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HomeMy WebLinkAboutReso 2003-273RESOLUTION NO. 2003-273 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA MAKING CERTAIN DETERMINATIONS AND AUTHORIZING THE SUBMITTAL OF THE PROPOSED CHANGES TO THE RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAXES AUTHORIZED TO BE LEVIED WITHIN COMMUNITY FACILITIES DISTRICT NO. 08-I (OTAY RANCH VILLAGE SIX) TO THE QUALIFIED ELECTORS THEREOF WHEREAS, the City Council of the City of Chula Vista, California, (the "City Council") previously has previously undertaken proceedings to form Community Facilities District No 08-1 (Otay Ranch Village Six) (the "District') and to authorize the levy of special taxes therein pursuant to the provisions of the Mello-Roos Community Facilities Act of 1982, as amended (Government Code Section 53311 and following) (the "Act") and the City of Chula Vista Community Facilities District Ordinance enacted pursuant to the powers reserved by the City of Chula Vista under Sections 3, 5 and 7 of Article XI of the Constitution of the State of California (the "Ordinance') (the ACt and the Ordinance may be referred to collectively as the "Community Facilities District Law") to finance the acquisition or construction of certain authorized facilities. WHEREAS, the qualified electors of the District, voting in a special election held on January 16, 2003, approved the authorization to levy special taxes within the District pursuant to a rate and method of apportionment of such special taxes ("Existing Rate and Method"); and WHEREAS, subsequent to the formation of the District and such election, the Otay Ranch Company ("Otay Ranch''), the master developer of the property within the District, requested that that the City Council, acting in its capacity as the legislative body of the District, initiate proceedings to consider modifying the Existing Rate and Method; and WHEREAS, the City Council has adopted its Resolution No. 2003-273 declaring its intention to consider changes to the Existing Rate and Method to authorize the levy of special taxes within the District pursuant to a revised rate and method of apportionment of special taxes set forth in Exhibit A attached hereto and incorporated herein by this reference (the "Revised Rate and Method"); and WHEREAS, notice of a public hearing to consider the authorization to levy the special taxes pursuant to the Revised Rate and Method has been given in the form and manner required by the Community Facilities District Law; and WHEREAS, it has now been determined that written protests have not been received by 50% or more of the registered voters residing within the District and/or property owners representing more than one-half (1/2) or more of the area of land within the District to the proposed changes to the Existing Rate and Method; and WHEREAS, inasmuch as there have been less than twelve (12) persons registered to vote within the District for each of the 90 preceding days, this legislative body desires to submit the question of authorizing the changes to the Existing Rate and Method to the landowners of the District, said landowners being the qualified electors as authorized by law. Resolution 2003-273 Page 2 NOW, THEREFORE, the City Council of the City of Chula Vista, California, acting in its capacity as the Legislative Body of Community Facilities District No. 08-I (Otay Ranch Village Six), does hereby resolve, declare, find, determine and order as follows: SECTION 1. RECITALS. The above recitals are all true and correct. SECTION 2. DETERMINATIONS. It is determined by this City Council that: A. all proceedings related to the proposed modification to the Existing Rate and Method prior hereto were valid and taken in conformity with the requirements of law, and specifically the provisions of the Community Facilities District Law; B. the proposed changes to the Existing Rate and Method conform with the City of Chula Vista Statement of Goals and Policies Regarding the Establishment of Community Facilities Districts; C. less than twelve (12) registered voters have resided within the District for each of the ninety (90) days preceding the close of the public hearing and, consequently, the qualified electors shall be the landowners of the District and each landowner who is the owner of record as of the close of the public hearing, or the authorized representative thereof, shall have one vote for each acre or portion of an acre of land that she or he owns within the District; D. the qualified electors have consented to the shortening of time for conducting the special election to present the question to authorize the levy of special taxes within the District pursuant to the Revised Rate and Method, therefore, such special election may be conducted less than 90 following the date of the public hearing to consider the changes to the Existing Rate and Method. SECTION 3. PROPOSED CHANGES TO THE EXISTING RATE AND METHOD. Except to the extent that funds are otherwise available to the District to pay for the public facilities previously authorized to be financed by the District, this City Council hereby approves, subject to the approval by the qualified electors of the District, changes to the Existing Rate and Method to authorize the levy of special taxes within the District pursuant to the Revised Rate and Method. Such special taxes shall be secured by recordation of a continuing lien against all non-exempt real property within the District, shall be levied annually within the District, and shall be collected in the same manner as ordinary ad valorem property taxes, or in such other manner at this Board or its designee shall determine, including direct billing of the affected property owners. Under no circumstances will the special tax levied against any parcel used for private residential purposes be increased by more than 10% as a consequence of delinquency or default by the owner of any other parcel or parcels within the District. A parcel shall be considered "used for private residential purposes" not later than the date on which an occupancy permit or the equivalent for private residential use is issued for such parcel. Such special tax shall be utilized to pay directly for the types of facilities described below, to pay debt service on bonds issued by the District to assist in financing such types of facilities, to replenish any reserve fund established for such bonds, and to pay the costs of administering the bonds and the District: Streets, landscaping within public rights-of-way, sewers and public utilities as may be authorized by the goals and policies of the City Council pertaining to the use of the Community Facilities District Law. The Revised Rate and Method sets forth the conditions under which the special tax obligation for any parcel may be prepaid and permanently satisfied in whole or in part. Resolution 2003-273 Page 3 SECTION 4. ELECTION. The proposition to authorize the levy of special taxes within the District pursuant to the Revised Rate and Method shall be submitted to the qualified electors of the District, said electors being the landowners, with each landowner having one (1) vote for each acre or portion thereof of land which he or she owns within the District. The special election shall be held on June 24, 2003 or such other date as the City Clerk, acting as the election official for such special election (the "Election Offidal"), and all of the qualified electors within the District may agree and consent. If the proposition to authorize the levy of the special tax pursuant to the Revised Rate and Method receives the approval of more than two-thirds (2/3) of the votes cast on the proposition, the special tax may be levied pursuant to the Revised Rate and Method as provided for in this resolution. SECTION 5. BALLOT The ballot proposal to be submitted to the qualified voters at the election shall generally be as follows: PROPOSITION A CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 08-1 (OTAY RANCH VILLAGE SIX) Shall City of Chula Vista Community Facilities District No. 08-1 (Otay Ranch Village Six), subject to accountability measures set forth in Resolution No. 2003-273, be authorized to levy a special tax pursuant to the revised rate and method of apportionment as set forth in such resolution for the purposes of paying debt service on bonds of such District, replenishing the reserve fund for such bonds, paying costs of administering such indebtedness and such district and paying directly for the types of facilities described in such resolution? SECTION 6. VOTE. The appropriate mark placed in the box after the word "YES" shall be counted in favor of the adoption of the proposition, and the appropriate mark placed in the box after the word "NO" in the manner as authorized, shall be counted against the adoption of said proposition. SECTION 7. ELECTION PROCEDURE. The Election Official is hereby authorized to take any and all steps necessary for the holding of said election. Said Election Official shall perform and render all services and proceedings incidental to and connected with the conduct of said election, and said services shall include, but not be limited to the following: Prepare and furnish to the election officers necessary election supplies for the conduct of the election. Cause to be printed the requisite number of official ballots, tally sheets and other necessary forms. C. Furnish and address official ballots for the qualified electors of the District. D. Cause the official ballots to be mailed and/or delivered, as required by law. E. Receive the returns of the election. F. Sort and assemble the election material and supplies in preparation for the canvassing of the returns. Resolution 2003-273 Page 4 G. Canvass the returns of the election. H. Furnish a tabulation of the number of votes given in the election. Make all arrangements and take the necessary steps to pay all costs of the election incurred as a result of services performed for the District and pay costs and expenses of all election officials. Conduct and handle all other matters relating to the proceedings and conduct of the election in the manner and form as required by law. Prepared by Approved as to form by liff~//~Swanson ~ Engfif~ering Director Resolution 2003-273 Page 5 PASSED, APPROVED, and ADOPTED by the City Council of the City of Chula Vista, California, this 17th day of June, 2003, by the following vote: ATTEST: Councilmembers: Councilmembers: Councilmembers: AYES: NAYS: ABSENT: Davis, McCaun, Rindone, Salas and Padilla None None Susan Bigelow, City Clbfk STATE OF CALIFORNIA ) COUNTY OF SAN DIEGO ) CITY OF CHULA VISTA ) I, Susan Bigelow, City Clerk of Chula Vista, California, do hereby certify that the foregoing Resolution No. 2003-273 was duly passed, approved, and adopted by the City Council at a regular meeting of the Chula Vista City Council held on the 17th day of June, 2003. Executed this 17th day of June, 2003. Susan Bigelow, City Clerk EXHIBIT A AMENDED RATE AND METHOD OF APPORTIONMENT FOR CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 08-I (Otay Ranch Village Six) A Special Tax as hereinafter defined shall be levied on each Assessor's Parcel of Taxable Property within the City of Chula Vista Community Facilities District No. 08-I (Otay Ranch Village Six) collected each Fiscal Year commencing in Fiscal Year 2003-2004 in an mount determined by the City Council through the application of the appropriate Special Tax for "Developed Property", "Undeveloped Property", and "Provisional Undeveloped Property" as described below. All of the Taxable Property in CFD-08-I, unless exempted by law or by the provisions hereof, shall be taxed for the purposes, to the extent and in the manner herein provided. A. DEFINITIONS The terms hereinafter set forth have the following meaning: "'A' Map" shall mean a master final subdivision or parcel map, filed in accordance with the Subdivision Map Act and the Chula Vista Municipal Code, which subdivides the land or a portion thereof shown on a tentative map into "super block" lots corresponding to units or phasing of a combination of units as shown on such tentative map and which may further show open space lot dedications, backbone street dedications and utility easements required to serve such "super block" lots. "Acre or Acreage" means the land area of an Assessor's Parcel as shown on an Assessor's Parcel Map, or if the land area is not shown on an Assessor's Parcel Map, the land area shown on the applicable Final Subdivision Map, parcel map, condominium plan, record of survey, or other recorded document creating or describing the land area. If the preceding maps for a land area are not available, the Acreage of such land area shall be determined by the City Engineer. "Act" means the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Division 2 of Title 5 of the Government Code of the State of California. "Administrative Fees and Expenses" means the actual or reasonably estimated costs directly related to the administration of CFD-08-I including, but not limited to, the following: the costs of computing the Special Taxes and preparing the annual Special Tax collection schedules (whether by the City or designee thereof or both); the costs of collecting the Special Taxes (whether by the County, the City, or othenvise); the costs of remitting the Special Taxes to the Trustee; the costs of the Trustee (including its legal cotmsel) in the discharge of the duties required of it under the Indenture; the costs to the City, CFD-08-I, or any designee thereof of complying with arbitrage rebate requirements; the costs to the City, CFD-08-I, or any designee thereof of providing continuing disclosure; the costs associated with preparing Special Tax disclosure statements and responding to City of Chula Vista Community Facilities District No. 08-1 Otay Ranch Village Six 11-25-02 ,Revised.4pri118, 2003 Page I public inquiries regarding the Special Taxes; the costs of the City, CFD-08-I, or any designee thereof related to any appeal of the levy or application of the Special Tax; and the costs associated with the release of funds from an escrow account, if any. Administrative Expenses shall also include mounts estimated or advanced by the City or CFD-08-I, for any other administrative purposes of CFD-08-I, including, but not limited to attorney's fees and other costs related to commencing and pursuing to completion any foreclosure on an Assessor's Parcel with delinquent Special Taxes. "Assessor's Parcel" means a lot or parcel shown in an Assessor's Parcel Map with an assigned Assessor's Parcel number. "Assessor's Parcel Map" means an official map of the County Assessor designating parcels by Assessor's Parcel number. "Assigned Special Tax" means the Special Tax for each Land Use Class of Developed Property as determined in accordance with Section C. 1 .a. "Available Funds" means (a) the balance in the reserve fund established pursuant to the terms of the Indenture in excess of the reserve requirement as defined in such Indenture, (b) delinquent Special Tax payments not required to fund the Special Tax Reqnirement for any preceding Fiscal Year,(c) that portion of Special Tax prepayments allocated to the payment of interest on Bonds, and (d) other sources of funds available as a credit to the Special Tax Requirement as specified in such Indenture. "Backup Special Tax" means the Special Tax amount set forth in Section C. 1 .b. "Bonds" means any bonds or other debt (as defined in the Act), whether in one or more series, issued or incurred by CFD-08-I under the Act. "Bond Year" means a one-year period beginning on September 2"a in each year and ending on September lst in the following year, unless defined otherwise in the applicable Indenture. "CFD Administrator" means an official of the City, or designee thereof, responsible for determining the Special Tax Requirement and providing for the levy and collection of the Special Taxes. "CFD-08-I" means City of Chula Vista Community Facilities District No. 08-I. "City" means the City of Chula Vista. "Community Purpose Facility Property" means all Assessor's Parcels which are (a) classified as community purpose facilities and meet the requirements of City of Chula Vista Ordinance No. 2002-2883 as amended on November 5, 2002 or (b) designated with specific boundaries and acreage on an 'A' Map or Final Subdivision Map as a community purpose facility. City of Chula Vista Community Facilities District No. 08-1 Otay Ranch Village Six 11-25~02 ,Revised April 18, 2003 Page 2 "Council" means the City Council of the City, acting as the legislative body of CFD-08-I. "County" means the County of San Diego. "Developed Property" means, for each Fiscal Year, all Taxable Property for which a building permit for new construction was issued prior to March 1 of the prior Fiscal Year in which the Special Tax is being levied. "Exempt Property" means property not subject to the Special Tax due to its classification as either Public Property, Property Oxvner Association Property, Community Purpose Facility Property, public or utility easements in accordance with section E. 1. "Final Subdivision Map" means a subdivision of property, created by recordation of a final subdivision map, parcel map or lot line adjustment, approved by the City pursuant to the Subdivision Map Act (California Government Code Section 66410 et seq.) or recordation of a condominium plan pursuant to California Civil Code 1352, that creates individual lots for which residential building permits may be issued without further subdivision of such property. "Fiscal Year" means the period starting July 1 and ending on the following June 30. "Indenture" means the indenture, fiscal agent agreement, trust agreement, resolution or other instrument pursuant to which Bonds are issued, as modified, amended and/or supplemented from time to time, and any instrument replacing or supplementing thc same. "Land Use Class" means any of the classes listed in Table 1 of Section C. 1.a. "Lot(s)" means an individual legal lot created by a Final Subdivision Map for which a building permit for residential construction has been or could be issued. "Maximum Annual Special Tax" means the maximum annual Special Tax, determined in accordance with the provisions of Section C, which may be levied in any Fiscal Year on any Assessor's Parcel of Taxable Property. "Non-Residential Property" means all Assessor's Parcels of Developed Property, for which a building permit(s) was issued for a non-residential use, excluding Community Purpose Facility Property. "Open Space" means property within the boundaries of CFD 08-I which (a) has been designated with specific boundaries and acreage on an 'A' Map or Final Subdivision Map as open space, (b) is classified by the County Assessor as open space (c) has been irrevocably offered for dedication as open space, prior to June 1st of the preceding Fiscal Year, to the federal government, the State of California, the Cotmty, the City, any other public agency or (d) is encumbered by an easement or other restriction required by the City limiting the use of such property to open space. Community Facilities District No. 08-1 Otay Ranch Village Six 11-25-02 ,Revised April 18, 2003 Page 3 "Outstanding Bonds" mean all Bonds, which remain outstanding as defined in the Indenture. "Property Owner Association Property" means any property within the boundaries of CFD-08-I which is (a) owned by a property owner association or (b) is designated with specific boundaries and acreage on an 'A' Map or Final Subdivision Map as property owner association property. As used in this de£mition, a Property Owner Association Property includes any master or sub-association. "Proportionately" means for Developed Property that the ratio of the actual Special Tax levy to the Assigned Special Tax or Backup Special Tax is equal for all Assessors' Parcels of Developed Property within CFD-08-I. For Undeveloped Property or Provisional Undeveloped Property "Proportionately" means that the ratio of the actual Special Tax levy per Acre to the Maximum Annual Special Tax per Acre is equal for all Assessor's Parcels of Undeveloped Property and equal for all Assessor's Parcels of Provisional Undeveloped Property within CFD-08-I. "Provisional Undeveloped Property" means all Assessor's Parcels of Public Property, Property Owner Association Property, Community Purpose Facility Property, Open Space or other property that would otherwise be classified as Exempt Property pursuant to the provisions of Section E, but cannot be classified as Exempt Property because to do so would reduce the Acreage of all Taxable Property below the required minimum acreage as set forth in Section E.1 for Zone A or Zone B as applicable. "Public Property" means any property within the boundaries of CFD-08-1 that which (a) is owned by a public agency, (b) has been irrevocably offered for dedication, prior to June 1st of the preceding Fiscal Year, to a public agency or (c) is designated with specific boundaries and acreage on an 'A' Map or Final Subdivision Map as property which will be owned by a public agency. For purposes of this definition, a public agency includes the federal govermnent, the State of California, the County, the City or any other public agency. "Residential Property" means all Assessor's Parcels of Developed Property for which a building permit has been issued for purposes of constructing one or more residential dwelling units. "Residential Floor Area" means all of the square footage of living area within the perimeter of a residential structure, not including any carport, walkway, garage, overhang, patio, enclosed patio, or similar area. The determination of Residential Floor Area shall be made by the CFD Administrator by reference to appropriate records kept by the City's Building D, epamnent. Residential Floor Area for a residential structure will be based on the initial building permit(s) issued for such structure. "Special Tax" means the annual special tax to be levied in each Fiscal Year on each Assessor's Parcel of Taxable Property to fund the Special Tax Requirement. City of Chula ~'ista Community Facilities District No. 08-1 Otay Ranch Village Six 11-25-02 ,Revised.4pri118, 2003 Page 4 "Special Tax Requirement" means that amount of Special Tax revenue required in any Fiscal Year for CFD-08-I to: (i) pay annual debt service on all Outstanding Bonds due in the Bond Year beginning in such Fiscal Year; (ii) pay other periodic costs on Outstanding Bonds, including but not limited to, credit enhancement and rebate payments; (iii) pay Administrative Fees and Expenses; (iv) pay any amounts required to establish or replenish any reserve funds for all Outstanding Bonds in accordance with the Indenture; and (v) pay directly for acquisition and/or construction of public improvements which are authorized to be financed by CFD-08-I provided that the inclusion of such amount does not cause an increase in the levy of Special Tax on the Undeveloped Property; (vi) less a credit for Available Funds. "State" means the State of Califomia. "Taxable Property" means all of the Assessor's Parcels within the boundaries of CFD-08-I that are not exempt fi:om the Special Tax pursuant to law or Section E below. "Trustee" means the trustee, fiscal agent, or paying agent under the Indenture. "Undeveloped Property" means, for each Fiscal year, all Taxable Property not classified as Developed Property. "Zone A" means a specific geographic area as depicted in Exhibits A and B attached hereto. "Zone B" means a specific geographic area as depicted in Exhibits A and B attached hereto. B. ASSIGNMENT TO LAND USE CATEGORIES Each Fiscal Year, all Assessor's Parcels of Taxable Property within CFD-08-I shall be (a) categorized as being located in either Zone A or Zone B, (b) classified as Developed Property, Undeveloped Property or Provisional Undeveloped Property and (c) subject to the levy of annual Special Taxes determined pursuant to Sections C and D. Furthermore, all Developed Property shall then be classified as Residential Property or Non-Residential Property. C. MAXIMUM ANNUAL SPECIAL TAX RATE Developed Property The Maximum Annual Special Tax for each Assessor's Parcel of Residential Property or Non-Residential Property shall be the greater of (1) the Assigned Special Tax described in Table 1 which follows or (2) the Backup Special Tax computed pursuant to lb. which follows. City of Chula Vista Community Facilities District No. 08J Otay Ranch Village Six 11~25-02 ,Revised.4pri118, 2003 Page $ a. Assigned Special Tax The Assigned Special Tax for each Assessor's Parcel of Developed Property is shown in Table I. TABLE 1 Assigned Special Tax for Developed Property within Zone A and Zone Land Use Class 1 2 Description Residential Property Non-Residemial Property b. Backup Special Tax Assigned Special Tax $800 per unit plus $.35 per square foot of Residential Floor Area $6,000 per Acre When a Final Subdivision Map is recorded within Zone A or Zone B the Backup Special Tax for Residential Property, Non-Residential Property and Undeveloped Property shall be determined as follows: For each Assessor's Parcel of Residential Property or Undeveloped Property to be classified as Residential Property upon its development within the Final Subdivision Map area, the Backup Special Tax shall be the rate per Lot calculated according to the following formula: Zone A $ 16,858x A L Zone B $ 26,445 x A L The terms above have the following meanings: B = Backup Special Tax per Lot in each Fiscal Year. A = Acreage classified or to be classified as Residential Property in such Final Subdivision Map. L = Lots in the Final Subdivision Map which are classified or to be classified as Residential Property. City of Chula Vista Community Facilities District No. 08-1 Otay Ranch Village Six 11-25-02 ,Revised Apri118, 2003 Page 6 For each Assessor's Parcel of Non-Residential Property, or Undeveloped Property to be classified as Non-Residential Property upon the development thereof within the Final Subdivision Map area, the Backup Special Tax shall be determined by multiplying $16,858 for Zone A and $26,445 for Zone B by the total Acreage of all Non-Residential Property and Undeveloped Property to be classified as Non- Residential Property upon the development thereof within the Final Subdivision Map area. Notwithstanding the foregoing if an Assessor's Parcel of Residential Property, Non- Residential Property or Undeveloped Property for which the Backup Special Tax has been determined are subsequently changed or modified by recordation of a new or amended Final Subdivision Map, then the Backup Special Tax applicable to such Assessor's Parcel shall be recalculated to equal the amount of Backup Special Tax that would have been generated if such change did not take place. Undeveloped Property and Provisional Undeveloped Property The Maximum Annual Special Tax for each Assessor's Parcel of Undeveloped Property or Provisional Undeveloped Property shall be $16,858 per Acre for Zone A and $26,445 per Acre for Zone B. D. METHOD OF APPORTIONMENT OF THE SPECIAL TAX Commencing with Fiscal Year 2003-04 and for each following Fiscal Year, the Council shall determine the Special Tax Requirement and shall levy the SpEcial Tax until the amount of Special Taxes equals the Special Tax Requirement. The Special Tax shall be levied each Fiscal Year as follows: First: The Special Tax shall be levied Proportionately on all Developed Property within Zone A and Zone B at a rate up to 100% of the apphcable Assigned Special Tax to satisfy the Special Tax Requirement. Second: If additional monies are needed to satisfy the Special Tax Requirement after the first step has been completed, the Special Tax shall be levied Proportionately on all Undeveloped Property within Zone A and Zone B, at a rote up to 100% of the Maximum Annual Special Tax for Undeveloped Property. In determining the Acreage of an Assessor's Parcel of Undeveloped Property for purposes of determining the annual Special Tax to be levied on such Assessor's Parcel, the CFD Administrator shall not include any Acreage shown on any applicable tentative subdivision map or other land use entitlement approved by the City that designates such Acreage for a use that would be classified as Open Space, Property Owner Association Property, Community Purpose Facility or Public Property. City of Chula Vista Community Facilities District No. 08-1 Otay Ranch Village Six 11-25-02 ,Revised~4pri118, 2003 Page 7 Third: If additional monies are needed to satisfy the Special Tax Requirement al[er the first two steps have been completed, the Special Tax to be levied on each Assessor's Parcel of Developed Property whose Maximum Annual Special Tax is derived by the application of the Backup Special Tax shall be increased Proportionately from the Assigned Special Tax up to the Maximum Annual Special Tax for each such Developed Property.. Fourth: If additional monies are needed to satisfy the Special Tax Requirement after the first three steps have been completed, then the Special Tax shall be levied Proportionately on all Provisional Undeveloped Property at a rate up to 100% of the Maximum Annual Special Tax for Undeveloped Property. Notwithstanding the above, under no circumstances will the Special Tax levied against any Assessor's Parcel of Residential Property be increased by more than ten percent per year as a consequence of delinquency or default in the payment of Special Taxes by the owner of any other Taxable Property. E. EXEMPTIONS The CFD Administrator shall classify the following as Exempt Property: (i) Public Property, (ii) Property Owner Association Property, (iii) Community Purpose Facility Property, (iv) Open Space and (v) Assessor's Parcels with public or utility easements making impractical their utilization for other than the purposes set forth in the easement; provided, however, that no such classification shall reduce the sum of all Taxable Property to less than 40.98 Acres in Zone A and 42.43 Acres in Zone B. Property which cannot be classified as Exempt Property because such classification would reduce the Acreage of all Taxable Property to less than 40.98 Acres in Zone A and 42.43 Acres in Zone B will be classified as Provisional Undeveloped Property and shall be taxed pursuant to the fourth step of Section D. Tax exempt status for purposes of this paragraph will be assigned by the CFD Administrator in the chronological order in which property becomes Exempt Property. The Maximum Annual Special Tax obligation for any property which would be classified as Public Property upon its transfer or dedication to a public agency but which is classified as Provisional Undeveloped Property pursuant to paragraph 1 of Section E shall be prepaid in full by the seller pursuant to Section H.1, prior to the transfer/dedication of such property to such public agency. Until the Maximum Annual Special Tax obligation for any such Public Property is prepaid, the property shall continue to be subject to the levy of the Special Tax as Provisional Undeveloped Property. If the use of an Assessor's Parcel of Exempt Property changes so that such Assessor's Parcel is no longer classified as one of the uses set forth in paragraph 1 that would make such Assessor's Parcel eligible to be classified as Exempt Property, such Assessor's Parcel shall cease to be classified as Exempt Property and shall be deemed to be Taxable Property. City of Chula Vista Community Facilities District No. 08-1 Otay Ranch I~illage Six 11-25-02 ,Revised.4pri118, 2003 Page 8 F. REVIEW/APPEAL COMMITTEE Any landowner or resident who feels that the mount of the Special Tax levied on their Assessor's Parcel is in error shall first consult with the CFD Administrator regarding such error. If following such consultation, the CFD Administrator determines that an error has occurred the CFD Administrator may amend the amount of the Special Tax levied on such Assessor's Parcel. If following such consultation and action (if any by the CFD Administrator), the landowner or resident believes such error still exists, such person may file a written notice with the City Clerk of the City appeal'rog the amount of the Special Tax levied on such Assessor's Parcel. Upon the receipt of any such notice, the City Clerk shall forward a copy of such notice to the City Manager who shall establish as part of the proceedings and administration of CFD-08-I a special three-member Review/Appeal Committee. The Review/Appeal Committee may establish such procedures, as it deems necessary to undertake the review of any such appeal. The Review/Appeal Committee shall interpret this Rate and Method of Apportionment and make determinations relative to the annual administration of the Special Tax and any landowner or resident appeals, as herein specified. The decision of the Review/Appeal Committee shall be final and binding as to all persons. G. MANNER OF COLLECTION The annual Special Tax shall be collected in the same manner and at the same time as ordinary ad valorem property taxes; provided, however, that CFD-08-I, may directly bill the Special Tax, may collect Special Taxes at a different time or in a different manner if necessary to meet its financial obligations, and may covenant to foreclose and may actually foreclose on Assessor's Parcels of Taxable Property that are delinquent in the payment of Special Taxes. Tenders of Bonds may be accepted for payment of Special Taxes upon the terms and conditions established by the Council pursuant to the Act. However, the use of Bond tenders shall only be allowed on a case-by-case basis as specifically approved by the Council. H. PREPAYMENT OF SPECIAL TAX The following definition applies to this Section H: "CFD Public Facilities" means those public facilities authorized to be financed by CFD-08-I. "CFD Public Facilities Costs" means either $20 million, or such lower number as shall be determined either by (a) the CFD Administrator as sufficient to finance the CFD Public Facilities, or (b) the Council concurrently with a covenant that it will not issue any more Bonds to bc secured by Special Taxes levied under this Amended Rate and Method of Apportionment. City of Chula Vista Community Facilities District No. 08-1 Otay Ranch Village Six 11-25-02 ,Revised.4pri118, 2003 Page 9 "Construction Fund" means an account specifically identified in the Indenture to hold funds which are currently available for expenditure to acquire or construct the CFD Public Facilities. "Future Facilities Costs" means the CFD Public Facilities Costs minus that (a) portion of the CFD Public Facilities Costs previously funded (i) from the proceeds of all previously issued Bonds, (ii) fi:om interest earnings on the Construction Fund actually earned prior to the date of prepayment and (iii) directly fi:om Special Tax revenues and (b) the amount of the proceeds of all previously issued Bonds then on deposit in the Construction Fund. "Outstanding Bonds" means all previously issued Bonds which will remain outstanding after the first interest and/or principal payment date following the current Fiscal Year, excluding Bonds to be redeemed at a later date with the proceeds of prior prepayments of Maximum Annual Special Taxes. 1. Prepayment in Full The Maximum Annual Special Tax obligation may only be prepaid and permanently satisfied for an Assessor's Parcel of Developed Property, Undeveloped Property for which a building permit has been issued, or Provisional Undeveloped Property. The Maximum Annual Special Tax obligation applicable to such Assessor's Parcel may be fully prepaid and the obligation of such Assessor's Parcel to pay the Special Tax permanently satisfied as described heroin; provided, however that a prepayment may be made only if there are no delinquent Special Taxes with respect to such Assessor's Parcel at the time of prepayment. An owner of an Assessor's Parcel intending to prepay the Maximum Annual Special Tax obligation shall provide the CFD Administrator with written notice of intent to prepay. Within 30 days of receipt of such written notice, the CFD Administrator shall notify such owner of the prepayment amount of such Assessor's Parcel. The CFD Administrator may charge a reasonable fee for providing this figure, which can be collected prior to preparing such calculation. The prepayment amount shall be calculated as summarized below (capitalized terms as defined below): Bond Redemption Amount plus plus plus plus less less Total: equals Redemption Premium Future Facilities Amount Defeasance Amount Prepayment Fees and Expenses Reserve Fund Credit Caoitalized Interest Credit Prepayment Amount City of Chula Vista Community Facilities District No. 08-1 Otay Ranch Village Six 11-25-02 ,Revised April 18, 2003 Page 10 As of the proposed date of prepayment, the Prepayment Amount (defined below) shall be calculated as follows: Step No.: For Developed Property, compute the Maximum Annual Special Tax for the Assessor's Parcel to be prepaid. For Undeveloped Property for wltich a building permit has been issued to be prepaid, compute the Maximum Annual Special Tax for that Assessor's Parcel as though it was akeady designated as Developed Property, based upon the building permit, issued for that Assessor's Parcel. For Provisional Undeveloped Property to be prepaid, compute the Maximum Annual Special Tax for such Assessor's Parcel using the Maximum Annual Special Tax for Undeveloped ?mperty. Divide the Maximum Annual Special Tax computed pursuant to step 1 by the sum of the total expected Maximum Annual Special Tax revenues which may be levied within CFD-08-I excluding any Assessor's Parcels for which the Maximum Annual Special Tax obligation has been previously prepaid. Multiply the quotient computed pursuant to step 2 by the principal amount of the Outstanding Bonds to compute the amount of Outstanding Bonds to be retired and prepaid (the "Bond Redemption Amounf'). Multiply the Bond Redemption Amount computed pursuant to step 3 by the applicable redemption premium on the next possible Bond call date, if any, on the Outstanding Bonds to be redeemed (the "Redemption Premium"). If all the Bonds authorized to be issued for CFD-08-I have not been issued, compute the Future Facilities Costs. Multiply the quotient computed pursuant to step 2 by the amount if any, determined pursuant to step 5 to compute the amount of Future Facilities Costs to be allocated to such Assessor's Parcel (the "Future Facilities Amount'). Compute the amount needed to pay interest on the Bond Redemption Amount from the first bond interest and/or principal payment date following the current Fiscal Year until the earliest redemption date for the Outstanding Bonds. 8. Confirm that no Special Tax delinquencies apply to such Assessor's Parcel. 9. Determine the Special Taxes levied on the Assessor's Parcel in the current Fiscal Year, which have not yet been paid. 10. Determine the fees and expenses of CFD-08-I, including but not limited to, the costs of computation of the prepayment, the costs to invest the prepayment proceeds, the costs of redeeming Bonds from the proceeds of such prepayment, and the cost of City of Chula Vista Community FaciHties District No. 08-1 Otay Ranch Village Six 11-25-02,Revised ~4pril 18, 2003 Page 11 recording any notices to evidence the prepayment and the redemption (the "Prepayment Fees and Expenses',) 11. Compute the amount the CFD Administrator reasonably expects to derive fi.om the re'investment of the prepayment amount less the Prepayment Fees and Expenses, as determined pursuant to step 10, from the date of prepayment until the redemption date for the Outstanding Bonds to be redeemed with the prepayment. 12. Add the amounts computed pursuant to steps 7 and 9 and subtract the amount computed pursuant to step 11 (the "Defeasance Amount"). 13. The reserve fund credit (the "Reserve Fund Credit") shall equal the lesser of: (a) the expected reduction in the reserve requirement (as defined in the Indenture), if any, associated with the redemption of Outstanding Bonds as a result of the prepayment, or (b) the amount derived by subtracting the new reserve requirement (as defined in the Indenture) in effect after the redemption of Outstanding Bonds as a result of the prepayment from the balance in the reserve fund on the prepayment date, but in no event shall such amount be less than zero. 14. If any capitalized interest for the Outstanding Bonds will not have been expended at the time of the first interest payment following the current Fiscal Year, a capitalized interest credit shall be calculated by multiplying the quotient computed pursuant to step 2 by the expected balance in the capitalized interest fund afier such first interest payment (the "Capitalized Interest Credit"). 15. The Maximum Annual Special Tax prepayment is equal to the sam of the amounts computed pursuant to steps 3, 4, 6, 10, and 12, less the amounts computed pursuant to steps 13 and 14 (the "Prepayment Amount"). 16. From the Prepayment Amount, the amounts computed pursuant to steps 3, 4, 12, 13, and 14 shall be deposited into the appropriate fund as established under the Indenture and be used to retire Outstanding Bonds or make debt service payments. The amount computed pursuant to step 10 shall be retained by CFD-08-I. The amount computed pursuant to step 6 shall be deposited in the Construction Fund. The Prepayment Amount may be sufficient to redeem other than a $5,000 increment of Bonds. In such cases, the increment above $5,000 or integral multiple thereof will be retained in the appropriate fund established under the Indenture to be used with the next prepayment of Bonds or to make debt service payments. As a result of the payment of the current Fiscal Year's Special Tax levy as determined under step 9 above, the CFD Administrator shall remove the current Fiscal Year's Special Tax levy for such Assessor's Parcel fi:om the County tax rolls. With respect to any Assessor's Parcel that is prepaid, the Council shall cause a suitable notice to be recorded in compliance with the Act, to indicate the prepayment of Special Taxes and the release of the Special Tax lien on such Assessor's Parcel, and the obligation of such Assessor's Parcel to pay the Special Tax shall cease. City of Chula l~ista Community Facilities District No. 08-1 Otay Ranch Yt?lage Six 11-25-02 ,Revised April 18, 2003 Page 12 Notwithstanding the foregoing, no Special Tax prepayment shall be allowed unless the mount of Maximum Annual Special Taxes that may be levied on Taxable Property within CFD-08-I, both prior to and after the proposed prepayment is at least 1.1 times the maximum annual debt service on all Outstanding Bonds. 2. Prepayment in Part The Maximum Annual Special Tax on an Assessor's Parcel of Developed Property or an Assessor's Parcel of Undeveloped Property for which a building permit has been issued may be partially prepaid. The amount of the prepayment shall be calculated as in Section H.1, except that a partial prepayment shall be calculated according to the following formula: PP =(PEx F)+A These terms have the following meaning: PP = the partial prepayment PE -- the Prepayment Amount calculated according to Section H. 1, minus Prepayment Fees and Expenses determined pursuant to step 10. F = the percent by which the owner of the Assessor's Parcel(s) is partially prepaying the Maximum Annual Special Tax. A= the Prepayment Fees and Expenses determined pursuant to step 10. The owner of an Assessor's Parcel who desires to partially prepay the Maximum Annual Special Tax shall notify the CFD Administrator of (i) such owner's intent to partially prepay the Maximum Annual Special Tax, (ii) the percentage by which the Maximum Annual Special Tax shall be prepaid, and (iii) the company or agency that will be acting as the escrow agent, if applicable. The CFD Administrator shall provide the owner with a statement of the amount required for the partial prepayment of the Maximum Annual Special Tax for an Assessor's Parcel within 30 days of the request and may charge a reasonable fee for providing this service. With respect to any Assessor's Parcel that is partially prepaid, the City shall (i) distribute the funds remitted to it according to step 16 of Section H. 1, and (ii) indicate in the records of CFD-08-I that there has been a partial prepayment of the Maximum Annual Special Tax and that a portion of the Maximum Annual Special Tax equal to the outstanding percentage (1.00 - F) of the remaining Maximum Annual Special Tax shall continue to be authorized to be levied on such Assessor's Parcel pursuant to Section D. TERM OF MAXIMUM ANNUAL SPECIAL TAX The Maximum Annual Special Tax shall be levied commencing in Fiscal Year 2003-2004 to the extent necessary to fully satisfy the Special Tax Requirement and shall be levied for a period no longer than the 2039-2040 Fiscal Year. City of Chula Vista Community Facilities District No. 08-I Otay Ranch Village Six 11-25-02 ,Revised April 18, 2003 Page 13 Z 0 N (]¥0~ V103~ Vl