT PLAN ZONE 15 CITY ATTY. DEPT. ASD COUNCIL GUIDANCE ON FINANCING OF PUBLIC IMPROVEMENTS IN LOCAL FACILITIES MANAGEMENT PLAN ZONE 15 CITY MGR. RECOMMENDED ACTION: Accept a presentation from the Administrative Services Department/City Attorney on an approach to financing public improvements in Local Facilities Management Plan Zone 15 ("Zone 15") and receive Council guidance on pursuing the financing approach. ITEM EXPLANATION: On September 10, 2013, via Agenda Bill 21,360, Council approved a reimbursement agreement between the City of Carlsbad and Bent-West, LLC for assessment district formation deposits and allowed Bent-West, LLC to temporarily bypass the initial Policy No. 33 (the "Policy") approval steps. On April 15, 2014, via Agenda Bill 21,567, Council made a finding under the Policy to waive the provision of the pass-through requirement for community facilities districts ("CFD") based on the benefit of proceeding with the College Boulevard improvements in a district with diverse ownership. As such, staff has been pursuing the formation of a CFD as the financing mechanism for College Boulevard, Reach A in Zone 15. However, several things have occurred during this process that could change the ability and/or effectiveness of a CFD to be a comprehensive financing tool for Zone 15. Citv of San Diego v. Melvin Shapiro, et al. The statutory authority governing CFD formations allows for an election of registered voters or landowners depending on the number of voters who are registered to vote within the proposed boundaries ofthe CFD. If less than 12 registered voters reside within the proposed boundaries ofthe CFD, the election must be a landowner election where each landowner gets one vote for each acre (or portion thereof) of land they own within the CFD. If 12 or more registered voters reside within the proposed boundaries ofthe CFD, the election must be a registered voter election where each registered voter within the CFD is entitled to cast a vote. On August 1, 2015, the California Court of Appeal, Fourth Appellate District, Division One, issued its opinion in City of San Diego v. Melvin Shapiro, et al. (the "Shapiro Decision"). The case involved a Convention Center Facilities District (the "CCFD") established by the City of San Diego (the "City"). The CCFD is a financing district much like a community facilities district established under the provisions of the Mello Roos Act. The CCFD was comprised of all of the real property in the entire City. However, the special tax to be levied within the CCFD was to be levied only on hotel properties located within the CCFD. FOR CLERK USE. COUNCIL ACTION: APPROVED • CONTINUED TO DATE SPECIFIC • DENIED • CONTINUED TO DATE UNKNOWN • CONTINUED • RETURNED TO STAFF • WITHDRAWN • OTHER - SEE MINUTES AMENDED • REPORT RECEIVED PAGE 2 The election authorizing the special tax was limited to owners of hotel properties and lessees of real property owned by a governmental entity on which a hotel is located. Thus, the election was not a registered voter election. Such approach to determining who would constitute the qualified electors ofthe CCFD was modeled after Section 53326(c) of the Mello Roos Act, which generally provides that, if a special tax will not be apportioned in any tax year on residential property, the legislative body may provide that the vote shall be by the landowners ofthe proposed district whose property would be subject to the special tax. The Court held that the CCFD special tax election was invalid under the California Constitution because Article XIIIA, Section 4 thereof and Article XIIIC, Section 2 thereof require that the electors in such an election be the registered voters within the district. In the Shapiro Decision, the Court expressly stated that it was not addressing the validity of landowner voting to impose special taxes pursuant to the Act in situations where there are fewer than 12 registered voters. The Shapiro Decision, however, casts doubt on the validity ofthe provisions ofthe Mello Roos Act that would require a landowner election in the event there was at least one registered voter but less than 12. Zone 15 currently has several registered voters. Accordingly, bond counsel (consistent with the current position of all major bond counsel firms in California) is not comfortable advising the City to proceed with a landowner election under these facts. Additionally, as there are fewer than 12 registered voters, there is not authorization under the Mello Roos Act to hold a registered voter election either. Based on the forgoing ambiguity, the city's bond counsel has recommended that any parcels including registered voters be excluded from participating in a CFD unless further clarification from the Courts or the Legislature is provided. Development Status The varying stages of development within the proposed CFD also present several challenges. Section 8 of the Policy requires that all property in a proposed special financing district have received environmental review and all land use entitlements. Further, Section 13.B.2 of the Policy requires the CFD special tax formula include provisions to protect against changes in the density of development ofthe property within the CFD that would result in insufficient special tax revenue. This mirrors the statutory authority governing CFDs. A significant amount of parcels in the proposed CFD are unentitled and have no environmental review. Additionally, if this requirement was waived, the unentitled properties still face challenges. The city has to use the densities as shown on the most current approved map or document. As such, the city would use the densities shown in the current Zone 15 Local Facilities Management Plan in establishing the special taxes for the unentitled properties. This could create a situation where a property's density is reduced due to development or environmental constraints when they receive entitlement, but the corresponding special tax obligation is not because it could result in insufficient special tax revenue. Insufficient special tax revenue could increase the risk of failing to meet debt service payments. Even if these challenges were overcome, and the unentitled properties were included in the CFD, a bond issuance could still create undesirable outcomes. For example, if the city chose to pursue a single debt issuance (versus a debt issuance with multiple series) while the unentitled properties remained unentitled, those property owners might be taxed prematurely and at a level that could not be supported by the value ofthe unentitled property. If the city chose to issue multiple series of bonds, the subsequent series of bonds would be small and most likely unmarketable or fiscally inefficient as the financing costs would represent Z PAGE 3 a disproportional share of the construction costs. Lastly, if the city chose to wait to issue bonds until all unentitled properties within the CFD became entitled, it would, according to Bent-West, LLC, create reimbursement uncertainty for Bent-West, LLC. According to Bent-West, LLC this uncertainty would make it difficult to move forward with advancing funds for the construction ofthe public improvements on behalf ofthe entitled and unentitled properties. Application for Financing Zone 15 Public Improvements Bent-West, LLC submitted an application for the initiation of a special financing district on January 8, 2015 in compliance with the Policy. Bent-West, LLC's application included CFD formation request letters from five (5) parcels within Zone 15: Property Name Owner/Representative Cantarini Ranch Dennis O'Brien Holly Springs Susan Kelly Encinas Creek Apartments Susan Kelly Dos Colinas John Rimbach Rancho Milagro Warren Lyall These properties only represent a portion ofthe properties originally proposed for inclusion in a community facilities district. There are approximately 23 parcels that benefit from the improvements. Further, these properties are the only benefiting properties currently entitled within Zone 15 (i.e. have obtained city approval of a Tentative Map or Site Development Plan). All other benefiting properties within Zone 15 are unentitled (i.e. have not had city approval or the city approval has expired) and several have registered voters residing on the property. Under a separate request made on January 9, 2015, Bent-West, LLC asked the city to consider entering into a reimbursement agreement with Bent-West, LLC which would contain provisions on how the remaining properties within Zone 15 would contribute their fair share towards the public improvements. The proposal contains the following main ideas: The reimbursement agreement(s) would cover only unentitled properties. The reimbursement of each property's fair share obligation will be based on actual costs; not estimated costs. The reimbursement of each property's fair share obligation will be based on actual unit counts; not estimated unit counts. The reimbursement payments would take place at some development trigger (e.g. approval of final subdivision map, issuance of grading permit, etc.). The fair share obligation would escalate by a standard inflationary index (e.g. CPI, CCI, etc.) until the obligation was paid or terminated. The city's obligation to collect reimbursement payments from benefiting properties would terminate 15 years after the city accepted the College Boulevard improvements. PAGE 4 Bent-West, LLC's recommendation of an alternative financing approach that includes a CFD on the entitled properties and a reimbursement agreement(s) for the unentitled properties is their proposed solution to the legal case and entitlement issues described above. Reimbursement Agreement Requiring the unentitled properties within Zone 15 to pay their fair share of the public improvements may be accomplished several ways. The city may enter into a reimbursement agreement with Bent-West, LLC that contains provisions on how the city will collect the fair share payments from the unentitled properties and pass them through to Bent-West, LLC. This is typically done by imposing a condition on those unentitled properties as they come forward to develop. The development condition requires the property owners pay their fair share ofthe public improvements. Alternatively, the city may adopt an ordinance under its charter city provisions giving the city the right to impose reimbursement agreements on properties benefiting from public improvements. This method would similarly require those properties pay their fair share ofthe public improvements. A reimbursement agreement approach, regardless of the details, would require that Council impose this obligation on the properties benefiting from the public improvements. Affected property owners would have the right to voice their opinions at a public hearing, but not vote. Staff will return at a future date to recommend a specific reimbursement agreement approach at Council's direction. Council Guidance Staff is requesting Council guidance on pursuing an alternative financing for Zone 15; more specifically, imposing a condition/reimbursement agreement to ensure all properties benefiting from the public improvements pay their fair share of the public improvements. FISCAL IMPACT: Per the Policy, the cost to form a special financing district lies solely with the applicant. The applicant is required to deposit sufficient funds with the city to cover all formation costs. If a special financing district is formed and bonds are issued, the Policy allows the formation costs to be reimbursed to the applicant from bond proceeds. If, for any reason, a special financing district is not formed and bonds are not issued, the city will refund any unexpended deposits to the applicant per the Policy. There is no fiscal impact to the city by providing Council guidance on imposing a condition/reimbursement agreement to ensure all properties benefiting from the public improvements pay their fair share of the public improvements. ENVIRONMENTAL IMPACT: This action does not constitute a "project" within the meaning of CEQA in that it has no potential to cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment, and therefore does not require environmental review. EXHIBITS: None. Sherry Freisinger Mil Receive - Agenda item # _7_ For the Information of the: Cirf^COUNCIL ACM^ v^CA_2lcc »^ From: Sent: To: Cc: Subject: Attachments: r 3 Stan Weiler <stanweiler@hwplanning.com> Friday, February 13, 2015 3:15 PM City Clerk 'Steve Powell'; 'John P. Yeager'; Aaron Beanan; Charles McBride City Council Meeting - 9:00 AM - February 17, 2015 - Agenda Item 7 Agenda Item 7 - First - Zone 15 Area Map - February 10, 2015.pdf; Agenda Item 7 - Second - Highlights of Reimbursement Agreementdocx; Agenda Item 7 - Third - Zone 15 LFMP Improvements.pdf; Agenda Item 7 - Fourth - Z-15 NBS Estimated Cost Allocation ll-3-14.pdf; Agenda Item 7 - Fifth - Zone 15 Improvement Cost Breakdown.pdf; Agenda Item 7 - Sixth - Habitat Mitigation Plan - January 22, 2015.pdf Attached are six exhibits that we would like to use during our presentation to the City Council on February 17, 2015 under Agenda Item 7 for the Financing of Public Improvements in LFMP Zone 15. Mr. Steve Powell and Mr. John Yeager will be making presentations to the City Council. Please confirm receipt and contact me if you have any questions. Best Regards, Ston Weiler, AlCP Principal 2888 Loker Avenue East, Suite 217 Carlsbad, CA 92010 Phone: 760.929.2288 Ext. 402 Mobile: 760.801.4678 www.hwplanning.com CO a 5 b. c tQ 3} m 03 m m M O z m cn > m > > D "D o Tl m 7J CJTY OF VJSTA • CO 00 -vl o> cn -t>. OJ (o • oc>>>oo ^73 > I H o> c/) s: 7JO > > z ^5 oz ox gz> Z > Crt o w o ;u m m > City of Carlsbad Zone 15 Improvement Costs District Wide Improvement Costs: Street Improvements: DW-1 Cannon Rd. - Reach 4A DW-2 College Blvd. and Cannon Rd. Intersection Improvements DW-3 College Blvd. Core Improvements - Sunny Creek Rd. to Cannon Rd. Subtotal - Street Improvements Water Improvements: DW-4a CMWD Reclaimed Water Line -12" (384 Zone) (College) DW-4b CMWD Reclaimed Water Line -12" (384 Zone) (Cantarini) DW-5a CMWD Water Line -12" (Service Area A - 375 Zone) (College) DW-5b CMWD Water Line -12" (Service Area A - 375 Zone) (Loop through Cantarini) DW-6a CMWD Water Line -16" and 36" (Service Area B - 490 Zone) (College) DW-6b CMWD Water Line -16" and 36" (Service Area B - 490 Zone) (A Street) Subtotal Water Improvements: Drainage Improvements: DW-7 College Bridge over Agua Hedionda Creek - Drainage Facilitv BL-L DW-8a Detention Basin BJ-1 DW-8b Detention Basin BJ-1 Easement Condemnation DW-9 College Bridge - 78" Storm Drain Extension - Portion of Drainage Facility BL-L DW-10 College Blvd. - Drainage Facility BR (66" Culvert under College Blvd.) DW-11 Common Basins / Storm Drain Westside DW-28 EC North Hydromodification Basin Subtotal Drainage Improvements: Other Improvements DW-19a Habitat Mitigation Site Frontage Improvements DW-19b Parkway Landscape - Habitat Mitigation Area DW-20a Frontage Improvements for RCOA Parcel 3 DW-20b Parkway Landscape - RCOA Parcel 3 DW-21a Frontage Improvemenets BJ Basin DW-21 b Parkway Landscape - BJ Basin Subtotal Frontage Improvements: Additional Soft Costs DW-22 ADL Construction Support & Close Out - Frontages DW-24 Leighton - Geotech for Grading DW-25 TY Lin Bridge Design and Inspection DW-26 Sotft cost reimbursement subseguent to 9/10/2013 DW-27 City Assessment District Processing Subtotal Additional Soft Costs: $506,593 203,024 3,107,978 $3,817,595 $475,752 320,556 341,572 227,649 0 0 $1,365,529 $2,393,348 469,847 500,000 105,146 0 30,443 33,842 $3,532,626 $36,684 0 258,411 46,434 146,459 7 315 $495,303 $4,250 53,000 38,200 245,000 $540,450 [Total District Wide Improvement Costs: $9,751,503 Page 1 of 2 City of Carlsbad Zone 15 Improvement Costs Specific Improvement Costs: street Improvements: SI-1 College Blvd. Frontage Improvements - Cantarini Ranch $547,076 SI-2 College Blvd. Frontage Improvements - Eq. Ctr. East 101,565 SI-7 College Blvd. Frontage Improvements - MDR 74,842 SI-10 College Blvd. Frontage Improvements - Lubliner 130,844 SI-11 College Blvd. Frontage Improvements - RCOA P-4 71,416 SI-12 College Blvd. Frontage Improvements - Dos Colinas 624,258 SI-15 College Blvd. Frontage Improvements - Wal-Mart 8,840 SI-16 College Blvd. Frontage Improvements - Eq. Ctr. South 59,080 Sl-3cr College Traffic Signals at Streets A - Cantarini Ranch 158,040 Sl-3dc College Traffic Signals at Streets A - Dos Colinas 158,040 Sl-8mdr College Traffic Signals at Streets C - MDR 79,020 Sl-8cr College Traffic Signals at Streets C - Cantarini Ranch 79,020 Sl-8dc College Traffic Signals at Streets C - Dos Colinas 158,040 SI-18 College Blvd. Frontage Improvements - Eq. Ctr. North RR ?7? Subtotal Street Improvements: $2,318,353 Water and Sewer Improvements: Sl-4cr Sewer Line North - Cantarini Ranch $12,867 Sl-4mdr Sewer Line North - MDR 125,488 Sl-5cr Sewer Line South - Cantarini Ranch 86,882 Sl-5hs Sewer Line South - Holly Springs 40,120 Sl-5dc Sewer Line South - Dos Colinas Subtotal Water and Sewer Improvements: $273,896 Drainage Improvements SI-17 ECN Hydromod Basin on EC North - Cantarini Ranch $102,618 Sl-6cr Common Drainage improvements - Cantarini Ranch 447,972 Sl-6dc Common Drainage Improvements - Dos Colinas 430,256 Subtotal Drainage Improvements: $980,846 |Total Specific Improvement Costs: $3,573,095 Habitat MItlaation Improvements Habitat Mitigation Improvements: Habitat Mitigation on EC Property $1,070,984 iTdtal Habitat Mitigation Improvement Costs: $1,070,984 (Total Cost Estimate $14,395,5821 Page 2 of 2 Highlights of Bent-West's Proposed Criteria for the proposed Zone 15 Reimbursement Agreement L City consultants and Citv staff (and ultimately, the Citv Council) will determine fair-share cost allocations for all Zone 15 benefitting properties. 2. All final "fair-share" cost allocations will be based on the actual costs of constructing the College Improvements. 3. Each property's final fair-share cost allocation will be based on the actual number of units that are ultimately approved for the property. 4. Reimbursement payments for cost shares will be payable onlv when a property moves forward with development (i.e. final map or grading permit). 5. If an unentitled property is never developed- it will never have to make its reimbursement payments. 6. City's obligation to collect reimbursement payments will expire 15 years after completion ofthe College Improvements. 4:^ w ro CO (D 00 m ^ a ffi c 5 — Q- g (D a g. <a I! 9- sr lo to CO O. g gg Q- O S.' to g "2 " 2 c =J CO m o c o o CO CO =J Zi CO CD 12 15 Z3 Z3 O O CD CD w cn CQ' CD' 03 03 TD -O cn Crt is. a. a. 2 3 to a 3 4i g CD 2. —^ IVJ [\J IXJ l\J OOO CJJ CJl tn ooo —^ |\J [XJ CJJ o o C» CD CD cb cb cb CJl CJJ cn ooo IXJ IXJ IXJ IXJ OOOO CD CD CD CD (b cb cb cb ~J ~J -~J CD OOOO m Tl §55 Z Z ooo O ^ ^ Hoc o o Co > > m ^ 2 D c m 05 o o DO m z H ooo ooo O :<> n > 33 r- ^ r- •<Zo M TD Z o > > 5 m 1- z z H O O W I— 1— o m m c I o o M M O M 7) DO DO > > a D 7) O O >ss z z m m 73 71 > > O OT m m < w Pz O O 2 m z -1 S T ! > > Tl I : z z > I>>i3 ; O O r- f„ ; > > -< H O 73 m OT o o o o m 73 OT Tl c c c c o m m c c CCC c C^. cr. cu CD CD CD CD CD HJ CO cu CD CD SOTOTOTMMSXOTOTOTMMOTOT^ ^r' Ti-nTiTi-no"^"n"'3''i"n^"n-n <: O ,5 O S i. p o _L s a 2. a 3. " S S = =: Q. CD CD izr. ^. Q. Q. = c± CD CD Q. £1 7>7}737i7>7l7>7373737171737173^ ^ ^ 00 CXI > ^ CO O 22^??I^tX.- IXJ 71 cocohJ-i-^crcriu cn>--->-o--'-^-' oooooooooooooooo CO o CJI 00 71 O 4^ —^ CJJ OJ CD O*^IXJ<Dh0 JCJIJ^O o ^ U) 0) 3 - 3 <D Q. S c ~ ro 0) 3 T3 -n .. > S ^ o o oc™ - §1 ro o o 3 H I ° ro fl] T — o 5' 4ij;»j^*^N>04^^*^^ ^00001000(300 ^i-OOOOCJlOOOOO oo^co-^cocncxj —»-cjj^4^ CJJ-^IXJOJOJOJOOCTJOOCJJOO -NI Ol _ O C» CD O -J- to o 'o bl' to 00 CD CO to .t^ o CD CD IXJ CO CD CJJ O "jJw 'C!J "->• CD Ji CD to -i CD OJ b b, O O OJ IXJ CD OJ Ol O OJ o to '-vl cn CO CO CD ho Txj OJ CO ^ CO ^ 7} c S- m 3 ro D •o C ro -I m D c Ul 3 9. O-O % 3 § 3 a CO -i Ol (O _^ CJI -1 -VJ CO CJI OJ CO CO CD CD o CD 00 —^ CJJ o o CO 00 b 'to Ji o u> CJI CO 00 —i Ji M cn o CO o o to OJ o o ooo CO IO (JJ CO ^ CD CJJ CD CO ~* CO OJ Ji CO 00 Ol CD CJI to Ji 1X3 _0 03 CO O Ji CD 03 CJI 00 CO CJI IO IXJ to to to CD ~sl OJ O CO _M Ji 00 b) OJ ~J OJ 00 CO —k Ji —i CO ro —^ to CO b to _1. IO cn '--J cn to —i 'cD 'OJ CO _i Ji KJ J>. CJJ CO CD Ji CO to CO to J>. CJJ Ol to CJl Ji OJ Ji —^ OJ CD o CD Ji OJ to bl OJ Ji IJ. 'OJ 'o 'tn 'co '—i 'o 'cn 'cD 'oj 'cn 'cn 00 Ol CJl OJ Ol CJJ CO CO 00 Ji CO CD Ji CD o OJ CJl CO CO CO o CO O CO CO 00 » -vl CD o fl) cr Cfl TD ro o 5) 3 3 O T3 5) ro ST M 3 -•— ro 3 G9 0) •a o 3 3- 5" 3 O o 3. N QJ O 5' 3 ro (D °- 5' cn 5 m ro ffl |i CD Q_ S 9. (fl to c o —. -< a o o O M ^ s Q- O O S 3 o =^ I o s B) a> m D- =. =j =: 0) OJ S> CT — - a) Q. ro 3 ro _. 3. in T) Sl 0 o 1 3 ° 1 Q. " 5: ro' ri S tn 3 ro m > 3 ro Q. ro Z3 N o Ul m cn Js>. w N) O o > m Cfl Cfl Cfl =3: 3 5) ^ CD CO T3 5-T3 — 0 N: 1 'CQ ^ CD >< CD cn 03 o — T3 Q 13 00 03 cn Q) 03 Q) Cfl Cfl Cfl CD CD CD Q. Q. Q. CCC T3 T3 T3 OOO 3 13 3 5 CO CD CD > S O ^ > Cfl- O O Cfl ^ 03 13 C3. O -. — CD CD cn Cfl Cfl CD CD CQ CD O ? C 03. 3 CQ- CD 13 :3- 3 o CD Q. 3 o o CQ £2. 03 03 o 3 CD O CD CD 03 03 CQ — CD gi Cfl 03 O O CD Cfl Cfl CD o 03 ~i Cfl D" 03 Q. N3 O N3 D) 01 CO 0) 3 O W (73 O CD CD o' o 03 3 ;o 3 i- i- 73 ^ CD —1 o 03' m CD o O 5L 03 m o 03 3. o >-o o CD Cfl Cfl 3 o > o o CD Cfl Cfl O O 03 03 —1 CD CD > 5" Cfl Q. CO 13 CD CD 3 g. CD 13 a> 3 Q. C (A CD O (D (A O cn o o o o o o t o o O N3 CJO O OOOOO O O —i —^ —^ 03 b CD b b b b o o o o o o o o o o o o o ^ tx3 ^ti N) !ti 'jiw b o o o o o o o (0 i m D c (A NJ I s "I m a c CO o o o o O O -i w -i CO ho ho ^ b O CJl O O O CJI o N O 3 !1 9 R o CJ -* C O > s» - n-= a 3 (D 3 03 ^ -i ^ ^ M ii li CO ^ OD b ho b o o o o o cn o I m a c (0 o o o •D CO •n c § c (= c c 3. 3. 3. 3. 5. (—OQ *—t- r-t- r-t. City of Carlsbad Council Guidance on Financing Public Improvements in Zone 15 February 17, 2015 1 Zone 15 Financing •AB 21,360: Council approved a reimbursement agreement to accept assessment district formation deposits and allowed Bent-West, LLC to temporarily bypass Policy 33 steps •AB 21,567: Council waived pass-through requirement for CFDs •Staff has encountered financing challenges that could change the ability and/or effectiveness of a CFD to be a comprehensive financing tool 2 Financing Challenges: Legal Challenges Entitlement Challenges 3 Legal Challenges •City of San Diego v. Melvin Shapiro, et al. –Court held electors must be registered voters –Court stated it wasn’t addressing validity of landowner voting in a CFD –Ruling still creates ambiguity for a CFD election which contains registered voters –Bond counsels recommend parcels with registered voters are excluded until ambiguity resolved Entitlement Challenges •Policy 33 requires: –All property in CFD has environmental review and all land use entitlements –Special tax formula must protect against changes in density which would create insufficient revenue •Development status –Five properties entitled, majority unentitled 5 Entitlement Challenges (cont.) •Map placeholder slide 6 ELCAMINOREAL MIDDLE TONDRCAMINO HILLS DRLEXI N G TONCRMILTON RD RANCHOCARLSBADDRFROST AVEDINBURGHDR MA S TO D O N CTMERW IN DRT WAI NAVINLE TDRCRATERRIMRD ALANDER CT BRYA NTDRLANCASTER R D WOLVERINETRCAVERNPLHARWICHDRFORECASTLECTREDBLUFFPLCANNONRD NORTH FORK AV L INDSAYDR C O U G A RDRA R A P A H O P L CARIBOUCTGA ZELLECTMORGANRDRAVINEDR FERMI CTBRAND ONCRBUCK RIDGEAV TOLKIENWY PALME RWYP ENINSULAD RB ER G ENPEAKPLLON GFELL OWR DMEADOWDR GLEN AV J E TTY PTWHIPTAIL LOOPTAMARACKAVFOURPEAKSST L Y N CH CT COYOTECTSADDLEDRCIARDICT MASTERS RDFOXTAI L L P GATESHE AD RD KEATSPL RICHFIELDDRCOLLEGE BL Local Facilities Management Zone 15 Benefiting Properties Document Path: J:\Requests2010Plus\Finance\5400231_15\LFMZ15Properties.mxd !J LFMZ 15 Boundary Entitled Property Unentitled Property Entitlement Challenges (cont.) •Density changes: –Density is determined by most current approved map or document for unentitled properties –Density could be decreased upon entitlement without corresponding decrease in special tax obligation because that could create insufficient tax revenue •Special tax obligation could be disproportionate to density 7 Entitlement Challenges (cont.) •Bond issuance(s) including unentitled: –Single bond issuance “now”: •Unentitled properties could be taxed prematurely and at a level unsupported by the property’s value –Series bond issuance “now and later”: •Subsequent series of bonds would be small and most likely unmarketable or fiscally inefficient –Single bond issuance “later”: •Bent-West, LLC indicates this creates uncertainty which makes it difficult to advance funds for construction on behalf of the entitled and unentitled 8 Application for Zone 15 Financing •Bent-West, LLC submitted: –Application to form a CFD over five entitled properties –Request to enter into a reimbursement agreement with the city that would contain provisions on how the unentitled properties would contribute their fair share 9 Proposed Reimbursement Agreement •Proposed reimbursement agreement provisions: –Cover only unentitled properties –Reimbursement based on actual costs –Reimbursement based on actual unit counts –Reimbursement payments occur at a development trigger (e.g. final map, grading permit, etc.) –Obligation would escalate by some inflationary index –City’s obligation to collect reimbursement payments from benefiting properties would terminate 15 years after city acceptance of the public improvements 10 Reimbursement Agreement Options •City enters into a reimbursement agreement with Bent- West, LLC that details how the city will collect the fair share payments from unentitled properties –Typically done by imposing a development condition on the unentitled properties •City uses charter city provisions to adopt a reimbursement agreement ordinance –Affords the right to impose a reimbursement agreement on properties benefiting from public improvements 11 Council Guidance •Staff requests Council guidance on pursuing an alternative financing for Zone 15; more specifically, imposing a condition or reimbursement agreement to ensure all properties benefiting from the public improvements pay their fair share •Staff will return to Council with a recommended approach at Council’s direction 12 Questions? 13 Jackson I DeMarco I Tidus Peckenpaugh A LAW CORPORATION February 16,2015 Direct Dial: 949.851.7409 Email: mstaples@jdtplaw.com Reply to: Irvine Office File No: 2294/00178 VIA EMAIL (clerk@carlsbadca.gov) AND FIRST CLASS MAIL City Council City of Carlsbad 1635 Faraday Avenue Carlsbad, Califomia 92008 Re: Objection to Proposed Approach to Finance Public Improvements in Local Facilities Management Plan Zone 15 and Request to Continue Matter Off Calendar (February 17,2015 Agenda Item No. 7, AB #21,864) Dear Mayor Hall and Honorable Councilmembers: 1. Introduction and Summary. We represent Mandana Cal Co., the owner of approximately 190 acres of land included in the reimbursement area ofthe Zone 15 financing proposal (shown as property no. 11 on the Zone 15 map at the last page of the attached "Zone 15 Infrastructure Financing and Reimbursement Program"). Mandana has owned the property for over 30 years. The property is unentitled and has long been farmed. Mandana's property comprises 27% ofthe entire reimbursement area plus CFD area, and more than 50% of the proposed reimbursement area. Although Mandana is a major landowner in Zone 15, the City and Bent-West did not inform Mandana of their efforts to form a financing district including Mandana's property until last July, after the City Council had already made several key decisions adverse to Mandana's interests in September 2013, April 2014, and June 2014. We urge the City Council to deny staffs request to pursue the hybrid CFD/reimbursement financing mechanism as currently proposed, and to continue the matter off calendar until its terms are vetted and consented to by 65% of the landowners included in the entire reimbursement area plus CFD area. The City's actions to date on the Zone 15 financing strategy violate Mandana's Constitutionally- protected substantive and procedural due process rights by: 1) failing to provide Mandana prior notice and an opportunity to participate in key City Council meetings over the past two years authorizing Bent-West to bypass the initial 65% irvine Office 2030 Main Street, Suite 1200 Irvine, California 92614 t 949.752.8585 f 949.752.0597 Westlake Village Office 2815 Townsgate Road, Suite 200 Westlake Village, California 91361 1805.230.0023 f 805.230.0087 www.jdtplaw.com City Council City of Carlsbad February 16,2015 landowner consent step required by Council Policy No. 33 (see City Council Resolution No. 2013-226), waiving Policy 33's prohibition against public financing of an applicant's administrative, financial consultant and legal fees in order to add Bent-West's expenditures into the Zone 15 financing district (see April 15,2014 City Council Minutes, Agenda Bill No. 21,567), and approving reimbursement agreements with Bent- West to form a CFD (see City Council Resolution Nos. 2013-226,2014-159); 2) withholding information from the City Council about major landowner objections and Bent-West's inability to achieve the required 65% landowner consent contradicting the Council's stated reasons for approving those actions; 3) failing to inform Mandana that the City Council had taken those actions to commence formation of a CFD until last July; and 4) structuring the current proposed financing mechanism described in the February 17, 2015 Agenda Bill in a manner intended to (i) encumber Mandana's unentitled property to the same or greater extent of the previously proposed CFD, (ii) avoid accounting for the property's inability to support the proposed debt, and (iii) avoid providing Mandana an opportunity to vote on the current financing mechanism. If implemented, the proposed financing strategy will also expose the City to risk of liability for the unconstitutional taking of Mandana's property by imposing an obligation to finance public improvements disproportionate to the property's need for or contribution to the improvements, at rates and terms that could render future development infeasible, with fiill knowledge that the property is unentitied and cannot support the debt. 2. The Proposed Financing Strategy Unfairly Burdens Mandana and Other Unentitled Properties for the Benefit ofthe Few Developers With Expiring Tentative Tract Maps. Under Bent-West's current Zone 15 financing proposal (see attached Zone 15 Infrastructure Financing and Reimbursement Program), a few developers with approved tentative tract maps representing less than half of the CFD area plus reimbursement area would form a CFD. Their participation would be capped at the payment of the special tax established by the CFD. The February 17, 2015 Agenda Bill (at p. 2) explains that, if only the landowners with approved tentative tract maps were to participate in a CFD, their land would not generate sufficient funds from the sale of bonds to construct College Boulevard. So the financing mechanism proposes that the majority of the ultimate College Boulevard construction costs would be paid primarily by the remaining unentitled properties by way of a reimbursement agreement obUgating the City to foreclose, if necessary, to pay the construction costs upon completion of certain milestones. Knowing that the value of the unentitied property would not meet the required loan-to-value ratio to support a CFD (see February 17, 2015 Agenda Bill p. 2), the proposal is to include only the few properties with approved TTMs in the CFD. The remaining unentitled properties would be subjected to a reimbursement amount that increases over time at the inflationary index rates which in Mandana's case, when compounded over 15 years, could approach 100%. The City Council City of Carlsbad February 16, 2015 proposal is also structured to not allow the vmentitled landowners to vote on the financing strategy. (See February 17, 2015 Agenda Bill, p. 4.) The proposal creates three different categories of landowners within Zone 15 (see map at last page ofthe Attachment): (1) a few entitled property owners with tentative tract maps are to be included in a CFD and their contribution would be capped based on a projected construction fund and tax-exempt municipal bond rates; (2) several undeveloped properties within Zone 15 are to be omitted from participation in the financing proposal without explanation; and (3) the remaining, unentitled landowners comprising the majority of the area are to provide security for the construction ofthe College Boulevard improvements by way of a reimbursement obligation. Unlike the CFD properties, the reimbursement properties' obligation is not capped. Therefore, - any variance in the construction funding projections would appear to be borne by the unentitled reimbursing properties. The proposed hybrid CFD/reimbursement strategy simply does not work under the current circumstances where the majority of the financing area is unentitled. The imposition of such a large reimbursement obligation on Mandana's unentitled property may make it infeasible to build, particularly in light of other regulatory and physical constraints. Additionally, landowners who have been omitted from the process until recently are now asking serious questions about the validity ofthe projected construction costs and Bent-West's inability to finance or construct public improvements under the terms of its Operating Agreement. The College Boulevard improvements, if constructed under the proposedfinancing mechanism, would not increase the value or development potential of Mandana's property. Instead, the financial burden may render the property's development infeasible. 3. The Proposed Financing Strategy Does Not Comply with City Council Policy 33 and City Council Approvals. The City Council's Policy No. 33 provides policy guidance for the City's use of assessment districts, CFDs and Bridge and Thoroughfare Districts. Policy 33 is intended to, among other things, ensure fairness in the application of assessments, special taxes, or fees to current and future property owners; ensure full disclosure to current and future property ovmers ofthe Special District; and establish one policy regarding the requirements that must be met before the City Council will consider approving the financing of public improvements using Special Districts. Policy 33's "Property Owner Requirements" (Sections 5 and 6) provides that the appUcant shall have the concurrence of the affected area's property owners representing not less than 65%), by area, of the land proposed to be assessed, taxed, or subject to the payment of fees. The September 10, 2013 City Council Resolution No. 2013- 226 that initiated the original proposed CFD proceedings requhes Bent-West to meet the 65% landowner approval threshold before proceeding with the rest of the formation process. Likewise, Section 11 ofthe Reimbursement Agreement for Special Financing District Formation Deposits approved by the City Council on June 24, 2014 requires Bent-West to comply with Council Policy No. 33 in forming the CFD and issuing bonds. City Council City of Carlsbad February 16,2015 The current hybrid CFD/reimbursement financing proposal does not meet 65% landowner concurrence provision of Policy 33's Property Owner Requirements. The hybrid CFD/City- imposed reimbursement area is not among the financing mechanisms for College Boulevard discussed in the September 10, 2013 Agenda Bill (p. 1). The City Council should not approve the request to pursue the financing approach, as currently proposed, until the matter has been vetted and supported by 65% of the affected landowners in accordance with Policy 33 and the Council's prior approvals. 4. The Proposed Financing Strategy Violates Mandana's Procedural Due Process Protections. The City has approved a series of waivers allowing Bent-West to deviate from the Policy 33 procedures without notice to the affected property owners. The process to date is creating bureaucratic momentum while depriving Mandana and the other affected landowners an opportunity to meaningfully participate in the City's decisionmaking. Policy 33's Property Ovmer Requirements provide for the applicant to prove it has the concurrence of at least 65% of the owners, by area, of property proposed to be subject to the levy of assessments before proceeding through the formation process for a special financing district. Ever since 2005 when a special financing district was first discussed by Bent-West, both Mandana and the Kato Family Limited Partnership (who collectively hold 41%) of the acreage in the so-called benefitted area) have objected to the premature inclusion of their properties in the financing structure on grounds that, as unentitled properties, their properties do not currently need or contribute to the College Boulevard improvements, and their property values could not support the debt levels that have been proposed. Until last July, Mandana was unaware that Bent-West and the City were, nevertheless, pursuing the formation of a CFD. Although Mandana is a major landowner within the CFD area that was originally proposed by Bent-West, the City provided no notice either before or after the City Council's action on September 10, 2013, authorizing Bent-West to temporarily bypass the initial 65%) landowner concurrence step under Policy No. 33's Property Owner Requirements (Resolution No. 2013-226). The September 10, 2013 Agenda Bill justifying the City Council's action erroneously says that "several large landowners are out of state and hard to communicate with" and that "Bent West, LLC believes having preliminary numbers to share with the other ownership interests would solidify the requisite 65 percent ownership approval". In fact, both Mandana and Kato are in-state and easily accessible to both the City and Bent-West. As soon as Ali Shashani of Mandana learned of Bent-West's efforts, he sent an email to Stephen Powell of Bent-West, with a copy to Chuck McBride and Aaron Beanan, reiterating Mandana's objection to being prematurely included in the proposed CFD. Warren Kato of the Kato Family Limited Partnership also notified Aaron Beanan of Kato's objection. A few months later, in December, the current hybrid CFD/reimbursement finance mechanism was distributed to most of the Zone 15 landowners. (There is no information on whether WalMart has received notice of the proposed financing mechanism, and if so, what its position is.) Under the City's waiver (City Council Resolution No. 2013-226) Bent-West was still required to comply with Policy 33's Property Owner Requirements providing for 65% landowner City Council ^- City of Carlsbad February 16,2015 concurrence before proceeding further with the financing district. Instead, the current proposal attempts to circumvent that requirement by unposing a reimbursement obligation on the unentitied properties by way of a reimbursement obligation, without providing them an opportunity to vote. (February 17,2015 Agenda Bill, p. 4.) However, as currentiy proposed, the CFD is interdependent on the imposition of the reimbursement obligation. The proposed financing strategy violates Mandana's procedural and substantive due process rights by pledging Mandana's property as collateralfor the College Boulevard construction costs over Mandana's objection, while depriving Mandana the opportunity to vote on the proposed financing mechanism. We offer the observation that College Boulevard is a City arterial serving not only the properties adjacent to it in Zone 15 but also significant other areas in the City. Accordingly, the City's referenced legal authority to establish a reimbursement area over the objection of a majority of the unentitied landowners, Govemment Code Sections 66486 and 66487 (a portion ofthe Subdivision Map Act), appears to be misplaced. 5. The Proposed Financing Strategy Amounts to an Unconstitutional Taking of Mandana's Private Property. Private property may not be taken for public use without just compensation. (U.S. Const., 5th Amend.; Cal. Const., art. I, §19.) The purpose of the Takings Clause "is to prevent the govemment from forcing some people alone to bear public burdens which, in all faimess and justice, should be borne by the public as a whole." (Palazzolo v. Rhode Island (2001) 533 U.S. 606,617-618.) Constitutional requirements also state that there must be an "essential nexus" between an imposed condition and the impacts of a specific project (Nollan v. California Coastal Commission, 483 U.S. 825, 837 (1987)) and that the conditions imposed must be "roughly proportional" to the project impact (Dolan v. City ofTigard, 512 U.S. 374, 391 (1994)). The proposed financing method would allocate a greater financial burden to Mandana than its fair share. Mandana's land is currently farmed and is unentitied. It does not contribute to or need the proposed improvements. Nevertheless, the hybrid CFD/reimbursement financing mechanism allocates Mandana's reimbursement obligation based on unit projections under the current General Plan designation. It is simply premature to include Mandana's property as part ofthe proposed financing mechanism when there is not yet a clear picture of its potential development yield due to regulatory and physical constraints. The proposed financing mechanism also does not factor into the fair share calculation the fact that certain Zone 15 properties are excluded from the CFD and reimbursement area, and that the Carlsbad Boulevard extension will carry many times more traffic than the Zone 15 properties will generate. The Febmary 17, 2015 Agenda Bill (p. 2) acknowledges that the unentitied property cannot carry the proposed debt. Also, unlike the CFD properties, which the City Council has allowed to pass through the financing debt to the uhimate homeowners (see April 15, 2014 City Council action on Agenda Bill No. 21,567), Mandana would be obligated to pay a lump sum reimbursement upon some development trigger, such as subdivision map approval or issuance of grading permit (see Febmary 17, 2015 Agenda Bill, p. 3). As soon as the City pledges Mandana's property as security for the CFD and establishes a reimbursement obligation subject to the inflationary index rates for the Carlsbad Boulevard improvements, it will cloud Mandana's titie and impose an City Council City of Carlsbad February 16, 2015 onerous and unfair burden on the property negatively affecting its value and rendering its future development infeasible. We assume the last thing the City wants to do is foreclose on the Mandana property and the other unentitled reimbursement properties. But based on the information in the Agenda Bill, the proposed Zone 15 financing strategy seems inevitably headed to that end. The City should assume that, in order to recover its costs of constmction, Bent-West may demand that the City foreclose on the allocations assigned to each of the reimbursement properties, if necessary, when they achieve a development milestone requiring payment. It is not difficult to imagine circumstances where the reimbursing property owners, for reasons beyond their control, may be unable to pay their contribution to fund the constmction of College Boulevard. For example, regulatory and physical development constraints, inability to obtain funding for the development project, market conditions impeding sales, a significant and unforeseen increase in College Boulevard's construction costs (which, in contrast to the CFD properties, only the reimbursing properties could be liable to pay). Imposing such a large financial obligation on Mandana's property may render its development infeasible. 6. Conclusion and Request to Continue the Matter Off-Calendar. Mandana and the other unentitled landowners are not unreasonable. They have legitimate concems with the proposed financing strategy that effectively requires them to assume the development risk, assume the market risk, and incur debt at a rate far greater than the few entitled landowners included in the CFD. The financing proposal is premature and should be continued off-calendar until these and other basic concerns are vetted and the consent of 65% of the affected landowners in the combined CFD/reimbursement area is obtained. Sincerely, Michele A. Staples Attachment cc: Steve Sarkozy, City Manager (manaRer(a),carlsbadca.gov) Celia A. Brewer, City Attomey (Celia.Brewer(S)carlsbadca.gov)* Chuck McBride, Director of Finance (Chuck.McBride@carlsbadca.gov) Aaron Beanan, Senior Accountant (Aaron.Beanan@carlsbadca.gov) Glen Van Peski (Glen.VanPeski@carlsbadca.gov) Jeremy Riddle (Jeremv.Riddle@carlsbadca.gov) Shannon Wemek (Shannon.Wemeke@carlsbadca.gov) Mr. Ali Shashani* *via email, with Attachment Zmte 15 InfrastractHire Fifflanemg amd RciimbiarscBBent ProaBram 1. The Carl^jad City Coumdl approved the Local Facilities ManagemeoJ Plan Ameinidtneiist Zone 15(E) (the '''Zone 15 LFMP") om Jaiuuasy ! 0,2012 puisuaitit to City Council Resoiedoa No. 2011-285. 2. The Zosne 15 LFMP specifies varioais m^or kifrasfnictisie improveroenis required to sene all new developmmt witMn Ime 15, imduding the constraction of CoUege Boulevard from Cmnon Road to the existing northerly terminus near Ef Camino Real and related infrastractare improveaients, as farther described in Exhibit "A" attached hereto (the "College Boulevard Improvements"). 3. Tlie City approved Carlsbad Tract No. 00-IS for the Bent-West property pursuant to Planning CommisSEOn Resolution No. 5753 and imposed various Conditions of Approval, mcluding Conditions Nos. 50 thFOUgh 56 requiring the financing and constraction of the Coiiege Boulevard Improvements (the "Conditions of Approval"). 4. Bent-West is proposing to advance 100% of the costs of the College Boulevard Improvements (aKiently estimated to be S 14,395,580), subject to reimbursenient from other benefitted properties within Zone 15 of their fair share of the costs of the College Boulevard Improvements, 5. The Zone 15 LFMP states that "no single financing mechanism could satisfy the complex infrastructure requiremente of this Zone." (Zone 15 LFMP, pp. 148-149) Consequently, Bent-West isj proposing two financing mechanisms for the reimbursement ofthe costs ofthe College Boulevard Improvements from benefitted properties within Zone 15 — a Community Facilities District established pursuant to Ae Melio-Roos Community Facilities Act of 1982, as amended (Govemment Code Section 533 U, et. seq.) (the "2^ne 15 CFD") and a reimbursement agreement between Bent-West and the City pursuant to which the City would collect a reimbursement from all benefitted properties within Zone 15 (the "Reimbursement Agreement''). 6. The cost of the Coiiege Boulevard Improvements would be spread among the benefitted properties pursuant to a fair share cost methodology approved by the City and coOected from such properties pursuant to the Zone 15 CFD and the Reimbursement Agreement An initial draft of the co55t allocation prepared by the City's consultant, NBS, is attached hereto as Exhibit "B", (A portion of the cost of some of the drainage and water line improvements are not included in the cost allocation but, in accordance with the Conditions of Approval, may be subject to separate reimbursement agreements providing for reimbursement from existing fee programs.) 7- The Zone 15 CFD would be established pursuant to City Council Resolution No. 2002-369 ("Policy 33") and the Meflo-Roos Act ft would include the foUowing elements: • The Tjotie 15 CFD boundaries would include five properties that are currently entitled-i.e., Dos Colinas, MDR/Encinas Creek Apartments, Holly Springs, Cantarini Ranch and Rancho Milagro. Each such propa^ would be designatol as its own 'Tax Zone"" within the Zone 15 CFD. • The special taxes auttorizied for each Tax Zone would be based on (1) the Tax Zme''s 6ir share of the estimated costs of those Coil^e Boulevard Improvements (excluding habitat mitigation for CoUege Boulevard) that are deemed eligible for fiEtancing through a CFD with tax-exempt bonds and (2) the existing entitiements or development assumpfoos for the Tax Zone included in the Zone 15 LFMP — i.e., limit eomits or gross leasable area ("GLA"). • PtMsuaikt to the Cify Council's action of April 15,2014, the special taxes would not be required to be prepaid prior to the sale of individual residential lots to homeowners. • Special taxes will not be levied upon property within a Tax Zone prior to the earlier of (I) approval ofthe first final subdivision map within the Tax Zone, (2) issuance of the first grading pemiit within the Tax Zone (excluding grading done tor agricultuml purposes), or (3) the coramencemait of construction, within the Tax Zone (excluding the construction of sfcmctures designed to support agricultural operations). • The amount of bonds issued to fiind the Zone 15 CFD Tax Zones' fair share of the Collie Boulevard Improvements shall be based upon tbe actual costs of the College Boulevard Improvements. 8. The Reimbursement Agreement would be entered into by the City pursuant to its police powers under Article XI, Section 7 of the California Constitution, Govemment Code Section 66486, Sections 20.16.041 and 20.16.042 ofthe CarlsbadMunicipal Code, fhe Zone i 5 LFMP and the Conditions of Approval. The Reimbursement Agreement is intended to fae ofthe type described in Section VI.E ofthe Zone 15 LFMP (see p. 150) and could be similar to the form of Eeimbursement agreement approved by the City in Zone 14 pursuant to City Council Resolution No. 2004-293. The Reimbursement Agreement will include the following elements: • The benefit areas of the Reimbursement Agreement (each, a "Benefit Area") shall correspond to each of the Tax Zones as well as the properties in Zone 15 but outside the Zone 15 CFD as depicted in Exhibit "C" attached hereto (ali, "Benefit Areas"). • The Benefit Areas corresponding to each Tax Zone within the Zone 15 CFD shall only be subject to reimbursement payments for their fair share of the habitat mitigation costs ofthe College Boulevard Improvements. • The Benefit Areas corresponding to each of the properties outside of tlie Zone 15 CFD shall be subject to reimbursement payments for their fair share of all of the costs of the College Boulevard Improvements. • InitiaEy, the established reimbursement payments shall be based upon (I) the estimated cosSs of the College Boulevard Improvements and (2) the actual entitlements or the developmmt assumptions for each Benefit Area in the Zone 15 LFMP. The actual leimbursement payments shall then be adjusted to reflect (I) the actual costs of Ae CoUege Boulevanl f mprovetnents and (2) the actual development entillements (Le., units or GLA) for the Benefit Areas at the time the reimbursement payment is required. • The reimbuisement payment for a Benefit Area shall be made upon the earlier of (1) approval of the first final subdivision map within the Benefit Area, (2) issuance of the first grading permit within the Benefit Area (excluding grading done for agricultural purposes), or (3) the commencement of constraction within the Benefit Area (excluding the constraction of structures designed to support agricultural operations). • The reimbursement payment for each Benefit Area shall be subject to an annual inflationary adjustment based upon a constructton cost index until it is paid with Eespect fo the Benefit Area. • The City's obligation to collect the reimbursement payment shall terminate on the date that is 15 years toilowing the City's acceptance of all College Boulevard Improvements. The foUowing is a suggested process for the approval of both the Zone 15 CFD and Reimbursement Agreement: • City consultant completes the fair share allocation of the estimated costs of tbe College Boulevard Improvements. • Bent-West submits to the City the concurrence ofthe owners of at least 65% of the land in the propo.?ed Zone 15 CFD, as required by Policy 33. • The fair share allocation is presented to aU Zone 15 landowners within the Benefit Areas for mview and comment in a meeting wf.th City staff and consultants. • City consultants and staff prepare and circulate to the Zone 15 CFD landowners the Zone 15 CFD documents (i.e. the CFD resolutions and rate and method of apportionment of s|^ial taxes) and City staff prepares and submits to Bent-West for review a draft Reimbursement AgreemenL • The Zone 15 CFD is presented to the City's Policy 33 committee. • City Council adopts Zone 15 CFD Resolution of Intention and sets a public hearing for the formation of tbe Zone 15 CFD. • City Council conducts a public hearing on the Zone 15 CFD pursuant to the Mello-Roos Act and a public hearing on the approval of the Reimbursement #145738 vj mG2 mssmu Agreement and the establishment of the Benefit Areas pursuant to Caristeid Municipal Code Section 20.16.042. City conducts the Zone 15 CFD election and confinms the election results. - If the election is successfiiL, City records the Zone 15 Notice of Special Tax Lien. Subsequent to formation of the Zone 15 CFD, the City could elect to permit the owner of a Benefit Area outside the Zone 15 CFD to annex into tbe Zone 15 CFD prior to the issuance of bonds in order to finance the Benefit Area's reimbursement paymoit obligation. msmvi 91SU mmmu College Boulevard Improvements District-Wide Improvements (all Tax Txms, and Benefit Area Properties) Street Improvemente Cannon Road - Reach 4A College Boulevard and Cannon Road Intersection Improvements College Blvd Core Improvemmts - Sunny Creek Rd to Cannon Rd Water Improvements CMWD Reclaimed Water Line -12" (384 Zone) CMWD Water Line 12" (Service Area A - 375 Zone - College) CMWD Water Line 12" (Service Area A - 375 Zone - Cantarini Loop) CMWD Water Line 16" & 36" (Service Area B - 490 Zone - College) CMWD Water Line 16" & 36" (Service Area B - 490 Zone - 'A' Street) Drainage Improvements College Bridge over Agua Hedionda Creek - Drainage Facility BL-L Detention Basin BJ-1 College Bridge - 78" Storm Drain Extension - Portion of Drainage Facility BL-L CoUege Blvd - Drainage Facility BR (66" culvert under College) Common Basins/Storm Drains Westside (College portion only) EC North Hydromodification Basin (College portion only) Frontage Improvements Habitat Mitigation Site EC Hydromod Basin (College portion only) RCOA Parcel 3 Basin B J Parkway Landscaping RCOA Parcel 3 Basin BJ Soft Costs ADL Construction Support and Close-out for Frontages Leighton Geotech for College Grading TY LIN Bridge Design and Inspection Design/Processing soft costs reimbursement to Bent-West (incunred subsequent to 9-10-13) City Processing Costs (pre-formation and formation) sS4S713»l m«1.2 W!l/MiaK!l4 A-l Specific Improvements (certain Tax Zone and Benefit Area Properties) College Boulevard Frontage Improvements RCOA Parcel 4 (Apartment portion only) MDR - Encinas Creek Cantarini Ranch Lubliner EC East WalMart (Lot H) EC South EC North Dos Colinas Signal Cost at College/Street C Cantarini Ranch MDR - Encinas Creek Dos Colinas Signal Cost at Collegd'Street A Cantarini Ranch Dos Colinas Sewer Line l^otth Can.tarini Ranch MDR - Encinas Creek Sewer Line South Cantarini Ranch Dos Colinas Holly Springs Common Basins/Storm Drains Westside Cantarini Ranch Dos Colinas EC Mofth Hydromodification Basin Cantarini Ranch ffii.'SiTitwt m6i2 ivmmu A-2 Habitat Mitigation (all Tax Zone and Benefit Area t*ropetties) College Boulevard Wetlands & Uplands Mitigation Improvements Costs for design, processing and construction of improvements only (no land costs or endowment, monitoring and maintenance costs) EXHIBIT "B" NBS Initial Draft, Cost Allocation (attached) miinvf. men mmmu Ol d ir» ' c fl- ic « ? O t —~ CB .2 f ^ i 1 ffl *; a* X J51 i3 O X J- e o b iJ -o Oi. C3 tei o 5 o ~ o ~ C3S a ^ « £1 •5 H E o o „ IB- p Ui £ tn c TJ c £ F4 C ICO) QTX (CT^ C2 *Oi [t«^ w ejj C7 (BQ OS to — 10 > lUJJ QQI : CiB asj Ol o CB6 ( 03 <«i cMi ll jp IT-' OB •"T- ir»^ i^jij g3 * ^Sifl td iQB 5^ ^CD fl 'v~ (h^ to GJO ITS no "tf" C9 db q Ofi cn O iffi V OO C3 SO IT- CTT -iT- cyi ^ M - "^f" 4 ft CJ Ol €3 C5 Q 0> Ql Qt 5SJ CP ^J" 1ft CS o o no K— SB> OJ O Clfe —™ 4CJ SO rj )S- it»«- O •tr^tfi^W m <;£ ofiK-qTswH"'* _ Cffi If^ CO 01 flB ^ CQ> ^ •ct' dD> ^ O C1I3 (Ti 'tCP Ot — ' ' Crtft CD* * _.J fflTT^ QQ ^I2> fljjji c> C5 ffi^ o( ^— qju • QS. (23 ir— so; isjj ir~ Pl 40 ' IMS CJ I O Q O O O O Q Q O O O O O O O O " 1 ^1 _1 EC flC — ts JO JCI It— €T1 eJ ff^ OS *~ 3 O o S IS- JC 4* s O CJ CSS 2 2 S 1; •0 -s 00 (SI 00 O S 2 2 ss 3 S 5 Sf 3 * O Q tJ :zi ^ ~ "¥ ^ S ^ f c 2 iffl ;^ g —C a trj iflfi iij3 jEL o .1= x: 6- IK 6- H- Is. IIL (ii (13 i:^ fflTl gyii c c: c (C g-j c Qj 13 D 3 o 3 o o o o en o o o o o I O OJ flit 50 ^ c £L TS ro c E c oil OS < O O O O £0 O o ^ £^ Cli orj T-^ ti-^ o d o o o o 3 o {a c o N I o o o o o o o 1 O Tt; OtI ^jf jijj -r— o o o o o o o o o o o o a O O O O <D O ^ X— ^1— ^— Q ^t— OJ I o O O O O O «J o O fs. STT M O C> O ! w— a CJ CD o o e£5 -E < E > so ^ ® g O ;5 I o o £ E I UL C! «l O U- O I SO S 10 SO o S o CM o Ol a xs 09 a i2 t_ SIS c O u IL. — m jp n. sr E «i o c o «i E >s OB o o _o ipervl UI • - o ipervl •c ipervl If o ipervl E jr fc 01]) E <0 = TS 01]) E <a 5; C ea €> 3 o o J> TS 7^ m— C C ra C ttJI o ss «;! OB c a. o CS-c: aS 41 o o a. O o o» C & SO < Ot s Q O o> c < OT m •£ •£ £i X o c tr c a. o Q o a. CL a. a. "O «J m =s "O «J <a xs (H x» -a E e OS OS m rs ra sa oa as IU < c* •* c* •* EXHIBIT "C" Zone 15 CFD TAx Zone & Benefit Area Properties (see attached) si4S72ii'i! msij. tmsmu C-l shashani ^1 From: Sent: To: Subject: Follow Up Flag: Flag Status: Russell W. Grosse Irusty.grosse@fsqp.com] Wednesday, July 23, 2014 4:20 PM Ali Shashani Meeting at West re Zone 15 issues Follow up Flagged We have meetings set up with Stephen Powell who is the project manager for West on Zone 15 issues Can 1 confirm a meeting at the West office on Tuesday July 29* at 2:30 pm. Let me know ifl can confirm the meeting. If you would like to meet here first and go over together, that would be fme. Their office is only 3 minutes away. Russell W. Grosse, CEO Foursquare Properties, Inc. Phone: 760 438 3141 Fax: 760 438 7615 rustv.grosse(a),fsqp.com shashani From: Russell W. Grosse [rusty.grosse@fsqp.com] Sent: Monday, July 28, 2014 3:46 PM To: Ali Shashani Subject: Meeting Hi Ali: This is to confirm your meeting here with Rusty at 10 am on Wednesday the 30'^ here in our office and then on to meet at the West Office. Joan Hendrick, Administrative Assistant to Russell W. Grosse, CEO Foursquare Properties, Inc. Phone: 760 438 3141 Fax: 760 438 7615 rustv.grosse@fsqp.com shashani From: Steve Powell [powell@theriver.com] Sent: Wednesday, July 30, 2014 5:19 PM To: Ali Shashani Cc: 'Russell W. Grosse' Subject: Zone 15 Improvements Cost Estimate Back-up Attachments: CFD NO. 4 - Ex C - with backup - District Wide Authorized Improvements Cost Update - July 3 2014 with Backup.pdf; CFD NO. 4 - Ex H - College Habitat Mitigation Improvements - Julv 3 2014.pdf ' AH, Thanks again for your time today. Per our discussion, 1 have attached the following documents that relate to costs of improvements that are proposed to be shared by all participating properties according to cost-sharing methodology that will be proposed by NBS and ultimately adopted by the City Council for CFD NO. 4 (Zone 15) 1. Exhibit C and cost estimate back-up documents,„these are the "District-Wide" improvements that are proposed to be financed with tax-exempt bonds resulitng in an Annual Special Tax being applied to participating properties beginning at time of issuance of a grading permit. 2. Exhibit H cost estimate for the design, processing and construction ofthe Habitat Mitigation area.. .effectively a "DisU-ict-Wide" improvement that will result in a One-Time Special Tax being due at time of issuance of a grading permit. Please let me know if you have any questions about any of the information that 1 provided today or the contents of this email. Thanks.... Steveb shashani From: All Shashani [ali.shashani@gmail.com] Sent: Tuesday, September 02, 2014 10:58 AM To: 'powell@theriver.com' 'chuck.mcbride@carlsbadca.gov'; 'Aaron Beanan'; 'attorney@carlsbadca gov'- 'dobrien@westpartners.com' Subject: Proposed Bent-West College Blvd. CFD Mr. Stephen Powell Project Manager Bent-West 5796 Armada Drive Suite 300 Carlsbad, CA 92008 Mr. Stephen Powell, In the last week of July 2014 in a telephone conversation with Mr. Rusty Gross I became aware that Bent-West has been working on a CFD for College Boulevard. Upon my enquiries about this matter Mr. Gross arranged a meeting with you in your office on July 30, 2014 for explanation of Bent-West's proposed CFD plans. In that meeting you presented a map prepared by Bent-West's engineers Hunsaker & Associates on Bent-West's behalf titled "Zone 15 Participating Properties" in Bent-West's proposed CFD. I expressed my great astonishment of how Bent-West had been working on this CFD for almost two years and had kept us completely in the dark about a process that is supposed to be a public process, especially when you knowingly and falsely without our knowledge and agreement had misrepresented Mandana and Kato properties as "Zone 15 Participating Properties" in Proposed Bent-West College Blvd. CFD. As you well know our properties have no approved tentative maps and therefore it is impossible to speculate on the number of eventual dwelling units on these properties. Mandana's property which is approximately 27% of Bent-West's proposed CFD will not participate in Bent-West's proposed CFD and as you know Kato's property, which is approximately 14% of Bent-West's proposed CFD has also objected to Bent-West's proposed CFD. Without Mandana's and Kato's participation in Bent-West's proposed CFD Bent-West does not have the legally required 2/3 of land owner's by area participation necessary to form this CFD. Ali Shashani Mandana Co. PO Box 10249 Newport Beach, CA 92658 Phone: 949.400.4404 February 10, 2015 Mr. Aaron Beanan, Senior Accountant City of Carlsbad Finance Department 1635 Faraday Avenue Carlsbad, CA92008 RE: Proposed financing plan for College Boulevard Dear Mr. Beanan, We have become aware that the City of Carlsbad is proposing to include our property in a possible financing plan proposed by Bent-West, LLC for the construction of Zone 15 improvements (College Boulevard). Generally, based on our understanding of the information presented to date we have no problem with the inclusion of our property in the financing plan as proposed by Bent- West, subject to everyone's understanding that: 1. Inclusion of our property in the financing plan will not result in a lien being placed on our property by the City or any other party. 2. The initial cost-share for our property will not exceed TWELVE THOUSAND DOLLARS ($12,000) per-imit cost-share for future new dwelling units. We understand that the cost-share may be adjusted during the fifteen year reimbursement agreement period to account for the application of the construction cost index, but for no other reason. 3. No cost-share as referenced above for the plaimmg or construction of required Zone 15 improvements v^U be incurred by our property unless our property obtains development entitlements for additional residential units and an actual building permit for an additional entitled residential unit on our property is issued by the City of Carlsbad. 4. No cost-share as referenced above for the planning or construction of required Zone 15 improvements will be mcurred by our property as a result of any new construction related to a remodel, addition or reconstruction of an existing residential unit regardless of the existing building footprint size or the addition of an otherwise approved "granny flat." 5. None of the foregoing will have any effect whatsoever on oiu- property from and after fifteen years from the date of completion of College Boulevard. Sincerely, The Owners of APN # 209-040-02 February 10, 2015 Mr. Aaron Beanan, Senior Accountant City of Carlsbad Finance Department 1635 Faraday Avenue Carlsbad, CA92008 RE: Proposed financing plan for College Boulevard Dear Mr. Beanan, We have become aware that the City of Carlsbad is proposing to include our property in a possible financing plan proposed by Bent-West, LLC for the construction of Zone 15 improvements (College Boulevard). Generally, we have no problem with the inclusion of our property in the financing plan as proposed by Bent-West, subject to everyone's imderstanding that: 1. Inclusion of our property in the financing plan will not result in a lien being placed on our property by the City or any other party. 2. The initial cost-share for our property will not exceed TWELVE THOUSAND DOLLARS ($12,000) per-unit cost-share for future new dwelling units. We understand that the cost-share may be adjusted during the fifteen year reimbursement agreement period to account for the application of the construction cost index, but for no other reason. 3. No cost-share as referenced above for the planning or construction of required Zone 15 improvements will be incurred by our property unless our property obtains development entitlements for additional residential units. 4. No cost-share as referenced above for the planning or construction of required Zone 15 improvements will be incurred by our property as a result of any new construction related to a remodel, addition or reconstruction of an existing residential unit regardless of the existing building footprint size or the addition of an otherwise approved "granny flat." 5. No cost-share for the plarming or construction of Zone 15 improvements (College Boulevard) will be incurred by our property imless an actual building pemiit for an additional entitled residential unit on our property is issued by the City of Carlsbad. 6. None of the foregoing will have any effect whatsoever on oiu- property from and after fifteen years from the date of completion of College Boulevard. Sincerely, The Owner of APN # 209-040-28 Hagaman Family SiuA'ivors 1990 Trust l^^w/yvex^ X. A^/t^^^^*-^ Trustee 3 0 February 10, 2015 Mr. Aaron Beanan, Senior Accountant City of Carlsbad Finance Department 1635 Faraday Avenue Carlsbad, CA 92008 RE: Proposed financing plan for College Boulevard Dear Mr. Beanan, We have become aware that the City of Carlsbad is proposing to include our property in a possible financing plan proposed by Bent-West, LLC for the construction of Zone 15 improvements (College Boulevard). Generally, we have no problem with the inclusion of our property in the financing plan as proposed by Bent-West, subject to everyone's understanding that: 1. Inclusion of our property in the financing plan will not result in a lien being placed on our property by the City or any other party. 2. Any proposed cost-share for our property will not exceed TWELVE THOUSAND DOLLARS ($12,000) per-unit cost-share for future new dwelling units, if any. We understand that the cost per unit may be adjusted in future years to account for the application of the construction cost index, but for no other reason. 3. No cost-share as referenced above for the planning or construction of Zone 15 improvements will be incurred by our property unless our property obtains development entitlements for additional residential units. 4. No cost-share as referenced above for the planning or construction of required Zone 15 improvements will be incurred by our property as a result of any new construction related to a remodel or reconstruction of an existing residential unit or the addition of an otherwise approved "graimy flat." 5. No cost-share for the plaiming or construction of Zone 15 improvements (College Boulevard) will be incurred by oiu- property unless an actual building permit for entitled units on our property is issued by the City of Carlsbad. 6. None of the foregoing will have any effect whatsoever on our property from and after fifteen years from the date of completion of College Boulevard. Sincerely, The Owners of APN # 209-040-15 Chase Coman Trust February 10,2015 Mr. Aaron Beanan, Senior Accountant City of Carlsbad Finance Department 1635 Faraday Avenue Carlsbad, CA 92008 RE: Proposed fmancing plan for College Boulevard Dear Mr. Beanan, We have become aware that the City of Carlsbad is proposing to include our property in a possible financing plan proposed by Bent-West, LLC for the construction of Zone 15 improvements (College Boulevard). Generally, we have no problem wifh the inclusion of our property in the financing plan as proposed by Bent-West, subject to everyone's understanding that: 1. Inclusion of our property in the financing plan vnll not result in a lien being placed on our property by the City or any other party. 2. Any proposed cost-share for our property will not exceed TWELVE THOUSAND DOLLARS ($12,000) per-unit cost-share for future new dwelling units, if any. We understand that the cost per unit may be adjusted in fiiture years to account for the application of the construction cost index, but for no other reason. 3. No cost-share as referenced above for the planning or construction of Zone 15 improvements will be incurred by our property unless our property obtains development entitlements for additional residential units. 4. No cost-share as referenced above for the planning or construction of required Zone 15 improvements will be incurred by our property as a result of any new construction related to a remodel or reconstruction of an existing residential unit or the addition of an otherwise approved "graimy flat." 5. No cost-share for the planning or construction of Zone 15 improvements (College Boulevard) will be incurred by our property imless an actual building permit for entitled units on our property is issued by the City of Carlsbad. 6. None of the foregoing v^U have any effect whatsoever on our property from and after fifteen years from the date of completion of College Boulevard. Sincerely, The Owners of APN # 209-040-45 Grosse 2005 Trust ^ ' Trustee February 10,2015 Mr. Aaron Beanan, Senior Accountant City of Carlsbad Finance Department 1635 Faraday Avenue Carlsbad, CA 92008 RE: Proposed financing plan for College Boulevard Dear Mr. Beanan, We have become aware that the City of Carlsbad is proposing to include our property in a possible financing plan proposed by Bent-West, LLC for the construction of Zone 15 improvements (College Boulevard). Generally, we have no problem with the inclusion of our property in the financing plan as proposed by Bent-West, subject to everyone's understanding that: 1. Inclusion of our property in the financing plan will not result in a lien being placed on our property by the City or any other party. 2. Any proposed cost-share for our property will not exceed TWELVE THOUSAND DOLLARS ($12,000) per-unit cost-share for future new dwelling units, if any. We understand that the cost per unit may be adjusted in future years to account for the application ofthe construction cost index, but for no other reason. 3. No cost-share as referenced above for the planning or construction of Zone 15 improvements will be incurred by our property imless our property obtains development entitlements for additional residential units. 4. No cost-share as referenced above for the planning or construction of required Zone 15 improvements will be incurred by our property as a result of any new construction related to a remodel or reconstruction of an existing residential unit or the addition of an otherwise approved "granny flat." 5. No cost-share for the planning or construction of Zone 15 improvements (College Boulevard) will be incurred by our property unless an actual building permit for entitied units on our property is issued by the City of Carlsbad. 6. None of the foregoing will have any effect whatsoever on our property from and after fifteen years from the date of completion of College Boulevard. Sincerely, The Owners of APN # 1 '^aiy E. Gross'^ Zane 15 iMlrastrmctare FjaanKCTBig and ReiimbBrseeaent Program 1. The Carisbssd City Council approval Local Facilities MaiMgement Plan Amendment Zoae 15(E) (the "Zone 15 LFMP") on January 10,20l2piiiKuanttoCityCoiii»cilResoliiidQii Mo.201i-2S5. 2. TheZone 15 LFMP specifies various major infrastrioctUEe improvements new development within Zone 15, including the construction of College Boulevard from Cannon Rmd to the existing northerly terminus near El Camino Real and related liafiastructore iimprovemeiiits, as flffther di^ribed in Exhibit "A" atladied hereto (the "College Boulevard fmprovemmts"). 3. Thc City approved Carlsted Tract No. 00-IS for the Bent-West property pursuant to Planning Commission Resolution No. 5753 and imposed various Conditions of Approval, incluKling Conditions Nos. 50 through 56 requiring the financing and constructian of the College Eloulevaid Improvements (the "Conditions of Approval"). 4. Bent-West is proposing to advance 100% of the costs of the CoUege Boulevard Improvements (currently estimated to be S14,395,580), subject to reimbursmient fiom other benefitted properties within Zone 15 of their fair share of the costs of the College Boulevard Improvements. 5. The 2^ne 15 LFMP states that "no single financing mechanism could satisfy the complex infrastructure requiremente of this Zone," (Zone 15 LFMP, pp. 148-149) Consequently, Bent-West is proposing two financing mechanisms for the reimbursement of the costs of the College Boulevard Improvements from benefitted properties within Zone 13 — a Community Facilities District established pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (Govemment Code Section 533 U, et. seq.) (the "Zone 15 CFD") and a reimbursement agreement between Bent-West and the City pursuant to which the City would collect a reimbursement from ali benefitted properties within Zone 15 (the "Reimbursement Agreement*"). 6. The cost of the College Boulevard Improvements would be spread amot^ the benefitted properties pursuant to a fair share cost methodology approved by the City and collected fix>m such properties pursuant to the Zone 15 CFD and the Reimbursement AgreemenL An initial draft of the cost allocation prepared by the City's consultant, NBS, is attached hereto as Exhibit "B". (A portion of the cost of some of the drainage and water line improvements are not included in the cost allocation but, in accordance with the Conditions of Approval, may be subject to separate retmburseraent agreements providing for reimbursement from existing fee programs.) 1. The Zone 15 CFD wouid be established pursuant to City Council Resolution No. 2002-369 ("Policy 33") and the Mello-Roos Act It would include the foUowing elements: • The Zone 15 CFD boundaries would include five properties that are currently entitled - i.e., Dos Colioas, MDR/Encinas Creek Apartments, Holly Springs, Cantarini Ranch and Rancho Milagro. Each such property would be dssignatal as its own "Tax Zone" witisiB She Zone 15 CFD. • The spccaaS tees autteorlaed for each Tax Zone would be based on (i) the Tax Zone's Sm share of the estsnsalEd costs of those Collie Boulevard Improvements (excluding habitat mitigation for CoUege Boulevard) that are deemed eligible for financing through a CFD wifli tax-exempt bonds and (2) the existing entitlements or development assumptions for the Tax Zone inducted in the Zone 15 LFMP - i.e., miit counts or gross leasable WSSL ("GLA"). • Pursuant to the City Council's action of April 15,2014, the special taxes wouid not be required to be prepaid prior to the sale of individual residential lots to homeowners. • Special taxes will not be levied upon property within a Tax Zone prior to the earher of (1) approval ofthe first final stdxlivision map within the Tax Zone, (2) issuance of the first grading pemiit within the Tax Zone (excludii^ grading done for agricultural purposes), or (3) the commencemmt of construction within the Tax Zone (excluding the construction of stmctures designed to support agricultural operations). • The amouni of bonds issued to fiind the Zone 15 CFD Tax Zones' fair share of the College Boulevard Improvements shall be based upon the actual costs of the College Boulevard Improvements. The Reimbursement Agreement would be entered into by the City pursuant to its police powers under Article XL Section 7 of the Califomia Constitution, Govemment Code Section 66486, Sections 20.16.041 and 20.16.042 ofthe Carlsbad Municipal Code, the Zone 15 LFMP and the Conditions of Approval^ The Reimbursement Agreement is intended to be of the type described in Section VI.E of Ae Zone 15 LFMP (see p. 150) and could be similar to the form of reimbursement agreement approved by the City in Zone 14 pursuant to City Council Resolution No. 2004-293. The Reimbursement Agreement will include the following elements: • The benefit areas of the Reimbursement Agreement (each, a "Benefit Area") shall correspond to each ofthe Tax 2x>nes as well as the properties in Zone 15 but outside the Zone 15 CFD as depicted in Exhibit "C" attached hereto (all, "Benefit Areas"). • The Benefit Areas corresponding to each Tax Zone within the Zone 15 CFD shall oniy be subject to reimbursement payments for their fair share of the habitat mitigation costs ofthe College Boulevard Improvements. • The Benefit Areas corresponding to each of the properties outside of the Zone 15 CFD shall be subject to reimbursement payments for then fair share of all of the costs of the College Boulevard Improvements. • Initially, the established reimbuEsement payments shall be based upon (I) the estimated costs of the College Boulevard Improvements and (2) Ihe actual entitlements or tiiK development assumptions for each Benefit Area in the Zone 15 LFMP. The actual icimburscmml payments shall then be adjusted to refiect (I) the actual costs of 5he CoUege Boulevard Improvemenfs and (2) the actual development entitlements (Le., units or GLA) for the Benefit Areas at the time the reimbursement payment is required, • The reimbursement payment for a Benefit Area shall be made upon the earlier of (I) approval of the first final subdivision map within the Benefit Area, (2) issuance of the first grading permit within the Bmefit Area (excluding grading done for agricultural purposes), or (3) the commencement of construction within the Benefit Area (excluding the constraction of stractures designed to support agricultural operations). • The reimbursement payment for each Benefit Area shall be subject to an annual inflaiionaiy adjustment based upon a construction cost index until it is paid with respect to the Benefit Area. • The City's obligation to collect the reimbursement payment shall terminate on the date that is 15 years toEowing the City's acceptance of all College Boulevard Improvements. The foUowing is a suggested process for the approval of both the Zone 15 CFD and Reimbursement Agreement: • City consultant completes the fair share allocation of the estimated costs of the College Boulevard Improvements, • Bent-West submits to the City the concurrence of the owners of at least 65% of the land in the propo-sed Zone 15 CFD, as required by Policy 33. • The fair share allocation is presented to all Zone 15 landowners within the Benefit Areas for review and comment in a meeting with City staff and consultants. • City consultants and staff prepare and circulate to the Zone 15 CFD landowners the Zone 15 CFD documents (i.e. the CFD resolutions and rate and method of apportionment of special taxes) aiKf City staff prepares and submits to Bent-West for review a draft Reimbursement AgreemenL • The Zone 15 CFD is presented to the City's Policy 33 committee. • City Council adopts Zone 15 CFD Resolution of Intention and sets a public hearing for the formation of the Zone 15 CFD. • City Council conducts a public hearing on the Zone 15 CFD pursuant to the Mello-Roos Act and a public hearing on the approval of the Reimbursement Agraement and the establishment of the Benefit Areas pursuant to Carisbad Municipal Code Section 20.16.042. City conducts the Zone 15 CFD election and confinns the election results. If the election is successfiiL City records the Zone 15 Notice of Spedai Tax Lien. Subsequent to forasation of the Zone 15 CFD, the City could elect to permit the owner of a Benefit Area outside the Zone 15 CFD to annex into tbe Zone 15 CFD prior to the issuance of bonds in order to finance the Benefit Area's reimbursement payment obligation. U4571Svi 91612 i0!29mi4 EXHIBIT "A" College Boulevard Improvements District-Wide Improvemenls (all Tax Zone and Benefit Area Properties) Street Improvements Cannon Road - Reach 4A College Boulevard and C^annon Road Intersection Improvements College Blvd Core Improvements - Surmy Creek Rd to Cannon Rd Water Improvements CMWD Reclaimed Water Line -12" (384 Zone) CMWD Water Line 12" (Servos Area A - 375 Zane - College) CMWD Water Line 12" (Service Area A - 375 Zone - Cantarini Loop) CMWD Water Line 16" & 36" (Service Area B - 490 Zone - College) CMWD Water Line 16" & 36" (Service Area B - 490 Zone - 'A' Street) Drainage Improvements College Bridge over Agua Hedionda Creek - Drainage Facility BL-L Detention Basin BJ-1 Coiiege Bridge - 78" Storm Drain Extension - Portion of Drainage Facility BL-L College Blvd - Drainage Facility BR (66" culvert under College) Common Basins/Storm Drains Westside (College portion only) EC North Hydromodification Basin (CoEege portion only) Frontage Improvements Habitat Mitigation Site EC Hydromod Basin (College portion only) RCOA Parcel 3 Basin BJ Parkway Landscaping RCOA Parcel 3 Basin BJ Soft Costs ADL Construction Support and Close-out for Frontages Leighton Geotech for College Grading TY f..fN Bridge Design and Inspection Design/Processing soft costs reimbuisemait to Bent-West (incurred subsequent to 9-10-13) City Processing Costs (pre-formation and formation) #f4572Svi m6i2 tm9.mu Spedfic Impravements (certain Tax Zone and Benefit Area Properties) College Boulevard Frontage Improvemenls RCOA Parcel 4 (Ajsartment portion only) MDR - Endnas Creek Cantarini Ranch Lubliner EC East WalMart (Lot II) EC South EC North Dm Colinas Signal Cost at College/Street C Cantarini Ranch MDR - Encinas Creek Dm Colinas Signal Cost at College/Street A Cantarini Ranch Dos Colinas Sewer Line North Cantarini Ranch MDR - Encinas Creek Sewer Line South Cantarini Ranch Dos Colinas Holly Spring? Common Basins/Storm Drains Westside Cantarini Ranch Dos Colinas EC North Hydromodification Basin Cantarini Ranch mismvi m6i2 mmmu A-2 Habitat Mitigation (all Tax Zone and Benefit Area Properties) College Boulevard Wetlands & Uplands Mitigation Improvements Costs for design, proces^ng and construction of improvements only (no land costs or endowment, monitoring and maintenance costs) mmsvi 91622 i&m/Mu A-3 EXHIBIT "B" NBS Initial Draft Cost Allocation (attached) p.m7nvi msii m/y^mu B-l — E 2 o a E S o (a 5 o > OS C o a.-' £ E S 'S °* J5 ta •sr JS « » «5 2 O X.C <* c S £?• « a 0 i> TO 11 CL ets eo O ^ O Ot i: o 4^ m "5 « E U o N c O ISB 1^- ' g ^ ^ QQi «r- O O STS <QEb Cl i!^ 00 C_ Eh**- ^Q* GC1> SO ffp^ uen^ UQ QQ •Oifr fffiX ^ ~~ ' 9£& O Qjl ' ''C^A d& T™" trTt fljdj (gj lOtr^iCDs -"r-ctaiacstp^ ea cyst •v- SD) ^ DO C8 to r— tt**- (ED BO (OK lO "tSf- ?0 "(tS T~ OS ( gQi DD 00 OS '<3r ^— m OQ ' IM CO O (TS aa O CO O CB 0 «j£> !r- o tfM o ao _ o © ® o u - •= lie a. 3 C < a. 0. a. « s a tn E - £ I: JO CB -e— ei" is^ c* o T- r- O 1*- so • SSt tSg^ gf^j t^Jl B*^ i^|f^ ^r— cgjm^^ iS- so no spis Tr~ pij r-w OQI V» •<T- -flr Tt- no w es- aoQaoooQoooooooo t to r«-o ot CO ? ® 9 ** -I cc sc — .^..-..^Oit- — <ir m o <C <£ '7-J-«-«-»-iiJ-«-«-«-Ji-J!-t-j5S lia. EiL im -T— -— —.- : ; ~ — -~— nasal Q. o. Q. TC -e IC H S ^ Q- Q- 3 3 3 Q. £L 0. X w Q; m z O I- — iO a. :o J *- -(^ 3 Ik. 0> C& Ql i O O O « ifij 3^ B"— 1 Y "v o « O o j o r «? . ttf 52 1^ f- «- S Ul o_, >- -J J -J fl£ or fi. £2- CL Q «S O {» sfj -5 _< «» >. w O M <c T* ffpji (y OL i^L •ect: 03 ffi al- £L QL Z w (£6 —J —fi Z2Z 5<< 00:0: Ul lil agt 'Ju. 11. 0 _I _« lOO oOO Z flL Q_ ^55 QL O. Q. Q u u u u •c -c r: -c QLfl.lEt.6Iu «-> o ^ -^^ j« 111 ,„ Ul . ips Si O (U o u o > One ffll Z JO <^ Q§a< J J ^ 0. CIS O BU Z ^ aSB ^ OUJ t o o I CM O <f^ wyp ^3 o o o CJ ct CP CO CD iSk t?a « OOOO o y «po- aa> cm at isa O O O 03 M IN M ^1 "ffi o a. o o s s o o ir~ o o o o r» T3 o o O CB o o ~* 113 o o 2 O .£1 to S 1= o S ffl O •£ S Si 1 g -mm " 3 i; = ^ 3 IS « C Q 0- "o muj IH E- ^ H- t— Ml ira ^ UL (JL ea m 1 :g *; ii m ffiS I ^ Z3 ID ZJ o ^ O O o TJ £k c £ < 3 a ^ CO c o M O BQ O O O O O O ENB Ok OSJ CHB O o o o o O Orf £*> -e- srs • O O O O O O oooooooo •c— o o o o o o a o o o o o o o O O O O «D O «D 3 •r--ff-Tt— ^o-r-ci a iil O O O O O UJ o o £<!( p to o •r^ O O O O O Sii •TO 23 -n c 6lL lu- '£ 5 50 ^ ^ O * " go _ ^ O O £ £ c c £ fj^ E ® o o <^ o CO 05 O S O ® OS O O O -a " B» ™ ffl t., IL_ 05 ffl .P O o — ®1 w go^ £ ^ o c tz «— (St EZ O CO ^ iZi C tu a> f c» & Q-l OS O m SO -B c c o o a. d 3 3 •a -o QQ F ra S ? E >y 3 O OS Q _ _o ^ a£i o £ as O ?i" = g e> = Ems «» o ffl tJ E •<- sz m c ^ in o £ g S g o © g c 3 a. 3 £ «» -a « g © E fc <3 CO S m iS ^ •Ofi E*i I'O EXHIBIT "C" Zone 15 CFD TAx Zone 8L Benefit Area Properties (see attached) smm,v\ nsi2 i^-^mu C-l Ml 8— < ill en O <z —I oQ Q2 1~ ^ fc o a St. o X £/>? tt: >-< o<- o :i a; o X -< O 2 < ^ C- Z SK - ««>60 CO f^COOIt 3