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2021/03/16 Agenda Packet
I declare under penalty of perjury that I am employed by the City of Chula Vista in the office of the City Clerk and that I posted the document according to Brown Act requirements. Datod:3 t 1 ?SLI Signed. 11 .�.....-ter.► CITY OF CHULA VISTA Mary Casillas Salas, Mayor John McCann, Councilmember- District 1 Maria V. Kachadoorian, City Manager Jill M. Galvez- Councilmember- District 2 Glen R. Googins, City Attorney Stephen C. Padilla- Councilmember- District 3 Kerry K. Bigelow, City Clerk Andrea Cardenas- Councilmember- District 4 Tuesday, March 16, 2021 5:00 PM Council Chambers 276 4th Avenue, Building A Chula Vista, CA 91910 SPECIAL MEETING OF THE HOUSING AUTHORITY MEETING JOINTLY WITH THE CITY COUNCIL OF THE CITY OF CHULA VISTA Notice is hereby given that the Mayor of the City of Chula Vista has called and will convene a Special Meeting of the Housing Authority meeting jointly with the City Council on Tuesday, March 16, 2021, at 5.00 p.m. via teleconference and in the Council Chambers,located at 276 Fourth Avenue, Building A, Chula Vista, California to consider items on this agenda. PURSUANT TO THE GOVERNOR OF THE STATE OF CALIFORNIA'S EXECUTIVE ORDER N-29-20, AND IN THE INTEREST OF THE PUBLIC HEALTH AND SAFETY, MEMBERS OF THE CITY COUNCIL AND STAFF MAY PARTICIPATE IN THIS MEETING VIA TELECONFERENCE. IN ACCORDANCE WITH THE EXECUTIVE ORDER, THE PUBLIC MAY VIEW THE MEETING ON TELEVISION AND/OR ONLINE AND NOT IN THE COUNCIL CHAMBERS. HOW TO WATCH: Watch the meeting via livestream at https://chulavista.legistarcomICalendaraspx, on AT&T U-verse channel 99(throughout the County), and on Cox Cable channel 24(only in Chula Vista). Recorded meetings are also aired on Wednesdays at 7 p.m. (both channels)and are archived on the City's website. HOW TO SUBMIT COMMENTS: Visit the online eComment portal for this meeting at: https:Ilchulavista.legistar.comICalendar.aspx. The commenting period will be open shortly after the agenda is published will remain open through the meeting. All comments will be available to the public and the City Council using the eComment portal. Comments must be received prior to the time the Mayor calls for the close of the commenting period. Comments received after such time will not be considered by the City Council. If you have difficulty or are unable to submit a comment,please contact the City Clerk's Office at cityclerk@chulavistaca.gov or(619)691-5041. ACCESSIBILITY. Individuals with disabilities are invited to request modifications or accommodations in order to access and/or participate in a City meeting by contacting the City Clerk's Office at cityclerk@chulavistaca.gov or (619) 691-5041 (California Relay Service is available for the hearing impaired by dialing 711) at least forty-eight hours in advance of the meeting. —The City of Chula Vista is relying on commercial technology to livestream and accept public comments via Granicus, Inc. With the increase of virtual meetings, most platforms are working to scale their systems to meet the new demand. If we have technical difficulties, we will resolve them as quickly as possible. City staff will take all possible measures to ensure a publicly accessible experience. City of Chula Vista Page 1 Printed on 311112021 City Council Agenda Mlarch 16,2021 CALL ITO oR E ROLL CALL: L: Councilmembers Cardenas, Galvez, McCann, Padilla and Mayer Casillas salas PLEDGE OF ALLEGIANCE TCS THE FLAG AND MOMENT OF SILENCE SPECIAL ORDERS OF THE DAY A. 1-0058 C OV I D 1 UPDATE BY CITY Y o f C H U LA VISTA EMERGENCY SERVICES COORDINATOR ATOR MARLON KING CONSENT CALENDAR (111tems 1 - 8) The Council will enact the Consent Calendar staff recommendations by one motion without discussion, unless a Councilmember, a member of the public, or staff requests that an item be removed for discussion. if you wish to comment on one of these items, de so at ht ps.-Ilchulavista.le istar.coml"Calendar.aspx 1 1-0073 APPROVAL of MINUTES of November 17,1 December 1, and 3, o o. Recommended Action, Council approve the minutes. 2. 21-0057 ORDINANCE OF THE CITY OF CHULA VISTA AMENDING VARIOUS SECTIONS OF CHULA VISTA MUNICIPAL CODE CHAPTER 2.52 TO AUJiUSIT THE CAMPAIGN CONTRIBUTION LIMIT FOR ANY ELECTION HELD ON OR AFTER JANUARY 1, 20122 (SECOND READING AND ADOPTION Department: City Clerk Environmental Notice: the activity is not a "Project" as defined under section 15378 of the California Environmental Quality ity Act state Guidelines; therefore, pursuant to Mate Guidelines section 15060(c)(3) no environmental review is required. Recommended Action: Council adopt the ordinance. 3. 20-0569 ACCEPTANCE OF THE OUs NCS ELEMENT oto ANNUAL PROGRESS REPORT & HOUSING SUCCESSOR ANNUAL REPORT FOR FISCAL YEAR 20191-2020 ©e,partment. Development services Department Environmental Notice:ce: The activity is not a "Project" as defined under section 15378 of the California (Environmental Quality Act state Guidelines; therefore, pursuant to State Guidelines section 1 o o1(c)(3) no environmental review is required. Recommended Action.: Council and Authority, as successor Housing Agency, accept the report. City of Chula Vista Page 2 Printed on 3/7112021 2021-03-16 Agenda Packet Page 2 of 724 City council Agenda Mlarch 16,2021 4. 21-0017 RESOLUTION OF THE CITY COUNCIL F THE CITY OF CHULA VISTA ORDERING THE SUMMARY VACATION OF AN IRREVOCABLE OFFER of DEDICATION FOR OPEN SPACE AND OTHER PUBLIC PURPOSES of A PORTION OF LOT "A'"' PER FINAL MAP No. 16325, CHULA VISTA TRACT No 12-05, OTAY RANCH VILLAGE 2 SOUTH PORTION of NEIGHBORHOOD R-1213 Department: development Services Department Environmental Notice: The project was adequately covered in previously certified final second tier environmental impact report, EIR 02-02 and final supplemental environmental impact report, SEIR 12-01 for City Ranch 'pillage Two sectional planning area (SPA) plan. Recommended Action: council adopt the resolution. 5. 21-0022 RESOLUTION of THE TTY" COUNCIL of THE CITY of CHULA VISTA APPROVING 'THE AMENDED MEASURE A PUBLIC SAFETY EXPENDITURE PLAN To ACLU ONE OPERATIONS SUPPORT CAPTAIN AND THREE FIREFIGHTER/EMT POSITIONS To ENGINE 59 To THE AUTHORIZED STAFFING of THE FIRE DEPARTMENT IN FISCAL YEAR 2020/2021 AND AMEND THE FISCAL YEAR 2021 EXPENDITURE, BUDGET FOR THE MEASUREA BALES TAX FUND TO FUND SUCH POSITIONS OUT of MEASURE A - FIRE DEPARTMENT AVAILABLE FUND BALANCE (415 VOTE REQUIRED) Department: Fire Department Environmental Cance: The activity is not a "Project" as defined under Section 15378 of the California (Environmental Quality Act State Guidelines; therefore, pursuant to Mate Guidlellines Section 150601(c)(3) no environmental review is regluired. Recommended Action: coulncil adopt the (resolution. 5. 21-0036 RESOLUTION of THE CITY COUNCIL. OF THE CITY of CHULA VISTA APPROVING A SECOND AMENDMENT To THE AGREEMENT BETWEEN THE CITY OF CHULA VISTA AND CLEAN HARBORS ENVIRONMENTAL SERVICES, INC. FOR URN-ICY HOUSEHOLD HAZARDOUS WASTE AN CONDITIONALLY EX MPT SMALL QUANTITY GENERATOR WASTE MANAGEMENT SERVICES Department: Economic Development Department City of Chula Vista Page 3 Printed on 311112021 2021-03-16 Agenda Packet Page 3 of 724 City Council Agenda Mlarch 16,2021 Environmental Notice: The Project qualifies, for a Categorical Exemption pursuant to the California Environmental Quality Act State Guidlellines Section 15808 Class 8 (Actions, by Regulatory Agencies for Protection of the Environment), Section 15330 Class 30 (Minor Actions to Prevent, Minimize, Stabilize, Mitigate or Eliminate the Release or Threat of Release of Hazardous Waste or Hazardous Substances), and Section 5061(b)(8). Recommended Action: Council adopt the resolution. 121-0032 A. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING AN EASEMENT PURCHASE AGREEMENT WITH SD,CF HOLDINGS CORPORATION IN THE AMOUNT OF $,1)370 B. ORDINANCE OF THE CITY OF CHULA VISTA AMENDING CHULA VISTA MUNICIPAL CODE SECTION 2.56 (PURCHASING SYSTEM) TO AUTHORIZE THE PUBLIC WORKS DIRECTOR OR CITY ENGINEER 'TO ACQUIRE INTERESTS IN REAL PROPERTY IN FURTHERANCE OF CAPITAL IMPROVEMENT PROJECTS, (FIRST READING) Department: Engineering Department Environmental Notice: The Project qualifies for a Categorical Exemption pursuant to the California Environmental Quality Act State Guidelines Section 15301 Class 1 (Existing) Facilities), Section 15808 class 3 (New Construction or Conversion of Small Structures), Section 15332 Class 32 (In-(Fill Development Projects), and Section 15061(b (8). Recommended Action: Coulncil adopt the resolution and place,the ordinance on first (reading., 81. .21-0065 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA RATIFYING AND CONFIRMING AMENDED EMERGENCY ORDER 0014-2020 (EFFECTIVE MARCH 10, 2021) OF THE, CHULA VISTA DIRECTOR OF EMERGENCY SERVICES ALLOWING FURTHER TOLLING AND EXTENSION OF DEADLINES FOR LAND USE AND BUILDING, PERMIT-RELATED ACTIONS Department: City Attorney, City Manager, & Development Services Environmental Notice: The activity is not a "Project" as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required. Notwithstanding the foregoing, the activity also qualifies for an Exemption pursuant to Section 15061(b)(3) of the California Environmental Quality Act State Guidelines. Recommended Action: Council adopt the resolution. City of Chula Vista Page 4 Printed on 311112021 2021-03-16 Agenda Packet Page 4 of 724 City Council Agenda Mlarch 16,2021 ITEMS REMOVED FROM THE CONSENT CALENDAR PUBLIC COMMENTS Persons commenting during Public Comments may address the Council on any subject matter within the Council's jurisdiction that is not listed as an item on the agenda. State law generally prohibits the Council from discussing or taking action on any issue not included on the agenda, but, if appropriate, the Council may schedule the topic for future discussion or refer the matter to staff. If you wish to comment, you may do so at htips.-Ilchula vista.legistar.com/Calendar.aspx 91. 121-0059 PUBLIC COMMENTS RECEIVED for March 16,12021 BOARD AND, COMMISSION REPORTS The Item(s) listed in this section of the agenda have been brought forward by a City board, commission, or committee and will be considered individually by the Council. If you wish to comment on any item, do so at h ttps.-Ilch ula vista.legistar.com/Calendar.aspx 10. 120-0535 CONSIDERATION OF APPROVAL OF CONSULTANT SERVICES AGREEMENTS FOR REDISTRICTING DEMOGRAPHER AND OUTREACH SERVICES RESOLUTION OF THE CITY COUNCIL OF 'THE CITY OF CHULA VISTA APPROVING CONSULTANT SERVICES AGREEMENTS FOR REDISTRICTING DEMOGRAPHIC CONSULTANT SERVICES, BETWEEN THE CITY AND NATIONAL DEMOGRAPHICS CORPORATION AND FOR REDISTRICTING OUTREACH CONSULTANT SERVICES BETWEEN THE CITY AND SOUTHWEST STRATEGIES, LLC Environmental Notice: The activity is not a "Project" as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 150601(c)(3) no environmental review is required. Recommended Action: Council adopt the (resolution. City of Chula Vista Page 5 Printed on 311112021 2021-03-16 Agenda Packet Page 5 of 724 City Council Agenda Mlarch 16,2021 ACTION ITEMS The Item(s) listed in this section of the agenda will be considered individually by the Council and are expected to elicit discussion and deliberation. If you wish to comment on one of these items, you may do so at https.-Ilchula vista.legistar.com/Calendar.asp. 1'1. 20-0551 CONSIDERATION OF THE ISSUANCE OF SPECIAL TAX BONDS AND OTHER RELATED DOCUMENTS FOR COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA) IMPRO VEMENT' AIC EA 2 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA ACTING FOR ITSELF AND IN ITS CAPACITY AS THE LEGISLATIVE BODY OF COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA), AUTHORIZING AND, PROVIDING FOR THE ISSUANCE OF SPECIAL TAX BONDS FOR IMPROVEMENT AREA NO. 2 OF SUCH COMMUNITY FACILITIES DISTRICT, APPROVING THE FORM OF BOND INDENTURE, BOND PURCHASE AGREEMENT PRELIMINARY OFFICIAL STATEMENT AND OTHER DOCUMENTS RELATED THERETO AND AUTHORIZING CERTAIN ACTIONS IN CONNECTION WITH THE ISSUANCE OF SUCH BONDS Department: Development Services Department Environmental Notice: The activity is not a "Project" as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 150601(c)(3) no environmental review is required. Recommended Action: Council adopt the (re,solution. 12. 121-0579 CONSIDERATION OF EXTENDING THE TERM OF ANNEXATION OF PROPERTY IN COMMUNITY FACILITIES DISTRICT NO. 17-1 (WESTERN CHULA VISTA DIF FINANCING PROGRAM) RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA ACTING IN ITS CAPACITY AS THE LEGISLATIVE BODY OF COMMUNITY FACILITIES DISTRICT NO. 17-1 (WESTERN CHULA VISTA DIF FINANCING PROGRAM), EXTENDING THE TERM OF ANNEXATION OF PROPERTY INTO SUCH COMMUNITY FACILITIES DISTRICT AND TAKING CERTAIN OTHER ACTIONS RELATING THERETO City of Chula Vista Page 6 Printed on 311112021 2021-03-16 Agenda Packet Page 6 of 724 City Council Agenda Mlarch 16,2021 Department: Development Services Department Environmental Notice: The activity is not a "Project" as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 150601(c)(3) no environmental review is required. Recommended Action: Council adopt the (resolution. 13. 121-0055 PRESENTATION OF A REPORT AND REQUEST FOR CITY COUN�CIL DIRECTION REGARDING SHORT- TERM/VACATION RENTALS Department: Development Services Department Environmental Notice: The activity is not a "Project" as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 150601(c)(3) no environmental review is required. Recommended Action: Council hear the report, discuss, and provide direction to staff, as appropriate. CITY MANAGER'S REPORTS MAYOR'S REPORTS COU NCI(!M EMBERS' COMMENTS CITY ATTORNEY'S REPORTS CLOSED SESSION Announcements of actions taken in Closed Session shall be made available by noon on the next business day following the Council meeting at the City Attomey-s office in accordance with the Ralph M. Brown Act 'Government Code 54957.7). 14. 121-0053 CONFERENCE WITH LEGAL COUNSEL REGARDING EXISTING LITIGATION PURSUANT TO GOVERNMENT CODE SECTION 54956.9 (d)(1) Name of case: A) Kimone Nunis, as Successor-in-Interest to Decedent Oral Nunix, et al. v. City of Chula Vista, San Diego Supperior Court, Case No. 37-2020-000455'71-CU-WM-CTL; and B) Estate of Oral W. Nunis, Sr., et al. v. City of Chula Vista, S a n Diego Superior Court Case . No . 37-2o20-00043271-CSU-CSR-CTL City of Chula Vista Page 7 Printed on 311112021 2021-03-16 Agenda Packet Page 7 of 724 City Council Agenda March 16,2021 15. 121-0054 CONFERENCE WITH LEGAL COUNSEL--ANTICIPATED LITIGATION Significant exposure to litigation pursuant to Government Code Section 54956.9d)(2) [or] 3 : One [1 Case. Claim presented 017/17/20. ADJOURNMENT to the regular City Council meeting on March 23, 2021, at 5.-00 p.m., in the Council Chambers. Materials provided to the City Council related to any open-session item on this agenda are available for public review,please contact the Office of the City Clerk at cityclerk@chulavistaca.gov or(619) 691-5041. Sign up at www.chulavistaca.gov to receive email notifications when City Council agendas are published online. City of Chula Vista Page 8 Printed on 311112021 2021-03-16 Agenda Packet Page 8 of 724 C® of Chula Vista Meetinge Minutes -, Draft Tuesday, (November 17,2020 5:00 RM Via Teleconference Council Chambers 276 4th Avenue, (Building A Chula Vista, CA 91910 REGULAR MEETING CSF THE CITY COUNCIL Pursuant to the Governor of the State of California's Executive Order N-29-20, and in the interest of public health and safety during the COVID-19 pandemic, members of the City Council and staff participated in this meeting via teleconference. Members of the public participated remotely and were not present in Council Chambers. All votes were taken by roll call and public comments were submitted electronically or otherwise in writing. The City Council minutes are prepared and ordered to correspond to the City Council Agenda. Agenda items may be taken out of order during the meeting. The agenda items at this meeting were considered in the order presented. CALL TO ORDER A regular meeting of the City Council of the City of Chula Vista was called to order at 5.-08 p.m. via teleconference and in the Council Chambers, located in City Hall, 276 Fourth Avenue, Chula Vista, California. ROLL CALL: Present: Councilmember Diaz, Deputy Mayor Galvez, Council ember McCann, Councilmember Padilla and Mayor Casillas Salas Also present: City Manager Kachadoorian, City Attorney Googins, Assistant City Clerk Turner, and City Clerk Analyst Hernandez PLEDGE OF ALLEGIANCE TO THE FLAG AND MOMENT OF SILENCE Councilmember Diaz led the Pledge of Allegiance. SPECIAL ORDERS OF THE DAY A. 20-0466 COVID-19 UPDATE BY CITY OF CHULA VISTA EMERGENCY SERVICES COORDINATOR MARLON KING Emergency Services Coordinator King gave a presentation on COVID-19 updates and responded to questions of the Council. B. 20-0478 COVID-19 UPDATE BY MARKETING AND COMMUNICATIONS MANAGER ANNE STEINBERGER ON COMMUNITY SUPPORT EFFORTS Mayor Casillas,alas announced that Item B would be continued to the next City Council meeting. City of Chula Vista Page 1 2021-03-16 Agenda Packet Page 9 of 724 City Council Meeting Minutes-IDIraft November 17,2020 C. -0465 PRESENTATION BY FIRE CHIEF JIM GEERING ANNOUNCING THE WINNER OF THE ORCHID ID AWARD AT THE ANNUAL ORCHIDS AND ONIONS CEREMONY AND THE NATIONAL GOLD MEDAL AWARD FROM FIREHOUSE MAGAZINE FOR FIRE .NATION NO. 10 - MILLENIA AND RECOGNIZING JFF'1= I ATZ ARCHITECTURE AND JIM SUMMERS OF EC CONSTRUCTORS Fire Chief Geering gave a presentation on the item and presented the awards to the Council., D. 0-0468 PRESENTATION OF A PROCLAMATION AMATION PROCLAIMING SATURDAY, NOVEMBER 2 , 2020 AS SMALL BUSINESS SATURDAY IN THE CITY OF CHULA VISTA Mayor Casillas Salas read the proclamation. E. 0-0469 PRESENTATION OF A PROCLAMATION TO PUBLIC WORKS DIRECTOR IRACS, MA QUILANTAN PROCLAIMING THURSDAY, NOVEMBER 19,, 2020 AS ARBOR DAY" IN THE CITY OF CHULA VISTA Mayor Casillas ,alas read the proclamation and City Manager Kachadoorian presented it to Public Works Director Quilantan. F. 20-0470 PRESENTATION OF A PROCLAMATION COMMENDING PUBLIC WORKS DIRECTOR IRACBEMA OLIVO QUILANTAN, RECOGNIZING 34 YEARS OF DEDICATED SERVICE Mayor Casillas Salas read the proclamation and City Manager l achadoorian presented it to Public Works Director Quilantan. CONSENT CALENDAR SNDA (Items 1 - 4) 11. 0-0370 A. RESOLUTION NO. 2020-256 O1= THE CITY COUNCIL O1= THE CITY OF CHULA VISTA APPROVING THE TERMINATION OF AN EXISTING LEASE AND EXECUTION OF A NEV' LEASE AGREEMENT WITH CHULA VISTA AMERICAN LEGION POST NO. 434 FOR THE CITY-OWNED BUILDING AND APPURTENANCES LOCATED AT 47 FIFTH AVENUE B. RESOLUTION NO. 2020-257 OF THE CITY COUNCIL. OF THE CITY OF CHULA VISTA RENAMING THE AMERICAN LEGION HALL LOCATED AT 47 FIFTH AVENUE TO THE CHULA VISTA VETERANS MEMORIAL. BUILDING Recommended Action: Council adopt the resolutions. City of Chula Vista Page 2 2021-03-16 Agenda Packet Page 10 of 724 City Council Meeting Minutes-IDraft November 17,2020 2. 20-0340 RESOLUTION N NCS. 2020-258 OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING AN AGREEMENT BETWEEN E N TIS CITY O CHULA VISTA AND D-MAX ENGINEERING, INC. FOR NATIONAL POLLUTANT DISCHARGE ELIMINATION SYSTEM DRY WEATHER MS4 OUTFALL AND TRASH MONITORING SERVICES Recommended Action: Council adopt the resolution. 3. 20-0455 INVESTMENT REPORT FOR THE QUARTER ENDED SEPTEMBER 00, 2020 Recommended Action: Council receive the report. 4. 20-0443 X RESOLUTION NO. 2020-259 OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA AMENDING THE COMPENSATION SC HEDUL. ANIS CLASSIFICATION PLAN TO REFLECT THE ADDITION AND DELETION OF VARIOUS POSITION TITLES AND AMENDING THE AUTHORIZED POSITION COUNT IN VARIOUS DEPARTMENTS WITH NO NET INCREASE IN AUTHORIZED STAFFING D. RESOLUTION NO. 2020-200 OF THE, CITY COUNCIL OF THE, CITY OF CHULA VISTA APPROVING THE REVISED FISCAL YEAR 2020-2021 COMPENSATION SCHEDULE EFFECTIVE NOVEMBER 20, 2020, AS REQUIRED BY CALIFORNIA CODE OF REGULATIONS, TITLE 2, SECTION 70.5 C. RESOLUTION NO. 2020-251 OF THE CITY COUNCIL OF THE CITY OF CHULA 'VISTA APPROVING THE REVISED FISCAL YEAR 2020-2021 COMPENSATION SCHEDULE EFFECTIVE JANUARY 15 20211 AS REQUIRED BY CALIFORNIA CODE OF REGULATIONS, TITLE 2, SECTION 570.5 D. ORDINANCE OF THE CITY OF CHULA VISTA AMENDING CHULA VISTA MUNICIPAL..- CODE SECTION 2.05.010, ADDING THE UNCLASSIFIED POSITION TITLE OF HUMAN RESOURCES MANAGER AND DELETING THE HUMAN RESOURCES OPERATIONS MANAGER AND PERFORMANCE AND ORGANIZATIONAL, DEVELOPMENT MANAGER POSITION TITLES (FIRST READING), 4/5 VOTE REQUIRED) Recommended Action: Council adopt the resolutions and place the ordinance on fiirst reading. Approval of the Consent Calendar ACTION: A motion was made by Councilmember McCann, seconded by Deputy (Mayor Galvez, to approve staff s recommendations on the above Consent Calendar items, headings read, text waived. The motion carried by the following roll call vote: City of Chula Vista page 3 2021-03-16 Agenda Packet Page 11 of 724 City Council Meeting Minutes-IDraft. November 17,2020 Yes: 5- Diaz, Galvez, McCann, (Padilla and Casillas Salas No: 0 Abstain: 0 PUBLIC COMMENTS . 20-0467 PUBLIC COMMENTS RECEIVED for November 17, 2020 Daniel Briceno, submitted comments regarding the Master Trails Plan. ACTION ITEMS 6. 20-0426 CONSIDERATION F AMENDING THE CHULA VISTA MUNICIPAL CODE TO ESTABLISH ENERGY UPGRADE REQUIREMENTS FOR ADDITIONS AND REMODELS TO SINGLE FAMILY HOMES MES ANIS CONDOS ORDINANCE OF THE CITY OF CHULA VISTA AMENDING CHAPTER 5.26 OF THE CHULA VISTA MUNICIPAL CODE TO ESTABLISH ENERGY UPGRADE REQUIREMENTS FOR ADDITIONS AN REMODELS TO SINGLE FAMILY HOMES AND CONDOS (FIRST READING) Conservation Specialist Downs gave a presentation on the item and responded to questions of the Council. The following members of the public submitted comments in support of staffs recommendation.- - Wendy llihalic, La m'''esa resident -Carolyn Schofield, Chula Vista resident -Mita dement, Chula Vista resident ACTION: A motion was remade by Dieputy Mayor Galvez, seconded by Mayor Casillas Salas, to (place the above ordinance can first reading, heading read, text waived. The motion carried by the following roll call vote: Yea: 4- Galvez, McCann, Padilla and Casillas Salas No: 1 - Diaz Abstain: 0 CITY MANAGER'S DEPORTS City Manager Kachadoorian announced Director of Human Resources Courtney Chase had been named a "Top 40 Business Leader under 40." MAYOR'S REPORTS Mayor Casillas Salas reported on her attendance at the following recent events: drive-by retirement celebration for lracsema Quilantan, Veteran's tray ceremony at Memorial Park, virtual Upwardly Global Gala of 2020, oath of office for the remaining Redistricting Commissioners, and an event for the Juan Diego Academy located at Mater Dei High School. Mayor Casillas Salas thanked Northgate Gonzalez grocery store for its ,o0o donation to the San Diego f=ood Bank and reminded residents to continue to adhere to CG" lt -1 9 guidelines. City of Chula Vista Page 4 2021-03-16 Agenda Packet Page 12 of 724 City Council Meeting Minutes-IDraft November 17,2020 7. 20-0476 6 RATI ICA ION OF APPOINTMENTS TO THE FOLLOWING BOARDS COMMISSIONS: -Brenda Aguirre, Mobilehoe Rent Review Commission -Norman Paddock, Housing Advisory Commission (Tenant Representative) ACTION: A motion was made by Mayor Casillas Salas, seconded by Councilmember McCann, to ratify the above appointments. The motion carried by the following roll call vote: Yes: 5- Diaz, Galvez, McCann, (Padilla and Casiillas Salas No: 0 Abstain: 0 COUNCILMEI IBEIRS" COMMENTS Councilmember McCann thanked Public Works Director Quilantan for her dedicated service to the City and Emergency Services Coordinator King for the COVID-19 updates. He encouraged residents to get the flu shot. Councilmember Galvez extended thanks to the following: ,Stan Jase with the Fleet Reserve Association for the Veterans Day ceremony and the Chula 'lista Municipal Golf Course staff for her recent tour of the facility. She congratulated the re-elected members of the TA' A hoard and announced the swearing in of the new Chamber of Commerce board. Councilmember Galvez paid tribute to Prank Roseman. She extended Thanksgiving greetings to the community. Councilmember Padilla extended congratulations to Public works Director Quilantan on her retirement and to Human Resources Director Chase for her recognition. He paid tribute to Frank Roseman. Councilmember Padilla reminded residents to continue to adhere to CO VID 19 guidelines and advice from medical professionals around the holiday. He extended Thanksgiving greetings to the community. . 20-0460 CCS NCIL MBER IA RATIFICATION OF' APPOINTMENT OF' ABEL CO DERO TO THE. MOBILEHOMP RENT REVIEW COMMISSION ACTION: A motion was made by Councilmember Diaz, seconded by Mayor Casillas Salas, to ratify the above appcointment. The motion carried by the following roll call vote: Yes: Diaz, Galvez, McCann, Padilla and Casillas Salas Nto: 0 Abstain: 0 CITY ATTORNEY'S REPOR S There were none. CLOSED SESSION City Attorney Googins announced that Item g would be continued to a future meeting and that Fire Chief Geering would be added to the Agency designated representatives for Item 10. Mayor Casillas ,Salas recessed the meeting! at 7:10p.m. The Council reconvened at 7 16 p.m., with all members present. City of Chula vista Page 2021-03-16,agenda Packet Page 13 of 724 City Council Meeting Minutes-IDraft. November 17,2020 Pursuant to Resolution No. 13706 and Council Policy No. 346-0 , official (Minutes and records of action taken during Closed Sessions are maintained by the City Attorney. 91. 20-0441 CONFERENCE WITH LEGAL. COUNSEL—ANTICIPATED LITIGATION Significant exposure to litigation pursuant to Government Code Section 54956.9d)(2) [or 3 : one [1] Case. City of Chula 'Vista Claire No. CV20153. Item g was not discussed and was continued to a future meeting. 110. 20-0459 CONFERENCE NCE WITH LABOR NEGOTIATORS PURSUANT To GOVERNMENT CODE SECTION 54957.6 Employee organization: Local 2180 International Association of Fire Fighters AFL-CIO Agency designated representatives. Maria Kachadoorian, Kelley Bacon, Courtney Chase, David Bilby, Glen Googins, and Jim Geering ACTION: No reportable action. ADJOURNMENT ,At 7.•25 p.m. Mayr Casiiias Saias adjourned the meeting in memory of c=rank Roseman. Minutes prepared by. Tysl ar L. Turner,,Assistant City Jerk Kerry K. igelor, MMC, City Clerk City of Chula Vista Page 6 2021-03-16 Agenda Packet Page 14 of 724 C® of Chula Vista Meetinge Minutes -, Draft Tuesday, December 1,2020 5:00 RM Via Teleconference Council Chambers 276 4th Avenue, (Building A Chula Vista, CA 91910 REGULAR MEETING CSF THE CITY COUNCIL Pursuant to the Governor of the State of California's Executive Order N-29-20, and in the interest of public health and safety during the COVID-19 pandemic, members of the City Council and staff participated in this meeting via teleconference. CALL TO ORDER A regular meeting of the City Council of the City of Chula Vista was called to order at 5.-30 p.m. via teleconference and in the Council Chambers, located in City Hall, 276 Fourth Avenue, Chula Vista, California. ROLL CALL: Present: Councilmember Diaz, Deputy Mayor Galvez, Council ember McCann, Councilmernber Padilla and Mayor Casillas Salas Also Present: City Manager Kachadoorian, City Attorney Googins, City Clerk Bigelow, and Assistant City Clerk Turner Mayor Casillas Saps announced that, due to technical difficulties, video of the meeting could not be, streamed online to be,viewable by the public and that the meeting should be adjourned to a future date. There was consensus of the Council to adjourn the meeting to December 3, 2020, at 5:00 p.m. ADJOURNMENT At 5:31 p.m., the meeting was adjourned to the Adjourned Regular Meeting of the City Council on December 3, 2020, at 5:00 p.m. Kerry K. Bigelow, MMC, City Clerk City of Chula Vista Page 1 2021-03-16 Agenda Packet Page 15 of 724 C® of Chula Vista Meetinge Minutes -, Draft Thursday, December 3,2020 5:00 RM Via Teleconference/Council Chambers 276 4th Avenue, (Building A Chula Vista, CA 91910 ADJOURNED REGULAR MEETING OF THE CITY COUNCIL Pursuant to the Governor of the State of California's Executive Order N-29-20, and in the interest of public health and safety during the COVID-19 pandemic, members of the City Council and staff participated in this meeting via teleconference. Members of the public participated remotely and were not present in Council Chambers. All votes were taken by roll call and public comments were submitted electronically or otherwise in writing. The City Council minutes are prepared and ordered to correspond to the City Council Agenda. Agenda items may be taken out of order during the meeting. The agenda items at this meeting were considered in the order presented. CALL TO ORDER An adjourned regular meeting of the City Council of the City of Chula Vista was called to order at 5.-02 p.m. in the Council Chambers located in City Hall, 276 Fourth Avenue, Chula Vista, California. ROLL CALL: Present: Councilmember Diaz, Deputy Mayor Galvez, Council ember McCann, Councilmember Padilla and Mayor Casillas Salas Also Present: City Manager Kachadoorian, City Attorney Googins, City Clerk Bigelow, and Assistant City Clerk Turner PLEDGE OF ALLEGIANCE TO THE FLAG AND MOMENT OF SILENCE Councilmember Padilla led the Pledge of Allegiance. SPECIAL ORDERS OF THE DAY A. 20-0484 COVID-19 UPDATE BY CITY OF CHULA VISTA EMERGENCY SERVICES COORDINATOR MARLON KING Emergency Services Coordinator King gave a presentation on the item and responded to questions of the Council. B. 20-0478 COVID-19 UPDATE BY MARKETING AND COMMUNICATIONS MANAGER ANNE STEINBERGER ON COMMUNITY SUPPORT EFFORTS Marketing and Communications Manager Steinberger and Senior Economic Development Specialist Pointer gave a presentation on the item. City of Chula Vista Page 1 2021-03-16 Agenda Packet Page 16 of 724 City Council Meeting Minutes-IDraft. December 3,2020 C. 20-0492 PRESENTATION OF A PROCLAMATION COMMENDING ENDING FIRE DEPARTMENT DEPUTY GRIEF JEFF PETER, RECOGNIZING 30 YEARS OF DEDICATED SERVICE E Mayor Casillas Salas read the proclamation and Fire Chief Geering and staff accepted it on behalf of Deputy Fire Chief Peter, who was available virtually. Fire Chief Geering commended' Deputy Fire Chief Peter. CONSENT CALENDAR (Items 1 - 12 Items 7 and 8 were removed from the Consent Calender at the request of Deputy Mayor Galvez and Councilmember Padilla, respectively. Housing Manager bines responded to questions of the Council regarding Item 5. 11. 20-0500 APPROVAL OF MINUTES of March 17, April 7 and 21, and May 5, 20201. Recommended Action: Council approve the minutes. 2. 20-0482 ORDINANCE E NO. 3495 O THF CITY OF CHULA VISTA AMENDING CHAPTER 15.25 O1= THE CHUL.A VISTA MUNICIPAL CODE I= TO ESTABLISH ENERGY UPGRADE REQUIREMENTS FOR ADDITIONS AND REMODELS TO SINGLE FAMILY HOMES AND CONDOS (SECOCND READING AND ADOPTION) Recommended Action: Council adapt the ordinance. 3. 20-0483 ORDINANCE NO. 3495 OF THE CITY OF CHULA VISTA AMENDING C HULA VISTA MUNICIPAL CODE SECTION 2.05.010 ADDING THE UNCLASSIFIED IED POST ION TITLE OF HUMAN RESOURCES MANAGER AND DELETING THE HUMAN RESOURCES OPERATIONS MANAGER AND PERFORMANCE AND ORGANIZATIONAL, DEVELOPMENT MANAGER POSITION TITLES (SECOND READING AND ADOPTION) (415 VOTE REQUIRED) Recommended Action: Council adapt the ordinance. 4. 20-0495 RESOLUTION NO. 2020-262 OF THE CITY COUNCIL OF THE CITY OF CHUL.A VISTA APPROVING AN ALTERNATIVE DISPUTE RESOLUTION AGREEMENT BETWEEN THE CITY OF CHULA VISTA AND THE CHULA VISTA POLICE OFFICER'S ASSOCIATION Recommended Action: Council adapt the resolution. 5. 20-0453 RESOLUTION LUTION NCS 2020-263 OF THE, CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING THE ISSUANCE,E, SAL AND DELIVERY OF MULTIFAMILY HOUSING REVENUE NOTES OF THE C H LA VISTA HOUSING AUTHORITY FOR OTAY" RANCH APARTMENT` Recommended Action: Council adopt the resolution. City of Chula Vista Page 2 2021-03-16 Agenda Packet Page 17 of 724 City Council Meeting Minutes-IDraft. December 3,2020 . 20-0451 RESOLUTION NO. 2020-204 OF THE CITY COUNCIL OF THE CITY OF CCF ULA VISTA AMENDING THE FISCAL YEAR 2020111 CIP PROGRAM BUDGET BY APPROPRIATING $50,000 FROM 'THE AVAILABLE BALANCE OF THE TRANSPORTATION DEVELOPMENT IMPACT FE FUND TO 'TRI=0389, "TRAFFIC SIGNAL IMPROVEMENTS ALONG EAST H STREET, 0 AY LAKES ROAD AND TELEGRAPH (CANYON ROAD'); APPROPRIATING $120,000 FROM THE AVAILABLE BALANCE OF THE TRAFFIC SIGNAL FUND TO TRF04027 "TRAFFIC SIGNAL MODIFICATIONS AT' BROADWAY & -- STREET AND BROADWAY & G STREET'y, ANLL TRANSFERRING $1157000 IN TRANSNE T APPROPRIATIONS FROM STM0369, "BIKEWAY FACILITIES S CHAP PROJECT TO STM03843 "BIDE LANE. IMPROVEMENTS O BROADWAY- PHASE 1" 4/0 VOTE REQUIRED) Recommended Action: Council adopt the resolution. Items 7 and 8 were removed from the consent calendar. 91. 20-0470 RESOLUTION NO 2020-267 OF THE CITY COUNCIL OF THE CITY OF CCF ULA VISTA WAIVING THE COMPETITIVE FORMAL BID. REQUIREMENT AND, ACCEPTING A PROPOSAL FROM MOTOROLA SOLUTIONS FOR CCOMMANDCCE TRAL AWARE. AND AERIAL. SUITE SOFTWARE SOLUTION Recommended Action: Council adopt the resolution. 10. 20-0488 RESOLUTION NO 2020-208 OF THE CITY COUNCIL OF THE CITY OF CCHULA VISTA APPROVING AN AGREEMENT WITH THE DEPARTMENT OF' ALCOHOLIC BEVERAGE (CONTROL, ACCEPTING $1078010 IN GRANT FUNDS, AND APPROPRIATING SAID FUNDS TO THE POLICE GRANTS SECTION OF THE, STATE GRANTS FUND (415 VOTE REQUIRED) Recommended Action: Council adapt the resolution. 11. 0-0481 A. RESOLUTION NO. 2020-269 O1= THE CITY COUNCIL O1= THE CITY OF CCHULA VISTA AMENDING THE CITY-INITIATED TOW LICENSE FEE B. RESOLUTION NO 2020-270 OF THE, CITY COUNCIL OF THE CITY OF CCHULA VISTA AMENDING THE CITY-INITIATED TOW AND STORAGE RATE SCHEDULE Recommended Action: Council adapt the resolutions. City of china Vista Page 3 2021-03-16 Agenda Packet Page 18 of 724 City Council Meeting Minutes-(Draft. December 3,2020 12. 20-0497 RESOLUTION NO. 2020-271 OF THE CITY COUNCIL OF THE CITY OF CF ULA VISTA ACTING AS THE LEGISLATIVE BODY CSF 'THE BAYFRONT PROJECT SPECIAL TAX FINANCING DISTRICT, LEVYING, THE SPECIAL TAX THEREIN FOR FISCAL YEAR 2020-2021 Recommended Action: Council adapt the resolution. Approval of the Consent Calendar ACTION: A motion was made by Mayor Casillas Salas, seconded by Councilmember McCann, to approve staffs s recommendations can the above Consent Calendar items, headings read, text waived. The motion carried by the following roll call vote: Items 1,3 through 6,and g through 12: Yes: 5- Diaz, Galvez, McCann, (Padilla and Casillas Salas No: 0 Abstain: 0 ACTION: Item 2: Yes: 4- Galvez, McCann, Padilla and Casillas Salas No: 1 - Diaz Abstain: 0 ITEMS REMOVED FROM THE CONSENT CALENDAR 7. 20-0417 RESOLUTION N NCS. 2020-265 OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA AMENDING THE FISCAL YEAR 2020/21 CIP PROGRAM BUDGET BY ESTABLISHING A NEW CIP PROJECT, DRN0217 217 "CORRUGATED METAL PIPE REPAIR IN THE RIGHT OF WAY 1=Y;2020/21'''; AND APPROPRIATING FUNDS THEREFOR (415 VOTE REQUIRED) At the request of Councilmemher Galvez, there was consensus of the Council to direct staff to provide a thorough presentation on the status of the City's corrugated metal pipe program, evaluations, corrections made to date, and what staff anticipates in the future. Engineering and Capital Projects Director Valle displayed the project map and responded to questions of the Council. ACTION: A motion was made by Deputy Mayor Galvez, seconded by Mayor Casillas Salas, to adapt Resolution No. 2020-265, heading i read, text waived. The motion carried by the following roll call vote: Yes: a- Diaz, Galvez, McCann, (Padilla and Casillas Salas INo: 0 Abstain: 0 City of Chula Vista Page 4 2021-03-16 Agenda Packet Page 19 of 724 City Council Meeting Minutes-IDraft. December 3,2020 . 20-0498 RESOLUTION NO. 2020-200 OF THE CITY COUNCIL OF THE CITY OF CF ULA VISTA RATIFYING AND CONFIRMING EMERGENCY FNCORDER 002-2020 (A ENDED NOVEMBER 10, 2020), PROVIDING THAT A RESPONSIBLE PARTY SHALL BE ALLOWED A MINIMUM OF 24 HOURS TO CORRECT VIOLATION OF A PUBLIC HEALTH ORDER, FR, AND EMERGENCY ORDER 000-2020 (AMENDED NOVEMBER 23, 2020), EXPANDING PROVISIONS AND REGULATIONS RELATED TO OUTDOOR BUSINESS OPERATIONS City Attorney Coogins responded to questions of the Council. ACTION: A motion was made by Dounci member Padilla, seconded by Mayor Caslillas Salas,i to adopt Resolution. No. 202 -266, with revisions to Section 4 to allow a minimum of 24 hours, but no more than 72 hours, to correct the violation, absent extenuating circumstances, as determined in the discretion of the Director of Emergency Services, notwithstanding any Chula Vista Municipal Code provision to the contrary. The heading was read, text waived. The motion carried by the following roll call vote: Yes: 5- Diaz, Ga vez, McCann, Padilla and Casl las Salas No: 0 Abstain-, 0 PUBLIC COMMENTS 13. 20-0485 PUBLIC COMMENTS RECEIVED for December 1 and 3, 2020 Alex McDaniel submitted comments in support of reinstating the rent moratorium until January 30, 2021. Bob Strahl submitted comments regarding the fee structure for residents and' non-residents at the Chula Vista Municipal Golf Course. Henry Martinez, Chula Vista resident, submitted comments in support of a fair contract for the Chula Vista firefighters. BOARD AND COMMISSION REPORTS 14. 20-0458 PRESENTATION BY MEASURE P CITIZENS' OVERSIGHT COMMITTEE CIGAR DAVID GARCIAS ON TIME MEASURE P COC ANNUAL. REPORT COVERING THE PERIOD OF JULY 1, 201 8 THROUGH JUNE 30, 20101 AND AN UPDATE ON MEASURE P PROJECT'S Measure P Citizens'Oversight Committee Cham C arcias gave a presentation on the item. ACTION ITEMS 15. 20-0471 CONSIDERATION OF ADOPTING THE CAFETERIA BENEFITS PLAN FOR 2021 AND APPROVING THE AMENDED COMPENSATION SUMMARY FOR ALL UNREPRESENTED EMPLOYEES AND ELECTED OFFICIALS City of Chula Vida Page 2021-03-16 Agenda Packet Page 20 of 724 City Council Meeting Minutes-IDraft. December 3,2020 A. RESOLUTION NO. 2020-272 OFT E CITY COUNCIL OF THE CITY OF CHUL.A 'VISTA ADOPTING THE CITY OF CHUL.A 'VISTA CAFETERIA BENEFITS PLAN FOR 2021 B. RESOLUTION NO. 2020-273 OF THE CITY COUNCIL. OF THE CITY OF C ULA VISTA APPROVING THE AMENDED COMPENSATION SUMMARY FOR ALL UNREP,RESENTED EMPLOYEES ANCA ELECTED OFFICIALS, INCLUDING AUTHORIZATION FOR THE MAYOR TO EXECUTE ANY NECESSARY CONTRACT AMENDMENTS TO IMPLEMENT SAID AMENDED COMPENSATION SUMMARY Human Resources Director Chase announced that approval or the item would affect executive compensation. ACTION: A motion was made by Councilllmemlber McCann, seconded by Mayor Casillas Salas,i to adopt Resolution Nos. 2020-272 and 2020-273, headings read, teat waived.The motion carried by the fo plowing roll callll vote: Yes: 5- Diaz, Ga vez, McCann, Padilla and Casl las Salas No: 0 Abstain: 0 16. 20-0487 CONSIDERATION OF RECEIPT OF THE QUARTERLY FINANCIAL REPORT, MAKING VARIOUS AMENDMENTS TO THE FISCAL YEAR 2020121 BUDGET AND APPROPRIATING FUNDS A. QUARTERLY FINANCIAL REPORT FOR THE QUARTER ENDING SEPTEMBER 30, 2020 B. RESOLUTION NO. 2020-274 OF THE, CITY COUNCIL OF THE CITY OF CHULA 'VISTA MAKING VARIOUS AMENDMENTS TO 'THE FISCAL YEAR 2020121 BUDGET 'TO ADJUST FOR VARIANCES S ANCA APPROPRIATING FUNDS THEREFOR R (415 VOTE REQUIRED) Budget arra Analysis Manager Prendell gave a presentation on the item.. ACTION: A motion was made by Mayor + asilas Salas, seconded by Councilimember McCann, to accept the report and adapt Resolution No. 2020-274, heading read, text waived.The motion carried by the following roll caul vote: Yes: 5- Diaz, Galvez, McCann, (Padilla and Casillas Salas IN o: 0 Abstain: CITY MANAGER'S REPORTS Engineering and Capital Projects Director Valle gave a presentation regarding trenching issues, in response to a previous Council referral. City of Chula Dista Page 6 2021-03-16 Agenda Packet Page 21 of 724 City Council Meeting Minutes-IDraft. December 3,2020 MAYOR'S REPORTS 17. 0-0489 RATIFICATION OF' APPOINTMENT OF MARIO SAL ANN TO THE BOARD OF ETHICS ACTION: A motion was made by Councilmember (Diaz, seconded by Councilmember Padilla, to ratify the above appointment. The motion carried by the following roll call vote: "yes: 5- Diaz, Galvez, McCann, (Padilla and Casillas Balms INo: 0 Abstain: Mayor Casillas ,Salas spoke regarding the COVID-19 pandemic. She encouraged the community to wear masks and to support local businesses. COUNCMLN"MEM BERs" COMMENTS Deputy Mayor Galvez encouraged the community to support local businesses. Councilmember McCann recognized Councilmember Diaz. Councilmember Padilla stated he echoed Councilmember McCann's statements regarding Councilmember Diaz and that he would reserve his farewell comments for the next Council meeting. He spoke regarding the COVID_9 g pandemic,and encouraged the community members to take care of each other. CITY ATTORNEY'S REPORTS City Attorney Googins announced that Item 98 would not be heard at that time and would be continued to a future date.. Mayor Casillas ,Salas recognized Information and Technology Services Director Chew for his work to keep everyone connected. CLOSED SESSION Pursuant to Resolution No. 13706 and Council Policy No. 346-03, Official Minutes and records of action talon during Closed Sessions are maintained by the City Attorney. 118. 0-0441 CONFERENCE WITH LEGAL COUNSEL--ANTICIPATED LITIGATION Significant exposure to litigation pursuant to Government. Cocke Section 54956.9d)(2) [or](3): One [1] Case. City of Chula Vista Claim No. CV20153. Item 18 was not discussed,and was continued to a future date. ADJOURNMENT The meeting was adjourned at 7:22 p.m. Kerry K. Bigelow, MMC, City Clear City of Chula Vista Page 7 2021-03-16 Agenda Packet Page 22 of 724 zmr, ..' l v r r C1TY' C,0UNC'1L A,GEN' DA S,TIA, "nEMENT l 1 CITY, OF CHUIAVISTA March 16,2021 File ID: 2-1-00 21-0057 TITS ORDINANCE OF THE CITY"of CHULAVISTA AMENDING VARIOUS SECTIONS OF CHULAVISTA MUNICIPAL CODE CHAPTER 2.52 To ADJUST THE CAMPAIGN CONTRIBUTION LIMIT FOR ANY ELECTION HELD ON OR AFTER JANUARY 1 2022 (SECOND READING AND ADOPTION RECOMMENDEDT Council adopt the ordinance. As required by Chula Vista Municipal pal Code section 2.52.0 40 D), the City Clerk has adjusted the campaign contribution limits for individuals and political party committees for any election occurring on or after January 1, 2022. Adoption of the ordinance amends various sections of the Municipal Code to reflect the adjusted limits. ENVIRONMENTAL REVIEW The Director of Development Services has reviewed the proposed activity for compliance with the California Environmental Quality Act (CEQA) and has determined that the activity is not a "Project" as defined under Section 15378 of the State CEQA Guidelines because it will not result in a physical change in the environment; therefore, pursuant to Section.. 15060(c)(3) of the State CEQ.A. Guidelines, the activity is not subject to CEQA. Thus,no environmental review is required. BOARD/COMMISSION/COMMITTEE,RECOMMEuI Not applicable. DISCUSSION Chula Vista Municipal Code section.2.52.040 (U) requires the City Clerk to adjust the campaign contribution limit every odd-numbered year to reflect any changes in the Consumer Price Index for the San Diego area for the two-gear period ending on December 31st of the previous year and requires these adjustments to be rounded to the nearest$10. The Consumer Price Index for the Sari Diego area for the periods ending December 201 and December 2020 were 292.5,47 and 303.9,32,respectively,demonstrating an increase of 3.89 percent. P 1 2021-03-16 Agenda Packet Page 23 of 724 The contribution limits were previously set at $350 for individuals and $1,190 for political party committees by Chula Vista Municipal Code section 2.52.040 (A) and (B), respectively. Applying the percentage of change of the Consumer Price Index and rounding to the nearest$10,the City Clerk adjusted the contribution limits to$360 for individuals and$1,240 for political party committees,. The City Clerk published the Notice of Campaign Contribution Limit Adjustment in the Star News, as required by Chula Vista Municipal Code section 2.52.040 (D), on February 12, 2021., Additionally, the Federal Voting Rights Act, together with an agreement between the U.S. Department of justice and the San Diego County Registrar of Voters, requires translation of all election-related materials and notices into covered languages predominantly spoken by 10,000 voters or more in the County. Therefore, the City Clerk has caused the notice to be translated into Chinese, Filipino, Spanish, and Vietnamese and published in language-specific newspapers,with publication dates between February 12, and 13, 2021. DECISION-MAKER CONFLICT" Staff has reviewed the decision contemplated by this action and has determined that it is not site-specific and consequently,the 500-foot rule found in California Code of Regulations Title 2, section 18702.2(a)(11), is not applicable to this decision for purposes of determining a disqualifying real property-related financial conflict of interest under the Political Reform Act(Cat. Gov't Code§87100,et seq.). Staff is not independently aware, and has not been informed by any City Councilmember, of any other fact that may constitute a basis for a decision maker conflict of interest in this matter. CURRENT-YEAR FISCAL IMPACT" Adoption of the proposed ordinance has no impact on the general fund. ONWING FISCAL IMPACT There is no ongoing fiscal impact. ATTACHMENTS Attachment 1: Proposed Amendment to Chula Vista Municipal Code Chapter 2.52 Staff Contact:Kerry Bigelow, City Clerk P : ge 2 2021-03-16 Agenda Packet Page 24 of 724 S ECOND READING AND ADOPTION ORDINANCE NO. ORDINANCE OF TIME CITY OF CHULA VISTA AMENDING VARIOUS SECTIONS, O CHU A VISTA MUNICIPAL COIF CHAPTER 2.52 TO ADJUST TIME CAMPAIGN CONTRIBUTION LIMIT FOR ANY ELECTION HELD ON OR AFTER JANUARY 1, 2022 WHEREAS, Chula "Nista Municipal Code section 2.52.040 (D) requires the City Clerk to adjust the campaign contribution limits every odd-numbered year to reflect any changes in the Consumer .Price Index for the San Diego area for the two-year period ending on :December 3 1 st of the previous year, and requires these adjustments to be rounded to the nearest 10; and WHEREAS, the Consumer Price Inde for the San Diego area for the periods ending December 2018 and December 2020 were 292.547 and 303.932,32, respectively, demonstrating an. increase of 3.89 percent; and WHEREAS, the contribution limit for individuals, other than a candidate, was previously set at $350 by Chula Vista Municipal Code section 2.52.040 (A), and the contribution limit for political party committees was previously set at $1,190 by Chula Vista Municipal Code section 2. 2.X140 7 and WHEREAS, based on applying the percentage of change in the Consumer Price Index. and rounding to the nearest 1 , the City Clergy adjusted the contribution limit to $,360 for individuals and $1,240 for political party committees, and WHEREAS, the City Clerk published the Notice of Campaign Contribution Limit Adjustment in the Star News on February 12, 2 21, and had the notice translated into Chinese, Filipino, Spanish, and Vietnamese and published in covered language-specific newspapers between February 12 and 13, 2021, as required by the Federal Voting Rights Act. NOW THEREFORE the City Council of the City of Chula Vista does ordain as follows: Section I. The following sections in Chula, Vista. Municipal Code chapter 2.52 are hereby amended and shall,read as follows.- 2.52.040 ollows2.2.040 Campaign contribution limits. A. No person, other than a candidate, shall make a contribution in excess of $360 to a candidate for a single election contest. No candidate shall solicit or accept a contribution in excess of$360 from a person for a single election contest. A candidate may receive up to $360 from a person in each of the general and special elections. The contribution limit in this subsection shall be adjusted biannually pursuant to subsection D) of this section. 2021-03-16 Agenda Packet Page 25 of 724 Ordinance No. Page 2 B. No political party committee, as that term is defined in California Government Code Section 85205, shall make a contribution in excess of$1,240 to a candidate for a single election contest. No candidate shall solicit or accept a contribution in excess of$1,240 from a political party committee for a single election contest. A candidate may receive up to $1,240 from a political party committee in each of the general and special elections. The contribution limit in this subsection shall be adjusted biannually pursuant to subsection (D) of this section. [Sections 2.52.040 C through I remain unchanged] 2. 2.050 Loans. A. A candidate shall not personally loan to his or her campaign funds, with the intent to receive repayment of those funds, an aggregate amount in excess of$5,000 for a single election contest. B. A loan or extension of credit shall be considered a contribution from the maker of the loan or extender of credit and shall be subject to the contribution limit of $,360 per person, pursuant to CVMC 2.52.040. The $360 contribution limit does not apply to loans made to a candidate for the purpose of a campaign by himself or herself or by a commercial lending institution in the lender's regular course of business on terms available to members of the general public for which the candidate is personally liable. 2.52.100 Written solicitations by candidates. Any candidate making a written solicitation for a contribution for his or her campaign for City elective office shall include the following written notice in no less than six point type on each such solicitation: NOTICE The City of Chula Vista Municipal Code limits contributions to campaigns for City elective office to three hundred sixty dollars per person.* *The dollar amount to be included in this notice shall be amended biannually to reflect any CPI adjustment to the contribution limit made pursuant to CVMC 2.52.040(D . Section 11. Severability If any portion of this Ordinance, or its application to any person. or circumstance, is for any reason held to be invalid, unenforceable or unconstitutional, by a court of competent jurisdiction, that portion shall be deemed severable, and such invalidity, unenforceability or unconstitutionality shall not affect the validity or enforceability of the remaining portions of the Ordinance, or its application to any other person or circumstance. The City Council of the City of Chula Vista hereby declares that it would have adopted each section, sentence, clause or phrase of this Ordinance, irrespective of the fact that any one or more other sections, sentences, clauses or phrases of the Ordinance be declared invalid, unenforceable or unconstitutional. 2021-03-16 Agenda Packet Page 26 of 724 Ordinance No. Page 3 Section 111. Construction The City Council of the City of Chula Vista intends this Ordinance to supplement,, not to duplicate or contradict, applicable state and federal law and this Ordinance shall be construed in light of that intent. Section IV, Effective Date This Ordinance shall take effect and be in force on the thirtieth day after its final passage. Section V. Publication The City Clerk shall certify to the passage and adoption of this Ordinance and shall cause the same to be published or posted according to law. Presented by Approved as, to form by Kerry K. Bigelow, MMC Glen R. Googins City Clerk City Attorney 2021-03-16 Agenda Packet Page 27 of 724 Attachment 1 Proposed Amendments to Sections of Chula Vista Municipal Code Chapter 2.52 2.52.040 Campaign contribution limits. A. No person, other than a candidate, shall make a contribution in excess of$3-5-0-360 to a candidate for a single election contest. No candidate shall solicit or accept a contribution in excess of$-3&0-360 from a person for a single election contest.A candidate may receive up to $35-0-360 from a person in each of the general and special elections. The contribution limit in this subsection shall be adjusted biannually pursuant to subsection (D) of this section. B. No political party committee, as that term is defined in California Government Code Section 85205, shall make a contribution in excess of$44-W1,240 to a candidate for a single election contest. No candidate shall solicit or accept a contribution in excess of $44, -9441,,240,from a political party committee for a single election contest.A candidate may receive up to $4,4401,240 from a political party committee in each of the general and special elections. The contribution limit in this subsection shall be adjusted biannually pursuant to subsection (D') of this section. [Sections 2.52.040 C through I remain unchanged] 2.52. 50 Loans. A.A candidate shall not personally loan to his or her campaign funds,with the intent to receive repayment of'those funds, an aggregate amount in excess of$5,000 for a single election contest. B.A loan or extension of credit shall be considered a contribution from the maker of the loan or extender of credit and shall be subject to the contribution limit of$34-0-360 per person, pursuant to CVMC 2.52.040. The $340-360 contribution limit does not apply to loans made to a candidate for the purpose of a campaign by himself or herself or by a commercial lending institution in the lender's regular course of business on terms available to members of the general public for which the candidate is personally liable. 2.52.100 Written solicitations by candidates. Any candidate making a written solicitation for a contribution for his or her campaign for City elective office shall include the following written notice in no less than six-point type on each such solicitation: NOTICE The City of Chula Vista Municipal Code limits contributions to campaigns for City elective office to three hundred 44y-5jxty dollars per person.* The dollar amount to be included in this notice shall be amended biannually to reflect any CPI adjustment to the contribution limit made pursuant to CVMC 2,.,52.040(D). 2021-03-16 Agenda Packet Page 28 of 724 zmr, ..' l v r r C1TY' C,0UNC'1L A,GEN' DA S,TIA, "nEMENT l 1 CITY, OF CHUIAVISTA March 16, 2021 File ID: 20-0569 ,TITS ACCEPTANCE of THE HOUSING ELEMENT 2020 ANNUAL PROGRESS REPORT & HOUSING SUCCESSOR ANNUAL REPORT FOR FISCAL YEAR 2019-2020 RECOMMENDEDT Council and Housing Authority, s Successor Housing Agency,accept the report. SUMMARY Annually, the City of Chula Vista prepares a Housing Element Progress Report "HE Report") on the implementation of the City's Housing Element, which also Includes the Successor Housing Agency Report. required by Senate Bill 341 (,SB-3,41 report) under Health and Safety Code (HSC) Section 34176.1(0., The HE Report has been prepared and provides detailed information regarding the housing activities of the City from. January 1, 2020 to December 31, 20,20. The SB-341 report includes housing and financial activities of the Housing Authority's Low- andModerate-Income Housing Fund of the former Redevelopment Agency. The respective reports must be submitted to the State of California Department of Housing and Community Development(State HCD) by April 1. ENVIRONMENTAL REVIEW The Director ofDevelopment Services has reviewed the proposed activity for compliance with the California Environmental Quality Act (CEQA) and has determined that the activity is not a "Project" as defined under Section 15378 of the State CEt A Guidelines because it will not result in a physical change in the environment-Y herefore, pursuant to Section 1.50o(c)(3) of the State CEQA Guidelines, the activity is not subject to CEQA. Thus,no environmental review is required. BOARD/COMMISSION/COMMITTEE RECOMMENDATION No action is required. The Dousing Advisory Commission will be provided with a summary of the Report at their neat meeting. DISCUSSION Housing Element Progress Report Adopted on April 23, 2013 and accepted by the California Department of' Housing and Community Development (State HCD) in June 2013, the City of Chula V'ista's 2013-2020 Dousing Element addresses the adequate dousing needs and opportunities for preset and future Chula Nista residents. Each year, the City must submit to State HCD a summary of its progress in implementing the policy and P 11 2021-03-16 Agenda Packet .Page 29 of 724 action programs outlined within the Housing Element based on the specified goals and objectives. The Chula Vista Housing Element 2020, Annual Progress Report, included as Attachment 1 (Executive Summary) and Attachment 2 (Required Housing Element Reporting Forms), provides detailed information regarding housing activities of the City of Chula Vista from January 1,20120 through December 31,2020. California Government Code Section 65400 requires the HE Report to include the following: (1) progress in meeting the Regional Housing Nee& (2) the effectiveness of'the Housing Element in the attainment of the community's housing goals and objectives; and (3) progress toward mitigating governmental constraints identified in the Housing Element. In 2020, building permits were issued for 1,,100 new residential units with no building permits issued for lower income housing during this reporting period. However, several density bonus projects were approved by the City Council and Planning Commission in 2020: Other accomplishments include the following by program: Tenant Based Rental Assistance 9 COVID-19 Emergency Rental Assistance 255 Rapid Re-Housing(Homeless) 4 ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ Accessory Dwelling Units 49 ----------- ...... Code Enforcement Inspections: ��� ii���� :i ii �i�i:i�:ii°i�ji�i��:ii ii ii�����ii:� ii i iii'' ����� i:i��i i��II' m Abandoned Residential Properties Programs 4 Multifamily Housing Inspections 369 Mobile Home Inspection Program 126 Code Complaints 506 (cases) New Reporting Items Beginning with this reporting period, the required State HCD reporting forms have been updated to demonstrate compliance with recent housing legislation and include: • Mobilehome park preservation activities • Motel and Hotel Conversions • Reporting on Surplus Lands • Reporting on the Local Early Planning Grant SB-341 ,R,epor,t On January 1, 2014, Senate Bill 341 ( E341) became effective, amending California Health & Safety Code (HSC) Section 34176.1. HSC Section 34,176.1(0 requires each housing successor agency that assumed the housing functions of a former redevelopment agency to prepare financial statements for the redevelopment housing agency and post a separate report on its website containing information regarding the housing and financial activities of the Low- and Moderate-Income Housing Asset Fund (LMIH F) of the former redevelopment agency for the previous year. P : ge 2 2021-03-16 Agenda Packet Page 30 of 724 The Housing Successor Annual Report for Fiscal Year 2,019-2,020 is included as Attachment 3., As required by State HCD,this report will be included with the submittal of Housing Element Annual Progress Report. DECISION-MAKER C"ONFLICT Staff has reviewed the decision contemplated by this action and has determined that it is not site-specific and consequently, the real property holdings of the City Council member/Housing Authority Commissioner do not create a disqualifying real property-related financial conflict of interest under the Political Reform Act (Cal. Gov't Code,§87100.,et seq.). Staff is not independently mare,and has not been informed by any City Council member/Housing Authority Commission Commissioner, of any other fact that may constitute a basis for a decision-maker conflict of interest in this matter. CURRENT-YEAR FISCAL IMPACT All staff time and costs to prepare this report were included in the adopted fiscal year 2019-2020. No additional appropriations are required. ONGOING FISCAL IMPACT There are no ongoing fiscal impacts related to this item. AT'TACHMEN'TS 1. Executive Summary 2. Housing Element Reporting Forms (Calendar Year 2020) 3. Housing Successor Annual Report-SB-3,41 (Fiscal Year 2019-2020) Staff Contact:Jose Dorado,Senior Management Analyst, Chula Vista Housing Authority P 3 2021-03-16 Agenda Packet Page 31 of 724 ATTACHMENT 1 HOUSING ELEMENT 2020 ANNUAL PROGRESS REPORT EXECUTIVE SUMMARY Some significant facts about affordable housing efforts during the! 2020 calendar year (January 1, 2020 to December 3 1, 2020) include: Policy 3.2 Balanced and Diverse Housing Rental Assistance • Nine (9) households received HOME funded Tenant Based Rental Assistance (TBRA)}. The target population for the TBRA program included those households who are literally homeless or are at risk of being homeless. Nineteen (19) households participated in the HOME COVID-19 Program. • Four (4) households received Rapid Re-Housing rental and/or security deposit assistance (for those who are literally homeless). • Seventy-nine (79) households were assisted through the City's Low-Mod Homeless Prevention Program. • Through the CARES Act funds received from the State, seventy-four (°74 Chula Vista households were provided emergency rental assistance and eighty-three (83) households were assisted through the County. • During 2020,the Section 8 program administered by the County of San Diego issued 2,642 vouchers in Chula Vista, 1,688 to elderly and 201 to large families. There are also 4 Public Housing projects owned by the County of San Diego in the City of Chula Vista, these are: Dorothy Street Manor, Melrose Manor, L Street Manor Apartments,, and Towne Center Apartments. First Time Homebuyer Assistance ■ No low-income households received down payment assistance through the First Time Homebuyer program in Calendar Year 2020. The City is,re-launching the FTHB program in the Spring of 2021. Policy 3.1 Maintaining & Enhancing the Quality and Sustainability of Housing and Residential Neighborhoods 'Ins,pection of Housin • Code Enforcement staff began inspections in 2020 on 369 apartment units through the City's Rental Housing Program. Enforcement• Through Title 25, Code Entorcement staff has completed inspections at various mobilehome parks. A total of 126 spaces were inspected in 2020. 2020 Housing Element Progress Report—Executive Summary Page i of ii 2021-03-16 Agenda Packet Page 32 of 724 Maintain Integrity of Residential Neighborhoods • Code enforcement stiff responded to 506 residential .g. apartments, duplexes, condominiums, mobile homes and single-family homes) complaints during 2019. For condos and single-family dwellings such activities included unpermitted construction, trash junk andd debris, and inoperable vehicles. Forty-six (46) of the complaints were related to apartment communities for such activities as mold, roach/rodent infestations and gather maintenance issues. ■ Four 4 residential properties were registered in the Abandoned Resi entia Properties Program. ■ Chula Vista voters approved Measure P—a temporary, ten-year, half-centsales tax to fund high priority infrastructure needs. Collection of the sales tax began April 1,2017. Notable improvements were made (in 2 20)to public infrastructure and facilities, streets, civic and south libraries, recreation and senior centers, sports fields and courts, parr improvements, traffic signals, and other improvements. A comprehensive list of improvements can be found on the City's website at www.chulavistaca.gov/measurep. ■ The City received an HCC Housing-Related Parks (HSP) Program.Grant in late 2017. n. 2020, construction was completed for improvements to Friendship Parr.. Water& Energy Efficiency Property Assessed Clean Energy (PACE) programs, a private-public partnership, financed over 210 projects for a total of more than 5 million in energy and water upgrades. • Over 380 no-cost home and business energy evaluations conducted, which led to over °f of residential participants implementing tis g a recommended ded energy-saving behavi©r or retrofit and.over % of business participants, 2020 Housing Element Progress Report—Executive sum air Page ii of ii 2021-03-16 Agenda Packet Page 33 of 724 ATTACHMENT T 1 Chula Vista 51h Cycle 2013-2021 Regional Housing Needs Allocation Progress Permitted Units Issued by Affordability utl Allot , , y 1 1, E Y Very Law 3,209 69 0 0 22 0 0 0 0 311.,18 Low 2,1439, 371 0 0 186 0 0 05 5 1.1,882 Moderate 22,57 3 012 1.1 0 2 13 0 41 0 X 69 1, Above 4, 56 2,300 956 689 849 1,+ 43 11777 799 960 9� 13 Moderate Total 1INA Total Units 3104; %,7 689 11059 10'5'6' 1� �� 8 " � ,'' 8 8 1 �� 2020 Dousing Element Progress Report Executive Summery Page i of ii. 2021-03-16 Agenda Packet Page 34 of 724 ....... .. tA .. .... . .. ............ ............... ............... General Information Jurisdiction Name Chula Vista Reporting Calendar Year 2020 optional:Click here to import last year's data.This is best used when,the workbook is new andl empty.You will be prompted to Contact Information pick an old workbook to import from. Project and program data will be copied exactly how it was entered in last year's form and First Name Leflani must be updated. Last Name Hines Title Housing Manager Em II II,u11�p5 �a v st a c a.a ov Phone 6196915263 Mailing Address Street Address 276 Fourth Avenue City Chula.Vista -Zipcode 91910 ---J v 122820 Annual F)rogiress !Report January 2020 2021-03-16 Agenda Packet Page 35 of 724 Jurisdiction Chula Vista ANNUAL ELEMENT PROGRESS REPORT Note:"+"indicates an optional field Reporting Year 2020 (Jan.1-Dec.31) Housing Element Implementation Cells in grey contain auto-calculation formulas (CCR Title 25§6202) Table A Housing Development Applications Submitted Date Total Total Project Identifier Unit Types Application Proposed Units-Affordability by Household Incomes Approved Disapproved Streamlining Notes Submitted Units by Units by Project Project 2 3 4 5 6 7 8 9 10 Date Was APPLICATION Unit Category Tenure Application Very Low- Very Low. Low- Low4ncorne Moderate- Moderate- Above Total Total SUBMITTED, Current APN Street Address Local Jurisdildtlott, Income Income Non Income Income Income Moderate-Total,PROPOSE111 APPROVED Pl§APtR0VE0 Pursuant,to,GC Prior AP`N+ Project,Name Tracking ID+ (SFA,SFO,2 to R-Renter SubmtItted Deed Deed Deed, Non Deed Deed Non Deed Units by Project Units by _ _ 65913.4(b)? Notes+ 4,5+,AIYU,MH) 0--Owner, (see Restricted Restricted Restricted Restricted Restricted Restricted Income project Units by Project' (SS35 Instructions), Streamlining) Summary Row:Start Data Entry Bel w 0 0 0 0 0 0 1081 1081 0 0 0 5662321800 178 Third Ave Landis&E Senior DR20-0009 5+ R 4/28/2020 58 58 No 5662322100 Housing 6443132900 Otay Ranch VLG 2 DR20-001 0 5+ R 5/11/2020 405 405 No 6443135200 R-25 A,corner of Heritage Road, Otay Ranch VLG 2 R-25 Santa Carolina Rd,A Apartments Santa Victoria Rd, .qnntn I i7n PH 6440702400 6440702400 ORV8W Parcel M, DR20-0011 SFA 0 7/2/2020 116 116 No Lot 16;SE corner Bluestone of Main Street and Avenida Capr'sa, 6440702400 6440702400 ORV8W Parcel 0, Trevi DR20-0012 2 to 4 0 7/2/2020 108 108 No Lot 17;NE corner of Calle Escuela and Avenida (land'sa. 6440702400 6440702400 ORV8W Parcel Q, Whitmore DR20-0013 SFD 0 7/2/2020 106 106 No Lot 18;NW corner of La Media Parkway and A\/Pn'dp(',qnr'-t- 6440702400 6440702400 ORV8W Parcel N Lucca DR20-0014 SFD 0 8/6/2020 117 117 No 6440702400 6440702400 ORV8W PARCEL Savona DR20-0015 SFD 0 8/6/2020 115 115 No P 5680430200 203 Garrett Av DR20-0021 5+ R 10/7/2020 12 12 No 6182902500 532 Palomar,532 532 Apartment Building DR20-0023 2 to 4 R 10/2712020 4 4 No Apartment Building 5681612500 Southwest corner Backhouse Apartments DR20-0019 5+ R 10/9/2020 31 31 No of Church Avenue and Davidson Street 6230721200 1431 Tobias Villa Tobias DR20-0027 2 to 4 R 12/17/2020 9 9 No 6220711400 1350 Industrial Industrial Blvd. DR18-0010 5+ R 5/2912018 72 72 72 0 No Boulevard Apartments 6431200200 676 Moss Street Moss Street DR18-0028 SFA 0 12/13/2018 141 141 141 0 No Townhomes 5670323100 00265-67 Woodlawn Avenue DR17-0034 5+ R 9/19/2017 6 6 6 0 No WOODLAWN AVE Apartments 0 0. 01 Airirllual 13rogress Repoil January 2020 2021-03-16 Agenda Packet Page 36 of 724 4.daffil chw.Mae, ANNUAL ELEMENT PROGRESS REPORT N--irlwals,an*afl-1,11 Ifteadt1gy1a, 2020 IJM 1-Da,31) Housing Element Implementation GNIN.. (CCR Tire 26§6202) Table A2 Annual Building Activity Report Summary-Novi Construction,Entffied,Peranks and Completed Urals P.Ject Identifier Unit Types Affordability by Household InconrIes-Completed Entitlement Atfordablifty by Household!Incomes-Building Pemnfts Affordability by Household Incomes-Certificates of Occupancy Streamlining III Housing with Financial Assistance Housing without Fina"'I Term fAfford.bifity DemollshedrDestroyed Units No.. and/or Dead Restrictions Assistance or Dead Restrictions or Deed Restriction 1 1 B 'I B 6 7 a 1 10 11 12 13 14 is is 17 1. 1. 20 21 #at Ul OfteI *a... Very Very Los. VaI,I Vc,L--r C.AfflEaw.Irf am"B"-'so--*00 7*mi I A#.l 1I I KeD.b., Dermsh.,OBBBOWeAtil I L-;In. La-m- bldtmaa� M.de- Enw.... d No L.-In.--I.- alcoscas. M..- L-Mesumv NOW- M.KaBat. Abele Co.uperaseloth. do wes"I'd, Hoewosmysil�"Btol wal U.J.-A Dead ANDIall roaaldloOK-plA.60I DINS,fi. n,D,,,"an Fare.ad d Building Pmme 'd No. I N.0sid B-I JIBSISNX. mad..w. mmeat-16I Alit.(..f as,---- 00 06913AOO I IVA 7 wasoft 0-foineaNd Type D.M.Yod fic'se, 1`60`011' CarmadAVIN D,Nd ... N- I.-a- se.o.... .-RDBI-d moc="I" ithl ear tydvalli ad -Ap- .,:.-",:dd D-d No.- In...-I...No. I Dede- .11 (Naflocon.1noonsAWN Owns- F"% Resolved ReWated M.d Restrated In-, B-il Resoloted Restricted 0,,dBeacflFsNd di.. 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SFD I . Ill ..,U_ 0 1—- 111 1 -12020 1 N -I,SIND 1812ASHLEYAV 11 1 01- MENOMONIE S11-1S la 2, N WSIMWO 1405 DOME-C. N IL E-d. E--. 0 0 11WOlB 0 -0 1 N WS441RD 1798 PATERNA 00S9 SFD 0 .7.019 0 1 -020 N DR BEI-LASITIARZI B SRI INNE �m� 0 10�0=111111,I I "11 1 02-RNA .7-S 0 1 -ISSS 1 IN OR BEILASITIARZI-B BR1961 SFD 0 ��l 0 ONES W3434ND 14M DOME Ro. E-- FR1S NONE 0 1 E, -03U SF) 0 IN 11-018 0 1 -02. 1 N WSSI-O CANTAMAR 3111-01 ln� 0 1/1-20 0 1 -.2. 1 N 101111IM1111MMA 0 W 111W020 0 1 1 N W3416XD KECK RD CAMBRIA BR19-0171 0 11-02D 1 -.2. 1 N W342010D 1- 11 1 IFI 0 11111111110MMMME/W 111-2t) 09 1 -2S 1 N EN.1. SU WU16XS 14M KECK R. CAMBRA 0 1 -IS I N 341- 1446 KECK RD -DR. BR19-0172 I SFU 0 0 1 -.2. N W3166wo It— CANTAMAR DR19-01M SFO 1 -.2. 1 N CHAK5 0 AMI.. -01- 0 TERA MIND P.d E-NCIA BR18-0 F. . -02- TE a 1 V-020 1 N _3%3%� M CAMINO Pld E-NCIA BN1$-0�3 .. 0 0 1 11�12 1 N CANTERA INNEMINNEM Annua�Progress Report VIIAMWIIIII EMMINIM111 I MEMO EEFIIIAIMI171 I W i N 2021-03-16 Agenda Pnket Page 40 of 724 4.d�w- Chw.M.� ANNUAL ELEMENT PROGRESS REPORT N-:-i-*Oi-1,11 IIUMM,gy- 2020 t4m 1-N,31) Housing Element Implementation (CCR TII 26§6202) CANT.- -ENC - 11-018 1 W-020 N --- C P.d E BR18 SFO 0 D MEN -2-0 1746 PILOT PEAK -17 E N E N -2E J 1 -020 1 N AV -TINE OR19 SFD JNNEW/ JNNEW/ 01 -6-0 1217 LXENZQ CANTANAR BR18-0171 SFD ..m. 1 1-2. 1 N -342-D 17171-111 -NTINE BR19-0213 SFC 0 INNER ENRON 0 l�� 1142 IlLfT PEAK -TINE BR19-0214 SM 0 0 -020 0 1 -.02. 1 IN W342-0 1745 VAC-LE 0 1 V-020 I IN -TINE DR19-0215 SFO 0 0 1711 PILOT PEAK -1. A, -NTINE .111S SFD ..2.2E 1 -020 1 IN -422- 00 -2-0 1741 VrLLE -TINE BR19-UIB SFD mm MORE omm VW2020 a 1 1-2. 1 N 0 W3.21- '-p_-.N' -F-1-0 DIPE-3 SFD mm MORE li� 0 Ilom ommoom 11-019 a I W-020 I N -21.3 U72 CMINO 0 BR18-5 SF. INNER 1101001 0 SEEN No=No= 11-019 0 1 N-020 I N ---ER6M-- N -21.3 1U7P6 CMO'No P,.d F-PRADO BR18-0- RED ERROR 0 11-019 a I --ulu W346WO 1321 ORTEGAST -NTE1- 13--- 0 0 W-020 I N W3460MD 1327 ORTEDA ST MONTE-A BR18-019B 8-FD Er" IS- 1 W-020 1 N -0- 13- I-A BR-18-01W SEE 0 -02E a I W-020 1 N W-1- 1-ORTEGAST o 0 0 1 W-020 I IN 111110-1-IT MWEN WE 1 W-020 I N E SACHARO W////"W11411 0 111W020 1 WlBQ020 I N W3167100 'SIS-ED CANT-AR -R..R SE. 111W020 1 .1-020 1 N SEEN 0 _,jE_S 1- ED CANTANAR NR1S El. 111W020 0 1 ...OW 1 IN SACHAR 0 1-KOFF S-SITIA--a BR19-0111 SF. 0 0 milli 1/=- 0 1 W�E=0 I IN -5 KOFF B-SITIA-13 BR19.0118 SFD 1 W-020 I IN W34161CO 14EA KECK RD -RA BR19-01M 0 1 W310020 I IN W3415ND 1457 KECK RD CAMBEA BR19-0161 $ED 0 0 1/1-20 a 1 W31=20 I IN W3415ND -5 KECK RD CA- 0 111M020 0 W-20 1 IN -1-D 1-KECK RD 0 111M020 0 -20 1 IN 13--- SFo 0 0 NEWEEM11M 1 111M020 0 1 -.020 1 IN W3415ND KECK RD -EA BR19-0165 .-F. 0 0 YM,MR',, 111M020 0 1 W-020 I IN WU16XD KECK RD C-BRA BR19-01W SFC 0 0 0 1 W-020 1 N wul- 14M KECK RD 0 0 1 W-020 N W3167WO 1S17- CANTAMAR BR19 101 SF. HAR 0 1-020 1 W-020 IN 1-DR E-SE-SITIAN11-18 BR1.-... SFD 0 1 -.20 1 IN -SWYCKOFF -8 -0110 113=020 0 1 WV44 N W3901wo 'T B-$ITIRR21 BR19 $ED 0 ,on F//1 ,_ROWD 1866 F�L,-EO NE-SIT-1-13 I BN19-0- SFD 1 0 IBM 0 1 1 N W3415WO 14680RTEGAST EMBNA BR19-017B SFD 0 0 1 -.1. 1 N W3,H5XD 14620RTEGAST CAM.R. BR19 0181 $ED 0 0 MO. 1 902020 N - 0 1466 ORTECAST CMSEA $ED 0 0 S/20. Ul 1 W14=20 I N MINOR 41-0 46 -02E 1 .14.020 1 N -34 0 ORTEGAST -RA BR19 01R2 SFD W11- 1833 MARTINEZ SIGNAT.- BR16-1141 SF. 311WO18 0 1 W1512020 I N DR NOR OR 0 .1-S 1 .17.020 '1 IN --S- IMI M-NEZ SIGN-RE BR16 ME 0 INNER W 460700 1339ORTECAST 0 0 1 W-020 I IN "TINEZ ME NONE DR SISNATURE BR1-1143 SF. 0 .1-S 0 1 -020 1 IN W3901ND I E9-OFF ST S-STIAR21 B BR190117 SFD ME 0111' 1 W-020 I IN -1-D 12.TER-IL CANTANAR BR19 0322 SF. 0 ERROR 10100 ME 0 INNER ENRON 11 0 -.20 1 -02. W:1-D 1217 TE-.PL C I I �INNER 11E011 1�0= 1 -020 1 N .K EASE -31- 1 RACHARO CANT-AR BR19-0325 SPO . RISEN 00101 0 ENRON ---- 1 W23-0 IN -6- ANTANAR BR19-03M 0 ERROR RISEN 00101 0 MOORE 1 0 1 -020 1 IN MARXINEZ SIGNATURE BR16-1- SFD 0 W-020 N W3156ND DR 1 ","I'll,I'll,11 NONE 10111 0 1011010= W3902ND 7L I I-B Bal-11S SFC 0 1-2D 0 1 -020 1 IN ERROR INNER E ON=ERROR MENOMONEE --D.D 1862 EL EASED A-ASITIA-S BR19-012D SF) 0 omm 1NE011 Imm ENRON 0 smommom 1, A� 113M020 0 1 W-020 I N IN W3168ND 12M TER-PL CAN- C 11110 SEEN ON= ON= 0 nommumm 11-21 0 1 W-020 I I I I W3168WD 1-TEERTA-PL CAN- BR19-03M SFC 0 ERROR�l 00101 0 .1.- a 1 ...020 1 IN W316WO 12K TERST&PL CANTANAR BR19-032B SFD 11111 SEEN ON= 10111 0 1011010= 1 .1.- 0 1 1 -020 1 IN W3891ND 121S..RTE -G-S-LE BR16 099D SFC 0 1.17-S a 1 1-020 1 IN MENDI I omm 1NE011 No= 0 1 -4-D .d D-SERRA BR16-08% - I . 1-- 1 1.102. 1 IN ERROR INNER INN= ERROR 0 MENOMONEE l�� --D.D 1214-CKOFF ST BR19-0115 I 0 11-2D 0 1 10-020 1 IN W3410ND 1405 OATEGAST -TINE BR19-02M SFC 0 0 1 1E, IN W3410ND 1417 ORTEGAST -TINE BR19-0221 SF. 0 0 -02. 0 1 -020 1 IN o-,I Wv�WiNff BR19-.. SFD -2.2E 0 1 1W-020 0 ..02. -3162ND 0 0 -1. 0 1 -4.0. 1 N -.1-D 1114 IL 1-11 IN= 113M020 1 1-10. 1 IN SE-SIT-1-B 3.1-114 0 0 MEMO --2- 1870 EL FASE0 B-SITIA-B BR19-0116 SFD 0 0 NEER ERNE 11-- 01 A, 1 1W1412020 IN -1-D 150 TE T -TINE BN1-25 0 0 1 1.114... 1 IN W316870D 1213 TEESTA-PL CANTANAR BR19-0327 SFD 0 RENE 41-02D 0 1 1.410. IN 0 F1111111111,11111e, ...2. 0 1 - W341OMD 1393 ORTEGA ST -TINE BR19-0227 SF. 0 1 1-0. W341010D 13690RTEGAST -TINE BR19-0- SFC 0 -20. 1 1-on I N W316-0 1221 TERST&PL CANTANAR BR19-0321 Sle 0 WW///// 01 1 MINNE INNEN 1 .1.- 1 1.1-2. 1 N -3434-D 1721 F�ARTIRN' E-d. BR18-0371 SFC 0 0 1-018 a I I-- I N W3410ND 1381 ORTEGAST -TINE BMM-228 SM. 3 0 -2020 1 1-0. 1 IN WU34NO 1732 F.A.TERNA E-d. BR18-0370 SID . 0 11-016 1 1-.- 1 N -3434- 1-F�ARTERN' E-d. BR18-0- SFD 0 0 1-018 a I I- I N -.2.3 1-YCKOFF -B -0119 ONE ST B-SITIAR21 BR19 SFC 0 ................... 0 113-2E 0 1 11-020 1 N I rXIMMEN 11MINE I- -11.5 BR19-004, S11-20 0 1 1-020 1 N -1- 1606 MAETINEZ S.N- BR16-1136 SFO 0 IN .1-S 0 1 111.0. N DR 0 �MENNEMEMI 1111 M.MTINEI I R SISNATURE Bal.-113S SFD 0 .1-1S 1 1111212- 1 N -03- M��C Mo P-F-PRADC, BR18-MT SFD 1NE011 Ilom 0 N INNER] -5.1. 0 1 1111=020 1 IN --D M�2�CTM_'No P,.d F-PRACC, BR18-0249 SEC 1NE011 Ilom 0 mom I"NEI 1 1111=020 1 IN A E-Ho 0 1-- 0 1 1111.0. 1 IN TERA MENOMONEE!ENRON ENRON INNER ERROR 0 ERROR HERE!I I -1-D 1_1M.-INEZ M-S 0 1 11-- 1 N SISNATURE BR16-114D SF. Ilom I ENRON 01 mmmiiiiiiiii,,, MIND CANTE -PRADO 11-019 0 1 11117Q020 W3604WD "'C -d F 3R1E-.S1 0 0 '721-NNA E-d. BR19-0129 S. 0 1 11-020 IN DR 0 NINE 1711PATERNA DR 111.02E 1 N E-.i. BR19-01W SFD 0 -8- '.2.T-..N' P,-F PRAD. 3.1.02- SF. IN 1 1100110111111001 0 INNER 1.1-1S 0 1 1 1-on I IN -38- ".4.CTME.N' P,.d F PRAD. ER1-2. SF) 0 0 UI I IN MIND CANTE PRADO -02W iw-019 0 1 IN --4- -d F BR18 SFO 0 lmilmom 1703 W RNA E-- SIR- C 0 S11-- 0 1 1.1- 1 IN MONSOON 1709-RNA E.- BR19-0131 SED Ell-- 0 N DR 11100111110011 0 MENOMONEE 1.0 -.70 C -F PRADC, -S RE SF. 0 0 1 1 IN --S.S -.0= -F PRADO BR18 0- SFD W, 1w-019 0 1 12-020 1 IN -2- 1016CMINO SS EFC MEN 1w-019 a 1 1-0. 1 IN PEADO -d F PRADO BR18 02 0 W382OND 1K.EANINO 1.1w 1 1 IN PRADO -d F PRADO 0 1A a W3820ND 1-CANIN, P11d F PRADO ER18-UST Sm RISEN SENSORS 1-R019 01 1W140020 I N PEADO W341-0 -9 KECK RD A- .--S SFD 0 0 1-1.2E 1 N W34-D 1-K BIR-31 $ED 0 S.-1 0 1 -1.2. i IN SR19 0 -14- 1.1 EN -NTINE 902. SF. 0 0 fiDW020 0 1 -1.. I IN """R-R. 1 1MM020 1 N -1- RD MONTIEV- BR19 0370 0 AN-A 11 6-21- -SPERSHING .N- BR19-0371 SFD SQ.- 0 1 -2.. 1 N - 10-h.�,d..) ME 11 -21- BR19-0372 SFD 0 0 1 1-0. IN T -2-3 NTERIAST B--73 S. -020 0 1 IN 1-PR-S.- 1 7, .W//F//F/w/m/m/w/w/gum -21-D C Me TEL RR19 OS74 F. 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SFD 0 -020 0 1 1MW020 I N 1413 KECK RD $PC 0 ONE 0 SI-21 a 1 -3.0. 1 N W 4-D 1417 KECK RD AI- 0 1 01111111111111111111 0111111111111111010 011111111111111101.01111111111111110111 0 W1111111111111111011A] -020 0 1 1-20n 1 N W 413ND -KECK RD AI- I"I I I 111� 0 S12-21) 0 1 1-021) 1 N 3111-113 11D 0 vM11111111M NE rz FEEM/M 0 9 0 1 -0020 1 N W3413ND NECKRD -TINE BR19-02W .1C 1111111,MMMEA11111111 I W/WWWWRI r/MMM/001111111 0, 1 1-120. -W- I HACIENDA 1W SFC 0 E011I MEN li� on 0 -017 01 N --D P-d I HACIENDA SFC 0 EMIN 0 0 ..017 0 1-02. 1 N --D -I HACIENDA 13.1-1- - 0 0 -017 G 1 -.20 1 N W3874NO 12"C"'No -C-INDIGO BR17-0213 SFO 0 .1-IS 0 1 1-020 1 N N 0 W3.7- P-d-N.G. .1117-4 STO 0 V-016 1 -020 1 N WK874RW 12�%AN NO -INDIII 0 -5 A .1-IS 1 1-2. 1 N ALO, -C BR17 SFD JIM 1011 MEN Boom ON= 0 3.7WW P-d.-INDIGO R11-021S SFC 0 0 1 1-020 1 N () P-d-NDIG. 3.17-.2`1 0 -016 0 1 1 "...20 1 N W387510D "'C"'No -C-INDIGO DR17-0216 SFO &I-IS 0 1 I)SEG020 I N -ON 0 -7-3 1-d-NDIG. BR17-S SFD 0 -AS 1 1-020 1 N -875- 13WCMINO -C-INDIGO BR17-MM SID WIIIIIIIIIVIIIg 0 .1-IS I 1,M. P,.d C-INDIGO BR1721 SFD -01S 0 1 1-20 1 N -.75SM P-d.INDIGO 3RI7-.2. S 0 1 1-020 1 N -7- -CANIND -C INDIGO EMM 21 SFO C 0 1 ICECO20 1 N ON 0 -75700 13MCMINO I—C INDIGO B.17-D. SID 0 R-AS 1 VSKQ020 1 N -N W3154100 18WEYAV SIGNATURE BR16-1 - 0 W-011 0 1 -020 1 N -02- .-N-P.dENCIA BR18 DOW - 0 .1.01S 1 ...02. 1 N -02W0 --NIDA-E--ENCIA Rl-W SID -A. 1 ...02. 1 N T A 2018AIAPNIDA ARTAN4 P,dEENCA, BR1$-N3l SFD 0 0 1 W.4020 1 N P.d E-IENCIA BR18-W33 SFC 0 �11.01S 0 1 N --21. 200NIDA P.d E-%ENQA 3111-.. SFO C .1-IS 0 1 -1- 1 N A 0 W3802WO 2026 NIDA P.dE IENCIA BR18 0035 0 ART 0 11-01N 0 1 ...02. 1 N -22- "IS"A'LLE -TINE BR16-1 S1. 0 _.A. 1 -020 1 N 1706 PILOT PEAK -2150 AV BR16-11W SFC 0 0 W-1S a 1 W.A W3421MO 1714 PILOT PEAK -TINE BR16-1197 SFC 0 MEMO NEEN wws 0 1 W260020 I�J W342-0 1717 -TINE BR16-1198 ST. 0 0 __01N 1 -1.2. 1 N -3421SW ...0 PIIDOT PEAK 0 1 -020 1 N A, A)AENTINE BR1S 11. ST. 0 NONNI I MEMO 0 MEMO W3421HO 1718 PILOT PEAK -018 0 1 -02. 1 N AV - 1 12W C NONNI I MEMO MEMO 0 1 1101-LLE -N- BN1G12S1 SFC 0 1 1 1 1 M11111 0 1 MNOW N AV -34-1) 171S-LLE W-IS I W.002. I N -TINE BR16 1202 SFL 0 MEMO���MEMO MEMO NONE W3806MO 308 CANINO P.d I�HACIENDA BR16-3 Im ism A-DEA MEMO IMM 1 INNER�I'll I'll I 1�"'I'll"1 1-Rois 0 1 -20 1 N 0 -31E4.) 1111HIE11V 11NIT111 BR1G SFC 1-- 31-018 0 1 -.2. 1 N WKI'M .IASNE_ Se_LRE Rl��...5 S" 0 FE/M I 311"W', a I wwn2o 1 N PIS CALL -PRADO -023D NO SGSC019 �j I WIMOW I N W386OND 1'5 I-ARESE -F BR18 0 SOME 0 10 1 1 X-020 P, P,,d F-PRADO R1-32 SFO 0 W3861ND `5 E MEN! 0 N 0 EN, WEEME 0 WMIN .1 S_M� 0 1 X18P020 I N W3152ND 1817ASNLEYAV SIGNATURE BR16-1118 SFD 0 0 .1-1S 0 1 W-020 1 N --D I IP1,=E F-PRACO Rl.-.-S FD 0 111 1 1 0 No 001 JIM 0 1 W-020 I N -3-10 -I HACIENDA BR16-OW EFC 0 1-018 0 1 -02. 1 N -WS- P-d I HACIENDA CR1G-0-E SF. 0 0 1W13- 0 1 W-020 1 N W384170D 919 CAMIN ALDE,k 0 Pld C-INDIGO BR16-01M SFC 0 ..011 0 1 -1- 1 N W3882H 0 20SE RASEO P.dD-SERRA BR16-0820 S. 0 GUI-Tu -919 1 W-020 N W3882RD 201-EO P.ID SERRA BR16 0823 SFD -019 a 1 -020 -U_ W3841ND �CANINO ALDEA P.dC INDIGO BR16 0137 SFD 0 N W3841ND PM CAMIN -C-INUICO BR16-0138 SFD 0 MEMO 0 WWO17 N W3882ND 2089 PASEO -D-SERRA BR16-0818 SF. 0 N CUI-Tu 0 2W3 PASE. -D-IIERRA 0 0 N W42W 2--NIDA P,dD-SERRA BR1621 - -01S G 1 1 N AND— 0 W388410D 2092_NIDA -6D SERRA BR16 08M SF. 0 1 -.2. 1 N AND— 211-NIDA ANC_ D SERRA BR16 0819 SF. 01 .21.- 0 1 -.2. 1 N NIDA _`K- 'A'. D SERRA 0 0 M11111111111111 SAIN.1', u I N I—- CANIN �S SFD 0 11 1 MEMO IDEA 0 'M 1 W3641NO SSS CANINO P,d C INDIGO BR17-0259 SFO 0 1 A-DEA I EMMMMMEN I 0 -3.11-R .�CM 1-K.-INVIGO 0 11 NONE MEMO 01000 1 0 10=101010MO,M 0=101010101M W3421WO 1722 PILOT PEAK -TINE BR16 1203 SFD 0 1 1 NONNI Milli NONNI I ENEN 1 -Q020 N -34222W 1734 PILOT PEAK A)AENTINE BR1612M SFD 0 MEMO ENEN __01S 01 1 W3422NO 172S PILOT PEAK A, -TINE BR- SFe 0 0 -015 0 1 W14CO20 I N W3422100 1730 PILOT PEAK -TINE BR16-1205 SFD 0 wwS N 1011 0 1 6WW 1721 VAfMLLE -TINE BR16-1209 SFC 0 1 MONIN/11 Www IMMM Mw 0 Emp/l/07/m wm 0 1 W140020 1 N -42- 1721 VACNALI AV -NTINE 3--l- SFD 100011 0 NIN 0 1 .1-2. 1 N W3423MO 1729 1 WKCO20 N M -TINE DR16-1207 SFO 0 NONNI MEMO 0 W3423WO 17W-LLE __01N 0 1 W-020 I N AV A)AENTINE BR161210 SHO 0 ��l� MEMO 0 -4-0 SES CAMIN S-RA BR11131 ST. ALDEA 0 0 2-017 1 W-020 N W-... S...A MGM.. SIC D NONE 11 1 W19COW I N -M700 S11 CANIN. P,d D SERRA 81416-01W SFG 0 V2=017 0 1 W19U020 I N I I- I I BR16:1113 SIM 0 X111MIS a 1 ....2. 1 N W315-0 181-HILEYAI/ -IE 0 W-016 0 1 -020 1 1.1W 2W1 DATE F- JENNE 0 -017 1 N PL KID' 1.21.1. 1 -.2. N -3WWW "'DAN, P-dD-.-RR. BRU-1313- SF. BE AN 0 --So- P.d D-SERRA .141-- SFD 0 1.21.1. 1 _0 I N 2101 PAGEO CULTURA ...... _8310, -PAS -0828 1 N CL TX BR16 SFD MEN MEMO 1 11 No _..WW 2= P-SER.A 3.16-M. - 0 1 -.2. 1 N WI05460() IN4 ASHLEY AV SISHATURE BR16-1117 SFO Mell", FINE,', Fleele", 311=018 1 20 1 KASHLEY1 SGIATURE BR16-1121 SFC 0 �IIWIIIIS 1 N 7 1 .-A I N _WR_ 2',18,PT�,,Go PF-PRADO BR18-UM SFD ........................ PER V1111", ,0, 2-PA' RU-0W6 SFD C 1w-9 a I VW2020 I N 61 CLTX P,,d F-PRADO IN/0" loom 21111-El ISI CLTURA -P-. -S 0 1-— 1 -.2. 1 N -6 P,.F ..IS S. NONE 5 C- -386-0 "P31 E� -G-E-LE DR16-09M 0 MEMO 1 0 0 1 -.2. 1 N W3861PW "P15 MILE -6 G-SILLE BR16 0965 ST. INN 0 Elmo 1-019 G 1 -.2. 1 N LANGS -W- -E-IALENCIA BR13121 SF. 0 1 N -3W0.0 .=O -d E--ENCIA BR16-0123 SFD 0 0 WW2017 0 1 0=20 1 N _N_ 11 CAMINO .11 0 1 .1-21) 1 N _ P.d E-NCIA BR16-OIM 0 0 _883W, 2100-NIDA P.d D-SERRA DR16-0830 SFG 0 I.-IS 0 1 1 N AND- 0 W3861WD 1131 MILE dG-SILLE BR16 0961 SFD 0 0 0 1 W12CO20 I N PILARE. -0 W3861NO 11PI19CALLE -6 0-SEMLLE BR16-0962 F. 0 1 -3861.R -G-SEMLLE BR16-090 SFD 0 ISOM............................... 0 1 W12PIT21[i 1 N Annua�Progress Report L.ry2C2. In I E/////// 2021-03-16 Agenda Pnket Page 42 of 724 chw.M.� ANNUAL ELEMENT PROGRESS REPORT N—:—inlin*0i-1,11 IftMM19y 2020 t4m 1-N,31) Housing Element Implementation (CCR TII 26§6202) W3861MO 1123 CALLE P_ES G-SEALLE R16-09N SFO 0 1—— 1 S/12CO20 1 N I WM020 I N W3883NO 2117 PARED P-D-SEREA, OR16-0833 SFC 0 010 ENNO I OREN -83M0 2M P.d D-SERRA BR16-0831 SFD 0 INNER SIM ONEERNMEN OMEN iv019 a I W...2. I N 2= P-d D-SERRA Rl.-... SFC 0 0 MEMO�l JIM 0 1 -020 1 N _..,,,D, 21AIIINIII -SERRA -0. E D ..1.- S. 0 0 r///// ENNE RENE 1�-1. 0 1 -020 1 N ._NVA -SERRA -0835 JIM 0 1 —.020 N W3883700 2108" 0 AN A E.d D BR16 0 �CAMINO P.d E-VALENCA DR18-0035 SFD 11-016 1 W10Q020 1 N 1ANTIRA W380-0 0 S.CAMINO P.d E-VALENCA BR18-003S SF) 11-016 1 1-20 N CAN MINES 1�10m= 0 ==OO= CM I..I-_1N- SFD 0 �immilmommom 11-018 1 WIM020 N Q.T INN=JONES NO= W-1— 1-dE--EN.- Rl.-0.36 — INNER 0 1 lminglom 11170018 0 1 V13CO20 I N ffl 1-dE--EN.- R1-.- — 1 110.02. 1 N 52 CALL W3859NO 11-ESE -G-S-LE BR16-09M S1. 1 -020 1 N W3.S... .-S-ILE R16-0.. SF) . 0 1.21— 1 -020 1 N 1-019 0 1 1-20 1 N _58W0 11,4,=$LE -G-S-LE BR16-0— SF) . li�iomm OEM 1 0 -E- EILIE RI.-.7 SFC . 0 1-1— 1 1.1.10 1 N --0) G-.-ILE R1-- 0 Iolm�mmm 0 mom 1-019 0 1 -.2. 1 N LW2=019 1 1.102. N W3859MO 1160CALLE -G-S-LE BR16-0971 SF. 0 JOE 0 PILARES 0 W3822WO 'C=o PIW F-PRADO BR18-OM SF. 0 NONE 1/101, 1 W1-020 N JW362-0 1,,Z,,'NO PlId F-PRADO SRU-0- $ED 0 -=019 0 1 W1=020 N 6-80070D P.d E-VALENCA BR185 SFD . 0 1 .131.20 N -.0— P-d E-—ENC. 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I N 1216CORTE -ELE -0 85 1W17Q019 0 1 W170020 I N MEND G BR16 SFC 0111 1 1 1 0 1= loom W389,100 1-CORI TE G-SCALLE BR16-0988 Am 11171011 N MEND INNER[ERROR 0 1220 CORff -1-- SF. -1-019 01 1 W170020 I N MEND 11 0 MEN --D 184SMARTINEZ SENATURE BR16 11M SFD C NONE ENRON 1 0 1 W18Q020 N 111 0 MENOMONIE 18.MARTINEZ SUNATURE BR161145 SFD F/Ew/R Nom.............../............/,,,1 11 020 1 N DR 0 W389170D 1211 COWE -S-E 1.1=0 I MEND -0 BR16 0 SS SF. 0 JOE=I I I I SC.UE -S I NONE] 1WV019 I 10/1P020 N W3891MD MEND G-ILE BR16-0987 SFO 0 ENRON MEN MEN 0 0 1 —3-- 1212 CORTE MENDI 0�SCOLLE BR16-0 A0 Sm lm�l�I E'''mmml� 0 ENE 1-R019 D 1 lVlR020 N W3891NO 1—CORITE G-S-LE BR16-991 SF. 0 1-17-1. 1 1-020 1 N MEND 0 W34MWO 3SANTA SGNATURF BR16 0— D WilC019 D 1 -020 1 N W384W 0 S63 CAMINO P.d D SERRA BR16 0855 SFD 0 1 1-020 1 N A-DEA -0- WS CAMIN' IDEA P,dE-VALENCM .--1 SEE 0 W-018 0 1 1 10-020 1 N W3891WO 1219CORTE -G-S-E -16-09. SFD 0 1W17M19 0 1 IOUP020 1 N MEND 0 1223CORTE MENDI ft�GILE BR16-992 $ED 0 NIMONERI.........../.......// 1 1080.10 N 0 1 -V019 loom W380WO -CAMINO P.d E--NCR BR18-56 SFO 0 1 1-1- 1 N AL- NEEN loom I NONNIN limilloom NIEMEN=NONE W3890WO --E MENDI G-S-LE BR16-0998 — I NONE] MERNMEMENJ NONE 0 1 1W14120M I N 12.CORI TE --LLE BR161002 — loom 0 1 1-020 1 N MEND loom 0 —8.2— 1231 COUE MENDI FildE BR16-0 SF. 0 0 1-019 01 1 N 1—C.-E -C-S-LE BR16-0995 SEE 1-101. 1 1 N MEND w/R goilommom ,_8_0 123�9EC�ORTE 1-019 1 N i -G-S-LE BR16-1003 SEC ROSE 1001 MMEINID-E --LLE BR16-0999 SEC J - loom lsilloo loom —.0. 1 N -.210 12 1 IN10-E ME -E-LLE E. 0 0 1—— 1 1 SSCORT W3891MO 12 E G-SEALLE DR16-0997 SFO 0 0 1-019 1 1—. N -CAMIN -02— ALC,,0 -G-S-LE BR16-01K SF. 0 2-017 1 1 N W38.2— IMCORTE P.dG-SLE BR16-10W SFC . D 1 --20 1 N DLE R16-10- SEC . OEM INNER 0 11MOM10110101001 1 1-020 1 N 00SO) '2.17EC'_L" ---E DRE-1— SEC . 0 0 1 1-02 1 N 121.1 CALLE ECED .-S-LUE I R1.--. SIC 0 MINE 1 0 1-019 0 1 -.0— .-EDALLE R1.-1..5 SF. 0 1 122.1—1 -SEALLE -1006 1 ECEO BR16 S. 0 1—CALL DEC.O, 0-S-LE BR16-1010 SFD 0 0 1-019 1 1 N 111M.-TINE1 11111110 E S_N_U_ SFD 1001 mm 0 NONE I.— a 1 111120020 1 N 12."ECE,' EILLE SFD 0 JOE=loom j VNEEMENNE ENNO 1-019 0 1 1111200M I N -W-D '..CTME.N' F-PRAC. RR1— — 0 1 1 0 MOORE 019 0 W380- ".CM_'NO -d F-PRACO DR18-olis — I E11111111111111111A 0 0 1 11-020 1 N _jR,_ 1111 M.-TINEI R S-NATURE — 0 NIEMEN NONE 0 MEMO 0 1 111-020 1 N -CAMINO G-SEALLE BR16-0190 Sm 0 2-017 0 1 1 1111W020 I N ALDEA 0 --D 1111I.-TINE1 -NATURE BR161133 SEC . E JOE=1 0 0110 1.— 1 N C178= S_ 0 E LR ENRON ]FlllllllllllllllllllIAIIIII�IIIIIIIIIIIII .111 0 11 N —..CTME.No P,id F-PRAD. DR1-- SF. 0 iwigaoig 0 11-0. 1 N W382010D 1—CAMIN P,,d F-PRADO BR16-0131 SF. 0 MEN PRADO N -20— 1012CAMIN, Sm 0 0 0 No 0 No PRADO P,.d F-PRADO BR16-0 MEN 0 VM017 0 1 12-020 1 N P-F-PRADC, BR16-0133 SF) . ME MEMO 0 INEEMIS ..Oil a 1 1.1.2. 1 0 a 0 0 1 0 = — — I I 1 0 I 1 01 1 1 1 0 Annua�Progress Report 1.ry2D2. NOW 2021-03-16 Agenda Pnket Page 43 of 724 This table is auto-populated once you enter your jurisdiction name and current year data.Hast Jurisdiction Chula Vista ANNUAL ELEMENT PROGRESS REPORT year information comes from previous APRs. Reporting Year 2020 (Jan.1-Dec.31) Housing Element Implementation Please contact HCD if your data is different than the material supplied here (CCR Title 25§6202) Table B Regional Housing Needs Allocation Progress Permitted Units Issued by Affordability 1 2 3 4 Total Remaining R'll-INAAllotation Total Units,to Income Level 2013 204 2015 2'016 2017 2018 2019 RHNA by Income, 2020 2021, by,Income Level Date(all years) Level Deed Restricted 3209' 69 24 22 115 3094 Very Low Non-Deed Restricted Deed Restricted 2439 371 8 186 565 1874 Low Non-Deed Restricted I Deed Restricted J 2257 328 1,929 Moderate Non-Deed Restricted 302 11 2 13 Above Moderate 4956 2300 956 689 849 1043 1777 840 960 9414 Total RHNA 12861 1 Total Units 1 3042 999 689 1659 1056 1777 840 966 10422 6897 Note:units serving extremely low-income households are included in the very low-income permitted units totals Cells in,grey contain auto-calculation formulas Annual F�`rogress Repart January 2020 2021-03-16 Agenda Packet Page 44 of 724 ANN�UAL ELEMENT PROGRESS REPORT Ho�using Element Implementation (CCR Title 25§6202) Jurisdiction Chula Vista Reporting Year 2020 (Jan. 1-Dec.31) Table D Program Implementation Status pursuant to GC Section 65583 Housing Programs Progress Report Describe progress of all programs,including local efforts to remove governmental constraints tothe maintenance,improvement,and,development of housing as identified in the housing element. 1 2 3 4 Name of Program, Objective Timiefrarne In KE Status of Program Implementation 1.1.1 Rehabilitation of Owner Continue implementation of the City's 2021 Program participation has fluctuated due to eligibility levels of participants due to credit,home loan values,availability of Occupied Housing Community Housing Improvement Program contractors to complete work and the COVID-191 pandemic. (CHIP)for low-income homeowners. Leverage its Home Upgrade,Carbon In 2020,there were 26,applications received for the Community Housing Improvement Program(CHIP).However,it was Downgrade(HUCD)program to better put on hold due to COVID-191 and issues with the inspection process.Applicants remained interested and on the waitlist. serve low-income and mioderate-,income residents. Integrate the HUCID program into the City's First-Time Homebuyers Program as an optional financing tool. Arinual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 45 of 724 1.1.2 Encourage Climate To support the City of Chula Vista's Climate 2021 The Property Assessed Clean Energy(PACE)program,reference Section 1.1.1,provides residents and businesses with Resilient Design Techniques Action Plan and its related goals,the City financing for energy and water upgrades,which improve their resiliency. In 2020,the PACE program has financed over supports the following design measures to 12 projects for a total of more than$700,000,in energy and water upgrades. Additionally,with the adoption of the improve climate change resilience:desig�n Existing Home Sustainability Ordinance existing residential homes that conduct additions or structu�ral remodels will be natural ventilation and passive solar into required to add energy efficiency measures to their project that can also increase the homes resiliency. residential buildings;limit internal heat by specifying high-efficiency lighting and equipment;modeling of energy performance with higher coo�ling desig�n temperatures;avoid building in flood zones; elevate mechanical and electrical equipment to minimize damage and danger from flooding;specify Class A roofing to reduce risk of wildfire;and desig�n bui�lding�s to maintain livable conditions in,the event of loss of power or heating fuel,or shortages of water. 1.1.2 Neighborhood Support a program focusing financial As resources are available Chula Vista voters approved Measure P—a temporary,ten-year,half-cent sales tax to fund h,igh priority infrastructure Revitalization resources and efforts that improve the needs.Collection of the sales tax began April 1,2017.Updates on how Measure P Funds are used can be found at (Note:Program numbering conditions and appearances of https://www.chulavistaca.gov/departments/public-works/infrastructure duplicative in HE) neighborhoods. This on-going program will target specific low-anid moderate-income The annual Beautify Chula Vista Day was cancelled in,2020 due to the COVID-1 9 pandemic. neighborhoods within Western Chula Vista that can be leveraged with other public and In 2020,the City partnered with local organizations,Alpha Project and McAllister Institute to create programs aimed at private investments. beautifying and cle,aniing up the City.Alpha Proj�ect's Operation Pride collected 121,040 lbs of trash and 467 shopping carts from September to December.In addition,McAllister Institute's Work for Hope program participants painted 76 public restrooms and started working to cl�ean gazebos,as well as removing 3,480 lbs of green waste and debris. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 46 of 724 1.1.3 Rental Housing As part of a comprehensive neighborhood As resources are available The City continues to meet with developers as contacted regarding the inclusion of affordable housing units into existing Rehabilitation revitalization strategy,the City seeks to mu�ltifam,ily housing�. Due to current rental housing market,(e.g high rents and low vacancy rates),there is a lack of provide financial assistance to private interest by private property owners in participating in this program. property owners of existing and deteriorating multifamily rental housing within Northwest and Southwest planniing areas and requiring the property owner to set aside a number of housing units for lower income households at affordable rents.Efforts will be made to target properties in such areas where privately initiated improvements in other neighborhood developments may be manprn Pri 1.1.4 Rental Housing As part of a comprehens,ive neighborhood As resources are available The City has identified properties for potential acquisition and rehabilitation. However,due to the current competitive Acquisition and revitalization strategy,the City Seeks to housing market,the City has been unable to acquire and rehabilitate property based upon extended timelinies requ�ired Rehabilitation, acquire and rehabi�litate existing rental for City Council approval and other funding requirements. housing throughout the Northwest and Southwest planning areas of the City and set aside a number of the housing u�nits for very low-i�ncome and/or special needs households at affordable rents. 1.1.5 Funding for Housing Support applications for available Federal 2021 Due to the City's budgetary reductions,funding levels,priority needs and scoring criteria,the City did not respond to the Related Environmental or State funding to reduce housing related U.S.Department of HUD NOFA's for its Healthy Homes and Lead Hazard Control Programs. Hazard Control environmental hazards,including lead hazard control,building structural safety, electrical safety,and fire protection to address multiple childhood diseases and injuries in,the home,such as the Healthy Homes Initiative. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 47 of 724 1.2.1 Multifamily Housing Provide for the continuance of a multifamily 2021 CE conducted a total of 369 inspections for apartment communities. In addition,48 cases were opened for individual Inspection inspection program that evaluates apartments resulting from inspections of apartment communities in 20�20. conditions of rental housing complexes of three or more units and reports violations to the City's Code Enforcement Division regarding current health and safety codes. The City will follow up on all reports of violations to ensure the correction of any identified deficiencies. 1.2.2 Mobilehome Inspection Provide for the continued systematic 2021 Through Title 25,Code Enforcement staff has completed 126 unit inspections throughout various parks in 2020., Program inspection of mobilehome and trailer park communities for compliance with Title 25 of the California Code of Regulations to promote safe and sanitary housing and nei�ahborhoods. 1.2.3 Code Enforcement Continue Code Enforcement activities that 2021 Due to the growing foreclosure issue in Chula Vista,the City adopted a Residential Abandoned Properties Program Activities proacti�vely monitor housing and (RAPP)ordinance in August 2007,which requires mortgage lenders to inspect defaulted properties to confirm that they neighborhood conditions for adherence to are occupied. If a property is found to be vacant,the program requires that the lender exercise the abandonment clause minimurn standards of habitability and within their mortgage contract,register the property with,the City and immediately begin to secure and maintain the appearance by responding to service property to the neighborhood standard.In 2020,4 properties were reg�istered through the Abandoned Properties requests from concerned citizens. Program. 2.1.1 Water Conservation Promote the inclusion of state-of-the art 2021 The PACE program,as mentioned in Section 1.1.2,helped fund indoor and outdoor water conservation measures in Practices water conservation practices in existing and existing bui�lding�s. new development projects where proven to be safe and environmentally sound through targeted policies and incentives in partnership with the local utilities.These practices can include,but are not limited to�, low-flow plumbing fixtures,and EPA WaterSense-labeled appliances. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 48 of 724 2.1.2 Landscaping-Specific Promote the use of low water demand 2021 The City continues to promote low water demand landscaping through its revised Landscape Water Conservation Water Conservation (WaterSmart)landscaping,which Ordinance,(large parcels)and Outdoor WaterSmart Guidelines&Checklist(small parcels),both of which guide Strategies incorporates high efficiency irrigation and landscaping projects towards h,igh water use efficiency. dro,ught-tolerant plant materials in existing and new development.When developing landscape,designs,encourage the minimal use of turf areas and the implementation of the City's Shade Tree Policy,which requires a certain percentage of shade coverage within parki�ng lots and along streets excluding alleyways.Water reuse techniques,such as graywater systems, rain water harvesting,and recycled water, to meet outdoor landscaping water demand should be encouraged. 2.1.3 New Development- Continue to develop,,update,and enforce, 2021 The City continues to promote low water demand landscaping through its revised Landscape Water Conservation Specific Water Conservation water-related building codes and Ordinance(large parcels)and Outdoor WaterSmart Guidelines&Checklist(small parcels),both of which guide development requirements such as the landscaping projects towards h,igh water use efficiency. City"s Landscape Water Conservation Ordinance,Green Building S,tand�ard�, The City continues to require Water Conservation Plans for large developments(over 50 dwelling units or equivalent) Design M�anual,and Water Conservation which emphasize both indoor and outdoor water use efficiency and requires homes to be pre-plumed for water re-use Plan Guidelines(or their equivalent)as part systems from clothes washers. of the residential development review and approval process.Developers shall provide homebuyers with,an"Outd�oor WaterSmart Package"at occupancy,,which also includes information about the City of Chula Vista NatureScap,e program. 2.1.4 Public Education for Promote water conservation,efficiency,and 2021 The City continues to work with the Sweetwater and Otay Water Districts in to host community educational workshops, Water Conservation reuse in the commun,ity by providing and distributing general water efficiency educational materials. As part of the Library's new Home Sustainability Kit appropriately targeted public education and residents can,check out a kit that includes water saving devices such as�low-flow shower heads and low-flow faucet by offering free technical assistance in aerators. partnership with the local water districts. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 49 of 724 2.2.1 General Energy Maximize energy efficiency and integrate 2021 The City encourages energy efficiency,renewable energy,and other green building technologies and des,ign principles in Efficiency and Renewable renewable energy into existing and new new and existing developments. During 20�20,the City adopted the,Existing Home Su�stainab,ility Ordinance which Energy Strategies development projects through appropriate requires existing residential homes that cond�uct additions or structural remodels to add energy efficiency measures to site and building design,energy efficient their project.Due to Covid-19 concerns,in-person on-site evaluations were canceled but staff still provided onli�ne and materials and appliances,,onsite renewable phone assistance to residents and businesses with energy efficiency questions. The City is working to establish a energy systems,and home energy Benchmarki�ng ordinance to address existing commercial and multifamily buildings.The City also joined San Diego performance ratings by developing targeted Community Power,a JPA Community Choice Aggregator,with the goal of increasing control over local electricity sources pol�icies consistent with the California Long- and reduce carbon emissions. Phase one customers are set to receive service March 2021. Additionally,the City Term Energy Efficiency Strategic Plan and continues to promote the Chula Vista Climate Action Challenge which,engages Chula Vista residents by providing by offering incentives in coordination with information about making sustainable cho,ices in their home. Almost 30�O households signed up by the end of 2020. San Diego Gas&Electric and other regional partners. 2.2.2 New Development- Continue to develop,update,and enforce 2021 The City encourages energy efficiency,renewable energy,and other green building technologies and des,ign principles in Specific Energy energy-related building codes and new and existing developments. In more recent years,California Building Codes are reflecting the need to implement Conservation Requirements development requirements.Applicable more energy efficient construction.To assist developers,contractors and other industry stakeholders,the City,in codes and development requirements partnership with SDG&E,has held numerous brown bag lunch events and webinars on building code requirements,new include,but are not limited to,the City's programs,and other relevant information. Enhanced Energy Efficiency,Green Building(includes Cool Roof standards), and Solar Ready ordinances(or their equivalent)as part of the residential development review and approval process. 2.2.3.Zero Net Energy Facilitate progress towards the 2021 See comments Section 1.1.1. Home Target development of"Zero Net Energy" residential buildings,which have a net energy consumption of zero over a typical year as envisioned by the California Long�- Term Energy Efficiency Strategic Plan.,This progress will be accomplished by creating developer incentives(such as expedited perm,itting or reduced permit fees)and by leveraging state and federal housing funds administered by the City's Housing Division. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 50 of 724 2.2.4 Public Education for Promote energy efficiency and renewable 2021 The City continues to provide energy-related materials and services through free energy evaluations,community Energy Conservation energy in the community by providing outreach events and the Library Energy Lounges. As part of the Library's new Home Sustainabil�ity Kit,residents can appropriately targeted public education and check out a kit that includes energy saving devices such as weatherstripping and LED light bulbs. The SDG&E by offering free technical assistance in Partnership with the City of San Diiego ended at the end of 2020. partnership with San Diego Gas&Electric. 3.1.1 Integration of Land The City's General Plan,including this 2013 2021 The City of Chula Vista's Sustainable Commiunities Program(SCP)seeks to promote energy efficiency and reduce green Use Planning and Transit —2020 Housing Element,promote a land house gas emissions i�n the planning and building process and in neighborhood design. use pattern that is antici�pated to reduce Vehicle Miles Traveled(VMT)and result in In 2013,the SCP developed a modeling tool for energy efficient community and site planning standards. The model is the region meeting or exceeding the targets based on LEED's Neighborhood Development rating system,which integrates the principles of smart growth,New established by the California Air Resources Urbanism,and green building and encourages better neighborhood planning and development by assisting developers to Board(CARB).The key component of the select the appropriate mix of energy efficient features to maximize their site's sustainabi�lity score.This evaluation tool 2013—2020 Housing Element will be to continues to be available on the City's website. promote the integration of land use planning and transit,whereby:the City In 2016 construction began on a Bus Rapid Trans,it(BRT)line(aka"South Bay Rapid")that will connect eastern Chula encourages the use of incentives,when Vista to downtown San Diego. Service began in February 2019.The South Bay Rapid route includes 12 stations along a available,for mixed-u�se development, 26-mile route from the Otay Mesa Port of Entry to Downtown San Diego via eastern Chula Vista,connecting to which includes housing,retail,and office employment and activity centers in Downtown San Diego and South County. space,at transit nodes and other high- intensity locations as appropriate.The City The Palomar Street Grade Separation project preliminary engineering and environmental document phase was supports implementation of the San Diego completed in January 2020.This project is planined to continue through 2027. Association of Governments(S,ANDAG)'s Sustainable Communities Strategy(SCS), including the adopted Regional Housing Needs Assessment(RHNA)Plan,which includes the following:increasing the housing supply and the miix of housing types,tenure,and affordability in an equitable manner,promote infill development and socioe,conomiic equity,the protection of environmental and agricultural resources,and the encouragement of efficient development patterns,promote an improved initraregional relationship between jobs and housing�,allocate a lower proportion of housing need to an income Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 51 of 724 4.1.1 Expiring Affordability P,roactively work with property owner(s)of 2012-2016 The City continues to work with those property owners,who own affordable housing where recorded covenants are Restrictions "at-risk"assisted housing developments nearing expiration.In accordance with our published Housing Element,there are no projects expiring in 2018 through whose affordability restriction are due to 2020., The City and Housing Authority implements and has incorporated the provisions of Section 52080(g)the expire by 2020,as identified within California Health and Safety Code and Sections 65863.10 and 65863.11 of the California Government Code i�nto its Appendix A of this Element,and affordable pol�icies and regulatory agreements for new projects. The Housing Authority continues to work with those affordable housing developers to evaluate the viability housing communities seeking to refinance or restructure to incorporate additional public benefit in the form of deeper of continuing the affordability of such income targ�eting�,additional rent restrictions,including additional rent restricted units,the extension of the existing term housing through owner participation,public of restrictions,or any combination therefore may be negotiated. subsidies,or participation,pub�lic subsidies or participation by affordable housing developers. 4.2.1 Monitoring of Units Comply with State Law regarding the Annually In 2020,no units occupied by low or moderate-income households in the Coastal Zone were lost or demolished., Lost monitoring and reporting of housi�ng units occupied by l�ow-or moderate-income households demolished within the Coastal Zone. 4.2.2 Replacement Housing Where conversion or demolition of housing 2021 See comments in 4.2.1. units in the Coastal Zone is occupied by low. or moderate income households is proposed,replacement of such,housing will be completed in accordance with State Law and the City's adopted Local Coastal Plan. 5.1.1 Affordable Housing Continue to implement the Balanced 2021 The City continues to implement this objective through the Affordable Housing Program requiring new residential ("Inclusionary")Policy Communities-Affordable Housing Policy developments of 50 units or more to provide 10%of the housing for low and moderate income households. In 2019,the first adopted by the City's Housing Element City entered into an Affordable Housing Agreement for 30-moderate,income units in the Village of Escaya. Also,within in 1981 and any implementing guidelines as the Village of Escaya,META Housing submitted an application for Low Income Housing Tax Credits and Bonds to assist adopted and updated.For all new in the,development of 175 low income housing units that are subject to the City's AHP. residential projects consisting of 50 or more dwelling units,10 percent of the residential units within the development("on-site") shall be affordable to low and moderate income households(5 percent low-income and 5 percent mo�derate-income). Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 52 of 724 5.2.1 First Time Homebuyer Continue assistance to low-income 2021 The City continues to contract with SpringBoard CDF1(formerly known as Community HousingWorks Realty and Assistance households in purchasing their first home Lending)to administer the City's First Time Homebuyer program. In 2014,the City was awarded$1,000,0100 i�n CalHome through the City's First Time Homebuyer funds to assist first time homebu�yers. In 2018,with the,final expenditure of CalHome funds,the City leveraged other Down Payment and Closi�ng Cost additional monies from its HUD HOME funds and Balanced Communities Program to assist 10 households close escrow. Assistance,Program.Consider In 2019,the program ran out of funding and the City wil�l be adding additional funding to the Program in 2,020. Also,an amendments,as necessary,to the Program application for$1.5M was submitted to HCD for CalHome funding u�nder a N�OFA released in November 2019. However, to adequately reflect real estate market the City has been unsuccessful in its application for CalHome funding. The City will be looking to appropriate funding conditions. from its availalbe HOME and other local funds for first time homebuyer assistance. 5.2.2 Mortgage Credit Continue to participate with the County of 2021 The MCC program is administered by CaIHFA. In 2019,CaIHFA ended its participation in the Program. Certificates(MCC) San Diego and other cities to issue and renew Mortgage Credit Certificates(MCC) to qualified first-,time low-and moderate- income homebuyers.First-time homebuyers are referred by the Development Services Department to the administratina aaency. 5.2.3 Homebuyer Education Support and encourage developers,lenders As funds are available Under its contract with SpringlBoard CDFI, SpringBoard offers bilingual ho�miebuyer education(HIBE)to resident who and Counseling and social service organizations to provide wish to learn about homebuyer programs. educational programs,loan counseling,and materials for homeowners and potential homeowners on home maintenance, improvement,and financial management. The purpose of these educational programs will be to help first-time,homebuyers prepare for the purchase of a home and to understand the importance of maintenance, equity appreciation,and personal budgeting to minimize foreclosure rates. 5.2.4 Support Private Support and encourage lenders, As funds are available Staff will continue to support and seek non-traditional approaches as opportunities exist. Financial Assistance Development Services organizations and Programs others to use non-traditional financial See comments listed above for Programs 5.2.1 -5.2.3., approaches to assist low-and moderate- income first-time homebuye�rs such as Individual Accounts and other emerging Ifinancial awroaches., I I Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 53 of 724 5.3.1 Mobilehome Space Continue to enforce CVMC Chapter 9.50 to 2021 The City continues to monitor and enforce the Mobilehome Space Rent Review Ordinance(Chula Vista Municipal Code Rent Review protect mobilehome�residents'investment "CVMC"'Chapter 9.50). in their home while at the same,time providing a reasonable return to the park In 2020,the Mobilehome Rent Review Commission meetings were disrupted by the COVID-19 pandemic.H�owever,City owner in order to preserve this housing staff continued to provide information,to commissioners through e-mail and website updates related to mobilehome,living alternative. in Chula Vista and other relevant matters that would assist them in,their duties prescribed u�nder CVMC Chapter 9.50. The Commission did not review any proposed rent increases., 5.3.2 Resident Ownership of Promote the purchase of those mobilehome 2021 No mo�bilehomie/trailer parks were listed for sale in 2020. Mobilehome Parks parks with a Mobilehome Park(MHP)zone designation by park residents,when a park becomes available for sale in accordance with CVMC Chapter 9.60(Sale of a Mobilehiome Park).Accordingly,resident organizations shall have a right to purchase a park listed for sale if the organization is able to reach an acceptable price and terms and conditions with the miobilehome park owner.Financial assistance that may be provided by the State,or other funding sources may be limited to income e,ligible residents and require,affordable hou�si�ng costs. 5.3.3 Mobilehome Park Continue to enforce CVMC Chapter 9.40 to 2021 The City will continue to enforce CVMC 9.40 if and when a park is proposed for closure. Conversion protect the rights of residents as miobilehiome/trailer parks are closed or 1converted to other uses. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 54 of 724 6.1.1 Homeless&"At-Risk" Continue to participate in regional planning 2021 The City continues to participate in regional org�anizations focused on housing and other needs of the homeless or near Homeless-Reg�ional Planning efforts to address needs of the homeless, homeless population. In January 2017,such regional bodies providing for data information and studies related to including the Regional Task Force on the homelessness(the Regional Taskforce on the,Homeless)and the Regional Continuum of Care Council,required by the Homeless and the South Bay Homeless U.S.Department of Housing and Urban Development for funding were merged to form one regional governance board Coal�iti�on. now known as the Regional Taskforce on the Homeless("RTFH"). In 20201,the COC and the RTFH were separated to better focus regional efforts and coordinate with local jurisdictions. Chula Vista continues to participate i�n the COC as a member in the full membership meetings and Board meetings. As an�ESG entitlement jurisdiction,the RTFH must consult with the City. Additionaly,in 2020 the City initiated efforts to engage a sub-regional South Bay approach to homelessness.These meetings have included City of San Diego,Coronado,National City,and local partner org�anizations. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 55 of 724 6.1.2 Homeless&"At-Risk Continue to support regional funding efforts 2021 In 2017,HUD implemented the"hous,ing first"model and the Coordinated Entry System("CES")as best practices in Homeless"-Regional to develop new hous,ing facilities for the addressing the needs of the homeless. With the changes in practice,Chula Vista and South Bay Community Services Funding homeless and maintain existing facilities (SBCS),as the primary service agency that provides homeless,shelter and services in Chula Vista,are continiuing to and services,�includ�ing the Regional make adjustments to its operations and funding process and priorities. Continuum of Care Council for San Diego County and its application for funding SBCS operates four tranisi�tional living programs and the City has continued to allocate on an,annual basis CDBG and thirough the Federal Supportive Housing ESG funds to SBCS for housing services. In 2018,the City funded the housing programs,as well as housing navigation Program,local FEMA Board,County of San, services,tenant based rental assistance and ho�tel/motel vouchers serving as"b�ridge"housing for homeless in process Diego Hotel/Motel Voucher Program and of entering into a housing program to be administered by SBCS. temporary winter shelters. The City also provides annual funding for the Rotational Shelter Network program to provide shelter to,homeless at various congregational sites throughout the County,including Chula Vista. The City continues to implement a Homeless Outreach Team,including 2 police officers and 1 PERT Clinician,along with community clean up of public areas such as parks,sidewalks,and open space areas.The,COVID-191 Pandernic in 2020 had an impact on how the City continued outreach and engaged homeless individuals.There was a shift in best practices due to change public health directives from Federal,State,and Local governments.The City is partnering with the County of San Diego in the"Project One for All"aimed at housing homeless with Severe Mental Illness and anticipates a coord�inated assessment of homeless and placement into housing. In March of 2019,the City of Chula Vista and National City joint applied for and received a Homeless Emergency Assistance Program,Grant from the State of California through the Regional Task Force on the Homeless. The grant award was$462,000,and it was strategically designed to address the regional homeless issues. Partnering with the Alpha Project,the program aimed at providing outreach,case management and housing navigation. These funds were leveraged with approximately$700,000 of hous,ing dollars to offer bridge housing and permanent housing opportunities. See comments in 6.1.1�. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 56 of 724 6.1.3 Existing&New Continue in-kind and financial assistance 2021 See comments in 6.1.1 and 6.1.2. Emergency Shelters& for existing and new emergency shelters The City continues to provide funding to South Bay Commiunity Services(SBCS)to operate its housing programs. SBCS Transitional Housing and transitional housing facilities that serve, receives$63,0�00 annually from the City's Emergency Solutions Grant funding to serve approxi mate ly 9,0 extremely low- the City by providing technical assistance, income homeless individuals and families that meet HUD's definition of homelessness. siting opportunities,grants,or low cost The City owns and operates six residential units that are used to provide housing for chronic homeless with mental loans to operating agencies. health issues with wrap around services provided by the County of San Dieg�o's Health and Human Services. Additionally,the City makes availableTenant Based Rental Assistance for 15 individuals,through this program. All un,its are fully occupied. The City continues to seek opportunities to partner with affordable housing developers for the development of permanent supportive housing. In 2020,the City initiated planning and design of a bridge shelter to provide a regional approach to homelessness.A potential site has been identified to provide services and beds for up to 100 individuals. 6.1.4 Tenant Rental Implement a homeless prevention program 2021 See comments in 6.1.1 and 6.1.2. Assistance providing rent subsidies for those at-risk of Since 2013,the City has contracted with South Bay Community Services(SBCS)to administer housing programs funded becom,ing homeless through Emergency Solutions Grant(ESG),HOME and CDBG to assist those homeless or at risk of being homeless. SBCS administers the City"s Rapid Re-hou�sing program,for those households experiencing a recent incident of homelessness(at 30%or less of AM I)for up to 2 years of rental assistance and a Homeless Prevention program for short term assistance not to exceed 3 months.In 20,20,SBCS assisted 9 families throug�h Tenant Based Rental Assistance,,4 families through ESG,79 families through Low-Mo�d Homeless Prevention,Program and 19 families through the COVID-19 Tenant Based Rental Assistance program. Additionally,with CARES Act funding through the State,74 Chula Vista households were provided emergency rental assistance and 83 households were assisted thirough the County. During 2020,the Section 8 program administered by the County of San Diego issued 2,642 vouchers in Chula Vista, 1,688 to elderly and 201 to large families.There are also 4 Public Housing projects owned by the County of San Diego in the City of Chula Vista,these are:Dorothy Street Manor,Melrose Manor,L Street Manor Apartments,and Towne Center AnqrtmPntc, 6.1.5 Information on Distribute informational materials to provide 2021 Staff continues to provide updated information on basic resources on the City's website and at the public counters.The Resources for Basic Needs contact information regarding basic needs, City continues to update the existing Community Resources guide to provide better and more accurate information to such as emergency food,shelter,and residents.The resource guide includes local and regional contact information,for services ranging from emergency services for the homeless.Materials can be shelter and food to legal assistance and health services. distributed on an as needed basis at pub�lic/civic center public counters and by Additionally,the City has created and now provides resource guides with information for necessary walk-in services to City personal in regular contact with the homeless population through the Homeless Outreach Team and online. homeless or near homeless households., ISee comments in 6.1.1. Annual Progrvss Report January 2020 2021-03-16 Agenda Packet Page 57 of 724 6.2.1 Second Dwelling Units Continue to al�low construction of new 2021 In 2020,49 permits were issued. accessory secondary dwelling units in areas where the units do not compromise the neighborhood character,as defined in, Section 19.58.0122,Accessory Second Dwelling Units,of the Chula Vista Municipal Code as needed to facilitate and encourage development. 6.2.2 Shared Living Support private programs for shared living 2021 Given the significant need for affordable housing,City policies continue to support alternative housing types and living that connect those with a home and are arrangements. While the City has provided past financial support to social service providers offering shared housing willing to share living accommodations with services in 2006,,the local social service agency that provided shared living referrals ceased thiis service. those that are seeking housing,particularly seniors,students,and single person The City has identified a possible partnership with another active shared housing service and is working towards households.The City can identify the expandi�ng their services within the Chula Vista community as a viable housing option. Continuing discussions occurred programs offered in the community and in 2020 but no funding source has been,identified to date., assist in program outreach efforts for shared living programs through advertisements in the City's website and placement of program brochures in key community locations,. 6.2.3 Co-Housing Evaluate the viability of co�-ho�using where 2021 This program is identified as a Level 2 priority.Due to the City's current budgetary reductions,review and amendments residents share common facilities(e.g., of the City's Mu�nicipal Code are being completed on an as needed basis. Any proposal to provide co-housing will be cooki�ng facilities)and amendments to Title evaluated and processed on a proj ect-by-project basis. Staff is focused on,updates to the City's zoning code and 19 of the Chula Vista Municipal Code and specific plans consistent with legislative actions affecting residential development in effect as of January 2019 and other documents,where appropriate,to review of other possible land use issues. faci�litate its development. The City wi�ll continue to develop and partner with other agencies and providers regarding other alternative living options and housing types,such as shared housing. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 58 of 724 6.2.4 Accessible Housing Continue to maintain and implement 2021 Title 1 and Chapter 19.14 of CVMC("Reasonable Accommodations")provides for a formal procedure to consider Regulations California Title 24 provisions for the,review whether a land use development standard or regulation of the City's can be modified or exempted in order to allow an and approval of residential deve,lopmenits. ind�ividual with a disability to occupy their home. In December 2017,the California Tax Cred�it Allocation Committee adopted regulations for its programs requiring minimum construction standards to address mobility,hearing,vision and other sensory impairments. 10%of units must be made,accessible to those with mobi�lity impairments and 4%of units for hearing,vision,or other sensory impairments. TCAC Regulation Sections 10325(f)(7)(K)and 10326(g)(6)require projects to adhere to the provisions of California Building Code Chapter 11(B,)regarding accessib�ility to privately owned housing made available for public use. In 2019,two(2)affordable housing developments are being rehabilitated totaling 177 units(58+119). 10%of the unit in these projects are now accessible to persons with disabilities per TCAC funding regulations. No projects were rehabilitated in 2020. 7.1.1 Specific Plans Develop and consider for adoption Specific 2013-14 The Palomar Gateway District Specific Plan was adopted in,August 2013. Since its adoption,there has been P'lans for the Southwest Planning Areas in development interest in the area. In 2015 a 21-unit residential project was completed at 778 Ada Street., In 2016,four order to implement the hiousing-related land new residential projects were issued building permits. No new residential permits,were issued for this area in 2017. use policy General Plan Update of 20�05. In September 2015 the Main Street Streetscape Master Plan was approved by City Council.The Plan is being implemented as funding becomes available and/or as developers develop property along the corridor. 7.1.2 Zoniing Update Title 19 of the Chula Vista Municipal 2021 Due to the City's current budgetary reductions,review and amendments to Title 19 of the City's Municipal Code(zoning) Code,,to implement housing-rel�ated land are being completed on an as needed basis.In use policy contained in the General Plan See comments in 7.1.1 and 7.4.1. Update of 2005. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 59 of 724 7.1.3 Emergency Shelters The City will amend its Zoning Ordinance 2013-14 Ordinance No.3442 of the City of Chula Vista amending various sections of Title 19"Planning and Zoning"'of the City of within one year of adoption of the Housing Chula Vista Municipal Code,to add�ress compliance with State laws governing supportive residential land use's(e.g. Element to address emergency shelters, emergency shelters,single room occupancy residences,transitional and supportive housing�,residential facilities,and and permit this use by right,without qualified employee housing)was passed on,October 16,2018,effective on,November 23,2018. requiri�ng a CUP, PUD or other discretional action within identified zones,consistent with Senate Bill 2(Housing Accountability) enacted in 2007.The zones being considered are the General-Industrial(1-G) and/or Limited Industrial(I-R)zones and the Community Purpose Facility within the P'lanne,d Community(P,-C)zone. 7.1.4 Transitional and The Zoning Ordinance will be amended to 2013-14 Ordinance No.3442 of the City of Chula Vista amending various sections of Title 19"Planning and Zoning"'of the City of Supportive Housing specifically define transition a I/su pportive Chula Vista Municipal Code to add�ress compliance with State laws governing supportive residential land uses(e.g. housing�.Transitional hou&ing,pursuant to emergency shelters,single room occupancy residences,transitional and supportive housing�,residential facilities,and Health and Safety Code Section 50675.2, qualified employee housing)was passed on,October 16,2018,effective on,November 23,2018. and supportive housing,,pursuant to Health and Safety Code 50�675.14,will be perm,itted as a residential use in all residential uses and subject to the same development standards as the same type of housing units in the same zone consistent with Senate Bill 2(Housi�ng Accountability) enacted in 2007. 7.1.5 Single Room The Zoning Ordinance does not contain, 2013-14 Ordinance No.3442 of the City of Chula Vista amending various sections of Title 19"Planning and Zoning"'of the City of Occupancy(SRO)Units specific provisions for SRO units.The City Chula Vista Municipal Code,to add�ress compliance with State laws governing supportive residential land uses(e.g. will amend the Zoning Ordinance to emergency shelters,single room occupancy residences,transitional and supportive housing�,residential facilities,and facilitate the provision of SRO's,consistent qualified employee housing)was passed on,October 16,2018,effective on,November 23,2018. with the Assembly Bill 2634(Hou�si�ng for Extremely Low-Income Households) enacted in 2007. 7.1.6 Farmworker Housing The Zoning Ordinance will be amended 2013-14 Ordinance,No.3442 of the City of Chula Vista amending various sections of Title 19"Planning and Zoning"'of the City of within one year of adoption of the Housing Chula Vista Municipal Code to address compliance with State laws governing supportive residential land use's(e.g., Element to comply with Section 17021�.5 emergency shelters,single room occupancy residences,transitional and supportive holusing�,residential facilities,and and 17021.6 of the State Health and Safety qualified employee housing)was passed on,October 16,2018,effective on,November 23,2018. Code regarding employee housing. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 60 of 724 7.1.7 Flood Hazard Pursuant to Assembly Bill 162,amend the 2013-14 The City's Environmental Element contains a policy related to flood hazard management,as well the City's Municipal safety and conservation elements of the Code and are consistent with the,Housing Element. City's General Plan upon adoption of the City's Housing Element to include an analysis and policies regarding flood hazards and management.Upon the amendment of the safety and conservations elements,the City will review the adopted Housing Element to maintai�n internal consistency and amend the Element as may be necessary. 7.2.1 Priority Processing Continue to implement priority processing 2021 Chula Vista offers expedited permit processing for certain development projects,including affordab,le housing. of the necessary entitlements and plan Affordable Housing Developers can request the expedited program to ensure the project is placed into service by the checks to exped�ite the development required deadlines established by the funders of the project(i.e.tax credit investors). All affordable housing projects process for residential developments,which have been provided with this service. do not require extensive Engineering or environmental review,with at least 15 percent of the units as affordable for very low-and low-income households.Update the expedite policy as may be necessary to encourage the development of affordable housing for lower income households. 7.2.2 Development Fees Various fees and assessments are charged As requested See comments in 7.2.1�. by the City to cover the costs of processing As needed based upon financial feasibility,the City may offer waiver and/or deferral of certain fees.,For rental housing perm,its and providing services and development proposed within the infill urbanized area of the City,west of 1-805,the City offers a development fee facilities.Continue to consider subsidizing, deferral program as incentive to those developments.In 2018,the City amended its M�unicipal Code to allow for the waiving,or deferri�ng fees for affordable waiver/deferral of certain fees for accessory dwelling units. units for very low-and l�ow-,income households on a case-by-case basis. As there are changes in legislation,the City continues to update policies and regulation.,The adoption of California Requests are evaluated based upon,the Senate Bill 13 prohibits development impact fees on accessory dwelling units,smaller than 750 square feet,and development's effectiveness and efficiency significantly limits the impact fees that may be charged to larger accessory dwelli�ng units., in achieving the City's underserved housing needs,particularly extremely low and special needs households as allowed by the City's Mu�nicipal Code. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 61 of 724 7.2.3 Water/Sewer The City of Chula Vista will provide a copy 2013-14;Within 30 days of The City provided a copy of the adopted Housing Element to the Otay Water District and Sweetwater Authority. of the adopted Housing Element to the Otay adoption of the Housing Water District and Sweetwater Authority Element within 30 days of adoption.The City will also continue with the District to ensure affordable housing developments receive priority water service provision. 7.3.1 Pursue Affordable Continue to utilize the eCivis software 2021 As opportunities become available for funding,,the City actively pursues partnerships and as a City to apply for such Housing Funding program,to proactively pursue available funding. Past awards include application with SBCS for the Promise Zone designation in November 2013.In 2014 the Federal or State funding to increase, City of Chula Vista was successful in a grant application for CaIHOME funds towards the creation of first-time homebuyer preserve and enhance housing affordable opportunities. In 20191,staff was,preparing an$1.5M CalHome application to assist First Time Buyer in response to a to low-income households Notice of Funding Availability that was issued by HCD i�n November 2019. In accordance with SB 2,the City appl�ied and received an award of$1.1.million in Permanent Local Housing Assistance to assist with,the provi�si�on of permanent supportive,housing,accessory dwelling un,its for lower income households,or financing of a bridge homeless shelter. The City also applied and was awarded$500,000 from the Local Early Action Planning grant to assist with the preparation of the Housing Element and to faciliate housing production in line,with the RHNA.Staff continues to search for,and apply for affordable housing grant opportunities. 7.4.1 Affordable Housing The City has adopted affordable housing 2021 See comments in 4.1.2 and 7.1.2. Incentives(aka Density incentives regulations to facilitate the The City of Chula Vista's Density Bonus Ordinance was approved by the City Council on December 11,2012.The Bonus,) development of affordable housing for very ordinance provides clarity and outlines the State re�qu�irements for affordable housing development. Developers of low low,low,and moderate income households and moderate income units are encouraged to utilize the incentives available through these regulations as may be and seniors.This policy provides for a needed. density bonius,incentives and waivers of development standards for housing 2 projects were approved in,2019,these include Bonita Glen and 310 K St.Bonita Glen has a total of 170 apartments-9 providing the required niumber of units for apartments for very low income individuals.310 K St has 46 apartments-3 apartments for very low income individuals. the income qualified househoilds and seniors.Continue to provide incentives for The City wi�ll continue to update the City's zoning code and specific plans consistent with legislative actions affecting the development of affordable housing and residential development in effect as of January 2019. housing for seniors through implementation of these regulations.Market incentives to housing developers via the Ci�ty's website and the Development Services front counters. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 62 of 724 7.4.2 Public Property Evaluate the viability of providing affordable 2021 Staff has evaluated its existing inventory of City and/or Agency owned land.The City has limited ownership of land,of housing on City owned property that which very little is currently suitable for residential development. As opportunities of surplus land become available',the becomes available or is deemed surplus, City will continue to evaluate the suitability of such land for residential purposes and the viability for affordable housing. property. 7.4.3 Affordable Housing in Evaluate the appropriateness of allowing As opportunities arise See comments in 7.4.1. Public or Quasi-Public Zones affordable housing within public or quasi- pub�lic zoning designations,when appropriate. 8.1.1 Affirmative Marketing& Require affordable housing developments 2021 The City continues to require all developers of affordable housing communities to provide the City with a Marketing Plan, Leasing for low-and mod�erate-income households including efforts for affirmative marketing to minority communities. All marketing plans are required as condition of the to comply with the foll�owi�ng policies; loan agreement and are subj�ect to review and approval by the City. marketing and leasing efforts,require outreach to minority communities,including All deed restricted affordable housing projects are required to conduct a lottery of the waitlist. advertising in multi-li�ngu�al media; require the monitoring of lease and sales efforts for compliance with affirmative marketing;and,require periodic reporting to the Community Development Department on the composition of resident populations in units,income levels and affordability of the units. 8.1.2 Fair Housing Education Continue contracting with a service provider 2021 The City contracts with Center for Social Advocacy(CSA)to p,rovide outreach and counseling for fair housing issues. &Counseling for implementation of programs for broad Information regarding fair housing education and resources is available,on the City's webs,ite and at the public counter. outreach and education on housing rights to CSA conducted several workshops during the year for the benefit or residents and property owners/managers. One ensure information and materials are such workshop was directed to property managers,and held at the Pacific Southwest Association of Realtor office. available to the entire commiunity through a variety of means,including availabil�ity on In addition,the,San Diego Regional Analysis of Impediments to Fair Housing Choice was completed in May 2020.The the City's website and various City and civic City is a member of the San Diego Regional Alliance for Fair Housing that consists of 18 participati�ng Cities and the bui�lding�s,fair housing counseling,and County of San Diego. resolution of fair housing complaints. Where appropriate,refer to other agencies, including State and Federal enforcement agencies. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 63 of 724 9.1.1 Public Input& Continue to incorporate public input and 2021 The City continues to provide opportunity for publ�ic input for all plans,policies and projects. The Development Services Participation participation in the design and development Department has an established public participation policy for review of all development projects. Additionally,as a of City housing plans and pol�icies. recipient of U.S.Department of Housing and Urban Development funds,,the City also has an adopted Citizen Participation Plan for these funding programs. As part of its public outreach and engagement,in developing plans,policies and projects,staff solicits input using various methods such as surveys,meetings with community stakeholder groups,City sponsored community meetings,focus groups,commun,ity cafes,and office hours with elected officials and departments.In 2020,the City engaged the pub�lic for participation in the 2021 Housing Element and 2020 Consolidated Plan,documents.City staff meets on a reg�ular basis with citizen advocacy groups to discuss and address specific neighborhood needs,such as ACCE and�Harborside Safety and Revitalization Committee. Outreach tools for publicizing events and information include the use of social med�ia,such as Facebook,Nextdoor, Instagram,Twitter,and the City website. Interested persons may also sign up for Cou�ncil and Commission agendas, new development applications,etc. Specifically for housing related projects,applicants are requested to hold a meeting with neighboring residents and property owners,at the onset of a project.As a project moves forward i�n the construction phase,applicants are requested to provide news and information to interested persons on progress and neighborhood impacts as a result of construction activity. 9.1.2 Limited English Development of a City-wid�e policy to 2021 The City continues to provide bilingual materials for all housing prograrn marketing materials and provides translation Proficiency Policy provide services to persons with limited services as needed and as requested. 'The City provides translation service language on its website and is evaluating English proficiency with the goal of this service for all meeting agendas. All agendas related to Housing and altered agendas include a request for providing such persons with better access translation services. to verbal and written information,provided by the City,specifically related to affordable The City's Human Relations Commission continues to work on programs,policies,and barrier identification to improve housing resources and programs for low- access to information,.The City of Chula Vista has been,designated a Welcoming Citiy,and with the Human Relations and moderate-income households. Commission has identified a the development of a more comprehensive policy as part of its future work program. Annual Progrvss Report January 2020 2021-03-16 Agenda Packet Page 64 of 724 9.1.3 Housing Resources Develop and maintain outreach or other 2021 Staff continues to provide updated housing res,ou�rce information as needed on the City's website,at the public counters Information appropriate marketing materials identifying and attends certain community events and meetings to provide information.The City also displays materials from other available housing resources and programs providers for those related housing services as Fair Housing services,Foreclosure Intervention services,Homelessness available in the City of Chula Vista, servi�ce�s,and community resources at the public counters. including affordable housing developments, to ensu�re existing and potential residents City staff hold a number of outreach events to provide technical assistance and information to its residents,business are aware of affordable housing owners,and other community partners. Due to the COVID-19 pandernic of 2020 and resulting public health directives opportunities. Information and materials are calling for stay at home orders and prohibiting of gatherings,outreach and education events were extremely limited. to be available,via the City's websiteand The City took proactive measures to update its website and provide resources for those financial impacted by COVID-1 9. the Development Services front counters. Staff attended andprovided information for residential property managers,mobilehome park owners/managers and attended community meetings,events and networking to provide housing and neighborhood related information,via onIffinp nintformg- 9.1.4 Annual Housing Report Provide an aninual report to the City Council Annually Since 2008,the Housing Advisory and Mobilehome Rent Review Commissions have met annually to review Housing on the City's existing housing stock and Element progress made during the previous year.In addition,the City Council is presented with the report annually in an pol�icies in relation to progress in open public meeting in March of each year.At meetings of the HAC and MHRRC,the City continues to update each implementing the policies of the Housi�ng commission on,relevant programs that are of�interest to participants and residents. Element,The annual report shall also be made available for review in public locations. Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 65 of 724 General Comments.-I Annual Progr-ess Report January 2020 2021-03-16 Agenda Packet Page 66 of 724 Jurisdiction Chula Vista Reporting Year 2020 (Jan. 1 -D�ec.,31) Building Permits Issued lby Affordabillity Sum,mary Income,Level Gurrent Year, Very Low Deed Restricted 0 �Noni-Deed Restricted 0 Low Deed Restricted 0 �Noni-Deed Restricted 0 Deed Restricted 10 Moderate �Noni-Deed Restricted 0 Ab�ove Moderate 960 ......................... Total Units 96,0 Note:Units serving extremely low-income households are included in the very low- income p�ermitted units totals Housing Applicaflons Summary Total Housing Applications Submitted: Number of Proposed Un,its in All Applications Received: 1,081 Total Housing Units Approved: 0 Total Housing Units Disapproved: 0 L� FUse of SB 35,StreamIJiq*I!!q'PrpAsions so Numob"er of Applications for Streamlining 0 AlmU)911� og�e�s IR- ,,qpart January 2020 1-0 -I e ?A"gen ac t Page 67 of 724 Number of Streamlining Applications Approved 0 Total Developments Approved with Streamlining 0 Total Units Constructed with Streamlining UnIts Constructed-SIB 35 Streamlining Permits ................. ...... n1t. S'C' Income Rental Ownership Total Very Low 10 01 0 Lo�w 0 0 0 Mnrj.=rnt �FA I I oderate 0 0 0 IAbove Moderate 0 01 0 Total 01 0 0 Cells in g�rey contain auto-calcul�ation formulas AlmU)911� og�e�s IR- ,,qpart January 2020 1-0 -I e JPA"gen ac t Page 68 of 724 Jurisdiction Chula Vista Reporting Year 2020 (Jan.1-Dec.31) ANNUAL ELEM�ENT PROGRESS REPORT Local Early Action Planning(LEAP)Reporting (CCR Titl�e 25§6202) Please update the status of the proposed uses listed in the entity"s application forfunding and the corresponding impact on housing within the region orjurisdiction,as applicable,categorized based on the eligible uses specified in Section 50515.02 or 50515.03,as applicable. Total Award,Amount $ 500,0 Task, $Amount Awarded $Cumulative Reim,b I ursement Task Status Other Notes,, Req uested Fundilb, 2/26/20�21;Reimb not Hsg Element Update Preparation 140,000.00 $ 1.00 Completed Local General requested Hsg Element Coordinate HCD $ 20,000.00 In Progress Local General Begin 3/1/2021 Hsg Element Initial Implement $ 80,000.00 Comm/Stakeholder Input Hsg $ 70,000.00 Inclusionary Housing Ordinance $ 80,000.00 ADU Design Std Expedite $ 30,000.00 Objective Design Std $ 30,000.00 In Lieu Fee $ 50,000.00 Summary of entitlements,building permits,and certificates of occupancy(auto-populated from Table A2) Completed Entitlement Issued by Affordability Suimmary Income,Level Current Year Very Low Deed Restricted 0 Non-Deed Restricted 0 Low Deed Restricted 0 Non-Deed Restricted 0 Deed Restricted 0 Aiiirriinual�� ��P� iir,iogress �R.epoiiq January 2020 2021-03-16 Agenda Packet Page 69 of 724 IIV I%J%Al%,11 C4L%., Non-Deed Restricted 0 Above Moderate 0 -Total Units 0 Bul'Iding Permits Issued,by,Affordabillity,Summary -------------------- Income Level Current Year, Very Low Deed Restricted 0 Non-Deed Restricted 0 Low Deed Restricted 0 Non-Deed Restricted 0 Deed Restricted 0 Moderate Non-Deed Restricted 0 Above Moderate 960, Total Units 960, Certificate of Occupancy Issued by Affordability Summary Income Level Current Year Very Low Deed Restricted 0 Non-Deed Restricted 0 Low Deed Restricted 0 Non-Deed Restricted 0 Moderate Deed Restricted 30 Non-Deed Restricted 0 Above Moderate 1225 -Total Units 125 Aiiirriinual�� ��P�)iir,iogress �R.epoiiq January 2020 2021-03-16 Agenda Packet Page 70 of 724 ,i4lboeogiRraw, CI'TY, OF11 A H'UL- A V111 '' , HOUSING SUCCESSOR ANNUAL REPORT Chula Vista Housing Authority Fiscal Year 201�9=120 2021-03-16 Agenda Packet Page 71 of 724 .................................. .............................. Housing Autho�rity as Housing Successor............................. .................................... .............. Scope of'This Housing Successor Annual Report...................... .................................... ........ Assets Transferred to the Housing Successor......................... .................................. ............2 BACKGROUND.................... ...................... .................................. ..............................2 Legal Requirements Pertaining to Housing Successors................. .................................... 2 Permitted Uses of Housing Asset Funds.............................. .................................... ..............3 Limits on the Accumulation of Housing Funds (Excess Surplus)................... ........................ 5 HOUSING ASSET FUND ACTIVITY.............................................. .................................... ..............6 Deposits and Fund Balance.......................................... .................................... ......................6 Expenditures....................... .................. .................................... ................................7 Ending Cash and Fund Balance....................................... .................................... ...................7 Housing Successor Po�rtfo�lio......................................... .................................. ........................7 Real Properties and Disposition Status............................. .................................... ..............8 LoansReceivable.......................... .................... .................................. ..........................9 COMPLIANCE WITH EXPENDITURE & PRODUCTION LIMITS ..................... ..................................�..�. 11 Proportionality Requirements........................................ .................................. ..................... 11 S,enio�r Rental Housing Limit Compliance ............................. .................................... ........... 13 ExcessSurplus ..................... .................. .................................... ........................... 14 OTHER INFORMATION............. ...................... .................................. ..................... 15 Ho�meo�wnership Unit Inventory....................................... .................................... ................. 15 Transfers to Other Housing Successors............................... .................................. ............. 15 APPENDIX 1 — HOUSING ASSET TRANSFER FORM........................... ....................................�..�.. 15 APPENDIX 2 - HOUSING SUCCESSOR ANNUAL REPORT REQUIREMENTS........................................................... 16 APPENDIX 3— HOUSING ASSET FUND EXPENDITURE REQUIREMENTS............................................................... 17 2021-03-16 Agenda Packet Page 72 of 724 Ed[AL-Iff This Housing Successor Agency Annual Report ("Annual Report"') presents information on Fiscal Year ("FY") 2019-20 expenditures and activities as required by Health and Safety Code CHSC") Section 34176.1(f), including but not limited to a housing successor's compliance with certain expenditure activities over the year as well as a five-year planning period. This Annual Report is required of any housing successor to a former redevelopment agency. Housing Authority as Housing Successor The Chula Vista Housing Authority ("Housing Authority") is the Housing Successor Agency ("Housing Successor") to the former Chula Vista Redevelopment Agency ("Agency"), which was dissolved along with all redevelopment agencies statewide by the State legislature in 2012. At the time of dissolution, a housing successor was to be selected to transfer and be responsible for the remaining assets and liabilities of a former redevelopment agency. The City Council elected to designate the Housing Authority as the Housing Successor to the former Agency. The Housing Authority perfor�rns many ot�her duties beyond those of a housing successor while acting in its broader capacity as a housing aut�hority. The Housing Authority reports on all of its activities in a separate (broader and more extensive) annual report required by HSC Section 34328, to be submitted to California Depart�rnent of Housing and Community Development ("HCD") by October 1 for the prior year. Scope of This, Hou�s,"Ing Successor Annual Report, This Annual Report is limited to the Housing Authority 5 s activities as it relates to its role as a housing successor. This may include, but is not limited to, financial activities, property disposition, loan administration, monitoring of covenants,, and affordable housing development. This Annual Report describes co�mpliance with various annual, five-year, and ten-year housing expenditure and production require�ments. FY 2019-20 is the first year of the current five-year compliance period for income proportionality, which begins July 1, 20191 and ends June 3,0, 2024. The Housing Successor Annual Report was due to HGD by December 31. The Housing Authority's audited financial statements will be posted on the City of Chula Vista 5 s ("City") website when available and incorporated herein by reference. Chula Vista Housing Successor Annual Report 2019-120 1 2021-03-16 Agenda Packet Page 73 of 724 Assets Transferred to the Housing Su�ccessor '','MI'll,............. Upon the statewide dissolution of redevelopment in 2012, all rights, powers, committed assets, liabilities, duties, and obligations associated with the affordable housing activities of the Agency were transferred to the Housing Authority.As one of its first duties as a housing successor, the Housing Authority prepared and submitted to the California Department of Finance ("DOF") an inventory of housing assets to be transferred from the former Agency. The inventory was enumerated on a Housing Asset Transfer Form ("HAT") which included: 1. Real properties; 2. Loan/Grant receivables; 3. Rent/Operation Income; and 4. Deferrals. All items on the HAT were reviewed and ultimately approved by the DOF on September 5, 2012. A copy of the HAT is provided as Appendix 1. Once approved by DOF and as directed by law, the Housing Authority, acting as the Housing Successor, transferred these assets to the Low and Moderate Income Housing Asset Fund ("Housing Asset Fund"). Approval of the HAT set in motion a series of obligations by the Housing Authority as a housing successor, as described in the following section. This Section summarizes the legal requirements for use of housing successor assets that are addressed in this Annual Report. 0 0 0 Le�gal Requirements Pertaining to Housing Successors In general, housing successors must comply with three major requirements pursuant to HSC Section 34 17'6.1: 1. Expenditures and housing production are subject to income and age targets. 2. Housing successors may not accumulate an 96 excess surplus,P) or a high unencumbered Housing Asset Fund balance based on certain thresholds. Chula Vista Housing Successor Annual Report 2019-�20 2 2021-03-16 Agenda Packet Page 74 of 724 3. Properties must be developed with affordable housing within five to ten years of DOF's approval of the HAT. Appendix 2 provides a detailed summary of the reporting requirements that are addressed in this Annual Report. Permitted Uses, of Housing AsseIt Funds Pursuant to HSC, Section 34176.1, Housing Asset Funds may be spent on: Administrative costs for operation of the housing successor agency. The law allows a housing successor to spend the greater of: * $200,000 per year adjusted for inflation, or * 5% of the statutory value of real property owned by the Housing Successor and the value of loans and grants receivable from the HAT ("Portfolio"). According to HCD, the $200,000 limit adjusted for inflation is $220,400 for FY 2019-20. The Housing Successor's FY 2019-20 Portfolio balance is $25,342,406, of which 5% is $1,267,120. Chula Vista's FY 20191-20 annual administrative cost limit is the hig�her of these amounts, or $1)2671120. Homeless preventi�on and rapid rehousing services up to $250,000 per year if the former redevelopment agency did not have any outstanding �inclusionary housing or replacement housing production requirements as of 2012. Chula Vista is eligible for this expense because it did not have any outstanding inclusionary or replacement housing requirements upon dissolution. Affordable housing development assisting households up to 80 percent of the Area Median Income ("AMI"), subject to specific income and age targets over a five-year period. on� eve o p e�ti Any HousingAsset Funds may be spent on development of affordable housing projects affordable to low, very low, and extremely low income households. "Development" is defined as "new construction, acquisition and rehabilitation, substantial rehabilitation as defined in HSC Section 33413, the acquisition of long-term affordability covenants on multifamily units as described in HSC Section 33413, or the preservation of an assisted housing development that is eligible for Chula Vista Housing Successor Annual Report 2019-120 3 2021-03-16 Agenda Packet Page 75 of 724 prepayment or termination or for which within the expiration of rental restrictions is scheduled to occur within five years.)9 Over each five-year compliance period, the current one beginning July 1�, 2019, 'at least 30 percent of such development expenditures must assist extremely low income households (3�0% AMI), while no more than 20 percent may assist low income households (between 60- 80% AMI). The balance of the funds may be used on very low income households (defined as households earning between 30% and 60% of AMI). The first five-year compliance period was January 1, 2014 through June 30, 2019. The Housing Authority was non-compliant with Housing Asset Fund income proportionality expenditure requirements during the first five-year compliance period, specifically with the 20% maximum expenditure requirement for the 60-80% AMI category. This is discussed later in the report. The current (second) five-year compliance period is July 1, 2019 to June 30, 2024. Note that housing successors must report expenditures by category each year, but compliance with income proportionality limits is measured every five years. For example, a housing successor could spend all its funds in a single year on households earning between 60-80%AM I, as long as it was 20 percent or less of the total expenditures during the five-year compliance period. Should a housing successor not spend at least 30% of its development expenditures for extremely low income households, or exceeds the amount spent on low income households, future expenditures are subject to greater restriction until these proportionality targets are met. Specifically, if a housing successor is unable to spend at least 30% of its development expenditures on extremely low units, it is required to increase this spending to 50% until compliant with the 30% threshold; a housing successor that spends more than 20% of its development expenditures on low income units cannot spend any further funds on low income developments until it is at or below the 20% threshold. As such, tracking these expenditures and their progress over the corresponding five-year period is an important function of this Annual Report. Chula Vista Housing Successor Annual Report 2019-�20 4 2021-03-16 Agenda Packet Page 76 of 724 le -Year Age on� Un�ilts Ass������sllted 111.11, If more than 50%, ofthe total aggregate number of rental units produced by the city, housing authority, or former redevelopment agency during the past 10 years are restricted to seniors, the housing successor may not spend more Housing Asset Funds on senior rental housing. It is important to stress that Housing Successor expenditure and production requirements are measured on different timeframes: One-Year Limits: Administrative Allowance and Homeless Prevention Allowance. Compliance evaluated annually and resets every year. Five-Year Limit: Expenditures by Income Level. Compliance evaluated over a fixed five-year period set by law, the current period being July 1, 2019 to J�une 30, 2024. Tlen-Year Limit: Number of Senior Deed-Restricted Units Assisted. Compliance evaluated based on a rolling ten-year period that is different every year, the current period being FY 2010-11 to 20 191-20. Appendix 3 describes Housing Asset Fund expenditure requirements in more detail, including the types of costs eligible in each category. Limits on the Accumulation of Housing Funds (Excess S,u�rplus) State law limits how much cash a housing successor may retain and, if it fails to commit and spend these 1. . dollars in a reasonable timeframe, ultimately penalizes the housing successor by requ�inng unspent funds to be transferred to HCD for use on State housing programs. HSC Section 34176.1(d) establishes a limit, known as an 66 excess surplus 19 on the amount of unencumbered Housing Asset Funds based on the greater of the following: $1,000,000, or The total amount of deposits made into the Housing Asset Fund over the preceding four years. Only amounts in excess of this threshold are considered an excess surplus. Once an excess surplus is determined, a housing successor must account for these funds separately and encumber said monies within three years. If after the third year the excess surplus has not been fully encumbered, the remaining Chula Vista Housing Successor Annual Report 2019-l20 5 2021-03-16 Agenda Packet Page 77 of 724 I- i)alance of the excess surplus is to be transferred to HCD within 9�O days. HCD is permitted to use these transferred excess surplus funds anywhere in the State under its Multifamily Housing Program or the Joe Serna, Jr. Farmworker Housing Grant Program. As part of the Annual Report, a housing successor must disclose any excess surplus and describe the housing successor's plan for eliminating this excess surplus. This section describes FY 2019-20 Housing Asset Fund activity and balances. Deposits and Fu�nd Balance The Housing Authority deposited $770,3917 into the Housing Asset Fund during FY 20191-20 from a variety of revenue sources, as shown in Figure 1. Figure I.-Housing Asset Fund Deposits, 20�19-20, [�Y 2 0"1"1 9,, -�,201 0 )Ieposits ($770,397) iii �nvestment Eairnings City Pool OiraingeTree Mobile H�ornie Park RevelnUes �nvestment Eairnings Others City Stafffime&cosit Recovery F Loran Repayments $16J68 Chainge in Fair Market VaIue of Investments $10,017' Chula Vista Housing Successor Annual Report 2019-�20 6 2021-03-16 Agenda Packet Page 78 of 724 Expenditures The Housing Authority expended a total of $117,023 during 2019�-20. Of these expenditures, $102,637 were for homeless prevention and rapid rehousing, and the remainder of $14,38,6 were administrative costs. Ending Cash and Fund Balance The Housing Asset Fund balance as of June 30, 2020 was $12,360,211, as summarized in Table 1. Table I.-Housing Asset Fund-Ending Ba�lan,ce as of June 30, 2020 E3,alance "I"y1pe AmOUn't Cash $ 10 7 821 7 715 Interest Receivable 31724 Prepaid Expenses 14773�63 Loans Receivable 25,042,406-34 Advance to Other Funds 277088 Accrued Interest 15,069, Interest Receivable SW Project Area 67292 Orange Tree Mobile Home Park 8071704 Accounts Payable (3�93) Deferred/Unearned Revenue (24,510,758) Ending Balance $ 129,3609,211 Source.- Fund 319 Trial Balance and Chula Vista Audit(LSL), 10, Housing Su�ccess,or Portfol' The Housing Successor Portfolio as of FY 2019-20 includes three properties within Orange Tree Mobile Home Park valued at $100,000 each and several loans receivable transferred from the former Agency. The Portfolio had a value of$25,042,406 as of FY 2019-20, as detailed in Table 2. Chula Vista Housing Successor Annual Report 2019-�20 7 2021-03-16 Agenda Packet Page 79 of 724 Table Z Housing Successor Real Property and Loans Receivable Portfolio Asset Ainriotiin�.-t -Real Properties Orange Tree #101,, #106,, #134 $300Y 000 Loans Recelvable South Bay Community Services $ 672,847 Cordova Trolley 5313863 Rancho Vista Housing 14621658 St Regis Park 132673226 Chula Vista Rehabilitation CHIP Loans 573,340 Park Village Apartments (Barrio Housing) 137)281 Mobile Home Assistance Programs (Grange 'Tree) 12,584 Los Vecinos (Wakeland) 91185,732 Main Plaza 231973479 The Landings I & 11 31098,263 Duetta Apartments 13013�3614 Volta Senior Apartments 11047,778 Anita Street 3 3 841 3 741 Subtotal $25,O�42Y 40�6 Total Portfolio Value $259,3429,406 Source.- Chula Vista Audit(LSL) and the City of Chula Vista REAL PROPERTIES AND DISPOSITION STATUS Pursuant to the approved HAT, the former Agency transferred three parcels to the Housing Authority, specifically three properties in the Grange Tree Mobile Home Park, with unit numbers 101, 106, and 134. All three formerly had income restriction covenants that have since expired. The properties, however, are continually rented to seniors with incomes at or below 120% of AW. There is one outstanding loan agreement for Grange Tree #24 that remains in deferral status, with $12,584 remaining to be paid. HSC Section 34176.1(e) requires all real properties acquired by a redevelopment agency prior to February 1, 2012 and transferred to the housing successor to be developed pursuant to the requirements detailed in HSC Section 33334.16. All property that falls within these parameters must be developed for affordable housing purposes or sold by September 5, 2017. Because the properties were already developed for affordable housing purposes the above, requirements have been satisfied. Chula Vista Housing Successor Annual Report 2019-�20 8 2021-03-16 Agenda Packet Page 80 of 724 L OANS RECEIVABLE Twelve agreements transferred from the former Agency to the Housing Authority as part of the initial HAT. The outstanding balances are described below. In 1998, the former Agency and the City entered into two loan agreements with South Bay Community Services. Both agreements involving the Housing Asset Fund were to fund the 40- unit Cordova Village. Interest accrues annually at three percent. As of June 30, 2020, the outstanding balance of the loans was $672,847. In 2000, the former Agency loaned $1,000,000 using Housing Asset funds, and the City loaned $500,000 using HOME funds to CIC Eastlake, L.P. for the development and operation of Rancho Vista Housing Project. The outstanding principal on the loan is to be repaid over 55 years and interest accrues at the simple interest �rate of three percent per year. As of June 30, 2020, the outstanding balance of the loan was $1�,4627658. Also in 2000, the former Agency entered into a loan agreement with Chelsea Investment Corporation for the acquisition and rehabilitation of the 119-unit multi-family housing project at 1025 Broadway (St Reg�is Park). The loan repayment period lasts 52 years and will accrue six percent interest. As of June 30, 2020, the outstanding balance of the loan was $1,267,226. The Chula Vista Rehabilitation Community Housing Improvement Program ("CHIP") is under direct control of the Housing Authority acting as the Successor Housing Entity for those loans that were funded using Housing Asset funds. CHIP offers deferred and low-interest �rate home improvement loans to qualified borrowers residing within a target area. Loan �repayments are re- deposited into the program cash accounts and are redistributed as future loans. As of June 30, 2020, the outstanding balance of the loan was $573,340. In 1991, the former Agency entered into a loan agreement with the Civic Center Barrio Housing Corporation. The loan was made for the purchase of land and the development of a 28,— unit low- income housing project. During 199�2, the loan was assigned to Park Village Apaftments Ltd., in which Civic Center Barrio Housing Corporation is the managing general partner. In 2009 an amendment to the loan was entered into changing the interest from three percent to five percent per year. As of June 30, 2020, the outstanding balance of the loan was $137,281. Chula Vista Housing Successor Annual Report 2019-�20 9 2021-03-16 Agenda Packet Page 81 of 724 The former Agency entered into agreements with eligible residents of the Orange Tree Mobile Home Park, whereby the Agency loaned $250,030 as permanent financing assistance to residents for the purpose of purchasing certain mobile home property. Interest is contingent on calculations specified in the agreement. As of June 30, 2020, the outstanding balance of the loans was $12,584. Only the loan to 521 Orange Ave. #24 (Velez) was still in deferral status. In 2008, the former Agency entered into a loan agreement with Wakeland Housing and Development Corporation to assist the borrower in constructing 41 affordable multi-family rental housing units. The loan amount of$5,680,000 was funded by the Housing Asset Fund. The loan bears an interest rate of five percent per year. As of June 30, 2020, the outstanding balance of the loan was $9,185,7291. In 2003, the former Agency and City entered into a loan agreement with Main Plaza, LP to assist in acquiring and improving certain real property for occupancy by very low, low, and moderate income households. The loan bears an interest rate of three percent per year with a 55-year term. As of J�une 30, 2020, the outstanding balance of the loan was $2,197',48,0. The City entered into a loan agreement with CIC Landings, L.P. to assist the borrower in constructing 91 affordable multifamily apartment units for occupancy by extremely low, very low, and lower income households. The City and former Agency also entered into loan agreements with Landings 11, L.P. to assist with constructing 141 affordable multi-family rental housing units. As of J�une 30, 2020, the outstanding balance of the loan was $3,098,263. In 2016, the City entered into a loan agreement with F Street Family CIC, LP to assist in the construction and permanent financing of affordable multi-family apartments with 86 deed restricted units (Duetta Apartments). The loan principal is in the amount of $8915,340 from the Housing Asset Fund. The loan bears an interest rate of three percent per year for 55 years. As of June 30, 2020, the outstanding balance of the loan was $1,013,614. In 2016, the City entered into a loan agreement with G Street Senior CIC, �LP to assist in the construction and permanent financing of affordable multifamily apartments with �122 deed restricted units (Volta Senior Apartments). The loan amount of $932,000 was funded by the Housing Asset Fund. The loan bears an interest rate of three percent per year for 55 years. As of June 3,0, 2020, the outstanding balance of the loan was $1,047,778. Chula Vista Housing Successor Annual Report 2019-�20 10 2021-03-16 Agenda Packet Page 82 of 724 In 2017 and 2018, the City entered into an amended a loan agreement with Wakeland Housing to assist in the acquisition of land and pre-development of an affordable multi-family housing project of 96 units (Anita Street). The City's loan would draw from the Housing Asset Fund and assist in the construction of 32 extremely low income units from the 96 total. The original loan amount of $3,300,000 was amended in 2018 and 2020, respectively, for an additional $858,740 and $1,036,425 for a total loan commitment to$5,1915,165. No interest accrues on the loan during the predevelopment phase of the Project. Fund balance has been restricted in the Low & Moderate Income Housing Successor Special Revenue Fund. However, as of June 30, 2020, only$3,841,741 has been dispersed to assist with 22 of the 32 units as of the writing of this report. During the 2019-20 year, the Housing Authority was in compliance with all annual and five- to ten-year planning period requirements as described in this section. Proportionality Requirements As summarized in Figure 2 below, the Housing Authority fully complied with all Housing Asset Fund spending �restrictions: During FY 20191-20, the Housing Authority expended $14,386 on allowable administrative expenses which is well under the current annual maximum limit of $220,400 ($2001000 plus inflation), or 5% of the Housing Successor Portfolio balance, whichever is greater. As shown earlier on Table 2, the Portfolio balance is $25,342,406, of which 5% is $1,267,120. During FY 2019-20, the Housing Authority used $102,6�37 of Housing Asset Funds for homeless prevention or rapid rehousing expenses and was therefore in compliance with the $250,000 spending limit. No affordable housing development-related expenditures have been made during the current five- year compliance period of July 1�, 2019 to June 30, 2024. Therefore, the Housing Authority meets the five-year income proportionality targets. Chula Vista Housing Successor Annual Report 2019-�20 2021-03-16 Agenda Packet Page 83 of 724 Figure 2. 2019-20 Housing Asset Fund Expenditure Summary 01LAIa Vista E)1(pend[ti.jires C o n-111i�p I y \A1 I t'�h I irn I t s $1'om000 ual Limits pliance $90101"000 $80�O��000 $70�O��000 $60101,,000 $50�O��000 $40101,,000 $300�000 $102,p637/ $20�O��000 $14,,386/ smo"000 $ 5 $0 '1001 $0 $0 $0 Administration/ Horneless Ext. �Low Rental 30%, Very Low 31-59%AW Low 60-801%,AMI Monitoring Prevention/Rapid AMI(30%irninhmurn) (no Ilim,it) (2 01%,irn a,x i m u im) RehOUsing Limit/Minimurni 1. The Housing Authority will ensure it continues to meet all Housing Asset Fund expenditure requirements, throughout this five-year compliance period of July 1, 2019 through June 30, 2024 and future five-year compliance periods. In the previous five-year compliance period (July 1, 2014 to J�une 30, 20191), the Housing Successor complied with the limits on administrative expenditures, homeless prevention or rapid rehousing expenditures, and expenditures on projects with units restricted to 60% to 80% of AMI. However, the Housing Successor was not in compliance with the limits on project expenditures restricted to extremely- low income households (those in the 30% of AMI range). As was reported last year, the Housing Successor spent $632,723 (27%) on projects with units at or below 30% of AMI in the previous five-year compliance period, which was 27% of total expenditures during the compliance period. This was below the 30% minimum expenditure requirement, meaning the Housing Successor was out of compliance with the provision. Failure to comply with the extremely low income requirement in any�five-year compliance period results in the Housing Authority now having to ensure that 50 percent of remaining funds will be spent on Chula Vista Housing Successor Annual Report 2019-�20 12 2021-03-16 Agenda Packet Page 84 of 724 1. extremely low income rental units until the Housing Authority demonstrates it is in compliance again. Since no funds were spent on housing units in the past year, the Housing Authority remains out of compliance and must continue to tra6k each future fiscal year expenditure against this reporting period until this threshold is met. Senior Rental Housing Limit Compliance Pursuant to HSC Section 34,17'6 (b), a maximum of 50% of deed-restricted rental housing units assisted by the former Agency, Housing Authority, or City in the previous '10 years may be restricted to seniors. The Housing Authority does not comply with the limit since 53,% of the total aggregate number of rental units produced within the preceding ten years were restricted to seniors. The Housing Authority, City, and former Agency assisted 77'2 deed-restricted rental units in the last ten years, 4091 of which are restricted to seniors, as shown in Table 3. Table I Deed-Restricted UnIits Assisted in Last 10, Years Yeair Sein'ior (yo Nori,-Sein'ior (yo Tota���� U�iri��Is U n It,s U n It,s 2009-10 0 0% 6 100% 6 2010-11 0 0% 162 100% 162 2011-12 0 0% 0 0% 0 2012-13 0 0% 0 0% 0 2013-14 99 '76% 31 24% 130 2014-15 184 97% 6 3% 190 2015-16 0 0% 1 100% 1 2016-17 126 59% 86 41% 212 2017-18 0 0% 71 100% 71 2018-19 0 0% 0 0% 0 12019-20 0 0% 0 0% 1 0 Total Deed-Restricted Senior Units: 409 363 772 Total Deed-Restricted Senior Units: 53.0% Source-City of Chula Vista Because the Housing Authority is out of compliance by 3�%7 it is prohibited from spending any further Housing Asset Fund monies on assisting or developing senior housing units until compliance has been reached. This would �require at least another 46 non-senior units to be assisted before reaching compliance. The Housing Authority will ensure that no further funds are spent on senior housing units until then. Chula Vista Housing Successor Annual Report 2019-120 13 2021-03-16 Agenda Packet Page 85 of 724 Excess Su�rplu�s The Housing Asset Fund may not accumulate an 99 excess surplus or an unencumbered amount that exceeds the greater of $1 million, or the sum of deposits in the prior four fiscal years. This requirement ensures that housing successors are actively spending available Housing Asset Funds on affordable housing. The Housing Authority has an excess surplus in the amount of$238,229, as of FY 20,191-20, as shown in Table 4 below. This is the first year that the Housing Successor has calculated a surplus since dissolution began in February 1 7 20,12. There was also an increase in expense appropriations from the available Housing Asset Fund balance ($408,184)to refund an overpayment from the South Bay Community Villas project. Table 4-Deed-Restricted Units Assisted in Last 10, Years Fiscal Year 2015-116 2016-117 2017-18 2018,49 Tota�l�1411,Year De�posits Deposits, $ 1,644,788 $ 1,180,9�72 $ 4,582,310 $ 2,503,208 $ 9,911,278 FY 2019�-20 Beginning Cash Balance $ 10,553,691 Less: Encumbered Funds, $ - Less:Amount refunded due to Overpayment $ (404,184) Unencumbered Amount $ 10,149,507 Step 11 $1 Million, or $ 1,1000,000 Last 4 Deposits $ 9,,911,278 Result: Larger Number $ 9,,911,278 Step 2 Unencumbered Cash Balance $ 10,149,507 Larger Number From Step 1 $ 9,911,278 Excess,Surplus $ 2385229 Source.*City of Chula Vista The Housing Successor will continue monitoring its deposits and fund balance and seek to expend at least $238,,229 on eligible projects or programs as soon as practicable, in order to correct and avoid accumulating an excess surplus in the future. 'The excess surplus must be expended or encumbered within three fiscal years and, if the Housing Successor fails to comply, it must transfer any excess surplus to HCD within 910 days of the end of the third fiscal year. To note, on November 30, 2020, the Housing Authority expended $316,9199, for the Anita Street project loan, which eliminated the excess surplus for FY 2019-20. This will be described in greater detail in the FY 2020-21 report. Chula Vista Housing Successor Annual Report 2019-�20 14 2021-03-16 Agenda Packet Page 86 of 724 I KAVAVI Homeownership Unit Inventory Table 5 presents an inventory of homeownership units assisted by the Housing Authority that require restrictions, covenants, or an adopted program that protects Housing Asset Fund monies. Table 5-Homeownership Uniit Inventory in Housing Asset Fund i-Project Narne/Address No�te Date �hn�te�i�-est Status CHIP Loans 73,8 Anita Street 6/3/1988 0% �Deferment 3998 Main Street 1/23,/1992 3% �Deferment 113,Oaklawn Avenue 7/27'/1987' 0% �Deferment 113,Oaklawn Avenue 11/4/1988 0% �Deferment 57'Suzanne Lane 9/25/1990 0% �Deferment 1043 Oleander Street 2/28/1992 5% �Deferment 501 Anita Street 8/23/2001 3% �Deferment 1556 Citrus Way 3/12/1987' 0% �Deferment 186 Tremont �4/22/1987' 0% �Deferment 1195 Monserate Ave 9/30/1987' 0% �Deferment 94 1 Street 9/12/2007' 0% �Deferment 204 Second Ave. 5/11/1979 0% �Deferment 891 Jefferson 12/12/2003, 3% �Deferment Total Units 13 Source.-City of Chula Vista Transfers to Other Housling Successors, There were no transfers to another housing successor entity for a joint project pursuant to HSC Section 34176.1(c)(2). Chula Vista Housing Successor Annual Report 2019-l20 15 2021-03-16 Agenda Packet Page 87 of 724 �11 1 will "Ma wil, =b dh 0 MCI M I The Housing Asset Transfer Form is attached as a separate document. Chula Vista Housing Successor Annual Report 2019-�20 15 2021-03-16 Agenda Packet Page 88 of 724 Housing Asset Total amount deposited in the Housing Asset Fund for the fiscal year. Fund Revenues & Amount of deposits funded by a Recognized Obligation Payment Schedule ("ROPS"). Expenditures Statement of balance at the close of the fiscal year. Description of Expenditures for the fiscal year, broken out as follows: Homeless prevention and rapid rehousing Administrative and monitoring Housing development expenses by income level assisted Description of any transfers to another housing successor for a joint project. Other Assets Description of any project(s)funded through the ROPS. and Active Projects Update on property disposition efforts (note that housing successors may only hold property for up to five years unless it is already developed with affordable housing). Other 66 portfolio" balances, including: • Statutory value of any real property either transferred from the former Agency or purchased by the Housing Asset Fund • Value of loans and grants receivable Inventory of homeownership units assisted by the former Agency or the Housing Successor that are subject to covenants or restrictions or to an adopted program that protects the former Agency's investment of monies from the Low and Moderate Income Housing Fund. Obligations & Description of any outstanding production obligations of the former Agency that were Proportionality inherited by the Housing Authority. Compliance with proportionality requirements (income group targets), which must be upheld on a five-year cycle. Percentage of deed-restricted rental housing restricted to seniors and assisted by the former Agency, the Housing Authority, or the City within the past ten years compared to the total number of units assisted by any of those three agencies. Amount of any excess surplus, and, if any, the plan for eliminating it. Chula Vista Housing Successor Annual Report 2019-�20 16 2021-03-16 Agenda Packet Page 89 of 724 APPENDIX .13 HOUSINGASSET �FUND EXPENDITURE .................................... Administration $220�400 Administrative activities such as: and Covn�pflance in ax u for 9 Professional services (consultant fees, auditor fees, etc.) Monitoring FY 2019-20 0 Staff salaries, benefits, and overhead for time spent on Housing (limit varies Successor administration Measured each year) 9 Compliance monitoring to ensure compliance with affordable Annually housing and loan agreements 0 Property maintenance at Housing Successor-owned properties Capped at $200�,00�O adjusted annually for inflation or 5% of the statutory value of real property owned by the Housing Successor and the value of loans and grants receivable from the HAT ("Portfolio:"), whichever is greater. Homeless $250�000 Services for individuals and families who are homeless or would be MR Prevention and per homeless but for this assistance, including: Ra�pid fiscalyear 9 Contributions toward the construction of local or regional Rehousing homeless shelters Solutions 0 Housing relocation and stabilization services including housing search, mediation, or outreach to property owners Measured 9 Sho:rt-:term or medium-:term rental assistance Annually 0 Security or utility deposits 0 Utility payments 9 Moving cost assistance 9 Credit repair 9 Case management 0 Other appropriate activities for homelessness prevention and rapid rehousing of persons who have become homeless. AffordaWe No spending "Development" includes: Housing limit, but must 9 New construction Develqprnent comply with 0 Acquisition and rehabilitation income and 0 Substantial rehabilitation age targets 0 Acquisition of long-term affordability covenants on multifamily units 9 Preservation of at-risk units whose affordable rent restrictions would otherwise expire over the next five years A& dr MP Z No11111111111111111111111111111 lt���icon��ie Every five years (currently FYs 2020-2024), Housing Asset Funds Tai rg e ts must meet income targets: Fixed Five- At least 3,0% on extremely low income rental households (up to Year 30% AMI or"Area Median Income") Cornpliance No more than 20% on low income households (60-80% AMI) Period (currently Moderate and above moderate income households may not be 2019-2,0 t�o assisted (above 80% AMI). 2023-24) Failure to comply with the extremely low income requirement in any five-year compliance period will result in having to ensure that 50 percent of remaining funds be spent on extremely low income rental units until in compliance. Exceeding the expenditure limit for low households earning between 60-8,0%, AMI in any five-year reporting period will result in not being able to expend any funds on these income categories until in compliance. Age Targ,,et si For the prior ten years (resets every year), a maximum of 50% of deed-restricted rental housing units assisted by the Housing Rolling Ten- Successor or its host jurisdiction may be restricted to seniors. Year Period (lo�oks back at If a housing successor fails to comply, Housing Asset Funds may not prior ten be spent on deed-restricted rental housing restricted to seniors until years), in compliance. I J�yjaol�sfg Ho �ufessor Annual Report 2019-�20 US19h ac et Page 9 6�724 Agen C I C1TY' C,0UNC'1L A,GEN' DA S,TIA, "nEMENT CITY, OF ..................................... CHUIAVISTA March 16, 2021 File,ID: 2021-0017 'TITLE RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA ORDERING THE SUMMARY VACATION OF AN IRREVOCABLE OFFER OF DEDICATION FOR OPEN SPACE AND OTHER PUBLIC PURPOSES, OF A PORTION OF LOT "A" PER FINAL MAP NO. 16325, CHULA VISTA TRACT NO. 12-05, OTAY RANCH VILLAGE 2 SOUTH PORTION OF NEIGHBORHOOD R-2113 RECOMMENDED ACTION Council adopt the resolution. SUMMARY This action will vacate a portion of the existing Irrevocable Offer of Dedication (IOD) of Lot"A" of Final Map 16325 so that Baldwin&Sons (the"Developer"') can complete a Lot Line Adjustment(L,LA) to accommodate a small park site, known as Pater'na Park, outside the constraints of the existing lot lines. This park will be maintained by the Homeowner Association. In accordance with Section 7050 of the California Government Code and Chapter 4, Section 8335 of the California Streets and Highways Code,this type o�f'vacation may be performed through adoption of a resolution. ENVIRONMENTAL REVIEW The Development Services Director has reviewed the proposed project for compliance with the California Environmental Quality Act(CEQA)and has determined that the project was adequately covered in previously certified Final Second Tier Environmental Impact Report, EIR 02-02 and Final Supplemental Environmental Impact Report, SEIR 12-01 for the Otay Ranch Village Two Sectional Planning Area (,SPA) Plan. Thus, no further environmental review or documentation is required. BOARD/COMMISSION/COMMITTEE RECOMMENDATION Not applicable. DISCUSSION An IOD for open space and other public purposes was offered by the Developer with Map No. 16325 for Lot A. Due to previous grading of the site,slopes along the South side of Paterna make it difficult to accommodate a small park site within the constraints of the existing lot lines. 1111. 0 0 1 PIi3ge 1 2021-03-16 Agenda Packet Page 92 of 724 With this proposed action,the City will vacate,a portion of the existing IOD recorded with Final Map 16325 in November 21, 2018 for LotA,and in accordance with Section 7050 of the California Government Code and Chapter 4,Section 8335 of the California Streets and Highways Code,this type of vacation maybe performed through adoption of a resolution of vacation by the City Council and recordation of a certified copy of the resolution attested to by the City Clerk. DECISION-MAKER C"ONFLIC'Ir Staff has reviewed the property holdings of the City Council members and has found no property holdings within 1,000 feet of the boundaries of the property which is the subject of this action.Consequently,this item does not present a disqualifying real property-related financial conflict of interest under California Code of Regulations Title 2, section 18702.2(a)(7) or (8), for purposes of the Political Reform Act (Cal. Gov't Code §87100,etseq.). Staff is not independently aware and has not been informed by any City Council member, of any other fact that may constitute a basis for a decision-maker conflict of interest in this matter. CURRENT-YEAR FISCAL IMPACT All costs associated with processing the summary vacation is borne by the Developer, resulting in no net fiscal impact to the General Fund or the Development Services Fund. ONGOING FISCAL IMPACT There is no ongoing fiscal impact associated with the abandonment of the 101). XYTACHMENTS Attachment 1: Vicinity Map Attachment 2: Proposed Lot Line Adjustment Attachment 3: New IOD for Open Space Lot Staff Contact:Boushra Salem,Principal Civil Engineer,Development Services Department P �3ge 2 2021-03-16 Agenda Packet Page 93 of 724 erl I 112 51m Mill, jr, fi) NO, OB U1111111=11 R c,"1111j]IIIIII y J�w ellIll, ji r 1,9� v Imm 00 Milli C H U,,L, ,/ Aj I V "T �M 5", M6 11 ji % % L Will, R Vr C��I,,,elNftjll'1j)):, 'TYIIIIII //M�, ji IJ iiiiiiiiiiiiiiiiiiiiiillillilinillillillillillillilI I loll ,,, r rG'1I sG LE 2021-03-16 Agenda Packet Page 94 of 724 ............ �CITY OF CHULA VISTA DEVELOPMENT SERVICES DEPARTMENT ENGINEERING & CAPITAL PROJECTS DEPAR MENTI .0 ADJUSTMENT PLAT �NO. LA2 0. 0 LEGAL DESCRIPTION SHEE T I OF 3 A LOT LINE ADJUSTMENT OF LOTS A AND D OF CHULA VISTA TRACT NO. 12-05 OF OTAY RANCH' VILLAGE 2 SOUTH PORTION OF NEIGHBORHOOD, R-21B, ACCORDING TO MAP THEREOF NO. 16325, FILED IN THE OMlCE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY FEBRUARY 1 lo 2019 AND LOTS A AND C OF CHULA VISTA TRACT NOS 12-05 & PCS 16-0006 OTAY RANCH VILLAGE 2 SOUTH NEIGHBORHOODS R-18A(c), R-21A AND PORTIONS' OF R-198, R-20 AND R-21B ACCORDING TO MAP THEREOF NO. 162o3, FILED IN THE OMCE OF SAID COUNTY RECORDER JULY 24, 2017� ALL IN THE CITY OF CHULA VISTA, COUN7Y OF SAN DIEGO, STATE OF CALIFORNIA. LEGEND 125, INDICATES EXISTING' LOT LINE m INDICATES NEW LOT LINE N\� INDICATES RECORD, DA TA PER MAP 16203 Y\ P08 INDICATES POINT OF 13EGINNING EGR�i CITY EXISTINGIPROPOSED LAND USE.--, P� Osl OF ss"c < 0 P, 0 EXISPNGIPROPOSED ZONING ,Wool, APNS CHULA 644—345—77 644-313-519, 644-313-87 644-344—�210 VISTA EXISTING AREAS PROPOSED AREAS 0 'VI CINI T Y MA P LOT C MAP 16203- 0.4 781 ACRES PARCEL A: 0.809 ACRES S7. LOT A MAP 16325: 14,0219, ACRES PARCEL 8: 13,813 ACRES NOT TO SCALE LOT D MAP 16J2- 5- 0.0681 ACRES PARCEL C: 0.052 ACRES LOT A MAP 1 Q203.- Q.4 73' ACRES EAKEL Q" TOTAL EXISTING: 15.0481 ACRES TOTAL PROPOSED. 15.:048 ACRES HUNSAKER ASSOCIATES SAN DI EGO, I NC. jA 0 71Z 71- e 0 0 0 9707 Waples Street (858)558-4500 DOUGLAS B. 9�OUP San Diego,CA 92121 L.S. t553 60F, PREPAREO Hy DOUGLAS' 81. STROUP ADDRESS 9707 WAPL,ES STREET, SW DIEGO, CA 92121 i-y 0 P14ONE No. 58) 558-415010 01 c'. (16 -10 P.E. OR L.S. NO. L.-S. -b553 �iL,.S. 8553 OWNER SR V2 R2 Ills LLCoi A, MMM/A UAKED UMUff COMPANY ADDRESS 20 CORPORATE PLAZA DR, NEWPORT BEACH, CA 92660 CA\.,�' PHONE No. -.��49) 640-8300 WO# ER-477 SIGNATURE SR V2 R21B, LLC,, LIA41TED LIABILITY COMPANY R2 1B, L L C, ORNIA k-AND 00 13 B Y.- NICHOLAS LEE l(V TITLE." AU''THORIZED AGENT GREGORY E. TSCHERCH- APPROVAL., ENOIT It.R-�N it DEVEL. T SERVICES DEPARTMENT CAPITAL PROJECTS DEPARTMENT �No. L8814 By'. BY.- olz CA\-% DA DA TE." R:\,0649VM"ALW W*g4*9 S"l �LLA a SHT 0l.d,wgL1Jul-29-2020.-15:0,1' W.O. 2807-0125 Page 95 o �CITY OF CHULA VISTA D�EVELOPIVIENT SERVICES DEPARTMENT ENGIN�EERING & CAPITAL PROJECTS DEPAR MENT ADJUSTMENT PLAT' �NO. LA20-0003 ............- SHEET 2 OF 3 INDICATES EXISTING' LOT LINE TO BE ADJUSTED INDICATES NEW LOTLINE N NJy ic INDICATES EXISTING' LANDFILL NUISANCE E4SEMENT TO OTAY LANDFILL RECORDED PARCEL A MARCH 17, 19917 AS INST. NO. 1997-0118911211911? O.R. LOT C PARCEL C ]\/]-A/ P 16203 L OT D INDICATES EXISTING' M.//-\P 16 3 2 5 IRREVOCABLE OFFER' OF DEDICATION OF FEE' INTEREST OVER LOT A PER MAP 16203 PARCEL D INDICATES PRIVATE' OPEN LOT A SPACE AS SHOWN ON MAP 16325 j\/1 A P 16203 AN EXISTING E4SEMENT FOR UNDERGROUND FACILITIES AND APPURTENANCES FOR THE TRANSMISSION AND DISTRIBUTION OF ELECTRICIT)� (o PIPELINES AND INCIDENTAL, PURPOSES TO SAN DIEGO GAS & ELECTRIC, COMPANY RECORDED JULY 15, 2016 AS INST. NO. 2',0116-0355258, O.R. (THE LOCATION OF THE EASEMENT CANNOT BE DETERMINED FROM RECORD INFORMATION) B c Jr Nr B MAP 16 1 12 0 300 600 900 A SCALE 111 �=�,300' A/ .p 16 116 D <� R:\064 &mlop\LLA Patema EX V21 SOUTH LLA Patema SHT 02.dwg[]Jul-29-2020 W.O. 2807-0125 W 2 QZELL-2 17 7 CITY OF CHULA VISTA DEVELOPMENT SERVICES DEPARTMENT ENGINEERING & CAPITAL PROJECTS DEPAR MENT ADJUSTMENT PLAT NO., 20-0003 SHEET 3 OF 3 LINE TABLE LA # BEARING DISTANCE Ll N58'047'06"W 33,55' L2 N25032'06"W 56,70' c L3 N28058'35"W 38,091 L4 N 1 7'026'03"W 46,75' uo- L5 N29'03 1'59"W 6B,33' lb) N28*14'5 7"E 51.431 Q \—�dl/ Ap/ < %% N I'vi L OT A/ F 16 3 2 5 EXISTING LOT LINE TO BE ADJUSTED P 2 '1391 f 00 cl, m CF) 2 2 9' NEW LOT LINE 9 CD CD C� C) % PAPvCEL C POB- L D SW COR LOT C J\11,rl-\P 1 6325 % % PARCEL B % F 1 6325 c PARCEL D L 0-� jz� ]\/]A/ P 16203 HUNSAKER dl &ASSOCIATES 0 80 160 240 SAN DIEGO, INCd I i i 9707 Waples Street (858)558-4500 SCALE 1 if 801 San Diego,CA 92121 R.-\0649\&Map\LLA Patemc\EX V2 SOUTH LLA Patema SHT 03.dwg[]Jul-29-2020:15:02 W.O. 2807-0125 WO# ER-477 RESOLUTION NO. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA ORDERING THE SUMMARY VACATION OF AN IRREVOCABLE OFFER OF DEDICATION FOR OPEN SPACE AND OTHER PUBLIC PURPOSES OF A PORTION OF' LOT "'A" PER FINAL MAP NO. 16325, CHULA VISTA TRACT NO. 12-05, OTAY RANCH VILLAGE 2 SOUTH PORTION OF NEIGHBORHOOD R-2 I B WHEREAS,, an Irrevocable Offer of Dedication (101)) in Fee Interest of Lot "A" was acknowledged by the City of Chula Vista for Open Space and Other Public Purposes as shown on Final Map No. 16325, filed in the Office of the County Recorder of San Diego County on November 21, 2018; and WHEREAS, this action will vacate a portion of said existing IOD as described in Exhibits A and B attached hereto and made a part hereof-, and WHEREAS, with the proposed vacation, the developer can complete a Lot Line Adjustment (LLA) to accommodate a small park site outside the constraints of the existing lot lines; and WHEREASI in accordance with Section 7050 of the California Government Code and Chapter 4, Section 8335 of the California Streets and Highways Code, this type of vacation may be performed through adoption of a resolution of vacation by the City Council and recordation of a certified copy of the resolution attested to by the City Clerk. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula Vista hereby orders the vacation of a portion of Irrevocable Offer of Dedication for open space and other public purposes of Lot A, according to map thereof No. 16325, incorporated herein by reference as if set forth in full. BE IT FURTHER RESOLVED that the City Council of the City of Chula Vista hereby directs the City Clerk to cause a certified copy of the resolution of vacation, attested by the Clerk, without acknowledgement or further proof, to be recorded in the Office of the County Recorder of San Diego County. From and after the date this, resolution is recorded, the vacation is complete. Presented by: Approved as to form by: Tiffany Allen Glen R. Googins Director of Development Services City Attorney 2021-03-16 Agenda Packet Page 98 of 724 EXHIBIT "A33 LEGAL DESCRIPTION VACATING PORTION OF THAT CERTAIN IRREVOCABLE OFFER OF DEDICATION OF FEE INTEREST FOR OPEN SPACE AND OTHER PUBLIC PURPOSES TO THE CITY OF CHULA VISTA OFFERED AND REJECTED PER CHULA VISTA TRACT NO. 12-05 OTAY RANCH VILLAGE 2 SOUTH PORTION OF NEIGHBORHOOD R-21 133 IN THE CITY OF CHULA VISTA, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 16325, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY FEBRUARY 11 7 2019, LYING WITHIN LOT A OF SAID MAP, BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHWEST CORNER OF LOT C OF CHULA VISTA TRACT NOS 12- 05 & PCS 16-00,06 OTAY RANCH VILLAGE 2 SOUTH NEIGHBORHOODS R-18A(c), R-21A AND PORTIONS OF R-19B, R-20 AND R-21 B) IN THE CITY OF CHULA VISTA, COUNTY OF SAN �DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 16203, FILED IN THE OFFICE OFTHE COUNTY RECORDER OF SAN DIEGO COUNTY JULY 24�) 2017; THENCE ALONG THE SOUTHERLY AND EASTERLY LINES THEREOF NORTH 66020'00 77 EAST, 35.00 FEET (RECORD, N660201)00"E, 35.00' PER SAID MAP NO�. 16203) TO THE BEGINNING OF A NON-TANGENT 236.00 FOOT RADIUS CURVE CONCAVE EASTERLY, A RADIAL LINETO SAID POINT BEARS SOUTH 66020'001"WEST; THENCE NORTHERLY ALONG, THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 116025'02") A DISTANCE OF 479.52 FEETTO AN ANGLE POINT IN SAID LOT C, BEING ALSO THE MOST NORTHERLY CORNER OF SAID LOT A: THENCE LEAVING THE EASTERLY LINE OF SAID LOT C ALONG SAID NORTHEASTERLY LINE OF LOT A SOUTH 28014'57"WEST, 51.43 FEET; THENCE LEAVING SAID NORTHEASTERLY LINE NORTH 58047'06" WEST, 33.55 FEET; THENCE SOUTH 70,012'54"WEST, 95.53 FEET; THENCE SOUTH 35027'54"WEST, 138.95 FEET; THENCE SOUTH 07012'54"WEST 110.82 FEET; THENCE SOUTH 25032'06" EAST, 4�7.17 FEET TO A POINT IN THE NORTHWESTERLY LINE OF SAID LOT A; THENCE ALONG, SAID NORTHWESTERLY LINE SOUTH 66020'00"WEST, 1�1.29 FEET TO THE POINT OF BEGINNING. 2021-03-16 Agenda Packet Page 99 of 724 THE HEREINABOVE DESCRIBED PARCEL OF LAND CONTAINS 9,421' SQUARE FEET, MORE, OR LESS. I.A R;P A DOUGL SLd,. STR-dv" S. 8:553 L.S. 8553 U kP HUNSAKER &AS VOCIATES SAN DIEGO, INC. OF CA\-- PAGE 1 OF 1" MA2807\1 25\Legal Descriptions\A05 LLA Paterna QC Lot A Map 16325.docx EXHIBIT "B 0 N28014'57"E 51.43' 1001 C3 LOT A LEGEND MA P PORPON OF THAT CERTAIN 6 3 251 IRREVOCABLE OFFER OF DEDICATION OF FEE INTEREST FOR OPEN SPACE ro AND OTHER PUBLIC PURPOSES IN LOT A OFFERED AND REJECTED PER MAP IRREVOCABLE OFFER NO. 16325, QUITCLAIMED HEREON. OF DEDICATION OF FEE ARE4 = 90 421 SQI.FT INTEREST FOR OPEN CN -z SPACE AND OTHER POC POINT OF COMMENCEMENT 0) PU13LIC PURPOSES IN 0 v-- a QL14 mi-, IN LOT A, OFFERED AND 7P0j9 TRUE POINT OF BEGINNING REJECTED PER MAP NO. 16325. (R) RADIAL BE4RING 291 29 RECORD DATA PIER MAP NO, 16203. LA LA LP Cn 0 CD T D CD Q LO AP 16325 LINE TABLE i BEARING DISTANCE L 1 N58*47'0I6"W 33.550 10-000' L2 N25032'06"W 4 7.170, L3 N66020'00"E 110 N-A 0 80 160 240 SCALE lll# =80�' '00, N, 0 L.S. 8553 'A HUNS!AKER jlq�% &ASSOCIATES s- STR" or CA0� SAN DIEGO, INC. DOOGLA S. 81 5 53 9707 Waples Street (858)558-4500 San Diego,CA 92121 R,-\0649\&Map\LLA Patema\EX V2 SOUTH LLA Paterna QIC Lo,t A Map 16325.dwg[]Apr-08-2020 W.O. 2807-0125 1 ia I , 0mulauct.1 -rage T u 3 C1TY' C,0UNC'1L A,GEN' DA S,TIA, "nEMENT CITY, OF ..................................... CHUIAVISTA March 16, 2021 File,ID: 20-0022 TITLE RESOLUTION OF THE CITY COUNCIL OF'THE CITY OF CHULA VISTA APPROVING THE AMENDED MEASURE A PUBLIC SAFETY EXPENDITURE PLAN TO ADD ONE OPERATIONS SUPPORT CAPTAIN AND THREE FIRE,FIGHTER/EMT POSITIONS TO, ENGINE 59 TO THE AUTHORIZED STAFFING OF' THE FIRE, DEPARTMENT IN FISCAL,YEAR 2020/2021 AND AMEND THE FISCAL YEAR 2021 EXPENDITURE BUDGET FOR THE MEASURE A SALES TAX FUND TO FUND SUCH POSITIONS OUT OF MEASURE A - FIRE DEPARTMENT AVAILABLE FUND BALANCE (4/5 VOTE REQUIRED) RECOMMENDED ACTION Council adopt the resolution. SUMMARY The Fire Department is proposing to amend the Measure A Public Safety Expenditure Plan to add one (1) Operations Support Captain and three (3) Firefighter/EMT positions. ENVIRONMENTAL REVIEW The activity is not a "Project)) as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 1,5060(c)(3) no environmental review is required. BOARD/COMMISSION/COMMITTEE RECOMMENDATION During the February 11, 2,021 meeting, these items were unanimously recommended for City Council approval by the Measure A Citizen"s Oversight Committee (COC). DISCUSSION With the successful passage of the Measure A Sales Tax, staff is moving forward with implementation of the Public Safety Expenditure Plan (PSEP). The Fire Department is requesting to approve modifications to the PSEP to meet ongoing or emerging staffing needs. In order to be considered critical need,recommendations must produce immediate threshold improvements to concentration and reliability of resources on the west side of the city,and/or produce immediate threshold improvements to distribution resources in the east, or be a requirement to support critical need 1111. 0 0 1 P �3ge 11 2021-03-16 Agenda Packet Page 102 of 724, improvements. Those critical needs are showing in the amended Measure A Proposed Expenditure Plan below., The responsibility of the Fire Department is to review response information data and the appropriate application of Measure A sales tax revenues that will ensure the best return on investment in terms of staffing improvements for improved deployment of Fire Department resources. Fire Captain-Operations Support The Operations Support Captain position will be assigned the Deputy Chief'of'Ope,rations with the intent to provide support to a wide range of activities,as well as provide effective and timely execution of such activities and support.These activities include: 0 Staffing Support-This includes monitoring daily staffing with the intent of coordinating inter- division staffing needs. Operations personnel are commonly used to support activities in Fire Administration,EMS,, EOC,Training,Support Services, and Mutual Aid. This often leads to staffing hardships if not coordinated from a continuity perspective. This requires this to be done from a typical 40-,hour workweek schedule opposed to from a shift work schedule. 0 Injuries -This includes tracking and reporting of injury leave between operations and administration.They will also act as a liaison and personnel advocate with HR and Risk Management.Workplace injuries are closely reviewed to determine how the injury occurred and how the injury could have been potentially avoided.After review of injury occurrence,the Operations Support Captain will provide corrective action and training as deemed necessary. 0 Fleet Support-This includes fleet monitoring of apparatus availability. It is critical for daily operations to have frontline and reserve apparatus available for service. This requires consistent collaboration with Public Works Fleet Manager and Shops Staff. Currently these duties are accomplished by on duty Battalion Chiefs and the shift work schedule has proven inadequate. 0 Bulletin/Policy/Guideline Management&Revision-Fire Department Operations rely on current and accurate doctrine to ensure effectiveness. There are three types of doctrine guide operations and they include: • Bulletins-These are a form of guidance that are composed as an immediate update to personnel to address an emerging issue or need. These are intended to be quickly distributed,and then rescinded if the need no longer exists; or converted and memorialized into Policy or Standard Operating Guideline. • Policy-These are used to provide guidance on actions or activities by the Fire Department in order to achieve our goals.With a growing Fire Department and City,.being current on policies and being able to effectively communicate that to staff is essential to complete our departments mission. • Standard Operating Guidelines -These are the most commonly used documents that provide guidance on actions or activities by the Fire Department for emergency operations. Typically, emergency response requires flexibility in mitigating an incident safety and effectively. • Manual Maintenance and Storage-A key aspect of meeting various standards is having the most up to date manuals and supplies readily available.The Operations Support Caption will ensure most updated educational materials are located in central areas and training is complete and up to date and provide thorough fo�llow up and re-certifications as needed. Deployments, Mutual Aid&Other Agency Assistance-The Fire Department has several agreements and ob�ligations with other agencies for mutual aid and dep�loyments.These agreements are very complex and diverse in their nature and require detailed maintenance and tracking in order to ensure we are meeting contract ob�ligations,remain in full qualification on contracts, and are P �3ge 2 2021-03-16 Agenda Packet Page 103 of 724, tracking such deployments,and mutual aids for proper cost recovery.'The Operations Support Captain will also assist Admin staff with the reimbursement process to ensure all deployments/aids are completely accounted for and revenues are received properly., • Qualifications-Will be responsible for all personnel qualifications for dep�loyment pr�ograms,including US&R and Wildland programs.Will be responsible for keeping details of team member assignments and ensuring all team members are properly accounted for and up to date on necessary trainings and qualifications to meet deployment/aid needs as they arise. • RTF&TEMS Programs -Will be responsible for management,upkeep and testing of PPE. Will also manage program rosters and be responsible for deployment management. Deployment management will be in conjunction with Operations and Admin for proper tracking and cost recovery as appropriate by the program. • OES T1 &T3 Obligations-Will be responsible for service contracts for OES obligations.Will also be responsible for continuous equipment maintenance to ensure obligations can be met as they arise. 0 Radio Communications-Includes management of both internal and external communications. Duties will include planning and coordinating with County,State and various Aid Agreement, ensuring communications internally as a department,as well as with PD and D�ispatch to ensure that we are operating effectively,have properly working equipment,and are up to date on mandates and software/hardware updates., In addition to the above activities, the Operations Support Captain will be assigned to the Deputy Chief of Operations and act on behalf of our fire operations staff and needs.'The Operations Support Captain will have the ability to undertake additional tasks as needed. With the rapid growth of our department, Measure A operational expansions and the upcoming launch of our Transport program,operational needs are exceeding the capacity of our current Support Services Captain.A dedicated Operations Support Captain will best serve our operations division to meet goals,support our mission and aid in effectively meeting response times. Fi,,,r,,e,,fi,,gh,,t,,e,,,r,,,/,,,EM'T The addition of 4.0 staffing on Engine 59 is the final addition in our expenditure plan for our current fire stations. Previously, Station 9 was not equipped to be able to house a 4thperson on the engine. With the completion o�f'new Station 9, estimated to be complete May 2021, the station will now be able to house the 4thperson on the engine.This is consistent with and completes the 8threcommendation as presented to the COC on May 16, 2019. This will complete our 4.0 staffing series on current stations to be able to reach our goal to meet emergency operations response times standards. Figure 2.Proposed Fire Department Expenditure Plan as of 1.26.2021 FY19 FY20 FY21 FY22 FY23 FY24 TOTAL Fire Captain 2 2 (4) 1 1 F i�ref ighite r Para me d i c 2 2 (4) 1 1 Firefighter/EMT 12 3 9 3 3 30 Fire Captain/PlO 1 1 Fire Captain-Operations Support 1 1 Deputy Chief 2 (1) 1 Sworn FTE 19 7 1 3 0 5 35 DECISION-MAKER CONFLICT Staff has reviewed the property holdings of the City Council members and has found no property holding S within 1,00�O feet of the boundaries of the property which is the subject of this action.Consequently,this item P �3ge 13 2021-03-16 Agenda Packet Page 104 of 724, does not present a disqualifying real property-related financial conflict of interest under California Code of Regulations Title 2, section 18702.2(a)(7) or (8), for purposes of the Political Reform Act (Cal. Gov't Code §87100,et seq.),. Staff is not independently aware and has not been informed by any City Council member, of any other fact that may constitute a basis for a decision-maker conflict of interest in this matter. CURRENT-YEAR FISCAL IMPACT The Fire Department will start a new Fire Academy in April 2021, which will last until September 2021. Current fiscal year Measure A savings will be used to fund the FY21 Measure A portion of the academy.'Thi,s includes the labor costs of the Fire Recruits and all related supplies&services costs. Upon completion from the Fire Academy all Fire Recruits will become Firefighters by September 2021. The labor expenses for the 3.0 new Firefighters will be incurred in the Measure A Fire Operations upon graduation.The personnel costs for these 3 new Fir�efighter/EMT's are reflected in the updated Measure A Public Safety Expenditure Plan attached starting FY22 moving forward. The Operations Support Captain is estimated to begin late April 2 0 2 1.The current fiscal year salary costs are reflected below,as well as the cost for a fully outfitted Chevy Tahoe needed for this position. The Fire Department recognizes that current community demands, safety strategies,and staffing needs will likely change in the future.The Fire Department also recognizes that revenues and expenses used to calculate current allocation plans may change in the future. PSEP recommendations for future years will continue to be reevaluated,balanced against changes in revenue or expenditure projections, and considered along with changing public safety trends and community needs. As a result, this Public Safety Expenditure Plan is intended to be a"living document". Future recommendations may change. ONGOING FISCAL IMPAC oil The long-,term spending plan reflects the use of available funds through FY 31. City staff believe, that the projected sales tax revenues are conservative. It is important to note that Measure A projected sales tax revenues fluctuate with the economy. The City will actively monitor the trends to determine if Measure A positions need to, be held vacant in order to avoid,long-term structural deficits and avoid layoffs or service level impacts. The chart on the following page shows the amended Measure,A PSEP for the Fire Department,which includes the addition of 10 Firefighters and 1.0 Operations Support Captain. ATTACI IMENTS Amended Measure A Public Safety Expenditure Plan (ED) Staff Contact:Harry Muns,Fire Chief and Emily Folker,Senior Management Analyst P �3ge 4 2021-03-16 Agenda Packet Page 105 of 724, RESOLUTION NO. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING THE AMENDED MEASURE A PUBLIC SAFETY EXPENDITURE PLAN TO ADD ONE OPERATIONS SUPPORT CAPTAIN AND THREE FIREFIGHTER/EMT POSITIONS TO ENGINE 59 TO THE AUTHORIZED STAFFING OF THE FIRE DEPARTMENT IN FISCAL YEAR 20�2O�/2021 AND AMEND THE FISCAL YEAR 2021 EXPENDITURE BUDGET FOR THE MEASURE A SALES TAX FUND TO FUND SUCH POSITIONS OUT OF MEASURE A — FIRE DEPARTMENT AVAILABLE FUND BALANCE (4/5 VOTE REQUIRED) WHEREAS, the Fire Department has identified emerging staffing needs necessary to continue response performance improvement; and WHEREAS, with the completion of the fire station at 100 Moss Street, Engine 59 can now accommodate 4.0 staffing which will complete the 8 th recommendation made to the Measure A Citizen's Oversight Committee("COC") on May 16, 2019 to improve response performance; and WHEREASI the Fire Department has identified emerging Operational Support needs necessary to improve operational effectiveness by adding a Fire Captain who reports to the Deputy Chief of Operations; and WHEREAS, on February 11, 2021, City staff presented to the Measure A Citizens Oversight Committee a proposed amendment to the Intended Expenditure Plan to add one (1) Operations Support Captain position and three (3) Firefighter/EMT positions to the authorized staffing of the Fire Department; and WHEREAS,the Measure A COC voted unanimously to recommend City Council approval of the four positions. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Chula Vista, that it approves the amended Measure A Public Safety Expenditure Plan, to add three Firefighter/EMT positions and one Operations Support Captain position to the authorized staffing of the Fire Department and amends the fiscal year 2021 expenditure budget for the Measure A Sales Tax Fund to fund such positions out of Measure A - Fire Department available fund balance. Presented by Approved as to form by Harry Muns Glen R. Googins Fire Chief City Attorney 2021-03-16 Agenda Packet Page 106 of 724, iii zal i ........... Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year Tota 1 2021 2022 2023 2024 2025 2026 2027 2028 2029 203,0 2031 Estimate Beginning Fire Department Funds Available $ 7,905,592 $ 10,929,126 $ 13,946,990 $ 15,043,903 $ 16,053,563 $ 16,320,465 $ 16,355,588 $ 16,134,674 $ 15,639,193 $ 14,849,158 $ 13,782,010 Estimated 1/2 cent Sales Tax Revenues $ 10,010,000 $ 11,388,509 $ 11,502,394 $ 11,617,418 $ 11,733,592 $ 11,850,928 $ 11,969,437 $ 12,089�,131 $ 12,210,023 $ 12,332,123 $ 12,455,444 $ 139,164,243 FEMA SAFER Grant Reimbursement $ 197,6,95 $ 306,857 $ 143,200 $ - $ - $ - $ - $ - $ - $ - $ - $ 756,915_ ts'Eimatea ruinas Avaiiiiiame Tor rire Department Spending Plain $ 18,113,288 $ 22,624,492 $ 25,592,584 $ 26,661,320 $ 27,787,155 $ 28,171,3,93 $ 28,325,025 $ 28,223,805 $ 27,849,216 $ 27,181,281 $ 26,237,454 $ 139,921,158 Proposed Expenditures DeputyChief* $ 556,319 $ 295,397 $ 305,737 $ 313,971 $ 322,436, $ 332,720 343,407 $ 354,515 $ 366,062 $ 378,069 $ 390,555 $ 3,959,187 Fire Captain 857,916 1,091,633 1,122,76,4 1,444,700 1,778,965 1,823,656 1,870,014 1,918,139 1,968,134 2,018,558 2,0�71,050 17,9165,528 Firefighter" 4,388,684 5,838,248 6,062,168 6�,959,433 7,194,705 7,466,782 7,754,725 8,059�,761 8,383,227 8,689,121 9,015,617 79,812,471 Fiirefighteir/Paramedic 465,732 564,827 483,605 739,215 1,004,398 1,023,553 1,043,090 1,063,018 1,083,344 1,104,077 1,125,225 9,700,084 Pub�lic Education Specialist - - - - - - - - - - - Academy Costs - - 530,532 - - - - - - - - 530,532 PPE Maintenance 133,904 131,868 124,080 159,152 167,580 163,3,28 166,144 168,960 171,776 174,592 177,408 1,738,792 Computers and other equipment/furniture 3,0,883 31,757 32,346 33,438 34,240 34,841 35,441 36,042 36,643 37,243 37,844 380,718 Fire Vehicles,Outfitting,Maint.,Fuel,etc. 375,349 296,702 1,456,111 522,196 524,356 526,516 528,676 530,836 532,996 535,156 537,316 6,366,207 Temporary Public Safety Training Facility - Actuial�s - - - - - - - - - - - Reimbursement for Support Staff(IT,Fin, H R,C ity Att o rn ey) 375,375 427,016�9 431,340 435,653 440,010 444,410 448,854 453,342 457,876 46�2,455 467,079 4,843,,46�2 Total Fire Department Proposed Expenditures $ 7,184,162 $ 8,677,501 $ 10,548,681 $ 10,607,758 $ 11,466,689 $ 11,815,805 $ 12,190,351 $ 12,584,612 $ 13,000,057 $ 13,399,271 $ 13,822,093 $ 125,296,980_ --------------------------------- End�ing Fire Department Available Funds 10,929,126 $ 13,9461.990 15,043,903 $ 16,053,563 16,320,465 $ 16,355,588 $ 160134,6�74 $ 15,639,193 $ 14,849,158 $ 13,782,010 $ 12,415,361 Notes on Ongoing Fiscal Impact: FTE- Full Time Equivalent Position Amounts budgeted in the Intended Public Safety Spending Plan may differ from the City's,Annual B,udge�t due to personnel c,os,ting estimates in the Annual Budget is based on individual employees projected salaries and benefits, and the Intended Public Safety Spending Plan are estimates that are based on positions. Actual expenditures per year,will vary based on actual activity and revenues. Reimbursement for Support Staff is based on 3.75%of Measure A Sales Tax revenues.. Fire Vehicles includes portion of Bayfront Fire Station not paid by new development. ***Sales Tax Revenue projections include a 1%escalator per year starting in Fiscal year 2022. FY21 totals reflect proposed changes outlined in current year fiscal impact 2021-03-16 Agenda Packet Page 107 of 724, CITY COUNCIL XNIPN A Now= AGENDA S 1AI EMENT CITY OF CHULAVISTA March 16,,2021 File ID: 21-0036 TI'TLE RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING A SECOND AMENDMENT TO 'THE AGREEMENT BETWEEN 'THE CITY OF CHULA VISTA AND CLEAN HARBORS ENVIRONMENTAL SERVICES, INC. FOR TURN-KEY HOUSEHOLD HAZARDOUS WASTE AND CONDITIONALLY EXEMPT SMALL QUANTITY GENERATOR WASTE MANAGEMENT SERVICES RECOMMENDED ACTION Council adopt the resolution. SUMMARY Per Resolution No. 2017-151, City Council approved an agreement with Clean Harbors Environmental Services, Incl. (Clean Harbors) on August 8, 2017 for Turn-Key Household Hazardous Waste and Conditionally Exempt Small Quantity Generator Waste Management Services. The agreement allowed for a two-year contract with five (5) one-year options to extend. Household Hazardous Waste (HHW) and Conditionally Exempt Small Quantity Generator (CESGQ) waste are accepted at the city I Household Hazardous Waste Facility on Wednesdays and Saturdays. Acceptable types of household hazardous waste include common toxic items such as paint, batteries, household cleaners, motor oil, pesticides, and pool chemicals. CESQG waste is a small amount of hazardous waste generated by a business. Environmental Services requested an increase last fiscal year due to rising participation rates at the Household Hazardous Waste Facility,just as the COVID-19 pandemic began,. However,participation rates at the facility have only continued to increase as a result of stay-at-home orders in response to the pandemic. Consequently, the maximum amount paid to the service provider is on track to exceed the contractual amount allowed per year prior to the conclusion of this fiscal year. Staff is requesting to increase the not-to- exceed annual contract amount from$3,50,0010 per year to$7010,000 per year for a new total not-to-exceed amount of$3,650,000 for the potential life of the contract (original two-year term plus 5 one-year options to extend). ENVIRONMEN'TAL REVIEW The Development Services Director has reviewed the proposed Project for compliance with the California Environmental Quality Act (CEQA) and has determined that the Project qualifies for a Categorical Exemption pursuant to State CEQA Guidelines Section 15308 Class 8 (Actions by Regulatory Agencies for 1,/ . 01 (,) l Page 1 2021-03-16 Agenda Packet Page 108 of 724, Protection of the Environment), Section 15330 Class 30 (Minor Actions to Prevent, Minimize, Stabilize, Mitigate or Eliminate the Release or Threat of Release of Hazardous Waste or Hazardous Substances), and Section 15�061(b)(3) because the proposed action will result in the implementation of options available to the public for conveniently and safely managing household wastes and thus reducing potential adverse impacts to the environment and human health.Thus,no further environmental review is required. BOARDXOMMISSION/COMMIT�I`EE RECOMMENDATION Not applicable. DISCUSSION Per Resolution No. 2017-151, City Council approved an agreement with Clean Harbors Environmental Services, Inc�. (Clean Harbors) on August 8, 2017 for Turn-Key Household Hazardous Waste and Conditionally Exempt Small Quantity Generator Waste Management Services. The agreement allowed for a two-year contract with five (5) one-year extensions. (Attachment 1 City of Chula Vista- Clean Harbors Environmental Services agreement) Household Hazardous Waste (HHW) and Conditionally Exempt Small Quantity Generator (CESGQ) waste are accepted at the city's Household Hazardous Waste Facility on Wednesdays and Saturdays. Acceptable types of household hazardous waste include common toxic items such as paint, batteries, household cleaners, motor oil, pesticides, and pool chemicals. CESQG waste is a small amount of hazardous waste generated by a business. The City of Chula Vista's HHW and CESQG program costs are paid for through fees collected on the solid waste rates and do not impact the General Fund. Costs are based on the actual number of Chula Vista residents and businesses participating in the program on a monthly basis. Environmental Services requested an increase last fiscal year due to rising participation rates, just as the COVID-19 pandemic began. However, due to continued stay-at-home orders put in place by the state in response to the pandemic, participation at the city's Household Hazardous Waste Facility has continued to increase.With more people staying at home cleaning out fzarages and storage sheds, participation rates are now averaging 900 to over 1,00�O vehicles per month. Participation has increased about 10�6%compared to this time last year - 596 vehicles were serviced at the facility in January 2020 compared to 1,226 vehicles in January 2021. (Attachment 2 -Increased participation rates graph) Due to these increased participation rates at the Household Hazardous Waste Facility, the maximum amount paid to the service provider is on track to exceed the contractual amount allowed per year prior to the conclusion of'this fiscal year. Environmental Services has adequate funds to cover household hazardous waste disposal costs through February 2021 and estimates that disposal costs may approach $170�,O�00 March 2021 through June 2021 if current participation rates remain. Staff is requesting to increase the not-to-exceed annual contract amount from $3,50,000 per year to $700,000 per year for a new total not-to-exceed amount of,$3,650,000 for the potential seven (7)year total contract term (original two-year term plus 5 one-year options to extend). Page 2 2021-03-16 Agenda Packet Page 109 of 724, DECISION-MAKER CONFLICT' Staff has reviewed the decision contemplated by this action and has determined that it is not site-specific and consequently,the real property holdinRs of the City Council members do not create a disqualifying real %_1 prop erty-related financial conflict of interest under Political Reform Act(Cal. Gov't Code§ 87100,et.seq,.) Staff is not independently aware, and has not been informed by any City Council member,of any other fact that may constitute a basis for a dec�ision-maker conflict of interest in this matter. CURRENT-YEAR FISCAL IMPAC 111r There will be no direct fiscal impact to the General Fund.All current exp�enditures and revenues associated with this contract and the Household Hazardous Waste Program are fully funded through the Environmental Services Fund. ONGOING FISCAL IMPACT There will be no ongoing fiscal impact to the General Fund.All future exp�enditures and revenues associated with this contract and the Household Hazardous Waste Program are fully funded through the Environmental Services Fund. ATTACHMEN'TS Attachment 1 -City of Chula Vista-Clean Harbors Environmental Services agreement Attachment 2-Increased participation rates graph Staff Contact:Manuel Medrano, Environmental Services Manager P a g e 3 2021-03-16 Agenda Packet Page I 10 of 724, RESOLUTION NO. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING A SECOND AMENDMENT TO THE AGREEMENT BETWEEN THE CITY OF CHULA VISTA AND CLEAN HARBORS ENVIRONMENTAL SERVICESI INC. FOR TURN-KEY HOUSEHOLD HAZARDOUS WASTE AND CONDITIONALLY EXEMPT SMALL QUANTITY GENERATOR WASTE MANAGEMENT SERVICES WHEREAS, on August 8, 2017, the City Council approved an agreement with Clean Harbors Environmental. Services, Inc. (Clean Harbors) for Tum-Key Household Hazardous Waste and Conditionally Exempt Small Quantity Generator Waste Management Services (Agreement); and WHEREAS, the term. of the Agreement was initially from August 2017 to June 30, 2019 and also provided that, upon satisfactory work performance, the parties could mutually agree to extend the Agreement for up to five (5) additional one-year periods, for a maximum term of approximately seven (7) years; and WHEREAS, the parties have exercised two (2) of the possible five (5) options under the Agreement; and WHEREAS, last fiscal year Environmental. Services requested an increase in the maximum compensation amount under the Agreement due to rising p�articipation rates at the Household Hazardous Waste Facility,just as the COVID-19 pandemic began; and WHEREAS, due to a continued increase in, participation at the Household Hazardous Waste Facility as a result of stay-at-home orders in response to the pandemic, the current maximum compensation amount during the current option term is nearing exhaustion; and WHEREAS, City staff recommends increasing the annual maximum compensation amount for the current option term, and any future option terms that are duly exercised, to $700,,000, for a new total not-to-exceed amount for the original term and all potential option terms of$3,650,000. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Chula Vista that it approves the Second Amendment to Agreement Between the City of Chula Vista and Clean Harbors Environmental Services, Inc. For Turn-key Household Hazardous Waste and Conditionally Exempt Small. Quantity Generator Waste Management Services, in the form presented, with such minor modifications as may be required or approved by the City Attorney, a copy of wbich sball be kept on file in the Office of the City Clerk, and authorizes and directs the Mayor to execute same. Presented by Approved as to form by Eric C. Crockett Glen R. Googins Deputy City Manager City Attorney 2021-03-16 Agenda Packet Page I I I of 724, DocuSign Envelope ID:8ED3D23C-0378-4EE2-AAlB-ClC5BlC6AD9D FIRST AMENDMENT to Agreement between the City of Chula Vista and Clean Harbors Environmental Services, Inc. For'Turn-key Household Hazardous Waste and Conditionally Exempt Small Quantity Generator Waste Management Services This FIRST AMENDMENT"Amendment"is entered into effective as of April 1, 20,20,"Effective Date"by and between the City of Chula Vista("City")and Clean Harbors Environmental Services, Inc. "Contractor/Service Provider"with reference to the following facts: RECITALS WHEREAS, City and Contractor/Service Provider previously entered into Turn-key Household Hazardous Waste and Conditionally Exempt Small Quantity Generator Waste Management Services "Original Agreement" on July 11, 2017- and WHEREAS, City and Contractor/Service Provider desire to amend the Agreement to increase the maximum amount to be paid to Clean Harbors Environmental Services, Inc. to ad ust i the not-to-exceed amount for each potential option term as, more specifically set forth below; and NOW, THEREFORE, in consideration of the above recitals and the mutual obligations of the parties set forth herein, City and Co�ntractor/Service Provider agree as follows: 1. Exhibit A, entitled Amended and Restated Scope of Work and Payment Terms is hereby attached hereto and incorporated herein by this reference. 2. Except as expressly provided herein, all other terms and conditions of the Original Agreement shall remain in full force and effect. 3. Each party represents that it has full right, power and authority to execute this FIRST Amendment and to perform its obligations hereunder, without the need for any further action under its governing instruments, and the parties executing this Amendment on the behalf of such party are duly authorized agents with authority to do so. R2020-142 City of Chula Vista Amendment to Agreement No.: 17073-Al Contractor/Service Provider Name: Clean Harbors Environmental Services,Inc. Rev,8/23/16 2021-03-16 Agenda Packet Page 112 of 724, DocuSign Envelope ID:8ED3D23C-0378-4EE2-AAlB-ClC5BlC6AD9D SIGNATURE PAGE TO FIRST AMENDMENT TO 'TURN-KEY HOUSEHOLD HAZARDOUS WASTE AND CONDITIONALLY EXEMPT SMALL QUANTITY GENERATOR WASTE MANAGEMENT SERVICES CLEAN HARBORS ENVIRONMENTAL CITY OF CHULA VISTA SERVICES, INC. DocuSigned by: ,e—DocuSigned by: i�;an fAkMS E1062BFD7C03864516... BY:"1—A3019D24A1 DB042D... BY: GARY BURNS MARY CASILLAS SALAS VICE PRESIDENT MAYOR ATTEST DOCUSigned by: BY.- E�3074D1 04EAF342E... KERRY K. BIGELOW,, MMC. CITY CLERK APPROVED AS TO FORM BY: EI DOCUSigned by: kic"d AuVbl"& For FD76561E77CE458... GLEN R. GOOGINS CITY ATTORNEY City of Chula Vista Amendment to Agreement No.: 17073-Al Contractor/Service Provider Name: Clean Harbors Environmental Services,Inc. Rev,8/23/16 2021-03-16 Agenda Packet Page 113 of 724, DocuSign Envelope ID:8ED3D23C-0378-4EE2-AAlB-ClC5BlC6AD9D EXHIBIT A AMENDED AND RESTATED SCOPE OF WORK AND PAYMENT TERMS 1. Contact People for Contract Administration and Lei!al Notice 4--y A. City Contract Administration: Manuel Medrano Economic Development Department 276 Fourth Avenue Chula Vista, CA 919 10 (619) 585-5766 mmedranogchulavistaca.gov For Legal Notice Copy to: City of Chula Vista City Attorney 276 Fourth Avenue, Chula Vistal CA 919 10 619-691-5037 CityAttomeygchulavistaca.us B. Contractor/Service Provider Contract Administration: CLEAN HARBORS ENVIRONMENTAL SERVICES,. INC. Jennifer McLaughlin 800 Verdulera Street Camarillo, CA 93010 (805) 914-1472 mclaughlinjennifergcleanharbors.com For Legal Notice Copy to: Jennifer McLaughlin 800 Verdulera Street Camarillo, CA 93010 (805) 914-1472 mclaughlinjennifergcleanharbors.com 2. Required Services A. General Description: Provide the necessary labor,materials and equipment to legally operate a permanent household hazardous waste collection facility, temporary household electronic and universal waste collection events (four per year), door-to�-door household hazardous waste collection. City of Chula Vista Amendment to Agreement No.: 17073-Al Contractor/Service Provider Name: Clean Harbors Environmental Services,Inc. Rev,8/23/16 2021-03-16 Agenda Packet Page 114 of 724, DocuSign Envelope ID:8ED3D23C-0378-4EE2-AAlB-ClC5BlC6AD9D B. Detailed Description: Task Descri*ption Defiverables Completion Date I Operate the City Contractor shall: June 30, 2019 of Chula Vista * Provide the necessary labor, materials and permanent equipment to legally operate the City-owned household regional pen-nanent household hazardous waste hazardous waste collection facility (PHHWPF) available for residents to drop-off household hazardous waste collection facility. during hours of operation. * Track, collect, package, transport, recycle,, treat and dispose of waste provided to the PHHWPF * Select the appropriate treatment, recycling, storage and disposal sites for all hazardous materials collected at the facility or events using the best environmentally sound methods of waste processing hierarchy to include recycling, incineration,and landfilling as the least desirable option. All sites chosen for temporary storage, treatment, recycling and/or disposal shall be fully permitted under local, state and federal laws. Contractor shall also be responsible for providing a waste analysis report that includes identifying the proposed disposal method for each waste stream, all proposed transporters and treatment, storage, and disposal facilities(TSDFs) which will be utilized to dispose of waste collected and all subcontractors. Transportation. of all materials collected to the appropriate facility and from that facility to any secondary management facilities as required. a Manifest, load and transport all conforming hazardous materials collected at the PHHWPF including Conditionally Exempt Small Quantity Generators (CESQG), generated wastes. *Contractor shall perform these services in.full compliance with all applicable Federal, State and local laws, rules, regulations, including local enforcement agencies for traffic control and orders of all regulatory agencies. Wrovide one trained, qualified and dedicated Project Manager to the program for technical assistance and support as well as all routine operational tasks. Project Manager or an equally qualified staff member will be on-site at the PHHWPF to assist and oversee proper hazardous waste packaging and shipments. City of Chula Vista Amendment to Agreement No.: 17073-Al Contractor/Service Provider Name: Clean Harbors Environmental Services,Inc. Rev,8/23/16 2021-03-16 Agenda Packet Page 115 of 724, DocuSign Envelope ID:8ED3D23C-0378-4EE2-AAlB-ClC5BlC6AD9D ,9 Provide one dedicated, qualified Customer Service Representative to the program for all contractual and waste tracking tasks and completion and submittal of all required reports to Federal, State and Local Agencies during normal business hours. o Provide City with the following items no later than forty-five (45) days after the month of service: copies of all manifests, bill of ladings, as well as a monthly report on all the waste collected divided by site,type and amounts of waste collected and invoice for payment along with an itemized listing of car counts. * Prepare and update all reporting documents required by Federal, State and local agencies such as Form 303, facility operations and contingency plan subject to City approval, and prepare an emergency response plan subject for review and approval by local fire marshals for said facilities. *Contractor agrees to provide staff services to transfer applicable permits for the City. 2 Operate the City Program administration to coordinate with City staff June 30, 2019 of Chula Vista's to schedule and provide household hazardous waste door-to-door door-to-door collection service as requested by Chula Vista residents. household e Complete inventory of materials to be collected hazardous waste a Professional,knowledgeable, collection and friendly staff e Service completed within 10 days of initial request program. (by phone or email.) a Emergency pickup service available on.a case by case basis,under City direction. a Assistance for all disabled and elderly participants requiring additional.help in.gathering of materials - resident must be at home at the time of collection a On-site inventory, collection, segregation and packaging completed by a trained chemist and/or technician. a Compliance with Health and Safety Standards per OSHA 1910.120. e Manifest Preparation-to include Land Disposal Restriction(LOR), Bill of Lading,and Treatment Storage Disposal Facility(TSDF),and any other regulatory documentation as required. e Same-day transportation of all materials to Permanent Site for consolidation and packaging. e Reporting to respective City to include name of resident, date of pick-up and complete breakdown of pounds and/or gallons of material collected by class. e Provide City with the City of Chula Vista Amendment to Agreement No.: 17073-Al Contractor/Service Provider Name: Clean Harbors Environmental Services,Inc. Rev,8/23/16 2021-03-16 Agenda Packet Page 116 of 724, DocuSign Envelope ID:8ED3D23C-0378-4EE2-AAlB-ClC5BlC6AD9D following items no later than forty-five(45)days after the month of service: copies of all manifests,bill of ladings as well as a monthly report on all the waste collected divided by site,type and amounts of waste collected and invoice for payment along with an itemized listing of homes serviced. *Additional reporting to City pertaining to collection, quantification,processing and transportation of materials paperwork and forms required by CalRecycle,the Department of Toxic Substances Control or any other local, state or federal agency. *Waste Survey and Customer Satisfaction Program Monthly services provided as needed. 3 Conduct four * Coordination with City Staff to mutually select the June 30, 2019 temporary event site location(s) collection events * Event setup and breakdown of hazardous 9 Professional knowledgeable and friendly staff waste, universal * Supplies and equipment 9 Waste collection.1 segregation, packaging, waste transportation., recycling and disposal mobilization and * Prepare and maintain a facility operations and staffing costs. contingency plan that shall include a contingency plan for unacceptable wastes such as explosive and biological waste, and prepare an emergency response plan subject for review and approval by local fire marshals for said facilities * Permit preparation and submittal, * Compliance with Health and Safety Standards per OSHA 1910.120 including all local, state and federal storrn water protection laws * Manifest Preparation- to include Land Disposal Restriction (LOR)�, Bill of Lading, and Treatment Storage Disposal Facility (TSDF) and any other regulatory documentation as required. * Safety meeting prior to each scheduled collection event * Provide City with the following items no later than forty-five (45) days after the event: copies of all manifests,bill of ladings, as well as a monthly report on all the waste collected divided by site,type and amounts of waste collected and invoice for payment along with an itemized listing of car counts * On-going Project Management Meetings City of Chula Vista Amendment to Agreement No.: 17073-Al Contractor/Service Provider Name: Clean Harbors Environmental Services,Inc. Rev,8/23/16 2021-03-16 Agenda Packet Page 117 of 724, DocuSign Envelope ID:8ED3D23C-0378-4EE2-AAlB-ClC5BlC6AD9D 3. 'Term: In accordance with Section 1.10 of this Agreement, the term of this Agreement shall begin August 1, 2017 and end on June 30, 2019 for completion of all Required Services. 4. Compensation: FX_1 Invoiced or agreed-upon amounts as follows: 7�RIP UNIT ITEM DESC TION UNIT PRICE, Turnkey Household Hazardous Waste Collection Facility of hazardous waste, universal waste and sharps: I Administration, staffing, 3 Per participant/vehicle load: 1. load on vehicle, (15 gallons $ 62.22 technicians, I trained or 125 pounds) chemist. Vehicle unloading, hazcatting, packaging and shipment preparation, transportation and disposal. 2 Same as Row I Description Per participant/vehicle load: 2 loads on vehicle, (30 gallons $ 30.83 or 250 pounds) Conditionally Exempt Small Quantity Generator qualified $167.71 per 3 Same as Row I Description businesses in Chula Vista only. business accepted. 4 Same as Row I Description Sharps, syringes, lancets, infectious substances affecting $189.35 Per humans 55-gal drum 5 Same as Row I Description Other SB 20/50 non-covered electronic waste, minus $.08 per kitchen appliances (EEE) pound 6 Same as Row I Description SB20/50 covered electronics, televisions, monitors, cathode $ 0.00 ray tubes, LCD panels, laptops, flat screen televisions Paintcare covered products interior and exterior architectural paints: latex, acrylic, wate r- based, alkyd, oil- based, enamel(including textured coatings), deck coatings, floor paints (including elastomeric), 7 Same as Row I Description primers, sealers, under-�coaters, stains, $0.00 shellacs, lacquers, varnishes, urethanes (single component), waterproofing concrete/masonry/wood sealers and repellents (not tar or bitumen- based), metal coatings, rust preventatives, field and lawn paints Do�o�r-to-door program, 8 Collection of household Per residence load: I load, (15 gallons or 125 pounds) $75.75 hazardous waste, universal. waste and sharps, City of Chula Vista Amendment to Agreement No.: 17073-Al Contractor/Service Provider Name: Clean Harbors Environmental Services,Inc. Rev,8/23/16 2021-03-16 Agenda Packet Page 118 of 724, DocuSign Envelope ID:8ED3D23C-0378-4EE2-AAlB-ClC5BlC6AD9D Administration, staffing, transportation, hazcatting, packaging, manifestation/administration and or recvcling or disposal 9 Same as Row 8 Description Per residence load: 2 loads (30 gallons or 250 pounds) For $30.83 every 12 gallons or 100 pounds beyond per collection Temporary Collection 10 Event/s of hazardous waste, Event servicing 0-200 vehicles $4�899.37 universal waste mobilization, staffing costs 11 Same as Row 10 Description Event servicing 200-400 vehicles $6>3.79 12 Same as Row 10 Description Event servicing�400-600 vehicles $81464.61 ,13 Same as Row 10 Description Event servicing 600-800 vehicles $111529.96 14 Same as Row 10 Description Event servicing 1,000 or more vehicles $14,1948.05 Notwithstanding the foregoing,the maximum amount to be paid to the Contractor/Service Provider for services performed through June 30, 2024 shall not exceed$2,250,000. If the City exercises an option to extend the Agreement (as provided below), the amount to be paid to the Contractor/Service Provider for services provided during the term of that extension shall not exceed $350,000. If the City exercises, all additional options to extend the Agreement, the total amount to be paid to the Contractor/Service Provider for services provided during the initial and optional extension periods shall not exceed $2,250,000. 0 0 5. Special Provisions: Z Options to Extend: Notwithstanding the completion date set forth in section 3.C., above, City has option to extend this Agreement for up to five (5) additional years, in one-year increments. The Director of Finance/Treasurer shall be authorized to exercise the extensions on behalf of the City. If the City exercises an option to extend, each extension shall be on the same terms and conditions contained herein, provided that the amounts specified in Section 4, above, may be increased by up to 2% in years three (3), five (5)�, and seven (7) for each extension. The City shall give written notice to Contractor/Service Provider of the City's election to exercise the extension. Such notice shall be provided at least 30 days prior to the expiration of the term. City of Chula Vista Amendment to Agreement No.: 17073-Al Contractor/Service Provider Name: Clean Harbors Environmental Services,Inc. Rev,8/23/16 2021-03-16 Agenda Packet Page 119 of 724, Reside�nt participation rates at the Chula Vista Participation Rates at Chula Vinsta's, IIIIIIIIIIousehold IIIIIIIIIIIazalrdous Waste Facility from January 2019 to January 2,021 1.4010, 1226 1200, 10010I 917 901 86 809 800, 7'26 706 :E gIR 684 688 683 67'7 678 g iiI 4- 0 622 626 6 5,67 Z 60101 5016 426 i ve00000 37 4001 56 71 2001 01 JAN'19 FE13'19 MAR'19 APIR'191 MAY'19 JL,JN'19 JUL"19 AUIG'19 SEP"19 OCT'19 NOV'19 DEC'19 JAN"20 FEB'20 JMAR'20 APR'20 MAY'20 JUN'201 �JLJJL'201 AUG'20 SEP'20 OCT'20 NOIV'20 DEC'20 MN'21 *Facility was 61osed Mmcl�i 18,2020 thrOL(gh N/lay 6,2020 due,to COVD-19 2021-03-16 Agenda Packet Page 120 of 724 SECOND AMENDMENT to Agreement between the City of Chula Vista and Clean Harbors Environmental Services, Inc. For Turn-key Household Hazardous, Waste and Conditionally Exempt Small Quantity Generator Waste Management Services This SECOND AMENDMENT ("Second Amendment") is entered into effective as of March 16, 2021, ("Effective Date") by and between the City of Chula Vista ("City") and Clean Harbors Environmental Services, Inc. ("Contractor/Service Provider") with reference to the following facts: RECITALS WHEREAS, City and Contractor/Service Provider previously entered into Agreement Between the City of Chula Vista and Clean Harbors for Turn-key Household Hazardous Waste and Conditionally Exempt Small Quantity Generator Waste Management Services ("Original Agreement") on July 11, 2017,; and WHEREAS, on or about July 1, 2019, the City and Contractor/Service Provider executed the first Notice of Exercise of Option, to Extend Agreement ("First Optio�n") extending the term of the Agreement through June 30, 2020 with a maximum compensation amount for the First Option of$255,000; and WHEREAS, on or about April. 1, 2020, the City and Contractor/Service Provider entered into a first amendment to the Original Agreement ("First Amendment") to increase the maximum amount to be paid during the First Option to $350,000 on the terms therein; and WHEREAS, on or about July 1, 2020, the City and Contractor/Service Provider executed the second Notice of Exercise of Option to Extend Agreement ("'Second Option") extending the term of the Agreement through June 30, 2021 with a maximum compensation amount for the Second Option of$255,000; and WHEREAS, the Original Agreement, First Option, First Amendment, and Second Option may collectively be referred to herein as the "Agreement"; and WHEREAS, City and Contractor/Service Provider desire to amend the Agreement to increase the maximum amount to be paid to Clean Harbors Environmental Services, Inc during the Second Option term and future option terms, as applicable., as more specifically set forth below. NOW, THEREFORE, in consideration of the above recitals and the mutual obligations of the parties set forth herein, City and Contractor/Service Provider agree as follows: City of Chula Vista Amendment to Agreement No.- 1,7073-A2 Contractor/Service Provider Name:Clean Harbors Environmental Services'.Inc. Rev.8/23/16 2021-03-16 Agenda Packet Page 121 of 724, 1. Exhibit A, entitled Amended and Restated Scope of Work and Payment Terms is hereby attached hereto and incorporated herein by this reference. 2. Except as expressly provided herein, all other terms and conditions of the Agreement shall remain in full force and effect. 3. Each party represents that it has full right, power and authority to execute this Second Amendment and to perform its obligations hereunder, without the need for any further action under its governing instruments, and the parties executing this Second Amendment on the behalf of such party are duly authorized agents with authority to do so. City of Chula Vista Amendment to Agreement No.- 1,7073-A2 Contractor/Service Provider Name:Clean Harbors Environmental Services'.Inc. Rev.8/23/16 2021-03-16 Agenda Packet Page 122 of 724, SIGNATURE PAGE TO SECOND AMENDMENT TO, TURN-KEY HOUSEHOLD HAZARDOUS WASTE AND CONDITIONALLY EXEMPT SMALL QUANTITY GENERATOR WASTE MANAGEMENT SERVICES CLEAN HARBORS ENVIRONMENTAL CITY OF CHULA VISTA SERVICES, INC. BY: BY: GARYBURNS �MARY CASILLAS SALAS DISTRICT VICE PRESIDENT, SOUTHERN C� �MAYOR ATTEST BY: KERRY K. BIGELOW, MMC CITY CLERK APPROVED AS TO FO�RM BY*- GLEN R. GOOGINS CITY ATTORNEY City of Chula Vista Amendment to Agreement No. 1,7073-A2 Contractor/Service Provider Name:Clean Harbors Environmental Services'.Inc. Rev.8/23/16 2021-03-16 Agenda Packet Page 123 of 724, EXHIBIT A AMENDED AND RESTATED SCOPE OF WORK AND PAYMENT TERMS� 1. Contact People for Contract Administration and Legal Notice A. City Contract Administration: Manuel Medrano Economic Development Department 276 Fourth Avenue Chula Vista, CA 91910 (619) 585-5766 mmedranogchulavistaca.gov For Legal Notice Copy to: City of Chula Vista City Attorney 276 Fourth Avenue, Chula Vista, CA 91910 619-691-5037 CityAttomeygchuluvistacaxs� B. Confractor/Service Provider Contract Administration: CLEAN �HARBORS ENVIRONIVIENTALSERVICES,, INC. Jennifer McLaughlin, Technical Services District Manager 800 Verdulera Street Camariflol CA 93010 (805) 914-1472 mclaughl.in.jennifergcl.eanharbors.com. For Legal Notice Copy to: Jennifer McLaughlin 800 Verdulera Street Camarillo, CA 93010 (805) 914-1472 mclaughlin.jennifergcleanharbors.com 2. Required Services A. General Description: Provide the necessary labor, materials and equipment to legally operate a permanent household hazardous waste collection facility, temporary household electronic and universal waste collection events (four per year), door-to-door household hazardous waste collection. City of Chula Vista Amendment to Agreement No.- 1,7073-A2 Contractor/Service Provider Name:Clean Harbors Environmental Services'.Inc. Rev.8/23/16 2021-03-16 Agenda Packet Page 124 of 724, B. Detailed Description- � Task Descripti*on Defiverables Completion Date I Operate the City of Chula Vista Contractor shall-. The initial term. of the permanent household hazardous Provide the necessary agreement awarded as waste collection facility. labor, materials and two (2) years with an equipment to legally additional five (5) one operate the City-owned (1) year options to regional permanent renew at the City's sole household hazardous discretion. waste collection facility (PHHWPF) available for residents to drop-�off household hazardous waste during hours of operation. e Track, collect, package, transport, recycle, treat and dispose of waste provided to the PHHWPF e Select the appropriate treatment, recycling, storage and disposal sites for all hazardous materials collected at the facility or events using the best environmentally sound methods of waste processing hierarchy to include recycling, incineration, and landfilling as the least desirable option. All sites chosen for temporary storage, treatment, recycling and/or disposal shall be fully permitted under local, state and federal laws. Contractor shall also be responsible for providing a waste analysis report that includes identifying the proposed disposal method for each waste stream, all proposed transporters and City of Chula Vista Amendment to Agreement No. 1,7073-A2 Contractor/Service Provider Name:Clean Harbors Environmental Services'.Inc. Rev.8/23/16 2021-03-16 Agenda Packet Page 125 of 724, treatment, storage, and disposal facilities (TSDFs) which will be utilized to dispose of waste collected and all subcontractors. Transportation of al.l. materials collected to the appropriate facility and from that facility to any secondary management facilities as required. * Manifest, load and transport all conforming hazardous materials collected at the PHHWPF including Conditionally Exemp�t Small Quantity Generators (CESQG) generated wastes. *Contractor sball perform these services in full compliance with all applicable Federal, State and local laws, rules, regulations, including local, enforcement agencies for traffic control and orders of all regulatory agencies. *Provide one trained, qualified and dedicated Project Manager to the program for technical assistance and support as well as all routine operational tasks. Project Manager or an equally qualified staff member will be on-site at the PHHWPF to assist and oversee proper hazardous waste packaging and shipments. * Provide one dedicated, qualified Customer Service Representative to City of Chula Vista Amendment to Agreement No. 1,7073-A2 Contractor/Service Provider Name:Clean Harbors Environmental Services'.Inc. Rev.8/23/16 2021-03-16 Agenda Packet Page 126 of 724, the program for all contractual. and waste tracking tasks and completion and submittal of all required reports to Federal, State and Local Agencies during normal business hours. e Provide City with the following items no later than forty-five (45) days after the month of service: copies of all manifests, bill of ludings as well as a monthly report on all the waste collected divided by site, type and amounts of waste collected and invoice for payment along with an itemized listing of car counts. * Prepare and update all reporting documents required by Federal, State and local agenc,ies such as Form 303, facility operations and contingency plan subject to City approval, and prepare an emergency response plan subject for review and approval,by local fire marshals for said facilities. eContractor agrees to provide staff services to transfer applicable permits for the City. 2 Operate the City of Chula 0 e Program administration The initial term of the Vista's door- to-door household to coordinate with City agreement awarded as hazardous waste collection staff to schedule and two (2) years with an program. provide household additional five (5) one hazardous waste door-to- (1) year options to door collection service as renew at the City's sole requested by Chula Vista discretion. residents. City of Chula Vista Amendment to Agreement No.- 1,7073-A2 Contractor/Service Provider Name:Clean Harbors Environmental Services'.Inc. Rev.8/23/16 2021-03-16 Agenda Packet Page 127 of 724, e Complete inventory of materials to be collected e Professional knowledgeable, and friendly staff * Service completed within 10 days of initial request (by phone or email..) e Emergency pickup service available on a case by case basis, under City direction. e Assistance for all disabled and elderly participants requiring additional help, in gathering of materials - resident must be at home at the time of collection * On-sile inventory, collection, segregation and packaging completed by a trained chemist and/or technician. e Compliance with Health and Safety Standards per OSHA 1910.120. a, Manifest Preparation to include Land Disposal Restriction (LOR), Bill of Lading, and Treatment Storage Disposal, Facility (TSDF) and any other regulatory documentation as required. a, Same-day transportation of all materials to Permanent Site for consolidation and packaging. o Reporting to respective City to include name of resident, date of pick-�up and complete breakdown of pounds and/or gallons of material co�llected by City of Chula Vista Amendment to Agreement No. 1,7073-A2 Contractor/Service Provider Name:Clean Harbors Environmental Services'.Inc. Rev.8/23/16 2021-03-16 Agenda Packet Page 128 of 724, class. * Provide City with the following items no later than forty-five (45) days after the month of service: copies of all manifests, bill, of ladings as well as a monthly report on all the waste collected divided by site, type and amounts of waste collected and invoice for payment along with an itemized listing of homes serviced. e Additional reporting to City pertaining to collection, quantification, processing and transportation of materials paperwork and forms required by Cal.Recycle, the Department of Toxic Substances Control or any other local, state or federal agency. e Waste Survey and Customer Satisfaction Program 3 Conduct four temporary * Coordination with City collection events of hazardous Staff to mutually select the waste, universal waste event site location(s) mobilization and staffing costs. e Event setup and breakdown e Professional knowledgeable and friendly staff • Supplies and equipment • Waste collection, segregation, packaging, transportation, recyc,ling and disposal e Prepare and maintain a facility operations and contingency plan that shall include a contingency plan City of Chula Vista Amendment to Agreement No. 1,7073-A2 Contractor/Service Provider Name:Clean Harbors Environmental Services'.Inc. Rev.8/23/16 2021-03-16 Agenda Packet Page 129 of 724, for unacceptable wastes such as explosive and biological waste, and prepare an emergency response plan subject for review and approval by local fire marshals for said facilities oPermit preparation and submittal. e Compliance with Health and Safety Standards per OSHA 1910.120 including all local, state and federal storm water protection laws e Manifest Preparation- to include Land Disposal Restriction (LOR), Bill of Lading, and Treatment Storage Disposal Facility (TSDF) and any other regulatory documentation as required. e Safety meeting prior to each scheduled collection event * Provide City with the following items no later than forty-five (45) days after the event: copies of all manifests, bill of ladings as well, as a monthly report on all the waste collected divided by site, type and amounts of waste collected and invoice for payment along with an itemized listing of car counts. * On-going Project Management Meetings City of Chula Vista Amendment to Agreement No. 1,7073-A2 Contractor/Service Provider Name:Clean Harbors Environmental Services'.Inc. Rev.8/23/16 2021-03-16 Agenda Packet Page 130 of 724, 3. Term: In accordance with Section 1.10 of this Agreement, the term of this Agreement shall begin August 1, 2017, and end on June 301 2019�for completion of all Required Services. 4. Compensation: � A. Form of Compensation� It Invoiced or agreed-upon amounts as follows: UNIT ITEM 'DESCRIPTION' '11[NIT COST' Turnkey Household Hazardous Waste Collection Facility of hazardous waste, universal waste and sharps: I Administration, staffing, 3 Per p�articipant/vehicle load.- I load on vehicle, (15 gallons $ 62.22 technicians, I trained or 1,25 pounds) chemist. Vehicle unloading, hazcatting, packaging and shipment preparation, transportation and disposal. 2 Same as Row I Description Per p�articipant/vehicle load.- 2 loads on vehicle, (30 gallons $ 3 0.83 or 250 pounds) Conditionally Exempt Small Quantity Generator qualified $167.71 per 3 Same as Row I Description businesses in Chula Vista only. business acce ted. 4 Same as Row I Description Sharps, syringes, lancets, infectious substances affecting $189 35 Per humans 55-gal, drum 5 Same as Row I Description Other SB 20/50 non-covered electronic waste, minus $.08 per kitchen appliances (EEE) pound 6 Same as Row I Description SB20/50 covered electronics, televisions, monitors, cathode $ 0.00 ray tubes, LCD panels, laptops, flat screen televisions Paintcare covered products interior and exterior architectural paints: latex, acrylic, wate r-based, alkyd, oil-based, enamel(including textured coating s), deck coatings, floor paints (including elastomeric), 7 Same as Row I Description primers, sealers, under-coaters, stains, $0.00 sbeflacs, lacquers, varnishes, urethanes (single component), waterproofing concrete/masonry/wood sealers and repellents (not tar or bitumen-based), metal coatings, rust preventatives, field and lawn paints Door-to-door program,, 8 Collection of household Per residence load: I load, (15 gallons or 125 pounds) $75.75 Lth�azardous waste, universal j City of Chula Vista Amendment to Agreement No.- 1,7073-A2 Contractor/Service Provider Name:Clean Harbors Environmental Services'.Inc. Rev.8/23/16 2021-03-16 Agenda Packet Page 131 of 724, waste and sharps, Administration, staffing, transportation, hazcatting, packaging, manifestation/administration and or recycling or disposal 9 Same as Row 8 Description Per residence load: 2 loads (30 gallons or 250 pounds) For $30.83 every 12 gallons or 1,00 pounds beyond per collection Temporary Collection 10 Evenf/s of hazardous waste, Event servicing 0-200 vehicles $41899.37 universal waste mobilization, staffing costs 11 Same as Row 10 Description Event servicing 200400 vehicles $6,263.79 12 Same as Row 10 Description Event servicing 400-600 vehicles $8�464.61 13 Same as Row 10 Description Event servicing 600-800 vehicles $111529.96 F14 e as Row 10 Description Event servicing 1,000 or more vehicles $14�948.05 Notwithstanding the foregoing, the maximum amount to be paid to the Contractor/Service Provider for services performed: • from July 11, 2017 through June 30, 2018 shall not exceed $250,000.00; • from July 1, 2018 through June 30, 2019 shall, not exceed $250,000.00; • from July 1, 2019 through June 30, 2020 shall not exceed $350,000.00, • from July 1, 2020 through June 30, 2021 shall not exceed $700,000.00, • from July 1, 2021 through June 30, 2022 shall not exceed $700,000.00 (if option exercised),- • from July 1, 2022 through June 30, 2023 shall not exceed $700,000.00 (if option exercised); and • from July 1, 2023 through June 30, 2024 shall not exceed $700,000.00 (if option exercised). If the City exercises all additional options to extend the Agreement, the total amount to be paid to the Contractor/Service Provider for services provided during the initial and optional extension periods shall not exceed $3,650,000. 5. Special Provisions- �� It Options to Extend: Notwithstanding the completion date set forth in section 3.C., above, City has option to extend this Agreement for up to five (5) additional years, in one-year increments. The Director of Finance/Treasurer shall be authorized to exercise the extensions on behalf of the City. If the City exercises an option to extend, each extension shall be on the same terms and conditions contained herein, provided that the amounts specified in Section 4.A, above, may be increased by up to 2% in years three (3), five (5), and seven (7) for each extension. The City City of Chula Vista Amendment to Agreement No.- 1,7073-A2 Contractor/Service Provider Name:Clean Harbors Environmental Services'.Inc. Rev.8/23/16 2021-03-16 Agenda Packet Page 132 of 724, shall give written notice to Contractor/Service Provider of the City's election to exerc,ise the extension. Such notice shall be provided at least 30 days prior to the expiration of the term. City of Chula Vista Amendment to Agreement No.- 1,7073-A2 Contractor/Service Provider Name:Clean Harbors Environmental Services'.Inc. Rev.8/23/16 2021-03-16 Agenda Packet Page 133 of 724, C1TY' C,0UNC'1L A,GEN' DA S,TIA, "nEMENT CITY, OF ..................................... CHUIAVISTA March 16, 2021 File,ID: 21-0032 'TITLE A. RESOLUTION OF THE CITY COUNCIL, OF THE CITY OF CHULA VISTA APPROVING AN EASEMENT PURCHASE AGREEMENT WITH SDCF HOLDINGS CORPORATION IN THE AMOUNT OF$1)370 B. ORDINANCE OF THE CITY OF' CHULA VISTA AMENDING CHULA VISTA MUNICIPAL, CODE SECTION 2.56 (PURCHASING SYSTEM) TO AUTHORIZE THE PUBLIC WORKS DIRECTOR OR CITY ENGINEER TO ACQUIRE, INTERESTS IN REAL PROPERTY IN FURTHERANCE OF CAPITAL IMPROVEMENT PROJECTS (FIRST READING) RECOMMENDED ACTION Council adopt the resolution and place the ordinance on first reading. SUMMARY As part o�f'the Sidewalk Gap Third Avenue (STL042,6) project City staff is preparing sidewalk improvement plans for Third Avenue between Zenith Street and Orange Avenue. In order to construct the proposed improvements,additional right-of-way located at 276-294 Zenith Street, Chula Vista, CA(APN: 623-201-46) will be required for the project. The required additional right-of-way has been appraised and City staff has negotiated an easement purchase agreement with the property owner, SDCF Holdings Corporation. Staff recommends adopting the resolution to approve the easement purchase agreement. The proposed ordinance would grant the City Engineer or,Director,of Public Works the authority to approve similar future real property agreements for CIP projects, subject to the limitations contained in the ordinancle�. Staff recommends placing the ordinance on first reading. ENVIRONMENTAL REVIEW The Development Services Director has reviewed the proposed project for compliance with the California Environmental Quality Act(CEQA)and has determined that the project qualifies for a Categorical Exemption pursuant to State CEQA Guidelines Section 15,301 Class 1 (Existing Facilities), Section 153013 class 3 (New Construction or Conversion of Small Structures),Section 15,332 Class 32 (In-Flill Development Projects),and Section 1S061(b)(3), because it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment. Thus, no further environmental review is required. 1111. 0 0 1 P �3ge 1 2021-03-16 Agenda Packet Page 134 of 724, BOARD/COMMISSION/COMM[TTEE RECOMMENDATION Not Applicable DISCUSSION Resolution Approviing Easement Purchase Agreement The Sidewalk Gap Third Avenue (STL0426)project was approved as a part of the Fiscal Year 20�18-20�22 CIP. This project proposes to install missing sidewalks along Third Avenue between Zenith Street and Orange Avenue. The project location was identified as #3 priority in the Chula Vista Pedestrian Master Plan dated June 15�, 2010. Construction of the proposed sidewalks requires acquisition of additional real property interests beyond the existing right-of-way limits. The proposed additional real property is located at the corner of Third Avenue and Zenith Street., The acquisition area was appraised by Epic Land Solutions in August of 2019 in accordance with Federal requirements. The value of the permanent roadway easement was appraised at $1,370. An offer package and purchase agreement were prepared by staff and delivered to SD�CF Holdings Corporation for review and concurrence. The President of SDCF Holdings Corporation, Mr. Nolan Alegre, representing the interests of the corporation,agreed to the terms of the purchase agreement on April 4, 2020 (see attachment 1). Staff recommends adopting the resolution to approve the easement purchase agreement. Ordi'nance Authorizi'ng Public Works Director or City Engffieer to Acqui're Interests in Real Property in Furtherance of CIP Projects CIP projects serve to enhance and maintain the City's infrastructure., To implement these enhancements in accordance with applicable City, State, and Federal requirements, and accepted engineering standards, the improvements must occasionally extend beyond the existing right-of-way limits. In such situations, like those described in the easement purchase agreement item above,City staffidentifies the required additional real property interests, coordinates to have said real property interests appraised, and negotiates real property purchase agreements between the City and private property owners. The proposed ordinance would authorize the Public Works Director or City Engineer to acquire property interests on behalf of the City, without City Council approval, if' certain conditions have been met. The conditions are: (1) that a CIP project has been established for the construction, repair, operation, or maintenance of City facilities and funds are appropriated to that CIP budget, (2) that the CIP budget has sufficient funds for the purchase and the purchase will not materially affect the ability to complete the CIP project,(3)that the purchase price does not exceed$100,000,and(4)that the purchase price does not exceed one hundred twenty-five percent (125%,) o�f'the appraised value of the interests to be acquired. If(1), (2), and (3) are satisfied but the proposed purchase price does exceed one hundred twenty-five percent(125%) of the appraised value of said interests,the City Manager can approve the purchase where doing so would be in the best interest of the City. In order to enhance the efficiency and flexibility of the City)s procurement process for acquisitions of real property interests in furtherance of CIP Projects, staff recommends placing the proposed ordinance on first reading. P �3ge 2 2021-03-16 Agenda Packet Page 135 of 724, DECISION-MAKER C"ONFLIC'Ir Staff has reviewed the property holdings of the City Council members and has found no property holdings within 1,000 feet of the boundaries of the property which is the subject of this action.Consequently,this item does not present a disqualifying real property-r�elated financial conflict of interest under California Code of Regulations Title 2, section 18702.2(a)(7) or (8), for purposes of the Political Reform Act (Cal. Gov't Code §87100,et seq.). Staff is not independently aware, and has not been informed by any City Council member, of any other fact that may constitute a basis for a decision-maker conflict of interest in this matter. CURREN'T-YE,AR FISCAL IMPACT The proposed real property acquisition in the amount of$1,370 will be funded by TransNet allocated to STL0426. There is no additional impact to the Tran,sNet Fund. ONGOING FISCAL IMPACT Following approval of the purchase,routine maintenance activities will be extended to the additional pub�lic right-of-way. ATTACHMENTS Attachment 1 -Easement Purchase Agreement (APN: 6�2�3-201-46) Staff Contact: Tim Jones,Asso�ciate Engineer,Department of Engineering and Capital Pro.ects P �3ge 3 2021-03-16 Agenda Packet Page 136 of 724, EASEMENT PURCHASE AGREEMENT THIS EASEMENT PURCHASE AGREEMENT ("Agreement") is dated as of the day of � 20211 by and between SDCF Holdings Corporation ("Seller" or "Owner"), and the City of Chula Vista, a municipal corporation ("'Purchaser" or 11cityll). RECITALS WHEREAS, Seller is the owner of certain real property located at 276-294 Zenith Street in the City of Chula Vista, California, more specifically described in Exhibit "A" and shown on a plat designated as Exhibit "B", which are attached to and incorporated into this Agreement this reference (the "Property"); and WHEREASI City desires to acquire an easement over, under, across, within, and through the Property, as more particularly described in Exhibit "C" hereto attached and incorporated by reference, for the easement purposes described herein; and WHEREAS, Seller desires to sell and City desires to purchase the Easement (as defined below) upon the terms and conditions set forth in this Agreement; and NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: ARTICLE I GRANT OF EASEMENT 1.1 Grant of Easement. Seller agrees to sell and grant to Purchaser an easement over, under, across, within, and through a portion of the Property, as more particularly described in Exhibit C, for the Easement Purposes ("Easement") on the terms and conditions set forth in this Agreement. 1.2. Deed. The Easement shall be conveyed by deed, free and clear of all liens, but subject to all encumbrances, easements, matters of survey and restrictions of record. The Deed of Easement, a draft of which is hereto incorporated by reference and attached as Exhibit B (the "Deed"), will be recorded Official Records of the San Diego County recorder. CIP Project#:STL0426 2021-03-16 Agenda Packet Page 137 of 724, ARTICLE 11 DESCRIPTION OF EASEMENT 2.1. Easement Purposes. "Easement Purposes" collectively means use of the Property as is necessary, desirable or advisable for the following purposes: a. for Street and Public Utility purposes on, over, under, across, and through. 2.2. Character of Easement. The Easement is exclusive to City and includes the absolute right of City to use the Easement for the Easement Purposes, which use must not be disturbed, interrupted or impeded in any manner while this Agreement is in effect. 2.3. Term. The Easement will be an easement in perpetuity for the benefit of City, its successors, and assigns. ARTICLE III PURCHASE PRICE 3.L Purchase Price. In consideration of the grant of the Easement, City will pay to Seller the sum of one thousand three hundred seventy dollars ($1,370.00). 3.2. Manner of Pa Payment of the Purchase Price shall be delivered in the form of a City check, or by wire transfer of funds at Closing. ARTICLE IV CLOSING 4.1. Time and Place. The close of escrow for the Easement purchase ("Closing") shall be held at City of Chula Vista, Civic Center, Building B (276, Fourth Ave., Chula Vista, CA 91910) after all the conditions and obligations of the parties of this Agreement are met. 4.2. Conditions to ClosiRg. City's obligations under this Agreement are subject to the satisfaction of the following conditions as of the date of Closing (or as of such earlier date specified): a. Title Matters. City shall.have obtained a commitment(the "Title Commitment")for issuance of an ALTA Owner's Policy of Title Insurance (the "Title Policy"')�. In the event that the Title Commitment and/or any other physical survey obtained by City discloses defects of title or other matters unsatisfactory to City, City shall notify Owner in writing(an "Objection Notice") on or before the sixtieth (60th) day after CIP Project#:STL0426 2 2021-03-16 Agenda Packet Page 138 of 724, the date of complete execution of this Agreement, of such title defects or other matters to which City objects. Owner covenants that it shall cure all title objections 0 which may be cured by execution of a document requiring the signature of no party other than Owner (including any affidavits which may reasonably be required by the title insurer). b. Representations and Warranties. Owner's representations and warranties, as set fo�rth in Article IV shall be true and correct and unbreached in all material respects as of the date of Closing. 4.2 Closing Costs. City shall pay all required recordation fees to record the Deed. City and Owner shall pay all costs of title insurance, survey, due diligence reports, and similar inspections. Each party hereto shall pay its own attorney's fees. 4.3 Items to be Delivered bv Owner. At Closing Owner shall deliver to City the Deed of Easement provided for in Article I hereof. 4.4 Right of Enta. City and City's authorized representatives may at any reasonable time and after giving reasonable notice to Owner, enter upon the Property for the purpose of making inspections, appraisals, surveys, including the cutting of Survey lines and putting up markers and driving stubs and stakes, site analysis, engineering studies, core sampling for engineering reports, and locating existing rights of way, easements, and utilities. City will exercise this right of entry in such a way so as to not cause unreasonable damage to the Property. City agrees, to the extent permitted by law, to indemnify, defend, and save harmless the Owner from all, claims of liability for any personal injury or property damage or otherwise to any person or property caused by any action or omission of City or its agents. Owner agrees to indemnify and save harmless the City from all claims of liability for any personal, injury or property damage or otherwise to any person or property caused by action or omission of Owner or its agents. ARTICLE V OWNER'S REPRESENTATIONS AND WARRANTIES Owner hereby makes the following warranties, representations and covenants with respect to the Property 5.1 Leases and oth,e,r,,,,,,,,,,,,,,,A,gr,e,,e,,m,,ents. At the time of closing, there shall be no written or unwritten agreements recorded or unrecorded, affecting or relating to the use of the easement. CIP Project#:STL0426 3 2021-03-16 Agenda Packet Page 139 of 724, 5.2. Litigation. There is no claim, action, suit, investigation or proceeding, at law, in equity or otherwise,now pending or, to the best of Owner's knowledge, threatened against Owner, or with respect to the Property, to which City might become a party. Owner is not subject to the terms of any decree, judgment or other action of any court, administrative agency or arbitrator, which has or could result in a material adverse effect on the Property or Owner's obligations hereunder. 5.3. Governmental Requirements. Owner has not received any notice of violation of any 0 federal, state, city, or other governmental order or requirement issued by any governmental body or by any action in any court, against or affecting the Property that has not been fully complied with in all respects to the satisfaction of the governmental authority having jurisdiction. 5.4. Assessments. There are no unpaid special assessments which affect the Easement. 5.5. No Conflict. Neither the execution nor the delivery of this Agreement or the documents contemplated hereby,nor the consummation of the conveyance of the easement to City, will conflict with or cause a breach of any of the ten-ns and conditions of, or constitute a default under, any agreement, commitment, note, mortgage, lease, bond, license, permit or other instrument or obligation by which Owner is,bound. 5.6. 'Owner"s Authority. Owner has full power to enter into this Agreement and to perform its obligations hereunder. CIP Project#:STL0426 4 2021-03-16 Agenda Packet Page 140 of 724, ARTICLE VI NOTICES All notices called for hereunder shall be in writing and shall be deemed to have been given when sent by registered or certified mail, return receipt requested, if to: OWNER SDCF Holdings Corporation Signed: Date: Name: Title: Address-, CITY Date: William S. Valle, P.E., Director of Engineering & Capital Projects/City Engineer 276 Fourth Avenue, Chula Vista, CA 91910 or to such other address as the party to receive such notice may hereafter request by written notice to the other. ARTICLE VII MISCELLANEOUS 7.1 Time is of the Essence. Time is of the essence of each and every term, condition, and provision of this Agreement. 7.2 No Third Party,,,,,,,,,,,RiRhts. Nothing in this Agreement, express or implied, is intended to confer upon any person, other than the parties and their respective successors and assigns, any rights or remedies under this Agreement. 7.3 Further Assurances. Each of the parties, shall, at its own expense, execute, acknowledge and deliver any further documents and instruments reasonably requested by the other party and shall take any other action. consistent with the terms of this Agreement that may reasonably be requested by the other party for the purpose of carrying out the terms of this Agreement. 7.4 Counte,rparts. This Agreement may be executed in counterparts, each of which shall 'be deemed an original, but all of which, together, shall constitute one and the same CIP Project#:STL0426 5 2021-03-16 Agenda Packet Page 141 of 724, instrument. Facsimile signatures are acceptable provided they are followed by hard copy originals within five days 7.5 Successors and As The provisions of this Agreement shall inure to the benefit of and bind Owner, Bank,, Escrow Holder, and their respective successors and assigns. 7.6 Entire Aueement. This Agreement contains the entire understanding and agreement of the parties hereto relating to the rights herein granted and the obligations herein set forth. Any prior, contemporaneous, or subsequent written or oral representations and modifications concerning this Agreement shall be of no force or effect. 7.7 Amendments and Waivers. This Agreement may not be amended or altered except by an instrument in writing executed by the parties. No waiver of any breach of a provision of this Agreement shall be deemed a waiver of any other provision. No waiver shall be valid unless in writing and executed by the waiving party. 7.8 Sever . If any portion of this Agreement shall be declared by any court of competent jurisdiction to be invalid,illegal or unenforceable, such portion shall be deemed severed from this Agreement, and the remaining parts of this Agreement shall remain in full force and effect, as fully as though such invalid, illegal or unenforceable portion had never been part of this Agreement. 7.9 Law. This Agreement is executed and delivered in the State of California and shall be construed and enforced in accordance with, and governed by, the laws of the State of California. 7.10 Administrative Claims Requirements and Procedures. No suit or arbitration shall be brought arising out of this, Agreement against City unless a claim has first been presented in writing and filed with City and acted upon by City in accordance with the procedures set forth in Chapter 1.34 of the Chula Vista Municipal Code, as same may be amended, the provisions of which, including such policies and procedures used by City in the implementation of same, are incorporated herein by this reference. Upon requestby City, Owner shall meet and confer in good faith with City for the purpose of resolving any dispute over the terms of this Agreement. (End of page. Next page is signature page.) CIP Project#:STL0426 6 2021-03-16 Agenda Packet Page 142 of 724, SIGNATURE PAGE EASEMENT PURCHASE AGREEMENT IN WITNESS WHEREOF, by executing this Agreement where indicated below, City and Consultant agree that they have read and understood all terms and conditions of the Agreement, that they fully agree and consent to bound by same, and that they are freely entering into this Agreement as of the Effective Date. SDCF HOLDINGS CORPORATION CITY OF CHULA VISTA BY: BY: NOLAN ALEGRE MARIA V. KACHADOORIAN PRESIDENT CITY MANAGER APPROVED AS TO FORM BY.- Glen R. Googins City Attorney CIP Project#:STL0426 7 2021-03-16 Agenda Packet Page 143 of 724, Exhibit A LEGAL DESCRIPTION 2021-03-16 Agenda Packet Page 144 of 724, Exhibit B PLAT 2021-03-16 Agenda Packet Page 145 of 724, Exhibit C GRANT OF EASEMENT DEED 2021-03-16 Agenda Packet Page 146 of 724, RESOLUTION NO. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING AN EASEMENT PURCHASE AGREEMENT WITH SDCF HOLDINGS CORPORATION IN THE AMOUNT OF $11370 WHEREAS, the City of Chula Vista(City) is currently developing plans for installation of sidewalks on Third Avenue between Zenith Street and Orange Avenue as part of its Sidewalk Gap Third Avenue (STL0426) project; and WHEREAS, additional real property interests will be required to construct the proposed improvements; and WHEREAS, City staff has negotiated an easement purchase agreement with SDCF Holdings Corporation, owner of the abutting property,, to acquire an easement needed for construction and maintenance of the proposed improvements; and WHEREAS, adoption of this resolution would approve the easement purchase agreement to allow the City to acquire an easement over the property owner's fee title interest; and WHEREASI staff recommends approving the easement purchase agreement. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Chula Vista that it approves the easement purchase agreement between the City of Chula Vista and SDCF Holdings Corporation, in the form presented, with such minor modifications as maybe required or approved by the City Attorney, a copy of which shall be kept on file in the Office of the City Clerk, and authorizes and directs the City Manager to execute same. Presented by Approved as to form by William S. Valle, P.E. Glen R. Googins Director of Engineering and Capital Projects/ City Attorney City Engineer 2021-03-16 Agenda Packet Page 147 of 724, ORDINANCE NO. ORDINANCE OF THE CITY OF CHULA VISTA AMENDING CHULA VISTA MUNICIPAL CODE SECTION 2.56 (PURCHASING SYSTEM) TO AUTHORIZE THE PUBLIC WORKS DIRECTOR OR CITY ENGINEER TO ACQUIRE INTERESTS IN REAL PROPERTY IN FURTHERANCE OF CAPITAL IMPROVEMENT PROJECTS WHEREAS, on November, 4, 2014, Chula Vista voters approved modifications to City Charter Sections 1009, 10 10 and 10 11 (Measure A) that delegated the authority to the City Council to make procurement rules for awarding City public works contracts and other types of City contracts; and WHEREASI the Charter amendments enabled future purchasing limits/requirements to be established by ordinance, allowing for the City to keep up with "best practices"; and WHEREAS, the currently proposed amendments to the purchasing ordinance are consistent with the Charter amendment and would enhance the efficiency and flexibility of the City' s procurement practices,while preserving appropriate checks and balances; and WHEREAS, in order to maintain transparency, staff will submit to the City Council a list of CIP projects and the associated public works contracts as part of the Finance Departments Quarterly Fiscal, Report; and WHEREAS, staff recommends authorizing the Public Works, Director or the City Engineer to acquire interests in real property in furtherance of capital improvement projects without the need to obtain City Council approval, subject to the limitations in the proposed amendments. NOW THEREFORE the City Council of the City of Chula Vista does ordain as follows: Section 1. Chapter 2 of the Chula Vista Municipal Code is amended to add section 2.56.13,5 as follows: 2.56.135 —Acquisition of real property interests. ,A. ClP' Prqjeetv. The Public Works D�irector, or City Engineer, shall have authority to acquire interests in real property that are necessary for the construction, repair, operation, or maintenance of City facilities without City Council approval, provided that: (a) a CIP project has, been established, for the construction, repair,, operation,, or maintenance of City facilities and funds have been appropriated to that CIP budget-, (b) sufficient funds are available in the ap�p�ro,ved. CIP budget to acquire the real property interest(s,) and, the use of such funds will not materially impact the City's ability to fully implement the CIP project with the remaining funds'; (c) the purchase price for the real property interests, being acquired does not exceed $100,000 per parce]; and (d) the purchase price for the C:\Users\legistar\AppData\Local\Tei-np\BCL Technologies\easyPD F 8\@,BCL@,F80EA5E6\@�),BCL@ ,F80EA5E6.doc 2021-03-16 Agenda Packet Page 148 of 724, Ordinance Page 2 real property interests being acquired does -not exceed one hundred, twenty-five percent (125%) of the appraised value of the interests to be acquired. Notwithstanding the limitation. in (d) above, the purchase price may exceed, one hundred twen-ty-five percent (1.25%) of the ap�p�rais,ed, value of the real. property interests to be acquired where subsections (a), (b), and, (c) above have been satisfied and, the purchase is approved 'by the City Manager. This section does not apply to acquisitions of real property interests 'by eminent domain. Section 11. Severability If any portion of this Ordinance, or its application to any person or circumstance, is for any reason held to be invalid, unenforceable or unconstitutional, by a court of competent jurisdiction, that portion shall be deemed severable, and such invalidity, unenforceability or unconstitutionality shall not affect the validity or enforceability of the remaining portions of the Ordinance, or its application to any other person or circumstance. The City Council of the City of Chula Vista hereby declares that it would have adopted each section, sentence, clause or phrase of this Ordinance, irrespective of the fact that any one or more other sections, sentences, clauses or phrases of the Ordinance be declared invalid, unenforceable or unconstitutional. Section 111. Construction The City Council of the City of Chula Vista intends this Ordinance to supplement, not to duplicate or contradict, applicable state and federal law and this Ordinance shall be construed in light of that intent. Section IV. Effective Date This Ordinance shall take effect and be in force on the thirtieth day after its final passage. Section V. Publication The City Clerk shall certify to the passage and adoption of this Ordinance and shall cause the same to be published or posted according to law. Presented by Approved as, to form by William S. Valle Glen R. Googins City Engineer City Attorney 2021-03-16 Agenda Packet Page 149 of 724, C1TY' C,0UNC'1L A,GEN' DA S,TIA, "nEMENT CITY, OF ..................................... CHUIAVISTA March 16, 2021 File,ID: 21-0065 'TITLE RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA RATIFYING AND CONFIRMING AMENDED EMERGENCY ORDER 004-2020 (EFFECTIVE MARCH 10, 2021) OF THE CHULA VISTA DIRECTOR OF EMERGENCY SERVICES ALLOWING FURTHER TOLLING AND,EXTENSION OF DEADLINES FOR LAND USE AND BUILDING PERMIT-REL,ATED ACTIONS RECOMMENDED ACTION Council adopt the resolution. SUMMARY This proposed resolution ratifies and confirms amended Emergency Order 004-2020 (Effective March 10, 2021) issued by the Chula Vista Director of Emergency Services, in accordance with Chula Vista Municipal Code section 2.14.080,(F)(1). ENVIRONMENTAL REVIEW The proposed resolution ratifying and confirming Emergency Order 004-2020 has been reviewed for compliance with the California Environmental Quality Act (CEQA) and it has been determined that the activity is not a "Project" as defined under, Section 15378, of the state CEQA Guidelines because it will not result in a physical change in the environment;therefore,pursuant to Section 15060(c)(3) of the State CEQA Guidelines,the activity is not subject to CEQA. Notwithstanding the foregoing, it has also been determined that the activity qualifies for an Exemption pursuant to Section 15061(b)(3) of the California Environmental Quality Act State Guidelines.Thus,no environmental review is require�d. BOARD/CONIMISSION/COMMITTEE RECOMMENDATION Not applicable. DISCUSSION The worldwide COVID-19 pandemic has had a substantial, sustained impact on virtually every community across the globe, including our community here in the City of Chula Vista. Despite increasing rates of vaccination, the pandemic, is not yet over and the number of cases in the County of San Diego, including in the South Bay region, continues to rise. 1111. 0 0 1 PIi3ge 1 2021-03-16 Agenda Packet Page 150 of 724, Throughout the, pande,mic, the City has prioritized the protection of' our community by utiliz,ing City resources to respond to the COVID-19 pandemic and protect public health. Due to the restrictions inherent in the State and County COVID-related order�s, and the related diversion of resources to address the continuing emergency,the Director of Development Services previously determined that it was appropriate to toll and extend various land use and building-permit related deadlines. On May 2,1, 2020�,the,Emergency Director issued Emergency Order 004-2,02,0(effective May 2,2,2,020),which tolled and extended for 180 days specified land use and building-permit related actions. Such actions included deadlines to review or take action on land use entitlements,permits,and ap�provals�- deadlines to exercise and continually pursue rights granted under land use entitlements, permits, and approvals; deadlines to review and approve building permit applications and plan ap,provals-� and deadlines for the expiration of building permits and plan approvals. These tolling provisions did not app,ly to deadlines for complying with code enforcement orders for life safety corrections.The City Council ratified and confirmed Emergency Order 004-2020 (effective May 22, 2020) on May 26, 2020. The Director of Development Services has determined that, given the continued COVID-re�lated restrictions and extended need to divert resources to the emergency,it is appropriate to further extend the land use and buil ding-permit actions identified in Emergency Order 004-2020 for additional 180-day periods until December 31, 2021. Accordingly, the Emergency Services Director amended Emergency Order 004-2020 (effective March 10, 2 O�2 1) to further toll and extend such land use and building-permit actions and provide for the waive�r of fees associated with applications to toll or extend. Pursuant to Chula Vista Municipal Code section 2.14.080(F)(1), rules and regulations issued by the Emergency Director must be confirmed by the City Council at the earliest practicable time. DECISIOM-MAKER CONFLICT Staff has reviewed the decision contemplated by this action and has determined that it is not site-spe�cific and consequently, the real property holdings of the City Council members do not create a disqualifying real property-related financial conflict of interest under the Political Reform,Act(Cal.Gov't Code§87 100,et seq.). Staff is not independently aware, and has not been informed by any City Council member, of any other fact that may constitute a basis for de�cision-maker conflic�t of interest in this matter. CURREN"I",-YEAR FISCAL IMPACT The COVID-19 pandemic creates a wide range of potential fiscal impacts to, the City; however, the subject resolution to ratify and confirm amended Emergency Order 004-2020 is unlikely to contribute in any significant way to such current-year fiscal impacts. Staff is evaluating the broader fiscal impact of the current public health crisis,and a comprehensive report will be presented to council in the future. ONGOING FISCAL IMPACT The COVID-19 pandemic creates a wide range of potential fiscal impacts to the City; however, the subject resolution to ratify and confirm amended Emergency Order 004-2020 is unlikely to contribute in any significant way to such ongoing fiscal impacts. Staff is evaluating the broader fiscal impact of the current pub�lic health crisis,and a comprehensive report will be presented to council in the future. P �3ge 2 2021-03-16 Agenda Packet Page 151 of 724, AT rACHMEN rs 1. Resolution 2. Attachment A:Amended Emergency Order No. 004-2020 (Effective Mar�ch 10, 2021) Staff Contact: Tiffany Allen, Director of Development Services; Glen Googins, City Attorney P �3ge 3 2021-03-16 Agenda Packet Page 152 of 724, RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA RATIFYING AND CONFIRMING AMENDED EMERGENCY ORDER 004-2020 (EFFECTIVE MARCH 10, 2021) OF THE CHULA VISTA DIRECTOR OF EMERGENCY SERVICES ALLOWING FURTHER TOLLING AND EXTENSION OF DEADLINES FOR LAND USE AND BUILDING PERMIT-RELATED ACTIONS WHEREAS, a worldwide COVID-19 pandemic was declared by the World Health Organization on January 30, 2020, and on January 31, 2020, the United States Secretary of Health and Human Services also declared a Public Health Emergency as a result of the COVID-19 virus; and WHEREAS, various states of emergency were declared by the United States (March 13, 2020), the State of California (March 4, 2020), and the County of San Diego (February 19, 2020), because of the threat to public safety (to persons and property including both physical and economic harm) as result of the COVID-19 virus; and WHEREAS, on March 12, 2020, pursuant to California Health and Safety Code sections 1.01.040, 120175, and 120175.5 (b) the Health Officer of the County of San Diego ("Health Officer") issued an Order of the Health Officer and Emergency Regulations (the "County Order") closing certain businesses, prohibiting certain public and private gatherings, and restricting other activities in San Diego County as a result of the COVID-19 virus pandemic; and WHEREAS, on March 13, 2020, due to the escalating number of COVID-19 virus cases nationwide, with many cases in the State of California, the City of Chula Vista Director of Emergency Services ("Emergency Director") issued a Proclamation declaring a Local Emergency, as authorized by Government Code section 8630 and Chula Vista Municipal Code ("CVMC") Section 2.14.080(a), which was subsequently adopted and ratified by the Chula Vista City Council on March 17, 2020 pursuant to Resolution No. 2020-065 (collectively, the "Emergency Resolution")�; and WHEREAS,, on March 16, 2020 and March 17, 20�2O�, the County Order was subsequently amended and addended by the Health Officer to include additional rules and restrictions in an effort to further promote public health and safety-, WHEREAS, pursuant to Health and Safety Code section 120175.5(b) and the County Order, all governmental entities in San Diego County shall take necessary measures within the governmental entity's control to ensure compliance with the County Order; and WHEREAS,, in accordance with Chula Vista Municipal Code section 2.14.080(F)(1) the Emergency Director recommended that the City Council affirm and adopt the County Order as a local measure in, order to protect the life and property of the Page I of 5 2021-03-16 Agenda Packet Page 153 of 724, residents of Chula Vista affected by the emergency declared as a result of the COVID-19 virus; and WHEREAS, on March 17, 2020, the City Council adopted Emergency Ordinance No. 3484-A ("City Order"),, which affirmed and adopted the County Order as it existed on March 17, 2020 and authorized the Director to expand or amend the City Order to apply to additional businesses or circumstances pursuant to his or her independent judgment consistent with the authority provided in Chula Vista Municipal Code section 2.14.080(F)(1); and WHEREAS, on March 17, 2020, the Governor of California issued Executive Order N-29,-20 which ordered, among other things, that all requirements of the Bagley- Keene Act and the Brown Act requiring the physical presence of members, personnel, or the public, were waived, and that legislative bodies could hold meetings via teleconferencing ("State Order 29-20"); and WHEREAS, from March 18, 2020 through February 6, 202 1, the County Health Officer issued a series of amendments and addendums to the County Order; and WHEREAS, on March 191 2020, the Governor of California issued Executive Order N-33-20 which ordered, among other things, all Californians to stay at home., with limited exce tions ("State Order 33-20"'); and p WHEREAS,, the number of COVID-19 virus cases remain high in both the State of California (https://covidl9.ca.gov/state-dashb�oard/) and in the City of Chula Vista (http,,s,,:,//www.sandieg,o,county.,,gov/content/d.am/sdc/hhsa/p,r,o,gr,am,s,/p�h,s,/E,p�idemiolo,g,Y/CO� VID-I 9%2ODaily%2OUpdate City%20oP/o2OResidence.pdf); and WHEREAS, on April 9, 2020, the Emergency Director issued Emergency Order 002-2020, which affirmed and adopted the Order of the Health Officer and Emergency Regulations issued by the County of San Diego Health Officer, as that Order may be from time to time updated and amended, as the Order and Emergency Regulations of the City of Chula Vista; and WHEREAS, on April 10, 2020�, the Emergency Director issued Emergency Order 020-A-2020 of the Chula Vista Director of Emergency Services (Effective April 11, 2020), which mandated, among other things, that City Council meetings be conducted via teleconference and City Board, Commission, and Committee meetings to be cancelled until further notice; that City parks and certain City trails be closed; and that essential public and private workers wear face coverings while interacting with the public and preparing food for public consumption.; and Page 2 of 5 2021-03-16 Agenda Packet Page 154 of 724, WHEREAS, on April 21, 2020, the City Council ratified and confirmed Emergency Orders 002-2020 and 002-A-2020 of the Chula Vista Director of Emergency Services; and WHEREAS, on April 22, 2020, the Emergency Director issued Emergency Order 002-13-2020 of the Chula Vista Director of Emergency Services (Effective April 23� 2020), which mandated that members of the public wear face coverings when entering essential businesses or service areas and makes individuals and business owners responsible for ensuring compliance with all face covering requirements; and WHEREAS, on April 28, 2020, the City Council ratified and confirmed Emergency Order 002-B-2020 of the Chula Vista Director of Emergency Services; and WHEREAS, on May 7, 2020, the Emergency Director issued Emergency Order 002-C-2020 of the Chula Vista Director of Emergency Services (Effective May 8, 2020), which opened City parks and trails subject to specified ten-ns, and which updated City's face covering requirements to conform with San Diego County"s, current standards, by expanding the circumstances under which face coverings are required and providing exemptions for specified persons; and WHEREAS, on May 12, 2020, the City Council ratified and confirmed Emergency Order 002-C-2020 of the Chula Vista Director of Emergency Services; and WHEREAS, on May 19, 2020, the Governor of California issued Executive Order N-65-20 which stated that, among other things, strict. compliance with certain statutes and regulations would prevent, hinder, or delay appropriate actions to prevent and mitigate the effects of the COVID-19 pandemic ("State Order 65-20"); and WHEREAS, on May 21, 20�2O�, the Emergency D�irector issued Emergency Order 004-2020 of the Chula Vista Director of Emergency Services (Effective May 22, 2020), which tolled and extended the deadlines for land use and building permit-related actions for 180 days; and WHEREAS, on May 26, 2020, the City Council ratified and co�nfin-ned Emergency Order 004-20�20 of the Chula Vista Director of Emergency Services; and WHEREAS, on July 1, 2020, the Emergency Director issued Emergency Order 005-2020 of the Chula Vista Director of Emergency Services (Effective July 1, 2020), which extended the City's eviction moratorium ordinance through July 31, 2020; and Page 3 of 5 2021-03-16 Agenda Packet Page 155 of 724, WHEREAS, on July 9, 2020, the Emergency Director issued Emergency Order 002-D-2020 of the Chula Vista Director of Emergency Services (Effective July 10, 2020), which authorized City board, commission, and committee meetings to occur under specified circumstances; permitted expanded uses of City parks and trails; and updated face covering requirements to conform with County and State requirements; and WHEREAS, on July 14, 2020, the City Council ratified and confirmed Emergency Order 005-2020 and Emergency Order 002-D-,2020 of the Chula Vista Director of Emergency Services; and WHEREAS, on July 29, 2020, the Emergency Director issued Emergency Order 006-2020 of the Chula Vista Director of Emergency Services (Effective July 29, 2020)�, attached hereto as Attachment A, which allows certain businesses to temporarily operate outdoors subject to local health and safety standards, and consistent with State and County guidelines; and WHEREAS, on August 4, 2020, the City Council ratified and confin-ned Emergency Order 006-2020 of the Chula Vista Director of Emergency Services; and WHEREAS, on November 19, 2020, in an effort to increase compliance with public health orders and curb the spread of COVID-19 in our community, the Emergency Director further amended Emergency Order 002-2020 to specify that responsible parties shall have a minimum of 24 hours to correct violations of public health-related orders; and WHEREAS, on November 23, 2020, the Emergency Director amended Emergency Order 006-2020 to expand the types of businesses permitted to operate outdoors and to add regulations related to outdoor business operation to enhance public safety and reduce adverse impacts on surrounding neighborhoods and uses; and WHEREAS, on December I� 2020, the City Council ratified and confirmed amended Emergency Order O�O�2-2020 and amended Emergency Order 006-2020 of the Chula Vista Director of Emergency Services; and WHEREAS, on February 23, 202 1, the Emergency Director issued Emergency Order 007-2020 of the Chula Vista Director of Emergency Services (Effective February 24� 202 1) to cap delivery service and related fees charged to retail food establishments until indoor dining resumes at 100% capacity; and WHEREAS, on. March 2, 2021, the City Council ratified and confirmed Emergency Order 007-20�20 of the Chula Vista Director of Emergency Services; Page 4 of 5 2021-03-16 Agenda Packet Page 156 of 724, WHEREAS, on March 10, 2021, the Emergency Director amended Emergency Order 004-2020 of the Chula Vista Director of Emergency Services (Effective March 10, 0 -C 202 1), attached hereto as Attachment A, to allow further tolling and extension o-L deadlines for land use and building permit-related deadlines until December 31, 2021 and WHEREAS, as of the date of this order, the COVID-19 virus continues to represent a danger to the Chula Vista community(to persons and property, including both physical and economic harm) requiring emergency action by the Emergency Director, as authorized by CVMC Section 2.14.080 [Director-,Powers and Duties] and the Emergency Resolutions-, WHEREAS, Chula Vista Municipal Code section 2.14.080(F)(1) authorizes the Emergency Director to make and issue rules and regulations reasonably related to the protection of life and property, subject to confirmation of the City Council at the earliest practical time. NOW,, THEREFORE, based on the facts and circumstances set forth above, the City Council of the City of Chula Vista hereby resolves as follows: 1. Amended Emergency Order 004-2020 of the Chula Vista Director of Emergency Services (Effective March 10, 2021)�, attached hereto as Attachment A, is hereby ratified and confirmed. Presented by Approved as, to form by Maria V. Kachadoorian Glen R. Googins City Manager/Director of Emergency Services City Attorney Page 5 of 5 2021-03-16 Agenda Packet Page 157 of 724, DocuSign Envelope ID:CB802253�-6DE4-4DE2-AOD8-52CDFE29F2CE EMERGENCY ORDER OF THE CHULA VISTA DIRECTOR OF EMERGENCY SERVICES [Order No. 004-2020] Amended Effective Date: March 10, 2021 Pursuant to CVMC section 2.14.08,0 [Director—Powers and Duties] and Chula Vista City Council Resolution No. 2020-065, the Chula Vista Director of Emergency Services ("Emergency Director") ORDERS AS FOLLOWS, Effective 12:01 a.m. on Wednesday, March 10, 202 1: I. All deadlines for land use and building p�ermit-related actions established by any provision of laws, ordinances, regulations, resolutions, rules and statutes, including provisions contained in the Housing Accountability Act, Permit Streamlining A%,L, California Environmental Quality Act, the Subdivision Map Act, and Chapters 13, 15, 17, 18, and 19 of the Chula Vista Municipal Code (the "land, use andbuilding permit-related actions"), are hereby tolled and extended starting May 22, 2020 for 180 days. Deadlines forland use andbuild-ing per-mit-related actions maybe tolled and extended for additional 18,0-day periods through, July 4, 202 1., thereby ending any tolling or extensions on or about December 3 11 r, no deadlines for],and use and building permit- c 202 1. Thereafte related actions shall be tolled and extended pursuant to this Order. Any fee associated with, an application, to toll, or extend a ],and use or building permit-related action pursuant to this Order shall.be waived. 2. For purposes of this order, "deadlines for land use and building permit-related actions" shall include: a. Deadlines to review, determine the completeness of, or take action on applications for land use entitlements, permits, and approvals, issued under Chapter 19 of the Chula Vista Municipal Code. b. Deadlines to open or conclude public hearin on, or to authorize an automatic 9 approval, denial, or disapproval of, applications for land use entitlements, permits, or approvals issued under Chapter 19 of the Chula Vista Municipal Code. c. Deadlines to exercise and continuously pursue the rights granted under land use entit,lements, permits and approvals issued under Chapter 19 of the Chula Vista Municipal Code. d. Deadlines for review and approval of applications for a building permit, plan review and related approvals issued under Chapter 15 of the Chula Vista Municipal Code. Page 1 of 3 2021-03-16 Agenda Packet Page 158 of 724, DocuSign Envelope ID:CB802253�-6DE4-4DE2-AOD8-52CDFE29F2CE e. Deadlines for expiration of issued building permits, plan reviews and related approvals issued under Chapter 15 of the Chula Vista Municipal Code. 3. In the event of conflict, all deadlines for land use and permit-related actions shall be tolled and suspended consistent with State law and any directives issued by the Governor. �4. Tolling provisions do not apply to deadlines for complying with code enforcement orders for life safety corrections issued by the Building Official or Fire Marshall. 5. Nothing in this order prohibits applicable City Departments from.continuing to process applications in a reasonable and timely manner. 6. This order may be expanded, interpreted, or amended pursuant to the independent judgment of the Chula Vista Director of Emergency Services,and in accordance with Chula Vista Municipal Code section 2.24.080(F)(l). GENERAL PROVISIONS 7. This order is issued as a result of a worldwide COVID-19 pandernic declared by the World Health Organization on January 30, 2020 and a Public Health Emergency due to the COVID-19 virus declared by the United States Secretary of Health and Human Services on January 31, 2020. 8. As of the date of this order, the COVID-19 virus, continues to represent a danger to the Chula Vista community(to persons, and property including both physical and economic harm), and has significantly impacted the City's personnel and financial resources. The actions required by this Order are necessary to reduce the number of individuals who will be exposed to COVID-19, and will thereby slow the spread of COVID-19 in the City of Chula Vista. By reducing the spread of COVID-19, this Order will save lives and increase public safety to persons and property, and reduce both physical and economic harm. 9. This Order is issued in accordance with, and incorporates by reference.- the Proclamation of Local Emergency issued by the Chula Vista Director of Emergency Services on March 131 2020; Chula Vista City Council Resolution No. 2020-065; Chula Vista City Council Emergency Ordinance No. 3484-A; Emer ency Order 002-�2020 of the Chula Vista 9 Emergency Services Director; the Declaration of Local Health Emergency issued by the County of San Diego Health Officer on February 14, 2020; the County of San Diego Order of the Health Officer and Emergency Regulations (Effective February 6, 202 1)- the Proclamation of a State of Emergency issued by the Governor of the State of California on March 4. 2020; Executive Order N-33-20 issued by the Governor of the State of Page 2 of 3 2021-03-16 Agenda Packet Page 159 of 724, DocuSign Envelope ID:CB802253�-6DE4-4DE2-AOD8-52CDFE29F2CE 2020- COVID-19 guidance issued by the California Department California on March 19, '1 of Public Health on including,but not limited but not limited to county-specific guidance, industry guidance, and the Face Coverings Guidance; the State of California's "Blueprint for a Safer Economy"; and Proclamation 9984 regarding COVID-19 issued by the President of the United States on March I 1 1 2020. 10. This Order comes after the release of substantial guidance from the County of San Diego Health Officer, the California Department of Public Health, the Centers for Disease Control and Prevention, and other public health officials throughout the United States and around the world. 11. With this Order, the Emergency Director is hereby exercising their independent judgment to make and issue rules and regulations reasonably related to the protection of life and property,, pursuant to Chula Vista Municipal Code section 2.24.080(F)(1), subject to confirmation of the City Council at the earliest practical time. SO ORDERED, BY: DocuiSigned by: Maria V. Kachadoorian, City Manager/Director of Emergency Services Approved as to Form: BY: e—DocuSigned by: Glen Googins, City Attorney, City of Chula Vista Page 3 of 3 2021-03-16 Agenda Packet Page 160 of 724, C1TY' C,0UNC'1L A,GEN' DA S,TIA, "nEMENT CITY, OF ..................................... CHUIAVISTA March 16, 2021 File ID: 20-0535 T11TLE CONSIDERATION OF APPROVAL OF CONSULTANT SERVICES, AGREEMENTS FOR REDISTRICTING DEMOGRAPHER AND OUTREACH SERVICES RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING CONSULTANT SERVICES, AGREEMENTS FOR REDISTRICTING DEMOGRAPHIC CONSULTANT SERVICES, BETWEEN THE CITY AND NATIONAL DEMOGRAPHICS CORPORATION AND FOR REDISTRICTING OUTREACH CONSULTANT SERVICES BETWEEN THE CITY AND SOUTHWEST STRATEGIES, LLC RECOMMENDED AC"FION Council adopt the resolution. SUMMARY Adoption of the resolutions will authorize contracts with National Demographics Corporation (NDC) and Southwest Strategies L,LC to assist the 2020 Redistricting Commission with redistricting efforts. City staff with the 20,20 Redistricting Commission solicited proposals for a demographer consultant (RFP P06-2021) and an outreach consultant(RF'P P10-2,0/2,1)to assistthe 2020 Redistricting Commission in acco�rdancewith Charter Section 300.5(A)(3). During the January 21, 2021 Commission meeting, the Commission voted to recommend the selection of National Demographics Corporation (NDC) as the redistricting demographer and Southwest Strategies LLC as the outreach consultant. ENVIRONMENTAL REVIEW The Development Services Director has reviewed the proposed activity for compliance with the California Environmental Quality Act (CEQA) and has determined that the activity is not a "Project 1P as defined under Section 15378 of the State CEQA Guidelines because it will not result in a physical change in the environment; therefore, pursuant to Section 15060(c)(3) of the State CEQA Guidelines, the activity is not subject to CEQA. Thus,no environmental review is required. BOARD/COMMISSION/COMMITTEE RECOMMENDATION At its meeting of January 21, 2021, the Redistricting Commission adopted Resolution Nos. 2021-001 and 2021-002 recommending that the City Council select National Demographics Corporation (NDC) for demographer services and Southwest Strategies, LLC for outreach services. 1111. 0 0 1 PIi3ge 1 2021-03-16 Agenda Packet Page 161 of 724, DISCUSSION DEMOGRAPHER CONS,UL'TANT SELECTION&SERVICES VENDOR SELECTION. Request for Proposals RFP P06-2,021 was created and posted on the City I s purchasing portal, PlanetBids, and viable, vendors were notified, in accordance, with the City's procurement policies. Three consultants,ARCBridge,Consulting&Training,INC.,,National Demographics Corporation ("NDC"),and Redistricting Partners submitted qualified responses to the RFP and their qualifications were evaluated by a panel consisting of City employees who reviewed and scored the proposals based on the following criteria: expertise and experience,demonstrated results and scope of services,allocation of resources,and price'. NDC was determined to offer the best proposal to meet the City and Commission needs and is the recommended consultant. SERVICES. NDC will provide demographic consultant services, online mapping tools, and paper-based mapping tools for public input.The scope of work includes: Project coordination with City staff,the public,and the 2,020 Redistricting Commission Provide mapping software training for the public for map submissions CALIPER online mapping tool DistrictR mapping tool including"Draw your Community"'and"Draw a Map' tools OUTREACH CONSUL'TAN'T SELECTION&SERVICES VEN DOR SE LECTION.Request for Proposals RF'P P 10-2 0/2 1 was created and posted on the City's purchasing portal,PlanetBids,and viable vendors were notified,in accordance with the City's procurement policies.Five consultants, Consulting Solutions Team, LLC; JPW Communications, LLC; NVS,; Southwest Strategies, LLC; and 'Tripepi Smith, submitted qualified responses to the RFP and their qualifications were evaluated by a panel consisting of City employees and one external communications professional who reviewed and scored the proposals based on the following criteria: expertise and experience, demonstrated results and scope of services,allocation ofresources,and price. Southwest Strategies,LLC was determined to offer the best proposal to meet the City and Commission needs and is the recommended consultant. SERVICES. Southwest Strategies will provide public outreach and communication consultant services, writing and translation services,and meeting p�lanning services.The scope of work includes: - Assist the Redistricting Commission,City staff and demographer consultant in implementing an open and transparent process that promotes public consideration of, and comment on, the drawing of Council.District boundaries - Coordinate up to five public outreach meetings/workshops, including options for the public to submit virtual and online public input - Develop a variety of written materials including but not limited to fact sheets, advertising, web content,pub�lic meeting fliers,social media posts,press releases and other documents - Provide and/or coordinate translation services as needed for written materials and simultaneous or other translation services for public workshops P �3ge 2 2021-03-16 Agenda Packet Page 162 of 724, DECISION-MAKER CONFLIC Staff has reviewed the decision contemplated by this action and has determined that it is not site-specific and consequently, the real property holdings of the City Council members do not create a disqualifying real pro perty-related financial conflict of interest under the Political Reform Act(Cal.Gov't Code§87 100,et seq.). Staff is not independently aware, and has not been informed by any City Council member, of any other fact that may constitute a basis for a decision-maker conflict of interest in this matter. CURRENT-YEAR FISCAL IMPACT Adoption of these resolutions will result in no additional impact to the general fund. Funds were appropriated for the Commission in the Fiscal Year 2020-2021 Approved Budget. ONGOING FISCAL IMPACT None., XrTACHMENTS 1. Consultant Agreement with National Demographics Corporation 2. Consultant Agreement with Southwest Strategies LL,C 3,. Redistricting Commission Resolution 2021-001 (Recommending National Demographics Corp) 4. Redistricting Commission Resolution 2021-002, (Recommending Southwest Strategies) Staff Contact:Kerry Bigelow, City Clerk and Anne Steinberger,Marketing&Communications Manager P �3ge 3 2021-03-16 Agenda Packet Page 163 of 724, RESOLUTION NO. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING CONSULTANT SERVICES AGREEMENTS FOR REDISTRICTING DEMOGRAPHIC CONSULTANT SERVICES BETWEEN THE CITY AND NATIONAL DEMOGRAPHICS CORPORATION AND FOR REDISTRICTING OUTREACH CONSULTANT SERVICES BETWEEN THE CITY AND SOUTHWEST STRATEGIES, LLC WHEREAS, the Chula Vista 2020 Redistricting Commission was established pursuant to Charter section 300.5 and Municipal Code chapter 2.51- and WHEREAS, Charter Section 300.5(A)(3) provides that the Commission shall utilize "one or more, as necessary, independent consultants experienced and competent in the skills necessary for the districting work" to assist the Commission in developing the Districting Plans required by the Charter-, and WHEREAS, in order to identify such consultants, proposals were solicited in compliance with the City's purchasing procedures, including Chula Vista Municipal Code section 2.56.110; and WHEREAS, in response to the City's Request for Proposals for redistricting demographic consultant services, three firms submitted qualified proposals: ARCBridge Consultant & Training, INC., National Demographics Corporation, and Redistricting Partners; and WHEREAS, in response to the City's Request for Proposals for redistricting outreach consultant services, five firms submitted qualified proposals: Consulting Solutions Team, LLC- JPW Communications, LLC; NV5; Southwest Strategies, LLC; and Tripepi Smith; and WHEREAS, during the January 21, 2021 Commission meeting the Commission voted to recommend the selection of National Demographics Corporation as the redistricting demographer and Southwest Strategies, LLC as the redistricting outreach consultant; and WHEREAS, the City adopted its Fiscal Year 20�20-21 in June 2020, including an allocation of$,125,000 for the Chula Vista 2020 Redistricting Commission. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Chula Vista, that it approves the Consultant Services Agreements, between the City and National Demographics Corporation and between the City and Southwest Strategies, LLC, in the forms presented, with such minor modifications as may be required or approved by the City Attorney, copies of which shall be kept on file in the Office of the City Clerk; authorizes and directs the City Manager to execute same; and authorizes the City Manager or designee to execute all change orders and expend contingency funds in an amount not to exceed $12,500. 2021-03-16 Agenda Packet Page 164 of 724, Presented by Approved as to form-, Gloria Hurtado, Chair Glen R. Googins 2020 Redistricting Commission City Attorney Presented by Kerry K. Bigelow, MMC City Clerk 2021-03-16 Agenda Packet Page 165 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A CITY OF CHULA VISTA CONSULTANT SERVICES AGREEMENT WITH NATIONAL DEMOGRAPHICS CORPORATION TO PROVIDE REDISTRICTING DEMOGRAPHIC CONSULTANT SERVICES This Agreement is entered into effective as of March 16, 2021 ("Effective Date") by and between the City of Chula Vista, a chartered municipal corporation("City") and NATIONAL DEMOGRAPHICS CORPORATION, A California Corporation) ("Consultant") (collectively, the "Parties" and, individually, a"Party") with reference to the following facts: RECITALS WHEREAS, the City of Chula Vista Charter was amended by the electorate in 2012 to provide that the four City Council members be elected by district; and WHEREAS, Charter section 300.5 requires Districting Commissions utilize one or more independent consultants to recommend a Districting Plan for adjusting the boundaries of the four Council districts within one year of receipt by the City of the final Federal Decennial Census information; and WHEREAS,the 2020 Redistricting Commission("2020 RDC")was formed and held its first Commission meeting on October 21, 2020; and WHEREAS, City staff circulated a Request for Proposals ("RFP") for a demographer consultant to assist the 2020 RDC1 in accordance with the City's procedures; and WHEREAS, three consultants submitted proposals in response to the RFP: ARCBridge Consulting & Training, Inc., National Demographics Corporation ("NDC"), and Redistricting Partners, and a City staff evaluation panel was formed and a subcommittee of two members from the 2020 RDC acted as observers of the City's established procurement practices; and WHEREAS, based on the proposals, interviews, and reference checks, the Commission voted to recommend that the City retain NDC to serve as the demographer consultant, City staff supports that recommendation, and the City Council approved the recommendation at its meeting of March 16, 2021- and WHEREAS, Consultant warrants and represents that it is experienced and staffed in a manner such that it can deliver the services required of Consultant to City in accordance with the time frames and the terms and conditions of this Agreement. [End of Recitals. Next Page Starts Obligatory Provisions.] i City of Chula Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMOGRAPHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 166 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A OBLIGATORY PROVISIONS NOW, THEREFORE, in consideration of the above recitals, the covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which the Parties hereby acknowledge, City and Consultant hereby agree as follows: 1. SERVICES 1.1 Required Services. Consultant agrees to perform the services, and deliver to City the "Deliverable s" (if any) described in the attached Exhibit A, incorporated into the Agreement by this reference, within the time frames set forth therein, time being of the essence for this Agreement. The services and/or Deliverables described in Exhibit A shall be referred to herein as the "Required Services." 1.2 Reductions in Scope of Work. City may independently, or upon request from Consultant, from time to time, reduce the Required Services to be performed by the Consultant under this Agreement. Upon doing Sol City and Consultant agree to meet and confer in good faith for the purpose of negotiating a corresponding reduction in the compensation associated with the reduction. 1.3 Additional Services. Subject to compliance with the City's Charter, codes, policies, procedures and ordinances governing procurement and purchasing authority, City may request Consultant provide additional services related to the Required Services ("Additional Services"). If so, City and Consultant agree to meet and confer in good faith for the purpose of negotiating an amendment to Exhibit A, to add the Additional Services. Unless otherwise agreed, compensation for the Additional Services shall be charged and paid consistent with the rates and terms already provided therein. Once added to Exhibit A, "Additional Services" shall also become "Required Services" for purposes of this Agreement. 1.4 'Standard of Care. Consultant expressly warrants and agrees that any and all Required Services hereunder shall be performed in accordance with the highest standard of care exercised by members of the profession currently practicing under similar conditions and in similar locations. 1.5 No Waiver of Standard of Care. Where approval by City is required, it is understood to be conceptual approval only and does not relieve the Consultant of responsibility for complying with all laws,codes,industry standards, and liability for damages caused by negligent acts, errors, omissions, noncompliance with industry standards, or the willful misconduct of the Consultant or its subcontractors. 1.6 Security for Performance. In the event that Exhibit A Section 4 indicates the need for Consultant to provide additional security for performance of its duties under this Agreement, Consultant shall provide such additional security prior to commencement of its Required Services in the form and on the terms prescribed on Exhibit A, or as otherwise prescribed by the City Attorney. 1.7 Compliance with Laws. In its performance of the Required Services, Consultant shall comply with any and all applicable federal, state and local laws, including the Chula Vista Municipal Code. 1.8 Business License. Prior to commencement of work, Consultant shall obtain a business license from city. 1.9 Subcontractors. Prior to commencement of any work, Consultant shall submit for City's information and approval a list of any and all subcontractors to be used by Consultant in the performance of the Required Services. Consultant agrees to take appropriate measures necessary to ensure that all subcontractors and City of ChM Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMOGR-APHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 167 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A personnel utilized by the Consultant to complete its obligations under this Agreement comply with all applicable laws, regulations, ordinances, and policies, whether federal, state, or local. In addition, if any subcontractor is expected to fulfill any responsibilities of the Consultant under this Agreement, Consultant shall ensure that each and every subcontractor carries out the Consultant's responsibilities as set forth in this Agreement. 1.10 Term. This Agreement shall commence on the earlier to occur of the Effective Date or Consultant's commencement of the Required Services hereunder, and shall terminate when the Parties have complied with all their obligations hereunder; provided, however, provisions which expressly survive termination shall remain in effect. 2. COMPENSATION 2.1 General. For satisfactory performance of the Required Services,City agrees to compensate Consultant in the amount(s) and on the terms set forth in Exhibit A, Section 4. Standard terms for billing and payment are set forth in this Section 2. 2.2 Detailed Inv . Consultant agrees to provide City with a detailed invoice for services performed each month, within thirty (30) days of the end of the month in which the services were performed, unless otherwise specified in Exhibit A. Invoicing shall begin on the first of the month following the Effective Date of the Agreement. All charges must be presented in a line item format with each task separately explained in reasonable detail. Eacn invoice shall include the current monthly amount being billed, the amount invoiced to date, and the remaining amount available under any approved budget. Consultant must obtain prior written authorization from City for any fees or expenses that exceed the estimated budget. 2.3 Payment to-Consultant. Upon receipt of a properly prepared invoice and confirmation that the Required Services detailed in the invoice have been satisfactorily performed, City shall pay Consultant for the invoice amount within thirty(30)days. Payment shall be made in accordance with the terms and conditions set forth in Exhibit A and section 2.4, below. At City's discretion, invoices not timely submitted may be subject to a penalty of up to five percent (5%) of the amount invoiced. 2.4 Retention Po . City shall retain ten percent(10%)of the amount due for Required Services detailed on each invoice (the "holdback amount"). Upon City review and determination of Project Completion, the boldback amount will be issued to Consultant. 2.5 Reimbursement of Costs. City may reimburse Consultant's out-of-pocket costs incurred by Consultant in the performance of the Required Services if negotiated in advance and included in Exhibit A. Unless specifically provided in Exhibit A,Consultant shall be responsible for any and all out-of-pocket costs incurred by Consultant in the performance of the Required Services. 2.6 Exclusions. City shall not be responsible for payment to Consultant for any fees or costs in excess of any agreed upon budget, rate or other maximum amount(s) provided for in Exhibit A. City shall also not be responsible for any cost: (a) incurred prior to the Effective Date; or (b) arising out of or related to the errors, omissions, negligence or acts of willful misconduct of Consultant,, its agents, employees, or subcontractors. 2.7 Payment Not Final Approval. Consultant understands and agrees that payment to the Consultant or reimbursement for any Consultant costs related to the performance of Required Services does not constitute a City final decision regarding whether such payment or cost reimbursement is allowable and eligible for payment under this Agreement, nor does it constitute a waiver of any violation by Consultant of the terms of 3' C111tyl o7 C10a Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMO�GFAPHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 168 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A this Agreement. If City determines that Consultant is not entitled to receive any amount of compensation already paid, City will notify Consultant in writing and Consultant shall promptly return such amount. 30 INSURANCE 3.1 Required Insurance. Consultant must procure and maintain, during the period of performance of Required Services under this Agreement, and for twelve months after completion of Required Services, the policies of insurance described on the attached Exhibit B, incorporated into the Agreement by this reference (the "Required Insurance"). The Required Insurance shall also comply with all other terms of this Section. 3.2 Deductibles and Self-Insured Retentions. Any deductibles or self-insured retentions relating to the Required Insurance must be disclosed to and approved by City in advance of the commencement of work. 3.3 Standards for Insurers. Required Insurance must be placed with licensed insurers admitted to transact business in the State of California with a current A.M. Best's rating of A V or better, or, if insurance is placed with a surplus lines insurer, insurer must be listed on the State of California List of Eligible Surplus Lines Insurers (LESLI) with a current A.M. Best's rating of no less than A X. For Workers' Compensation Insurancel insurance issued by the State Compensation Fund is also acceptable. 3.4 Subcontractors. Consultant must include all sub-con sultants/sub-contractors as insureds under its policies and/or furnish separate certificates and endorsements demonstrating separate coverage for those not under its policies. Any separate coverage for sub-consultants must also comply with the terms of this Agreement. 3.5 Additional Insureds. City, its officers, officials, employees, agents, and volunteers must be named as additional insureds with respect to any policy of general liability, autornobile, or pollution insurance specified as required in Exhibit B or as may otherwise be specified by City's Risk Manager.. The general liability additional insured coverage must be provided in the form of an endorsement to the Consultant's insurance using ISO CG 2010 (11/85) or its equivalent; such endorsement must not exclude Products/Completed Operations coverage. 3.6 General Liability Coverage to be '. Prirnary." Consultant's general liability coverage must be primary insurance as it pertains to the City, its officers, officials, employees, agents, and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, or volunteers is wholly separate from the insurance provided by Consultant and in no way relieves Consultant from its responsibility to provide insurance. 3.7 No Cancellation. No Required Insurance policy may be canceled by either Party during the required insured period under this Agreement,except after thirty days' prior written notice to the City by certified mail, return receipt requested. Prior to the effective date of any such cancellation Consultant must procure and put into effect equivalent coverage(s). 3.8 Waiver of Subrogation. Consultant's insurer(s) will provide a Waiver of Subrogation in favor of the City for each Required Insurance policy under this Agreement. In addition, Consultant waives any right it may have or may obtain to subrogation for a claim against City. 3.9 Verification of Cov,,er,a urnish City with ge. Prior to commencement of any work, Consultant shall f original certificates of insurance and any amendatory endorsements necessary to demonstrate to City that Consultant has obtained the Required Insurance in compliance with the terms of this Agreement. The words 41 C111tyl o7 C10a Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMO�GFAPHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 169 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A 44-will endeavor" and "but failure to mail such notice shall impose no obligation or liability of any kind upon the company, its agents,, or representatives"or any similar language must be deleted from all certificates. The required certificates and endorsements should otherwise be on industry standard forms. The City reserves the right to require, at any time, complete, certified copies of all required insurance policies, including endorsements evidencing the coverage required by these specifications. 3.10 Claims Made Policy Requirements. If General Liability,Pollution and/or Asbestos Pollution Liability and/or Errors & Omissions coverage are required and are provided on a claims-made form, the following requirements also apply: a. The "Retro Date"must be shown, and must be before the date of this Agreement or the beginning of the work required by this Agreement. b. Insurance must be maintainedl and evidence of insurance must be provided, for at least five (5) years after completion of the work required by this Agreement. c. If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a "Retro Date" prior to the effective date of this Agreement, the Consultant must purchase "extended reporting"coverage for a minimum of five (5)years after completion of the work required by this Agreement. d. A copy of the claims reporting requirements must be submitted to the City for review. 3.11 Not a Limitation of Other Obli,gations. Insurance provisions under this section shall not be construed to limit the Consultant's obligations under this Agreement, including Indemnity. 3.12 Additional Cover . To the extent that insurance coverage provided by Consultant maintains higher limits than the minimums appearing in Exhibit B, City requires and shall be entitled to coverage for higher limits maintained. 4. INDEMNIFICATION 4.1. General. To the maximum extent allowed by law, Consultant shall protect, defend,indemnify and hold harmless City, its elected and appointed officers, agents, employees and volunteers (collectively, "'Indemnified Parties"), from and against any and all claims, demands, causes of action, costs, expenses, (including reasonable attorneys' fees and court costs), liability, loss, damage or injury, in law or equity, to property or persons, including wrongful death, in any manner arising out of or incident to any alleged acts, omissions, negligence, or willful misconduct of Consultant, its officials, officers, employees, agents, and contractors, arising out of or in connection with the performance of the Required Services, the results of such performance, or this Agreement. This indemnity provision does not include any claims, damages, liability, costs and expenses arising from the sole negligence or willful misconduct of the Indemnified Parties. Also covered is liability arising from, connected with,, caused by or claimed to be caused by the active or passive negligent acts or omissions of the Indemnified Parties which may be in combination with the active or passive negligent acts or omissions of the Consultant, its employees, agents or officers, or any third party. 4.2. Modified Indemnity Where Agreement Involves Design Professional Services. Notwithstanding the forgoing, if the services provided under this Agreement are design professional services, as defined by California Civil Code section 2782.8, as may be amended from time to time, the defense and indemnity obligation under Section 1, above, shall be limited to the extent required by California Civil Code section 2782.8. 5' C111tyl o7 C10a Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMO�GFAPHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 170 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A 4.3 'Costs of Defense and Award. Included in Consultant's obligations under this Section 4 is Consultant's obligation to defend, at Consultant's own cost, expense and risk, any and all suits, actions or other legal proceedings that may be brought or instituted against one or more of the Indemnified Parties. Subject to the limitations in this Section 4, Consultant shall pay and satisfy any judgment, award or decree that may be rendered against one or more of the Indemnified Parties for any and all related legal expenses and costs incurred by any of them. 4.4. Consultant's Obligations Not Limited or Modified. Consultant's obligations under this Section 4 shall not be limited to insurance proceeds,if any,received by the Indemnified Parties,or by any prior or subsequent declaration by the Consultant. Furthermore, Consultant's obligations under this Section 4 shall in no way limitl modify or excuse any of Consultant's other obligations or duties under this Agreement. 4.5. Eni'orcement Costs. Consultant agrees to pay any and all costs City incurs in enforcing Consultant's obligations under this Section 4. 4.6 Survival. Consultant's obligations under this Section 4 shall survive the termination of this Agreement. 5. FINANCIAL INTERESTS OF CONSULTANT. 5.1 'Form 700 F The Califomia Political Reform Act and the Chula Vista Conflict of Interest Code require certain government officials and consultants performing work for government agencies to publicly disclose certain of their personal assets and income using a Statement of Economic Interests form(Form 700). In order to assure compliance with these requirements, Consultant shall comply with the disclosure requirements identified in the attached Exhibit C, incorporated into the Agreement by this reference. 5.2 Disclosures; Prohibited Interests. Independent of whether Consultant is required to file a Form 700, Consultant warrants and represents that it has disclosed to City any economic interests held by Consultant, or its employees or subcontractors who will be performing the Required Services, in any real property or project which is the subject of this Agreement. Consultant warrants and represents that it has not employed or retained any company or person, other than a bona fide employee or approved subcontractor working solely for Consultantl to solicit or secure this Agreement. Further,Consultant warrants and represents that it has not paid or agreed to pay any company or person, other than a bona fide employee or approved subcontractor working solely for Consultant, any fee, commission, percentage, brokerage fee, gift or other consideration contingent upon or resulting from the award or making of this Agreement. Consultant further warrants and represents that no officer or employee of City, has any interest, whether contractual, non-contractual, financial or otherwise, in this transaction, the proceeds hereof, or in the business of Consultant or Consultant's subcontractors. Consultant further agrees to notify City in the event any such interest is discovered whether or not such interest is prohibited by law or this Agreement. For breach or violation of any of these warranties, City shall have the right to rescind this Agreement without liability. 60 REMEDIES 6.1 Termination for Cause. If for any reason whatsoever Consultant shall fail to perform the Required Services under this Agreement, in a proper or timely manner, or if Consultant shall violate any of the other covenants, agreements or conditions of this Agreement (each a "Default"), in addition to any and all other rights and remedies City may have under this Agreement, at law or in equity, City shall have the right to terminate this Agreement by giving five (5) days written notice to Consultant. Such notice shall identify the Default and the Agreement termination date. If Consultant notifies City of its intent to cure such Default prior -2021-003 i City of ChM V*sta Agreement No.. Consultant Name:NATIONAL DEMO�GFAPHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 171 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A to City's specified termination date, and City agrees that the specified Default is capable of being cured, City may grant Consultant up to ten (10) additional days after the designated termination date to effectuate such cure. In the event of a termination under this Section 6.1, Consultant shall immediately provide City any and all "Work Product" (defined in Section 7 below) prepared by Consultant as part of the Required Services. Such Work Product shall be City's sole and exclusive property as provided in Section 7 hereof Consultant may be entitled to compensation for work satisfactorily performed prior to Consultant's receipt of the Default notice; provided, however, in no event shall such compensation exceed the amount that would have been payable under this Agreement for such work, and any such compensation shall be reduced by any costs incurred or projected to be incurred by City as a result of the Default. 6.2 Termination or Suspension for Convenience of Cily. City may suspend or terminate this Agreement, or any portion of the Required Services, at any time and for any reason, with or without cause, by giving specific written notice to Consultant of such termination or suspension at least fifteen (15) days prior to the effective date thereof. Upon receipt of such notice, Consultant shall immediately cease all work under the Agreement and promptly deliver all"Work Product"(defined in Section 7 below)to City. Such Work Product shall be City's sole and exclusive property as provided in Section 7 hereof. Consultant shall be entitled to receive just and equitable compensation for this Work Product in an amount equal to the amount due and payable under this Agreement for work satisfactorily performed as of the date of the termination/suspension notice plus any additional remaining Required Services requested or approved by City in advance that would maximize City's value under the Agreement. 6.3 Waiver of Claims. In the event City terminates the Agreement in accordance with the terms of this Section, Consultant hereby expressly waives any and all claims for damages or compensation as a result of such termination except as expressly provided in this Section 6. 6.4 Administrative Claims Requirements and Procedures. No suit or arbitration shall be brought arising out of this Agreement against City unless a claim has first been presented in writing and filed with City and acted upon by City in accordance with the procedures set forth in Chapter 1.34 of the Chula Vista Municipal Code, as same may be amended, the provisions of which, including such policies and procedures used by City in the implementation of same, are incorporated herein by this reference. Upon request by City, Consultant shall meet and confer in good faith with City for the purpose of resolving any dispute over the terms of this Agreement. 6.5 Governing Law/Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of California. Any action arising under or relating to this Agreement shall be brought only in San Diego County, State of California. 6.6 Service of Process. Consultant agrees that it is subject to personal jurisdiction in California. If Consultant is a foreign corporation, limited liability company, or partnership that is not registered with the California Secretary of State, Consultant irrevocably consents to service of process on Consultant by first class mail directed to the individual and address listed under"For Legal Notice," in section I.B. of Exhibit A to this Agreement,, and that such service shall be effective five days after mailing. 7. OWNERSHIP AND USE OF WORK PRODUCT All reports, studies, information, data,, statistics,, forms, designs, plans, procedures, systems and any other materials or properties produced in whole or in part under this Agreement in connection with the performance 7 City of ChM Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMOGR-APHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 172 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A of the Required Services (collectively "Work Product") shall be the sole and exclusive property of City. No such Work Product shall be subject to private use, copyrights or patent rights by Consultant in the United States or in any other country without the express, prior written consent of City. City shall have unrestricted authority to publish,, disclose, distribute, and otherwise use, copyright or patent, in whole or in part, any such Work Product, without requiring any permission of Consultant, except as may be limited by the provisions of the Public Records Act or expressly prohibited by other applicable laws. With respect to computer files containing data generated as Work Product, Consultant shall make available to City,upon reasonable written request by City, the necessary functional computer software and hardware for purposes of accessing, compiling, transferring and printing computer files. 8. GENERAL PROVISIONS 8.1 Amendment. This Agreement may be amended, but only in writing signed by both Parties. 8.2 A,,s,,,s,,i,,gnment. City would not have entered into this Agreement but for Consultant's unique qualifications and traits. Consultant shall not assign any of its rights or responsibilities under this Agreement, nor any part hereof, without City's prior written consent, which City may grant, condition or deny in its sole discretion. 8.3 Autbo The person(s) executing this Agreement for Consultant warrants and represents that they have the authority to execute same on behalf of Consultant and to bind Consultant to its obligations hereunder without any further action or direction from Consultant or any board, principle or officer thereof. 8.4 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which shall constitute one Agreement after each Party has signed such a counterpart. 8.5 Entire Agreement. This Agreement together with all exhibits attached hereto and other agreements expressly referred to herein, constitutes the entire Agreement between the Parties with respect to the subject matter contained herein. All exhibits referenced herein shall be attached hereto and are incorporated herein by reference. All prior or contemporaneous agreements,, understandings, representations, warranties and statements, oral or written, are superseded. 8.6 Record Retention. During the course of the Agreement and for three (3) years following completion of the Required Services, Consultant agrees to maintain, intact and readily accessible, all data, documents, reports, records, contracts, and supporting materials relating to the performance of the Agreement, including accounting for costs and expenses charged to City, including such records in the possession of sub- contractors/sub-consultants. 8.7 Further Assurances. The Parties agree to perform such further acts and to execute and deliver such additional documents and instruments as may be reasonably required in order to carry out the provisions of this Agreement and the intentions of the Parties. 8.8 Independent Contractor. Consultant is and shall at all times remain as to City a wholly independent contractor. Neither City nor any of its officers, employees, agents or volunteers shall have control over the conduct of Consultant or any of Consultant's officers, employees, or agents ("Consultant Related Individuals"), except as set forth in this Agreement. No Consultant Related Individuals shall be deemed employees of City, and none of them shall be entitled to any benefits to which City employees are entitled, including but not limited to, overtime, retirement benefits, worker's compensation benefits, injury leave or other leave benefits. Furthermore, City will not withhold state or federal income tax, social security tax or 8 City of ChM Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMOGR-APHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 173 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A any other payroll tax with respect to any Consultant Related Individuals; instead, Consultant shall be solely responsible for the payment of same and shall bold the City harmless with respect to same. Consultant shall not at any time or in any manner represent that it or any of its Consultant Related Individuals are employees or agents of City. Consultant shall not incur or have the power to incur any debt, obligation or liability whatsoever against City, or bind City in any manner. 8.9 Notices. All notices, demands or requests provided for or permitted to be given pursuant to this Agreement must be in writing. All notices, demands and requests to be sent to any Party shall be deemed to have been properly given or served if personally served or deposited in the United States mail, addressed to such Party, postage prepaid, registered or certified, with return receipt requested, at the addresses identified in this Agreement at the places of business for each of the designated Parties as indicated in Exhibit A, or otherwise provided in writing. 8.10 Electronic Signatures. Each Party agrees that the electronic signatures,whether digital or encrypted, of the Parties included in this Agreement are intended to authenticate this writing and to have the same force and effect as manual signatures. Electronic Signature means any electronic sound, symbol, or process attached to or logically associated with a record and executed and adopted by a Party with the intent to sign such record, including facsimile or email electronic signatures, pursuant to the California Uniform Electronic Transactions Act (Cal. Civ. Code §§ 1633.1 to 1633.17) as amended from time to time. (End of page. Next page is signature page.) 9 City of ChM Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMOGR-APHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 174 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A SIGNATURE PAGE CONSULTANT SERVICES AGREEMENT IN WITNESS WHEREOF1 by executing this Agreement where indicated below, City and Consultant agree that they have read and understood all terms and conditions of the Agreement, that they fully agree and consent to bound by same, and that they are freely entering into this Agreement as of the Effective Date. NATIONAL DEMOGRAPHICS CITY OF CHULA VISTA CORPORATION ,o—DocuSigined by: V&j �66,SN& BY: �--E47139FO�ACA6411... BY: DOUGLASJOHNSON MARY CASILLAIS SALAS PRESIDENT MAYOR ATTEST BY: KERRY K. BIGELOW1 MMC CITY CLERK APPROVED AS TO FORM BY: Glen R. Googins City Attorney w City of Chula Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMOGRAPHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 175 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A EXHIBIT A SCOPE OF WORK AND PAYMENT TERMS 1. Contact People for Contract Administration, and Legal, Notice A. City Contract Administration: Kerry K. Bigelow, City Clerk 276 Fourth Avenue, Chula Vistal CA 91910 619-407-3590 kbigelowgchulavistaca.gov For Legal Notice Copy to: City of Chula Vista City Attorney 276 Fourth Avenue, Chula Vista, CA 919 10 619-691-5037 CityAttomeygchulavistaca.gov B. Consultant Contract Administration: NATIONAL DEMOGRAPHICS CORPORATION PO BOX 5271, Glendale, CA 91221 310-200-2058 djohnsongNDCresearch.com For Legal Notice Copy to: Douglas Johnson 1520 N. Pacific Ave., Glendale, CA 91202 310-200-2058 djohnsongNDCresearch.com 2. Required Services A. General Description: Consultant shall assist the City's 2020 RDC in analyzing United States Census data and preparing a Draft Redistricting Plan and Recommended Redistricting Plan; and assist in reporting the Recommended Redistricting Plan to City Council and implementing the Final Redistricting Plan. B. Detailed Description: Consultant shall perform the following services: Project Coordination: a) Work with the City Attorney's office to ensure review and satisfaction of all legal requirements related to Redistricting and ensure compliance with: i. Chula Vista City Charter; ii. Chula Vista Municipal Code-, iii. State statutes; iv. Federal Voting Rights Act; and V. All other applicable federal, state, and local laws. ut City of Chula Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMO�GFAPHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 176 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A b) Work with City staff, the Commission, and outreach consultant: i. Assist in establishing a work plan and timeline for adjusting the current four Council Districts that meets all applicable legal and City deadlines. ii. Assist in planning and implementing a work plan for broad-based public input by residents and targeted Chula Vista stakeholders. iii. Assist City staff and the Commission in preparing a Draft Redistricting Plan, Recommended Redistricting Plan, and report to the City Council regarding the Recommended Redistricting Plan and implementing a Final Redistricting Plan. Project Setup: c) Provide City with DistrictR "Draw your Community" and "Draw a Map"tools. d) Utilize Geographic Information System(GIS) mapping software and GIS to redraw district lines with the ability to analyze census data, statistics, and demographics. i. Develop demographic database including Census Bureau and California Statewide Database data along with any Geographic Information System(GIS)data that the City wishes to include and provides (e.g., school locations, school attendance areas, important local landmarks, communities of interest, and/or recognized neighborhood boundaries). e) Provide a user-friendly experience for the public, Chula Vista stakeholders, the 2020 RDC, and City staff for needed map drawing. f) Identify and report possible redistricting violations during the map drawing process. g) Provide mapping software training in-person or online for the public for map submissions. h) Perform a Voting Rights Act map evaluation. i) Emptoy any software necessary, including statistical software and GIS software to create district maps, analyze census data, statistics, and demographics and provide the Commission and City with reports as requested and required. j) Provide public participation kits in paper and Excel-based formats, as requesting by the 2020 RDC and/or the City. k) Attend Commission meetings and workshops, in person or virtually, as requested by City. 1) Attend City Council meetings, as requested. m) Assist the Commission and City staff as may be required in all facets of developing and implementing a Final Redistricting Plan: i. Conduct initial (usually telephonic) discussion with staff and/or the 2020 RDC about data, City-recognized neighborhoods, project schedule, and special concerns of the jurisdiction. j. Assist with developing a communications plan for public outreach, including suggestions for webpage content and design, public feedback logistics, and strategies for engaging constituents. k. Assist with developing a meeting plan, includimy, recommendations on frequency and format of outreach meetings, information sessions, public study sessions and/or public hearings. 1. Assist with developing a project plan, including a detailed timeline, goals and objectives, and specific deliverables list. m. Provide education and guidance on required redistricting criteria, and advice on selecting optional redistricting criteria, for staff. Commission members, and elected officials. n. Provide progress reports on an as-needed basis as determined by the project manager and coordinate regularly with the jurisdiction's project team. o. Participate phone- or web-conference calls to discuss the project's progress or to answer any questions that may arise. Plan Development and Implementation n) Provide analysis of any potential divisions of"protected class" population concentrations in the existing election areas. o) Analysis and preparation for presentation of all whole or partial plans submitted by the public. u City of ChM Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMO�GFAPHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 177 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A p) Creation of 2 to 4 initial draft maps. q) Conversion of all maps and reports to web-friendly versions. r) Online posting of all maps to an interactive review website. s) Create additional and/or revised maps as requested in a timely manner. 0 Assist the Commission with (i) preparation of the Draft Redistricting Plan, the Recommended Redistricting Plan, and the report to City Council to accompany the Recommended Districting Plan, and (ii) implementation of the Final Redistricting Plan. u) Provide spatial data in file geodatabase or shapeftle of any dataset used or created for this project to staff upon request. v) Provide spatial data in GIS-friendly format of any dataset used or created for this project to staff upon request. w) Work with the County Registrar of Voters (ROV) to implement the final adopted plan a. Provide the San Diego County ROV the new district boundaries in required format at the direction of the City. 3. Term: In accordance with Section 1.10 of this Agreement, the term of this Agreement shall begin March 16, -,x t- 1�(,i t1i e t e rn'i o- t]i e A 2021 and end on June 30, 2022. "I".lie C`it,�,i Clei�`I< slilill I)e ztt,ifliol��ize(i t'(-) F gl��een'ietlt oii� i t,"Y" 111,111ecessq'11111]� V 1",() alk,,�Nl for completion of all Required Services. 4. Compensation,: A. Form of Compensation M Single Fixed Fee. For performance of all of the Required Services by Consultant as herein required, City shall pay a single fixed fee of $36,250.00, upon completion of all Required Services to City's satisfaction. Additional services available as follows: Public Mapping * Paper, PDF, and Excet Public Participation Kit"without Caliper or ESRI $31,500 * Paper, PDF, and Excel "Public Participation Kit" with purchase of Caliper or ESRI no charge * Caliper's "Maptitude Online Redistricting" $2500 Per meetimy, expense: * In-person attendance, per meeting $2�750 * Virtual (telephone, Webex, teams, etc.) attendance, per meeting $11250 Additional analysis, at City request * Principal $300 per hour * Vice President $250 per hour * Senior Consultant $200 per hour * Consultant $150 per hour * Analyst/Clerical $50 per hour B. Rel*mbursement of Costs 0 None, the compensation includes all costs Notwithstanding the foregoing, the maximum amount to be paid to the Consultant for services performed through June 30, 20221 or the contract term end date, as may be amended per Section 3, above, whichever is later, shall not exceed $72,,250.00. 5. Speci*al Provisions: 13' C111tyl o7 C10a Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMO�GFAPHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 178 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A 0 Permitted Sub-Consultants: CALIPER MAPPING TOOL ,14 City of Chula Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMOGFAPHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 179 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A EXHIBIT B INSURANCE REQUIREMENTS Consultant shall adhere to all terms and conditions of Section 3 of the Agreement and agrees to provide the following types and minimum amounts of insurance, as indicated by checking the applicable boxes (x). Type of Insurance Minimum Amount Form M General Liability: $2,000,000 per occurrence for Insurance Services Office Form Including products and bodily injury, personal injury CG 00 01 completed operations, (including death), and property personal and damage. If Commercial General advertising injury Liability insurance with a general aggregate limit is used, either the general aggregate limit must apply separately to this Agreement or the general aggregate limit must be twice the required occurrence limit Additional Insured Endorsement *Must be primary and must not or Blanket Al Endorsement for exelude ProduetslCompleted City* Operations Waiver of Recovery hnctorsement FX_1 Automobile Liability $1,000,000 per accident for bodily Insurance Services Office Form injuryl including death, and CA 00 01 property damage Code I-Any Auto Code 8-Hired Code 9-Non Owned Workers' $1 000,,000 each accident Compensation $1 000,000 disease policy limit Emptoyer's Liability $1 000,,000 disease each employee Waiver of Recovery hnctorsement FX_1 Professional Liability, $1,000,,000 each occurrence Cyber Liability, or $2,000,000 aggregate Errors & Omissions Other Negotiated Insurance Terms: NONE t,.5 City of Chula Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMO�GFAPHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 180 of 724, DocuSign Envelope ID:258EB9E6-F68B-41 A6-A987-401 BF2C34B7A EXHIBIT C CONSULTANT CONFLICT OF INTEREST DESIGNATION The Political Reform Act' and the Chula Vista Conflict of Interest Code 2 ("Code") require designated state and local government officials, including some consultants, to make certain public disclosures using a Statement of Economic Interests form (Form 700). Once filed, a Form 700 is a public document, accessible to any member of the public. In addition, consultants designated to file the Form 700 are also required to comply with certain ethics training requirements,3 FX-1 A. Consultant IS a corporation or limited liability company and is therefore EXCLUDED 4 from disclosure. F-1 B. Consultant NOT a corporation or limited liability company and disclosure designation is as follows: APPLICABLE DESIGNATIONS FOR INDIVIDUAL(S)ASSIGNED TO PROVIDE SERVICES (Category deseriptions available at www'.ehulavistaea.goKIde tslei'ty-elerkleonfli'et-o�f-i'nterest-eode) partmen Nam�e, Email A ddress Applicable,Des ation Enter Name of Each Individual Enter email address(es) F� A. Full Disclosure Who Will Be Providing Service F� B. Limited Disclosure (select one or more qf Under the Contract—ff the categories under which the consultant shallfile): individuals have different El 1. El 2. 1:13. El 4. El 5. El 6. 1:17. disclosure requirements, Justification: duplicate this row and complete separatelyjbr each 1:1 C. Excluded from Disclosure individual I.Required Filers Each individual who will be performing services for the City pursuant to the Agreement and who meets the definition of"Consultant,"pursuant to FP,PC Regulation 18700.3, must file a Form 700. 2.,Required Filing Deadlines Each initial Form 700 required under this Agreement shall be filed with the Office of the City Clerk via the City's online filing system,Neffile, within 30 days of the approval of the Agreement. Additional Form 700 filings will be required annually on April I during the term of the Agreement, and within 30 days of the termination of the Agreement. 3.Filing Designation The City Department Director will designate each individual who will be providing services to the City pursuant to the Agreement as full disclosure, limited disclosure, or excludedftom disclosure, based on an analysis of the services the Consultant will provide. Notwithstanding this designation or anything in the Agreement, the Consultant is ultimately responsible for complying with FPP,C regulations and filing requirements. If you have any questions regarding filing requirements, please do not hesitate to contact the City Clerk at(619)691-504,1, or the FPPC at 1-866-ASK-FPPC, or (866)275-3772 *2. Pursuant to the duly adopted City of Chula Vista Conflict of Interest Code,this document shall serve as the written determination of the consultant's requirement to comply with the disclosure requirements set fo�rth in the Code. Completed by: Cristin a He,rn an dez, City Clerk A n alyst 1. Cal. Gov. Code §§8 1,000 et seq.- FPPC Regs. 18700.3 and 18704. 2 Chula Vista Municipal Code §§2.02.010-2.02.040. 3 Cal. Gov. Code §§53234,etseq. 4 CA FPPC Adv.A-15-147(Chadwick)(2015);Davis v. Fresno Un�fied School District(20151)237 Cal.App.4 th 261; FPPC Reg. 18700.3 (Consultant defined as an"individual"who participates in making a governmental decision;"individual"does not include cor oration or limited liability com lany). 16 City of Chula Vista Agreement No..2021-003 Consultant Name:NATIONAL DEMOGRAPHICS CORPORATION Rev. 9/15/20 2021-03-16 Agenda Packet Page 181 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 CITY OF CHULA VISTA CONSULTANT SERVICES AGREEMENT WITH SOUTHWEST STRATEGIES, LLC TO PROVIDE PUBLIC OUTREACH AND COMMUNICATION SERVICES FOR 20,21 REDISTRICTING EFFORT This Agreement is entered into effective as of March 16, 2021 ("Effective Date") by and between the City of Chula Vista, a chartered municipal corporation ("City") and Southwest Strategies, LLC, Southwest Strategies, LLC, A California Corporation) ("Consultant") (collectively, the "Parties" and, individually, a "Party"), with reference to the! following facts: RECITALS WHEREAS,the Chula Vista Redistricting Commission was established pursuant to Charter section 3 00.5 and WHEREAS, Charter Section 300.5(A)(3) the Commission shall utilize "one or more, as necessary, independent consultants experienced and competent in the skill necessary for the redistricting work"' to assist the Commission in developing the Districting Plans required by the Charter; and WHEREAS, in order to identify such consultants, proposals were solicited in compliance with the City's purchasing procedures, including Chula Vista Municipal Code section 2.56.110; and WHEREAS, in response to the City's Request for Proposals, five firms submitted proposals: Consulting Solutions Team, LLC- JPW Communications, LLC; NV5- Southwest Strategies, LLC; and Tripepli Smith; and WHEREAS, the Commission has considered the recommendation of the subcommittee created to participate in the Request for Proposals (RFP) evaluation process that affirmed the qualification of the recommended public outreach consultant to the Commission at its meeting of January 21, 202 1; ; and WHEREAS,, the Commission recommends that the City retain Southwest Strategies, LLC as the redistricting outreach consultant.; and WHEREAS,, Consultant warrants and represents that it is experienced and staffed in a manner such that it can deliver the services required of Consultant to City in accordance with the time frames and the terms and conditions of this Agreement. [End of Reci*tals. Next Page Starts Obfigatory Provl*sl*ons.] Cit;of Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 182 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 City o Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 183 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 OBLIGATORY PROVISIONS NOW, THEREFORE, in consideration of the above recitals, the covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which the Parties hereby acknowledge, City and Consultant hereby agree as follows: 1. SERVICES 1.1 Required Services. Consultant agrees to perform the services, and deliver to City the "Deliverables" (if any) described in the attached Exhibit A, incorporated into the Agreement by this reference, within the time frames set forth therein, time being of the essence for this Agreement. The services and/or Deliverables described in Exhibit A shall be referred to herein as the "Required Services." 1.2 Reductions in Sco-pe of Work. City may independently, or upon request from Consultant, from time to time, reduce the Required Services to be performed by the Consultant under this, Agreement. Upon doing Sol City and Consultant agree to meet and confer in good faith for the purpose of negotiating a corresponding reduction in the compensation associated with the reduction. 1.3 Additional Services. Subject to compliance with the City's Charter, codes, policies, procedures and ordinances governing procurement and purchasing authority, City may request Consultant provide additional services related to the Required Services ("Additional Services")�. If so, City and Consultant agree to meet and confer in good faith for the purpose of negotiating an amendment to Exhibit A, to add the Additional Services. Unless otherwise agreed, compensation for the Additional Services shall be charged and paid consistent with the rates and terms already provided therein. Once added to Exhibit A, "Additional Services" shall also become "Required Services," for purposes of this Agreement. 1.4 Standard of Care. Consultant expressly warrants and agrees that any and all Required Services hereunder shall be performed in accordance with the highest standard of care exercised by members of the profession currently practicing under similar conditions and in similar locations. 1.5 No Waiver of Standard of Care. Where approval by City is required, it is understood to be conceptual approval only and does not relieve the Consultant of responsibility for complying with all laws,codes, industry standards, and hability for damages, caused by negligent acts, errors, omissions, noncompliance with industry standards, or the willful misconduct of the Consultant or its subcontractors. 1.6 Performance. In the event that Exhibit A Section 4 indicates the need for Consultant to provide additional security for performance of its duties under this Agreement, Consultant shall provide such additional security prior to commencement of its Required Services in the form and on the terms prescribed on Exhibit A, or as otherwise prescribed by the City Attorney. 1.7 Compliance with Laws. In its performance of the Required Services, Consultant shall comply with any and all applicable federal, state and local laws, including the Chula Vista Municipal Code. 1.8 Business License. Prior to commencement of work, Consultant shall obtain a business license from city. 1.9 Subcontractors. Prior to commencement of any work, Consultant shall submit for City's information and approval a list of any and all subcontractors to be used by Consultant in the performance of the Required Services. Consultant agrees to take appropriate measures necessary to ensure that all subcontractors and 3 Cit;of Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 184 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 personnel utilized by the Consultant to complete its obligations under this Agreement comply with all applicable laws, regulations, ordinances, and policies, whether federal, state, or local. In addition,, if any subcontractor is expected to fulfill any responsibilities of the Consultant under this Agreement, Consultant shall ensure that each and every subcontractor carries out the Consultant's responsibilities as set forth in this Agreement. 1.10 Term. This Agreement shall commence on the earlier to occur of the Effective Date or Consultant's commencement of the!Required Services hereunder, and shall terminate when the Parties have complied with all their obligations hereunder; provided, however, provisions which expressly survive termination shall remain in effect. 2. COMPENSATION 2.1 General. For satisfactory performance of the Required Services,City agrees to compensate Consultant in the amount(s) and on the terms set forth in Exhib�it A, Section 4. Standard terms for billing and payment are set forth in this Section 2. 2.2 Detailed Inv . Consultant agrees to provide City with a detailed invoice for services performed each month, within thirty (30) days of the end of the month in which the services were performed,, unless otherwise specified in Exhibit A. Invoicing shall begin on the first of the month following the Effective Date of the Agreement. All charges,must be presented in a line item format with each task separately explained in reasonable detail. Each invoice shall include the current monthly amount being billed, the amount invoiced to date, and the remaining amount available under any approved budget. Consultant must obtain prior written authorization from City for any fees or expenses that exceed the estimated budget. 2.3 Payment to Consultant. Upon receipt of a properly prepared invoice and confirmation that the Required Services detailed in the invoice have been satisfactorily performed, City shall pay Consultant for the invoice amount within thirty(30)days.Payment shall be made in accordance with the terms and conditions set forth in Exhibit A and section 2.4, below. At City's discretion, invoices, not timely submitted may be subject to a penalty of up to five percent (5%) of the amount invoiced. 2.4 Retention P * City shall retain ten percent(10%)of the amount due for Required Services detailed on each invoice (the "holdback amount"). Upon City review and determination of Project Completion, the holdback amount will be issued to Consultant. 2.5 Reimbursement of Costs. City may reimburse Consultant's out-of-pocket costs incurred by Consultant in the performance of the Required Services if negotiated in advance and included in Exhibit A. Unless specifically provided in Exhibit A,Consultant shall be responsible for any and all out-of-pocket costs incurred by Consultant in the performance of the Required Services. 1 2.6 Exc I iusions. City shall not be responsible for payment to Consultant for any fees or costs in excess of any agreed upon budget, rate or other maximum amount(s) provided for in Exhibit A. City shall also not be responsible for any cost: (a) incurred prior to the Effective Date; or (b) arising out of or related to the errors, omissions, negligence or acts of willful misconduct of Consultant, its agents, employees, or subcontractors. 2.7 P,,Um,,ent Not Final,,,,,,,,,,,,,,,A,p,,p,,roval. Consultant understands and agrees that payment to the Consultant or reimbursement for any Consultant costs related to the performance of Required Services does not constitute a City final decision regarding whether such payment or cost reimbursement is allowable and eligible for payment under this Agreement, nor does it constitute a waiver of any violation by Consultant of the terms of 4 Cit;of Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 185 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 this Agreement. If City determines that Consultant is not entitled to receive any amount of compensation already paid, City will notify Consultant in writing and Consultant shall promptly return such amount. 3. INSURANCE 3.1 Required Insurance. Consultant must procure and maintain, during the period of performance of Required Services under this Agreement, and for twelve months after completion of Required Services, the policies of insurance described on the attached Exhibit B, incorporated into the Agreement by this reference (the "Required Insurance"). The Required Insurance shall also comply with all other terms of this Section. 3.2 Deductibles and Self-Insured Retentions. Any deductibles or self-insured retentions relating to the Required Insurance must be disclosed to and a -proved by City in advance of the commencement of work. P. 3.3 Standards for Insurers. Required Insurance must be placed with licensed insurers admitted to transact business in the State of California with a current A.M. Best's rating of A V or better, or, if insurance is placed with a surplus lines insurer, insurer must be listed on the State of California List of Eligible Surplus Lines Insurers (LESLI) with a current A.M. Best's, rating of no less than A X. For Workers' Compensation Insurance, insurance issued by the State Compensation Fund is also acceptable. 3.4 Subcontractors. Consultant must include all sub-cons ultants/sub�-contractors as insureds under its policies and/or furnish separate certificates and endorsements demonstrating separate coverage for those not under its policies. Any separate coverage for sub-consultants must also comply with the terms of this Agreement. 3.5 Additional Insureds. City, its officers, officials, employees, agents, and volunteers must be named as additional insureds with respect to any policy of general liability, automobile, or pollution insurance specified as required in Exhibit B or as may otherwise be specified by City's Risk Manager.. The general liability additional insured coverage must be provided in the form of an endorsement to the Consultant's insurance using ISO CG 2010 (11/85) or its equivalent; such endorsement must not exclude Products/Completed Operations coverage. 3.6 General Liability "Primary,,,.," Consultant's general liability coverage must be primary insurance as it pertains to the City, its, officers, officials, emp�loyees, agents, and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, or volunteers is wholly separate from the insurance provided by Consultant and in no way relieves Consultant from its responsibility to provide insurance. 3.7 No Cancellation. No Required Insurance policy may be canceled by either Party during the required insured period under this Agreement, except after thirty days' prior written notice to the City by certified mail, return receipt requested. Prior to the effective date of any such cancellation Consultant must procure and put into effect equivalent coverage(s)�. 3.8 Waiver of Subrogation. Consultant's insurer(s) will provide a Waiver of Subrogation in favor of the City for each Required Insurance policy under this Agreement. In addition, Consultant waives any right it may have or may obtain to subrogatio�n for a claim against City. 3.9 Verification of Coverage. Prior to commencement of any work, Consultant shall fumish City with original certificates of insurance and any amendatory endorsements necessary to demonstrate to City that Consultant has obtained the Required Insurance in compliance with the terms of this Agreement. The words 5 Cit;of Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 186 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 44will endeavor" and "'but failure to mail such notice shall impose no obligation or liability of any kind upon the company, its agents, or representatives"or any similar language must be deleted from all. certificates. The required certificates and endorsements should otherwise be on industry standard forms. The City reserves the right to require, at any time, complete, certified copies of all required insurance policies, including endorsements evidencing the coverage required by these sp�ecifications. 3.10 Claims Made Policy Requirements. If General Liability,Pollution and/or Asbestos Pollution Liability and/or Errors & Omissions coverage are required and are provided on a claims-made form, the following requirements also apply: a. The "Retro Date"must be shown, and must be before the date of this Agreement or the beginning of the work required by this Agreement. b. Insurance must be maintained, and evidence of insurance must be provided, for at least five (5) years after comp�letion of the work required by this Agreement. c. If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a "Retro Date" prior to the effective date of this Agreement, the Consultant must purchase "extended reporting"coverage for a minimum of five(5)years after completion of the work required by this Agreement. d. A copy of the claims reporting requirements must be submitted to the City for review. 3.11 Not a Limitation of Other Obligations. Insurance provisions under this section shall not be construed to limit the Consultant's obligations under this Agreement, including Indemnity. 3.12 Additional Cover . To the extent that insurance coverage provided by Consultant maintains higher limits than the minimums appearing in Exhibit B, City requires, and shall be entitled to coverage for higher limits maintained. 4. INDEMNIFICATION 4.1. General. To the maximum extent allowed by law, Consultant shall protect,defend,indemnify and hold harmless City, its elected and appointed officers, agents, employees and volunteers (collectively, "Indemnified Parties"), from and against any and all claims, demands, causes of action, costs, expenses, (including reasonable attorneys' fees and court costs), liability, loss, damage or injury, in law or equity, to property or persons, including wrongful death, in any manner arising out of or incident to any alleged acts, omissions, negligence, or willful misconduct of Consultant, its officials, officers, employees, agents, and contractors, arising out of or in connection with the performance of the Required Services, the results of such performance, or this Agreement. This indemnity provision does not include any claims, damages, liability, costs and expenses arising frorn the sole negligence or willful misconduct of the Indemnified Parties. Also covered is liability arising from, connected with, caused by or claimed to be caused by the active or passive negligent acts or omissions of the Indemnified Parties which may be in combination with the active or passive negligent acts or omissions of the Consultant, its employees, agents or officers, or any third party. 4.2. Modified Indemnity here Agreement Involves D,,,e,,,s,,,i,,,g,n Professional Services. Notwithstanding the forgoing, if the services provided under this Agreement are design professional services, as defined by California Civil Code section 2782.8, as maybe amended from time to time, the defense and indemnity obligation under Section, 1, above, shall be limited to the extent required by Califomia Civil Code section 2782.8. 6 Cit;of Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 187 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 4.3 Costs of Defense and Award. Included in Consultant's obligations under this Section 4 is Consultant's obligation to defend, at Consultant's own cost, expense and risk, any and all suits, actions or other legal proceedings that may be brought or instituted against one or more of the Indemnified Parties. Subject to the limitations in this Section 4, Consultant shall pay and satisfy any judgment, award or decree that may be rendered against one or more of the Indemnified Parties for any and all related legal expenses and costs incurred by any of them. 4.4. Consultant's Obligations Not Limited or Modified. Consultant's obligations under this Section 4 shall not be limited to insurance proceeds, if any,received by the Indemnified Parties, or by any prior or subsequent declaration by the Consultant. Furthermore, Consultant's obligations under this Section 4 shall in no way limit, modify or excuse any of Consultant's other obligations or duties under this Agreement. 4.5. 'Enforcement Costs. Consultant agrees to pay any and all costs City incurs in enforcing Consultant's obligations under this Section 4. 4.6 Survival. Consultant's obligations under this Section 4 shall survive the termination of this Agreement. 5. FINANCIAL INTERESTS OF CONSULTANT. 5.1 Form 700 F The California Political Reform Act and the Chula Vista Conflict of Interest Code require certain government officials and consultants performing work for government agencies to publicly disclose certain of their personal assets and income using a Statement of Economic Interests form(Form 700). In order to assure compliance with these requirements, Consultant shall comply with the disclosure requirements identified in the attached Exhibit C, incorporated into the Agreement by this reference. 5.2 Disclosures-, Prohibited Interests. Independent of whether Consultant is required to file a Form 700, Consultant warrants and represents that it has disclosed to City any economic interests heldby Consultant, or its employees or subcontractors who will be performing the Required Services, in any real property or project which is the subject of this Agreement. Consultant warrants and represents that it has not employed or retained any company or person, other than a bona fide employee or approved subcontractor working solely for Consultant,to solicit or secure this Agreement. Further, Consultant warrants and represents that it has not paid or agreed to pay any company or person, other than a bona fide employee or approved subcontractor working solely for Consultant, any fee, commission, percentage, brokerage fee, gift or other consideration contingent upon or resulting from the award or making of this, Agreement. Consultant further warrants and represents that no officer or employee of City, has any interest, whether contractual, non-contractual, financial or otherwise,, in this transaction, the proceeds hereof, or in the business of Consultant or Consultant's subcontractors. Consultant further agrees to notify City in the event any such interest is discovered whether or not such interest is prohibited by law or this Agreement. For breach or violation of any of these warranties, City shall have the right to rescind this Agreement without liability. 6. REMEDIES 6.1 'Termination for Cause. If for any reason whatsoever Consultant shall fail to perform the Required Services under this Agreement, in a proper or timely manner, or if Consultant shall. violate any of the other covenants, agreements or conditions of this Agreement (each a "Default"), in addition to any and all other rights and remedies City may have under this Agreement, at law or in equity, City shall have the right to terminate this Agreement by giving five (5) days written notice to Consultant. Such notice shall identify the Default and the Agreement termination date. If Consultant notifies City of its intent to cure such Default prior 7 Cit;of Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 188 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 to City's specified termination date, and City agrees that the specified Default is capable of being cured, City may grant Consultant up to ten (10) additional. days after the designated ten-nination date to effectuate such cure. In the event of a termination under this Section 6.1, Consultant shall immediately provide City any and all "Work Product" (de!fined in Section 7 b�elow) prepared by Consultant as part of the Required Services. Such Work Product shall be City's sole and exclusive property as provided in Section 7 hereof. Consultant may be entitled to compensation for work satisfactorily performed prior to Consultant's receipt of the Default notice; provided, however, in no event shall such compensation exceed the amount that would have been payable under this Agreement for such work, and any such compensation shall be reduced by any costs incurred or projected to be incurred by City as a result of the Default. 6.2 'Termination or Suspension for Conve,mence of City. City may suspend or terminate this Agreement, or any portion of the Required Services, at any time and for any reason, with or without cause, by giving specific written notice to Consultant of such termination or suspension at least fifteen (15) days prior to the effective date thereof. Upon receipt of such notice, Consultant shall immediately cease all work under the Agreement and promptly deliver all"Work Product"(defined in Section 7 below)to City. Such Work Product shall be City's sole and exclusive property as provided in Section 7 hereof Consultant shall be entitled to receive just and equitable compensation for this Work Product in an amount equal to the amount due and payable under this Agreement for work satisfactorily performed as of the date of the termination/suspension notice plus any additional remaining Required Services requested or approved by City in advance that would maximize City's value under the Agreement. 6.3 Waiver of Claims. In the event City terminates the Agreement in accordance with the terms of this Section, Consultant hereby expressly waives any and all claims for damages or compensation as a result of such termination except as expressly provided in this Section 6. 6.4 Administrative Claims Requirements and Procedures. No suit or arbitration shall be brought arising out of this Agreement against City unless a claim has first been presented in writing and filed with City and acted upon by City in accordance with the procedures set forth in Chapter 1.34 of the Chula Vista Municipal Code, as same may be amended,the provisions of which, including such policies and procedures used by City in the implementation of same, are incorporated herein by this reference. Upon request by City, Consultant shall meet and confer in good faith with City for the purpose of resolving any dispute over the terms of this Agreement. 6.5 Govem,i,n,j�r,,,,,,,,,,,,,,Law/Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of California. Any action arising under or relating to this Agreement shall be brought only in San Diego County, State of California. 6.6 'Service of Process. Consultant agrees that it is subject to personal jurisdiction in California. If Consultant is a foreign corporation, limited liability company, or partnership that is not registered with the California Secretary of State, Consultant irrevocably consents to service of process on Consultant by first class mail. directed to the individual. and address listed under"For Legal. Notice," in section I.B. of Exhibit A to this Agreement, and that such service shall be effective five days after mailing. 7. OWNERSHIP AND USE OF WORK PRODUCT All reports, studies, information, data, statistics, forms, designs, plans, procedures, systems and any other materials or properties produced in whole or in part under this Agreement in connection with the performance 8 Cit;of Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 189 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 of the Required Services (collectively"Work Product"') shall be the sole and exclusive property of City. No such Work Product shall be subject to private use, copyrights or patent rights by Consultant in the United States or in any other country without the express, prior written consent of City. City shall have unrestricted authority to publish, disclose, distribute, and otherwise use, copyright or patent, in whole or in part, any such Work Product, without requiring any permission of Consultant, except as may be limited by the provisions of the Public Records Act or expressly prohibited by other applicable laws. With respect to computer files containing data generated as Work Product, Consultant shall make available to City, upon reasonable written request by City, the necessary functional computer software and hardware for purposes of accessing, compiling, transferring and printing computer files. 8. GENERAL PROVISIONS 8.1 Amendment. This Agreement may be amended, but only in writing signed by both Parties. 8.2 Assignment. City would not have entered into this Agreement but for Consultant's unique qualifications and traits. Consultant shall not assign any of its rights or responsibilities under this Agreement, nor any part hereof, without City's prior written consent, which City may grant, condition or deny in its sole discretion. 8.3 Autho The person(s) executing this Agreement for Consultant warrants and represents that they have the authority to execute same on behalf of Consultant and to bind Consultant to its obligations hereunder without any further action or direction from Consultant or any board, principle or officer thereof. 8.4 Counterparts. This Agreement may be executed in counterparts., each of which shall be deemed an original,but all of which shall constitute one Agreement after each Party has signed such a counterpart. 8.5 Entire Agreement. This Agreement together with all exhibits attached hereto and other agreements expressly referred to herein, constitutes the entire Agreement between the Parties with respect to the subject matter contained herein. All exhibits referenced herein shall be attached hereto and are incorporated herein by reference. All prior or contemporaneous agreements,, understandings, representations, warranties and statements, oral or written, are superseded. 8.6 Record Retention. During the course of the Agreement and for three (3) years following completion of the Required Services, Consultant agrees to maintain, intact and readily accessible, all data, documents, reports, records, contracts, and supporting materials relating to the performance of the Agreement, including accounting for costs and expenses charged to City, including such records in the possession of sub- contractors/sub-consultants. 8.7 Further Assurances. The Parties agree to perform such further acts and to execute and deliver such additional documents and instruments as may be reasonably required in order to carry out the provisions of this Agreement and the intentions of the Parties. 8.8 Indep ndent Contractor. Consultant is and shall at all times remain as to City a wholly independent contractor. Neither City nor any of its officers, employees, agents or volunteers shall have control over the conduct of Consultant or any of Consultant's officers, employees, or agents ("Consultant Related Individuals"), except as set forth in this Agreement. No Consultant Related Individuals shall be deemed employees of City, and none of them shall be entitled to any benefits to which City employees are entitled, including but not limited to, overtime, retirement benefits, worker's compensation benefits, injury leave or other leave benefits. Furthermore, City will not withho�ld state or federal income tax, social security tax or 9 Cit;of Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 190 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 any other payroll tax with respect to any Consultant Related Individuals; instead, Consultant shall be solely responsible for the payment of same and shall hold the City harmless with respect to same. Consultant shall. not at any time or in any manner represent that it or any of its Consultant Related Individuals are employees or agents of City. Consultant shall not incur or have the power to incur any debt, obligation or liability whatsoever against City, or bind City in any manner. 8.9 Notices. All notices, demands or requests provided for or permitted to be given pursuant to this Agreement must be in writing. All notices, demands and requests to be sent to any Party shall be deemed to have been properly given or served if personally served or deposited in the United States mail, addressed to such Party, postage prepaid, registered or certified, with return receipt requested,, at the addresses identified in this Agreement at the places of business for each of the designated Parties as indicated in Exhibit A, or otherwise provided in writing. 8.10 Electronic Signatures. Each Party agrees that the electronic signatures,whether digital or encrypted, of the Parties included in this Agreement are intended to authenticate this writing and to have the same force and effect as manual signatures. Electronic Signature means any electronic so�und, symbol, or process attached to or logically associated with a record and executed and adopted by a Party with the intent to sign such record, including facsimile or email electronic signatures,pursuant to the California Uniform Electronic Transactions Act (Cal. Civ. Code §§ 1633.1 to 1633.17) as amended from time to time. (End of page. Next page is signature page.) io City of Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 191 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 SIGNATURE PAGE CONSULTANT SERVICES AGREEMENT IN WITNESS, WHEREOF, by executing this Agreement where indicated below, City and Consultant agree that they have read and understood all terms and conditions of the Agreement, that they fully agree and consent to bound by same, and that they are freely entering into this Agreement as of the Effective Date. SOUTHWEST STRATEGIES, LLC CITY OF CHULA VISTA BY: E6DocuSigned by: oAxis (W& 5BDF028427EE48D... BY: CHRIS WAHL MARY CASILLAS SALAS PRESIDENT MAYOR ATTEST BY: Kerry K. Bigelow, MMC City Clerk APPROVED AS TO FORM BY: Glen R. Googins City Attorney I it Cit;of Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 192 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 EXHIBIT A SCOPE OF WORK AND PAYMENT TERMS 1. Contact People for Contract Administration and Legal Notice A. City Contract Administration: Anne Steinberger 276 Fourth Ave, Chula Vista, CA 919 10 619-409-5446 asteinberger@chulavistaca.gov For Legal Notice Copy to: City of Chula Vista City Attorney 276 Fourth Avenue, Chula Vista, CA 919 10 619-691-5037 CityAttomey@chulavistaca.gov B. Consultant Contract Administration: SOUTHWEST STRATEGIES, LLC �402 B St, Suite 150, San Diego, CA 92101 (8518) 541-7800 cwahl@swspr.com For Legal Notice Copy to: Pedro Anaya 401 B St, Suite 150 (858) 541-7800 panaya@swspr.com 2. Required Services A. General Description: Consultant will provide public outreach and communication services, writing and coordinating translation services,and meeting planning services for the 2020 Chula Vista Redistricting effort B. Detailed Description: Consultant shall: 1. Become familiar with relevant provisions of the City's Charter and Municipal Code related to Chula Vista Redistricting process. 2. Work with the Redistricting Commission, City staff and the demographer consultant in developing and implementing a Work Plan to promote broad-based public input by residents and targeted Chula Vista stakeholders in the development of various redistricting maps. The strategies should include how to reach iiiiiiiiiiiiiiiiiiiiiillillillillillillilliillillillillillillillI iiiiiiiiiiiiillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillI 12 City of Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 193 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 stakeholders during COVID-19 Pandemic restrictions and limits on public gatherings. The stakeholders include, but are not limited to residents, education, businessl social service, and/or non-profit agencies or organizations. 3. Coordinate, schedule, and attend up to five public outreach meetings/workshops in various areas of the City to educate and engage targeted stakeholders on the development of districting maps. These public outreach meetings/workshops may require innovative options for securing public input during COVID-19 pandernic restrictions and limits on public gatherings. 4. Attend or participate in community and other meetings or events to educate and inform participants about the 2020 Redistricting effort and promote opportunities for public input. 5. Coordinate translation services at public outreach meetings/wo�rkshops or other events,, as requested. 6. Develop a variety of written materials which may include; fact sheet(s), advertisin , web content, public 1� 9, meeting fliers, social media posts,press releases, newsletter articles, and other documents. The consultant also will coordinate translation of certain materials, as requested. 7. Assist the Redistricting Commission, City staff and mapping consultant in implementing an open and transparent process that promotes public consideration of, and comment on, the drawing of Council District boundaries. 8. Attend standiniz and special Redistricting Commission meetings as needed to assist in the implementation of 4_� the Work Plan and timeline for finalizing a recommended Redistricting Plan in compliance with all City and State deadlines 3. Term: In accordance with Section 1.10 of this, Agreement, the terrn of this Agreement shall begin March 16, SL 11111c f`�1�1� C 2021 and end on .1ti t��i 1 3(1,') K., R -1, 0)1`1��,1413 L11 ta ill" I ' I S %t"I't )1-1. f"11C "E''I" ".I -a C1 C1,I's cllt',,� Of jiei�'s is, 1!1� h 0, ieten,�n i W C11,, 711 k iw,�L3 I- 11,C111 dtl]C t*ek,as(,: (1, b)11, Oiictiobetl� 2("Y2 11[ ,,1�1,(J P, t,lti 's 9 iie C(11`11,S L11 ta ill",S 111] 11( t t s ni, 12 2 11 da,1,,1rLj,,,f or, FLUI U`11 S h 30�, �O" 2. 11 11)'\1v,1c!fxTer, I i"11110,10"e(i to extet,i( ("i1i itract li",ii (,'ili li I C g( '1' �'[ �(1 1 3 C, 6,1� 0 h I Ig ani�,J for completion of all Required Services. t() I 1("�)XIIII 4. Compensation: A. Form of Compensation Z Time and Materials. For performance of the Required Services by Consultant as identified in Section 2.B., above, City shall pay Consultant for the productive hours of time spent by Consultant in. the performance of the Required Services, at the rates or amounts as indicated below: Enter Applicable Hourly Rates Pedro Anaya $150/hour Patrick Batten $150/hour Anika Fisch $150/hour Joann Fields $150/hour iiiiiiiiiiiiiiiiiiiiill��illillillillillillilliillillilillilllI iiiiiiiiiiiiiiiiiiiiiillillillillillillilliililillillillillillillillillilliillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilI 1131 Cit;of Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 194 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 Alexis Lopez $150/hour Sam Rivera $150/hour Susana Villegas $150/hour B. Reimbursement of Costs El None, the compensation includes all costs OR FX_1 Invoiced or agreed-upon amounts as follows: Mileage at the current IRS reimbursement rate (2021 rate: 56 cents/mile) Notwithstanding the foregoing, the maximum amount to be paid to the Consultant for services performed through June 30, 2022, or the contract term end date if extended per section 3., above, whichever is later, shall not exceed $501,000. 5. Special Provisionso, FX_1 Permitted Sub-Consultants: Joann Fields,, Susana Villegas EXHIBIT B INSURANCE REQUIREMENTS Consultant shall adhere to all terms and conditions of Section 3 of the Agreement and agrees to provide the following types and minimum amounts of insurance, as indicated by checking the applicable boxes (x). Type of Insurance Minimum Amount Form General Liability: $2,000,000 per occurrence for Insurance Services Office Form Including products and bodily injury, personal injury CG 00 01 completed operations, (including death), and property personal and damage. If Commercial General advertising injury Liability insurance with a general aggregate limit is used, either the general aggregate limit must apply separately to this Agreement or the general, aggregate limit must be twice the required occurrence limit Additional Insured Endorsement *Must be primary and must not or Blanket At Endorsement for exclude ProductslCompleted city* Operations Waiver of Recovery Endorsement FX_1 Automobile Liability $1,000,000 per accident for bodily Insurance Services Office Form injury, including death, and CA 00 01 I property damage Code I-Any Auto 14 City of Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 195 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 Code 8-Hired Code 9-Non Owned Workers' 1 000,000 each accident Compensation $1 000,000 disease policy limit Employer's Liability $1 000,000 disease each employee Waiver of Reco�very Endorsement Professional Liability $1 000,000 each occurrence (Errors & Omissions) $2,000,000 aggregate Other Negotiated Insurance Terms: "NONE" iiiiiiiiiiiiiiiiiiiiiillillillillillillilliillillillillillilliilI iiiiiiiiiiiiiiiiiiiiiillillillillillillilliillillillillillillilliillillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillilliilillillilliillillillillillillilliillillillillillillilliillillillillillillillI 15 City o Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 196 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 EXHIBIT C CONSULTANT CONFLICT OF INTEREST DESIGNATION The Political Reform Act' and the Chula Vista Conflict of Interest Code 2 ("Code") require designated state and local government officials, including some consultants, to make certain public disclosures using a Statement of Economic Interests form (Form 700). Once filed, a Form 700 is a public document, accessible to any member of the public. In addition, consultants designated to file the Form 700 are also required to comply with certain ethics training requirements 0 3 0 A. Consultant IS a corporation or limited liability company and is therefore EXCLUDED 4 from disclosure. El B. Consultant NOT a corporation or limited liability company and disclosure designation is as follows-. APPLICABLE DESIGNATIONS FOR INDIVIDUAL(S) ASSIGNED TO PROVIDE SERVICES (Category descriptions available at www.chulav,istaca,..,go.yldepartmentslc,i.ty-clerklconllic interest-co,de.) N "s Name Email Address 4Mlicante DesW' nation Enter Name of Each Individual Enter email address(es) El A. Full Disclosure Who Will Be Providing Service El B. Limited Disclosure (select one or more of' Under the Contract—If the categories under which the consultant shallfile): individuals have different 1:1 1. 1:12. El 3. El 4. El 5. El 6. El 7. disclosure requirements, Justification: duplicate this row and complete separatelyfor each El C. Excluded from Disclosure individual 1.Required Filers Each individual who will be performing services for the City pursuant to the Agreement and who meets the definition of"Consultant,"pursuant to FPPC Regulation 18700.3, must file a Form 70�O�. 2.Required Filing Deadlines Each initial Form 700 required under this Agreement shall be filed with the Office of the City Clerk via the City's onfine . J filing system,Neffile, within 30 days of the approval of the Agreement. Additional Form 700 filings will be require.. annually on April I during the term of the Agreement, and within 30 days of the termination of the Agreement. 3.Filing Designation The City Department Director will designate each individual who will be providing services to the City pursuant to the Agreement as ffill disclosure, limited disclosure, or excludedftom disclosure, based on an analysis of the services the Consultant will provide. Notwithstanding this designation or anything in the Agreement, the Consultant is ultimately responsible for complying with FPPC regulations and filing requirements. If you have any questions regarding filing requirements, please do not hesitate to contact the City Clerk at (619)691-5041, or the FPPC at 1-866-ASK-FPPC, or (866)275-3772 *2. Pursuant to the duly adopted City of Chula Vista Conflict of Interest Code,this document shall serve as the wrritten determination of the consultant's requirement to comply with the disclosure requirements set forth in the Code. Completed by: Anne Steinberger I Cal. Gov. Code§§8 1000 et seq.- FPPC Regs. 18 700.3 and 18 704. 2 Chula Vista Municipal Code §§2.02.010-2.02.040. 3 Cal. Gov. Code §§53234,etseq. 4 CA FPPC Adv.A-15-147 (Chadwick)(2015);Davis v. Fresno Un4ied School District(20 15)23 7 Cal.App.4"26 1;FPP,C Reg. 18700.3 (Consultant defined as an"individual"who participates in making a governmental decision; "individual"'does not include corporation or limited liability company). iiiiiiiiiiiiiiiiiiiiiillillillillillillilliillillilillillilillilI iiiiiiiiiiiiiiiiiiiiiillillillillillillilliilillillillillillillililliillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilliillillillillillillillillillillilliillillillillillillilliillillillillillillilI ,K 6 Cit;of Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 197 of 724, DocuSign Envelope ID: 12A5,3BBO-5928-40EC-986D-16A781907OC6 iiiiiiiiiiiiiiiiiiiiiillillillillillillillillillillillillilliillI iiiiiiiiiiiiiiiiiiiiiillillillillillillilliilillillillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillillillilliilillillillillillillillilliillillillillillillilliillilliillillillillilI 17 City o Chula Vista Agreement No.:2021-006 Consultant Name:Southwest Strategies,LLC Rev. 9/15/20 2021-03-16 Agenda Packet Page 198 of 724, DocuSign Envelope ID:2C7CC12F-6ODl�-42A8-8,CF9�-A6B859698D7E RESOLUTION NO. 20�21- 001 RESOLUTION O�F' THE 2020 REDISTRICTING COMMISSION OF THE CITY OF CHULA VISTA RECOMMENDING THE SELECTION OF NATIONAL DEMOGRAPHICS CORPORATION AS THE DEMOGRAPHER FOR THE REDISTRICTING COMMISSION WHEREAS, the Chula Vista Redistricting Commission was established pursuant to Charter section 300.5; and WHEREAS, Charter section 300.5(A)(3) the Commission shall utilize "o�ne or more, as necessary, independent consultants experienced and competent in the skill necessary for the redistricting work" to assist the Commission in developing the Districting Plans required by the Charter; and WHEREAS,, in order to identify such consultants, proposals were solicited in compliance with the City's purchasing procedures, including Chula Vista Municipal Code section 2.56.110; and WHEREAS, in response to the City's Request for Proposals, three firms submitted proposals: ARCBridge Consulting & Training, Inc., National Demographics Corporation and Redistricting Partners; and WHEREAS, the Commission has considered the recommendation of the subcommittee created to participate in the Request for Proposals (RFP) evaluation process that affirmed the qualification of the recommended demographer to the Commission at its meeting of January 21, 202 1; and WHEREAS, the Commission recommends that the City retain National Demographics Corporation as the redistricting demographer. NOW, THEREFOREI BE IT RESOLVED by the 2020 Redistricting Commission of the City of Chula Vista, that it recommends that the City retain National Demographics Corporation to serve as the demographer to assist the Commission in completing its work; and that it authorizes the commission chair to present the recommendation to the City Council on behalf of the Commission. PASSED, APPROVED, and ADOPTED by the 2020 Redistricting Commission of the City of Chula Vista, California, this 2 1 st day of January 202 1, by the following vote.- A Y E S- Commissioners: Cressler, Fomter, Hurtado, Juan and Moreno NAYS: Commissioners: None ABSENT: Commissioners: Andrade and Dostal 2021-03-16 Agenda Packet Page 199 of 724, DocuSign Envelope ID:2C7CC12F-6ODl�-42A8-8,CF9�-A6B859698D7E Resolution No. 20�2 1-001 Page 2 DOCUSigned by: Q" f/04444 1589BBODA37NE6... Gloria Hurtado, Chair ATTEST: DocuiSigned by: "k; 40 9805BEMM684BO... Tyshar L. Turner, Commission Secretary STATE OF CALIFORNIA COUNTY OF SAN DIEGO CITY OF CHULA VISTA 1, Tyshar L Turner, Secretary of the Redistricting Commission of the City of Chula Vista, California, do hereby certify that the foregoing Resolution No. 2021-001 was, duly passed, approved, and adopted by the Redistricting Commission at its regular meeting held on the 2 1 st day of January 202 1. Executed this 2 Is' day of January 2 02 1. DocuiSigned by: 9805BEMM684BO... Tyshar L. Turner, Commission Secretary 2021-03-16 Agenda Packet Page 200 of 724, DocuSign Envelope ID:2C7CC12F-6ODl�-42A8-8,CF9�-A6B859698D7E RESOLUTION NO. 2021- 002 RESOLUTION O�F' THE 2020 REDISTRICTING COMMISSION OF THE CITY OF CHULA VISTA RECOMMENDING THE SELECTION OF SOUTHWEST STRATEGIES, LLC AS THE PUBLIC OUTREACH CONSULTANT FOR THE REDISTRICTING COMMISSION. WHEREAS, the Chula Vista Redistricting Commission was established pursuant to Charter section 300.5; and WHEREAS, Charter Section 300.5(A)(3) the Commission shall utilize "one or more, as necessary, independent consultants experienced and competent in the skill necessary for the redistricting work" to assist the Commission in developing the Districting Plans required by the Charter; and WHEREAS,, in order to identify such consultants, proposals were solicited in compliance with the City's purchasing procedures, including Chula Vista Municipal Code section 2.56.110; and WHEREAS, in response to the City's Request for Proposals, five firms submitted proposals: Consulting Solutions Team, LLC; JPW Communications, LLC; NV5; Southwest Strategies, LLC; and Tripepi Smith; and WHEREAS, the Commission has considered the recommendation of the subcommittee created to participate in the Request for Proposals (RFP) evaluation process that affirmed the qualification of the recommended public outreach consultant to the Commission at its meeting of January 21, 2021- and WHEREAS, the Commission recommends that the City retain Southwest Strategies,, LLC as the redistricting outreach consultant. NOW, THEREFOREI BE IT RESOLVED by the 2020 Redistricting Commission of the City of Chula Vista, that it recommends that the City retain Southwest Strategies, LLC to serve as the public outreach consultant to assist the Commission in completing its work; and that it authorizes the commission chair to present the recommendation to the City Council on behalf of the Commission. PASSED,APPROVED,and ADOPTED by the 2020 Redistricting Commission of the City of Chula Vista Califomia, this 21 s'day of January 202 1, by the followinr vote: I I %_11 A Y E S- Commissioners: Cressler, Fomter, Hurtado, Juan and Moreno NAYS: Commissioners: None ABSENT: Commissioners: Andrade and Dostal 2021-03-16 Agenda Packet Page 201 of 724, DocuSign Envelope ID:2C7CC12F-6ODl�-42A8-8,CF9�-A6B859698D7E Resolution No. 2021-002 Page 2 DOCUSigned by: 1589BBODA37NE6... Gloria Hurtado, Chair ATTEST: DocuiSigned by: 9805BEMM684BO... Tyshar L. Turner, Commission Secretary STATE OF CALIFORNIA COUNTY OF SAN DIEGO CITY OF CHULA VISTA 1, Tyshar L Turner, Secretary of the Redistricting Commission of the City of Chula Vista, California, do hereby certify that the foregoing Resolution No. 2021-002 was, duly passed, approved, and adopted by the Redistricting Commission at its regular meeting held on the 2 1 st day of January 2021. Executed this 2 1 st day of January 202 1. DocuiSigned by: 9805BEMM684BO... Tyshar L. Turner, Commission Secretary 2021-03-16 Agenda Packet Page 202 of 724, IN III Bill! C1TY' C,0UNC'1L A,GEN' DA S,TIA, "nEMENT CITY, OF ..................................... CHUIAVISTA March 16, 2021 File,ID: 20-0551 'TITLE RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA, ACTING IN ITS CAPACITY AS THE LEGISLATIVE BODY OF COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA), AUTHORIZING AND PROVIDING FOR THE ISSUANCE OF SPECIAL 'TAX BONDS, FOR IMPROVEMENT AREA NO. 2 OF SUCH COMMUNITY FACILITIES, DISTRICT, APPROVING 'THE FORM OF BOND INDENTURE, BOND PURCHASE AGREEMENT, PRELIMINARY OFFICIAL STATEMENT' AND OTHER DOCUMENTS RELATED THERETO AND AUTHORIZING CERTAIN ACTIONS IN CONNECTION WITH THE ISSUANCE OF SUCH BONDS RECOMMENDED ACTION Council adopt the resolution. SUMMARY In September 2016 the City formed Community Facilities District No., 16-1 (Millenia) (the "District") and designated two improvement areas therein ("Improvement Area No. 1 11 and "Improvement Area No. 2") pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (the "Act"), to finance the acquisition or construction of certain public improvements. The Dlistrict is authorized to issue up to $21,000,0100 principal amount of blonds with respect to Improvement Area No. 2. In June 2018,the District issued$12,280,0010 of special tax bonds for Improvement Area No. I to fund the acquisition of certain public facilities.The District now intends to issue a series of special tax blonds(the"Bonds")secured by special taxes levied within Improvement Area No. 2. ENVIRONMENTAL REVIE'W The activity is not a "Project P) as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required,. BO,ARD/COMMISSION/COMMITTEE RECOMMENDATION Not Applicable DISCUSSION The District was formed by the City pursuant to the Act and Improvement Area No. I and Improvement Area No. 2 were designated therein. The District constitutes a governmental entity separate and apart from the city. Pursuant to the Act,on August 2,2016,the City Council adopted Resolution No.2 016-154 stating its intention to form the District,designate Improvement Area No. 1 and Improvement Area No.2 therein,and to authorize 1111. 0 0 1 P �3ge 11 2021-03-16 Agenda Packet Page 203 of 724, the levy of a special tax on the taxable property within each of Improvement Area No. I and Improvement Area No�. 2. On August 2, 2016,the City Council also adopted Resolution No., 2016-155, stating its intention to incur bonded indebtedness in an aggregate principal amount, with respect to Improvement Area No. 2, not to exceed $21,000,000, for the purpose of financing the acquisition, construction, expansion, improvement, or rehabilitation of certain public facilities to serve the area within the District and its neighboring areas., Subsequent to a noticed public hearing, the City Council adopted Resolution Nos. 2,016-184 and 20�16-185 on September 13, 2016, which established the District, designated Improvement Area No. 1 and Improvement Area No�. 2 therein,authorized the levy of a special tax within each of Improvement Area No. I and Improvement Area No. 2, determined the necessity to incur bonded indebtedness within the District with respect to each of Improvement Area No�. 1 and Improvement Area No. 2,and called an election within each of Improvement Area No. 1 and Improvement Area No. 2 on the propositions of incurring bonded indebtedness,levying a special tax and setting an appropriations limit within the District. On September 13,2 016,an election was held within Improvement Area No.,2 at which the landowners within Improvement Area No. 2 eligible to vote approved the issuance of bonds for the District with respect to Improvement Area No�. 2 in an amount not to exceed $21,000,000. A Notice of Special 'Tax Lien for Improvement Area No. 2 was recorded in the office of the County of San Diego Recorder on September 23, 2016 as Document No. 2016-0502330. On September 20, 2016�,the City Council,acting as the legislative body of the District,adopted an ordinance which authorized the levy within Improvement Area No. 2 of a special tax pursuant to the Rate and Method of Apportionment of Special Tax for Improvement Area No. 2 approved at the September 13, 2016 election. After the formation of the District, the master developer of property within the D�istrict requested that the City Council, acting as the legislative body of the District, delete certain commercial property from Improvement Area No. 2 and initiate proceedings to consider modifying the rate and method of apportionment for Improvement Area No.2 (the"RMA"). The City Council adopted Resolution No.2020-001 on January 7, 202,0, declaring its intention to consider changes to the RMA and to amend the boundary map of the District to remove certain property from Improvement Area No. 2. Subsequent to a noticed public hearing, the City Council adopted Resolution No�. 2020-029 on February 18, 2020, which called a special election on the proposition of levying a special tax in accordance with the Amended and Restated Rate and Method of Apportionment of Special Tax for Improvement Area No. 2 (the "Amended RMA"). On February 18, 2 0 2 0,an election was held within Improvement Area No. 2 at which the landowners within Improvement Area No.2 eligible to vote approved the levy of a special tax within Improvement Area No.2 in accordance with the Amended RMA. On February 18, 2020, the City Council adopted Resolution No. 20�2O�- 30, which declared the results of the election approving the Amended RMA. An Amendment to Notice of Special Tax Lien for Improvement Area No. 2 was recorded in the office of the County on February 28, 2020, as Document No. 2020-0105261. On July 28, 2020�,the City Council, acting as the legislative body of the District, adopted Ordinance No. 3492 which authorizes the levy within Improvement Area No. 2 of a special tax pursuant to the Amended RMA. The District is located in the eastern portion of the City of Chula Vista approximately 8 miles southeast of the City of San Diego,within the Otay Ranch master planned community. 'The District consists of approximately 66 gross acres of which 42 acres are contained within Improvement Area No. 1 and 24 acres are contained within Improvement Area No. 2.The District is a portion of a larger development within Otay Ranch known as "Millenia." The Millenia development is located south of Birch Road, east of State Route 125,and west of P �3ge 2 2021-03-16 Agenda Packet Page 204 of 724, Eastlake Parkway. The Millenia project covers approximately 206 acres and is a mixed-use development consisting of both rental and for-sale residential units and a maximum of 3.3 million square feet of commercial uses, including a hotel, retail space and a business district of up to two million square feet of office space. The Millenia project is expected to be served by a number of parks and a civic core including library facilities, an elementary school and a City fire station. Completed developments within Millenia include single family homes,apartments, attached and detached condominiums,retail centers and an Ayres hotel. Improvement Area No. 2 of the District is made up of four separate project areas. Residential development is underway in three of the project areas which are planned to include 335 for-sale market-rate homes at buildout. The fourth project area is located within the portion of Millenia designated primarily for commercial use, however, residential uses are also permitted. The development within Improvement Area No. 2 is part of the second phase of Millenia. PROPERTY OWNERSHIP SLF IV-Millenia,LLC,a Delaware limited liability company("SLF),is the master developer within the District., SLF has contracted with Meridian Communities, LLC ("Meridian"'), a land development and home�building company, to manage the development of the property within Millenia, including the District. SLF and Meridian are not affiliated entities. SLF has conveyed the three residential project areas within Improvement Area No. 2 to Lennar Homes and Pinnacle New Homes LLC (which is a joint venture entity formed by SLF and Meridian to develop one of the residential projects within Improvement Area No. 2). The fourth pro�ject area consists of an approximately eight acre finished lot owned by SLF, which may be used for commercial and/or residential development. SLF has not made a de,cisio�n as to whether any residential projects will be located in the fourth project area., Lennar Homes is developing two residential communities totaling 209 homes and being marketed as "Cleo" and "Vibe." Pinnacle Homes is developing a residential community with 126 homes being marketed as "Pinnacle at Millenia." The major infrastructure (sewer,water,storm drains,utilities,and arterial roads)to be installed to serve the property within Improvement Area No. 2 is substantially complete, with minor street improvements and a pedestrian crossing remaining. Millenia is accessed via Bir�ch Road and Eastlake Parkway,the arterial roads which border Millenia. The property within Improvement Area No. 2 varies from finished lots to completed homes owned by individuals. The remaining in-tract improvements are expected to be constructed by the homebuilders as development within their respective projects continue to progress. SLF is responsible for constructing six parks within the Millenia pro�ject pursuant to a Park Agreement (the "Park Agreement") with the City. The Park Agreement gives the City the right to withhold building permits for units or properties within Millenia should commencement of park construction or park completion not occur as provided for in the Park Agreement. To date there have been no violations of any of the park thresholds identified in the Park Agreement. DEVELOPMEN'T STATUS As of March 1,2 0 2 1,the status of the residential developments owned by homeb�uilders within Improvement Area No. 2 was as follows: (i) Lennar Homes had completed and conveyed 35 homes to individual homeowners, owned a five-unit building with 3 completed model homes,had 73 homes under construction (50 of which are in escrow and nearing completion) and owned 96 finished lots; and (ii) Pinnacle New Homes, LLC had completed and conveyed 36 homes within Improvement Area No. 2 to individual P �3ge 13 2021-03-16 Agenda Packet Page 205 of 724, homeowners, owned six comp�leted model homes, had 54 homes under construction (44 of which are in escrow and nearing completion) and owned 30 finished lots. SLF owns the remaining project area within Improvement Area No. 2, which consists of an appro�ximate,ly eight-acre finished lot ("Lot 19"). Lot 19 and an adjacent 11-acre lot ("Lot 1") together co�mprise the "business district"within Millenia. Lot 1 is not located within Improvement Area No.2. The business district is entitled for commercial development with a minimum building square footage of'800�,000 and a maximum of 1,900�,O�00. The business district is also entitled for up to 225 residential units, which may be for-rent or for-sale products. If a residential project is included in the business district,it may be located within either Lot 19 or Lot 1. SLF has not decided whether any residential development will be included within Lot 19 and is currently not able provide an estimated timeframe for a decision as to whether there will be any residential development within Lot 19. SLF expects to monitor the demand for residential and commercial space to make a determination as to the plan of development within Lot 19 and Lot 1. The parcels in all three residential developments are in the process of being segregated from the original master parcel into individual condominium parcels. For phases within which at least one unit has closed escrow to an individual homeowner prior to January 1 of'each year,the Treasurer-Tax Collector of'the County of San Diego ("'Tax Collector") is obligated to segregate and assign individual assessor parcel numbers to all units within that phase and send property tax bills for the next tax year to each owner of record as of January 1. For phases without at least one closing to an individual homeowner prior to January 1 of each year, but with closings to individual homeowners prior to July 1 of such year,the Tax Collector is expected to complete a different segregation process ("Tax Collector Segregation") for the tax year beginning July 1. During this process the Tax Collector instructs the owner of'the parent parcel not to pay the property tax bill received for the parent parcel until completion of the Tax Collector Segregation which can take between six (6) to twelve (12) months. Once the parcels are segregated new tax b�ills (the "Delayed Tax Bills") will be mailed by the'Tax Collector to the then owners of record. Delays in the payment of Improvement Area No. 2, special taxes levied and collected on property tax bills have occurred and are expected to occur in the future as a result of the Tax Collector Segregation process. This is due to the Tax Collector's practice of instructing property owners not to pay the special taxes levied on the original master parcels or the parcels created as a result of segregation ("Segregated Parcels".) These property tax bills are not noted as delinquent by the Tax Collector and cannot be paid without stopping the segregation process. Once the process is comp�leted the Delayed Tax Bills are mailed by the Tax Collector. To mitigate the potential time delay in the collection of the special taxes from the Delayed Tax Bills, staff is proposing that the CFD enter into a Deposit Agreement with SLF to provide for the advance by SL,F of monies to be held by the CF'D in the event Tax Collector Segregation causes a de�lay in the payment of the special taxes for the master parcels or the Segregated Parcels. The amount to be deposited with the CFD is$1,003,113.34 which is comprised of the following: Pinnacle VI'be Cleo Total FY 20-21 74,012.40 74�012.40 FY 21-22 134,)454.96 122,)225.92 203J95-14 460J76-02 FY 22-23 155)950.20 124,)671.20 188�303-52 468,924.92 Total 36�4,)417.56 2�46)897.12 391,798-66 1 003,113-34 Monies will be released back to SLF once a year based on the receipt of the Delayed Taxes or the ability to levy the special taxes on the tax roll. The $1,003,113.34 deposit will be made after approval of the Deposit P �3ge 14 2021-03-16 Agenda Packet Page 206 of 724, Agreement by the City Council and prior to printing the Preliminary Official Statement for the Bonds. AUTHORIZATION AND SALE The Bonds are authorized to be issued pursuant to the Act, the resolution (the "Resolution"'), presented for consideration of adoption by the City Council of the City of Chula Vista, acting as the legislative body of the District, and a Bond Indenture dated as of April 1, 2021 (the "Indenture"), by and between the District and Wilmington Trust, National Association, as Fiscal Agent. The resolution appro�ves the form of the follo�wing documents in connection with the financing: 1. Indenture; 2. Bond Purchase Agreement (the "Bond Purchase Agreement"), by and between the Diistrlict and Stifel, Nicolaus&Company,,Incorporated (the "Underwriter"), 3. Preliminary Official Statement("Preliminary Official Statement"; 4. Continuing Disclosure Agreement ("Continuing Disclosure Agreement"), by and between the District and Spicer Consulting Group,as dissemination agent; and 5. Deposit Agreement by and between the City, the Community Facilities District and SLF IV- Mille�nia, LLC. The Resolution also approves the distribution of the Preliminary Official Statement and authorizes the execution of' the Bond Purchase Agreement and Deposit Agreement by the City Manager, a Deputy City Manager, or the Director of Finance, as well as provides certain sale parameters. These parameters are as follows: (1) the par amount of the Bonds cannot exceed $13,0010,0100, (2) true interest cost cannot exceed 4.5%,and (3)the underwriter's discount cannot exceed 1.15%of the par amount of the Bonds,. Except for the special taxes, no other taxes are pledged to the payment of the Bonds. The Bonds are not general or special obligations of'the City nor general obligations of the District but are special obligations of the District payable solely from special taxes levied within Improvement Area No.2 and amounts held under the Indenture. In connection with the issuance of the Bonds, the City has been represented by Best Best& Krieger LLP as Bond Counsel, Stradling Yocca Carlson and Rauth,a Professional Corporation as Disclosure Counsel, Harrell & Company Advisors, LLC as Municipal Advisor, Spicer Consulting Group as Special Tax Consultant, Kitty Shno & Associates as Real Estate Appraiser and Meyers Research LLC as Market Absorption Analyst. Wilmington Trust, National Association,will act as Fiscal Agent for the Bonds. The Bonds, if issued, will be sold on a negotiated sale basis to Stifel, Nicolaus &Company, Incorporated as Underwriter. USE OF PROCEEDS The amount of Bonds to be issued is currently estimated at$11,255,0100. The proceeds of the Bonds will be used to (a) pay the,costs of forming the District; (b) pay the cost and expense of acquisition of certain pubilic facilities required in connection with the development of the District; (c) fund capitalized interest on a portion of the Bonds through September 1, 2021; (d), fund a Reserve Fund securing the Bonds; and (e) pay costs of issuance of the Bonds. The special taxes that were levied in Fiscal Year 2020-21 will be used to make an initial deposit to the District's Administrative Expense Fund for Improvement Area No. 2. The major infrastructure (sewer, water, storm drains, utilities, and arterial roads) to be installed by SLF to serve the property within Improvement Area No. 2 is substantially complete. CRED11T FEATURES The District is being actively developed. Existing developments within the Millenia community include apartments, single family homes and a hotel. As of March 1, 2021, 95% of the Improvement Area No�. 2 P �3ge 15 2021-03-16 Agenda Packet Page 207 of 724, residential property is considered developed and 5% considered undeveloped. Fiscal Year 2020-21 was the first fiscal year in which special taxes were levied within Improvement Area No.2 (based on building permits issued by March 2020) so there,are no delinquencies of special tax,but the Fiscal Year 2,02,0-21 special taxes levied will be deposited under the Deposit Agreement. It is estimated that for Fiscal Year 2021-22 approximately 45% of the special tax obligation will be the responsibility of individual o�wners, if all homes currently in escrow close,with the remaining 55%the responsibility of SLF'and homebuilders. Lennar will be responsible for approximately 34�% of the total levy,Meridian about 12%and SLF'Millenia about 9%.The appraised value of property as of December 15, 2020 to the estimated lien is estimated at 5.24 to 1. Since the Appraisal was completed several months ago,the appraiser has provided a Supplement to the Appraisal stating the that appraised value of the property as of February 15, 202,1 is not less than the appraised value of property as of December 15, 202,0. As with most community facilities district bonds, the Bonds will not have a rating. SB 450/GOVERNMEW CO�DE 5852.1 California law requires prior to authorization of the issuance of bonds with a term greater than, 13 months, the governing body ofa p�ub�lic body to obtain and disclose all of the following information in a meeting open to the public: (A) True Interest Cost of the Bonds: 3.62 % (B,) Finance Charge of the Bonds (Sum of all fees paid to third p�arties): $ 422,0�00.00 (C)i Net Proceeds to be Received (net of finance charges, reserves and capitalized interest, if any): $10)562)000 (D) Total Payment Amount Through Maturity: $2,0,854,000 (Exhibit A to the Resolution provides a breakdown of this information.) DECISIOM-MAKER CONFLICT Staff has reviewed the property holdings of the City Council members and has found no property holdin63 within 1,000 feet of the boundaries of the property which is the subject of this action.Consequently,this item does not present a disqualifying real property-r�elated financial conflict of interest under California Code of Regulations Title 2, section 187022(a)(7) or (8), for purposes of the Political Reform Act (Cal. Go�v't Code §8,7100, et seq.). Staff is not independently aware, and has not been informed by any City Council member, of any other fact that may constitute a basis for a dec�ision-maker conflict of interest in this matter. CURREN"Ir-YE,AR FISCAL IMPACT The estimated costs of issuance associated with the issuance of the Bonds, including costs for the underwriting,are contingent upon the actual sale the Bonds,anticipated to occur by the end of March 2021, and are payable from the bond proceeds or reimbursed from funds deposited by SLF to pay such costs. ONGOING FISCAL IMPACT The costs to administer the District, shall be paid from the proceeds of special taxes to be levied within the District. There is,therefore,no ongoing fiscal impact on the City's General Fund. P �3ge 6 2021-03-16 Agenda Packet Page 208 of 724, ATTAC14MENTS 1. Bond Indenture 2. Bond Purchase Agreement 3,. Appraisal 4. Supplement to Appraisal S. Continuing Disclosure Agreement 6. Preliminary Official Statement 7. Market Absorption Study 8. Deposit Agreement Staff Contact.-Kimberly Ellio�tt P �3ge 7 2021-03-16 Agenda Packet Page 209 of 724, DEPOSIT AGREEMENT FOR COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA) IMPROVEMENT AREA NO 2 'THIS AGREEMENT (the "Agreement") is entered into as of the day of March, 2021 by and between the CITY OF CHULA VISTA, a charter city duly organized and validly existing under the Constitution and the laws of the State of California(the("City"'), COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA), a community facilities district formed and existing pursuant to the laws of the State of California and the City of Chula Vista Community Facilities District Ordinance (the "District") and SLF IV-MILLENIA, LLC, a Delaware limited liability company(the '40wner"). RECITALS A. The City, the District and the Owner have entered into that certain Acquisition/Financing Agreement (the "Financing Agreement") dated as of February 6, 2018, for the purposes of setting forth terms and conditions for the acquisition of the Improvements funded from (a) proceeds of bonds issued by the District for each Improvement Area which are secured by the levy of special taxes witbin each Improvement Area and (b) Surplus Special Taxes derived from the levy of special taxes within the Improvement Areas. Capitalized terms used herein and not otherwise defined shall have the meaning set forth in the Financing Agreement. B. Improvement Area No. 2 is divided into four separate project areas, three of the project areas are planned for separate residential condominium development projects each being developed in phases, with each phase corresponding to a recorded condominium plan, as listed in Exhibit A attached hereto and incorporated herein by this reference. For phases, within which at least one unit has closed escrow to an individual homeowner prior to January I of each year, the Treasurer-Tax Collector of the County of San Diego,(the"Tax Collector")is,obligated to segregate and assign individual parcel numbers to all units within that phase and send property tax bills for the next tax year to each owner of record as of January 1. C. For phases without at least one closing to an individual homeowner prior to January I of each year, but with closings to individual homeowners prior to July I of such year, the Tax Collector is expected to complete a different segregation process ("Tax Collector Segregation") for the tax year beginning July I and instruct the owner of the parent parcel to be segregated not to pay the property tax 'bill received for the parent parcel in the process of Tax Collector Segregation until completion thereof which can take between 6 to 12 months. Upon completion of Tax Collector Segregation, new tax bills (the "D�elayed Tax Bills") are mailed by the Tax Collector to the then owners of record. D. Delays in the payment of Improvement Area No. 2 special taxes levied in accordance witb the Improvement Area No. 2 Special Tax RMA (as defined in the hereinafter defined Indenture) and collected on property tax bills have occurred and are expected to occur in the future as a result of Tax Collector Segregation such that the special taxes levied on.the parcels comprising the phases listed in Exhibit A (the "Parent Parcels") or the parcels resulting therefrom as a result of segregation (the "Segregated Parcels")�, set forth on such property tax bills are not paid by property owners as may be instructed by the Tax Collector, are not noted as delinquent by 60297.00058\33719007.8 2021-03-16 Agenda Packet Page 2 10 of 724, the Tax Collector and cannot be paid without stopping the segregation process until completion thereof and the Delayed Tax Bills are mailed by the Tax Collector. E. The District plans to issue the City of Chula Vista Community Facilities District No. 16-1 (Millenia) Improvement Area No. 2 2021 Special Tax Bonds (the "Bonds") pursuant to a Bond Indenture (the "Indenture"),, by and between the District and Wilmington Trust, National Association,, as fiscal agent (the "Fiscal Agent") and the Bonds will be secured by special taxes levied and collected in Improvement Area No. 2 of the District. F. The purpose of this Agreement is to provide for the advance by the Owner of monies for deposit in the Deposit Fund (defined below) to be held by the District in the event Tax Collector Segregation causes a delay in the payment of the special taxes for the Parent Parcels or the Segregated Parcels (together, the "Parcels") and the deposit in the Deposit Fund of special taxes collected from the payment of Delayed Tax Bills for the purposes described below. AGREEMENT The parties hereto, for mutual consideration, the receipt of which is hereby acknowledged, agree as follows: Section 1. Establishment of the Deposit Fund and Disposition of Deposit. The District shall establish and maintain a separate and distinct fund (the "Deposit Fund"). All monies deposited in the Deposit Fund will be held by the District as cash uninvested and used as set forth in this Agreement. Prior to the distribution of the preliminary official statement for the Bonds by the District to potential investors, Owner shall deliver to the District monies in the amount of$1,003,113.34 (the "Deposit"), which equals the amount of special taxes levied in Fiscal Year 2020-2021 which were unpaid due to Tax Collector Segregation, plus, the amount of special taxes expected by the parties to be levied in Fiscal Year 20�21-2022 and Fiscal Year 2022-2023 on the Parcels, the payment of which may be delayed due to Tax Collector Segregation. The District shall deposit such monies in the Deposit Fund. Section 2. Calculation of Unpaid Special Taxes. So long as the Bonds are outstanding and Tax Collector Segregation has not been completed with respect to all of the Parcels, not later than August I of each year (each a "D�ate of Determination"), the District will review its records to determine the amount of special taxes levied on the Parcels for the preceding fiscal year and review the public records of the Tax Collector to determine the amount of special. taxes collected on the Parcels for the preceding fiscal year and then calculate the amount that relates to a Parcel for which Tax Collector Segregation has not been completed and which special taxes have not been collected for the preceding fiscal year as of such date (the "Unpaid Special Taxes"). The District's determination of the Unpaid Special Taxes as of any Date of Determination pursuant to this Section 2 shall be conclusive absent manifest error. -2- 60297.00058\33719007.8 2021-03-16 Agenda Packet Page 211 of 724, Section 3. Application of the Deposit Fund. (a) Use of Deposit. I the District shall transfer $74 012.40 On the date of issuance of the Bonds, to the Administrative Expense Fund established pursuant to the Indenture. (11) The District shall,no later than February 15th and August 15th of each year, transfer monies in the Deposit Fund to the Fiscal Agent for deposit in: (a) the Administrative Expense Fund established under the Indenture in an amount equal to a proportionate share of the Administrative Expense Requirement (as defined in the Indenture) and (b) the Special Tax Fund established under the Indenture in the amount equal to the least of(x) the Unpaid Special Taxes as of the immediately preceding Date of Determination or (y) the amount necessary to pay debt service on the Bonds due on the next Interest Payment Date (as defined in the Indenture). (b) Replenishment. Following a draw on monies in the Deposit Fund and transfer thereof to the Fiscal Agent for deposit in the Administrative Expense Fund or the Special Tax Fund pursuant to this Agreement,immediately upon receipt,the District shall deposit proceeds of special taxes from the payment of Delayed Tax Bills (the "Delayed Special Tax Revenues") into the Deposit Fund to the extent necessary to replenish the Deposit up to the amount attributable to such Parcels deposited into the Administrative Expense Fund and the Special Tax Fund pursuant to Section 3(a) above. Under no circumstance shall the District or the City be obligated to deposit any monies into the Deposit Fund pursuant to this Section 3(b) except the Delayed Special Tax Revenues,, including without limitation proceeds of the Bonds. (c) Release of Deposit. No later than September I of each year,the District will review the public records of the Tax Collector to determine if segregation occurred on the Parcels for which at least one home was conveyed to a homeowner in the prior calendar year and for which there is expected to be no Delayed Tax Bills. The District shall release from the Deposit Fund to the Owner the amount allocable to a Parent Parcel for which full segregation has occurred and for which the special taxes have been levied on the Segregated Parcels or may be levied in a subsequent tax year. On each Date of Determination, the District shall also calculate the difference between the Unpaid Special Taxes and the portion of the Deposit attributable to the corresponding installment payments received (an "Excess Deposit")�. No later than September I of each year, the District shall release from the Deposit Fund to the Owner the amount equal to the Excess Deposit. For the avoidance of doubt, the Owner shall, in total, receive no more than $1,003,113.34. Section 4. Notices. Any written notice, request or other communication to be given hereunder shall be given to the party entitled thereto at its address set forth in the Financing Agreement. -3- 60297.00058\33719007.8 2021-03-16 Agenda Packet Page 212 of 724, Section 5. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Section 6. Siurular and Plural; Gender. Whenever used herein, the singular number shall include the plural, the plural number shall include the singular, and the masculine feminine or neuter gender shall include the! others whenever the context of this Agreement so indicates. Section 7. Entire Agreement. This Agreement contains the entire Agreement between the parties hereto with respect to the subject matter hereof. This Agreement may not be altered, modified or amended except by an instrument in writing executed by all of the parties. Section 8. Governing Law. This Agreement has been executed in and shall be governed by the laws of the State of California. Section 9. Recitals; Exhibits.Any recitals set fo�rth above and any attached exhibits are incorporated by reference into this Agreement. Section 10. Authoritv of Signatories. Each signatory and party hereto hereby represents and warrants to the other party that it has legal authority and capacity and direction from its, principal to enter into this Agreement, and that all resolutions and/or other actions have been taken so as to enable such party to enter into this Agreement. [Signature Page Follows] -4- 60297.00058\33719007.8 2021-03-16 Agenda Packet Page 213 of 724, IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the date first above written. SLF IV-,MILLENIA, LLC, a Delaware limited liability company By: SLF IV Millenia Investor, LLC, a Texas limited liability company, its sole and managing member By: Stratford Land Fund IV, L.P., a Delaware limited partnership, its co-managing member By: Stratford Fund TV GP, LLC a Texas limited liability company, its, general partner By: Name: Title: CITY OF CHULA VISTA By: Name: Maria Kachadoorian, City Manager APPROVED AS TO FORM.- By: City Attorney COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA) By: Name-. Maria Kachadoorian, City Manager -Signature Page- Deposit Agreement S-1 60297.00058\33719007.8 2021-03-16 Agenda Packet Page 214 of 724, EXHIBIT A Total Deposit for Deposit for I st Installment 20-21 Deposit for 2nd Installment 20-21 20-21 Phase Pinnacle Vibe Cleo Pinnacle Vibe Cleo 1 371006.20 371006.20 74M 12.40 2 3 4 5 6 7 8, 9 10 m 3706.20 371006.20 74M 12.40 Total Deposit for Deposit for I st Installment 2 1-22 Deposit for 2nd Installment 21-22 21-22 Phase Pinnacle Vibe Cleo Pinnacle Vibe Cleo I 9�442.07 9�442.07 1804.14 2 808.48 808.48 16�176.96 3 1 0�192.92 - 8�543.40 1 0�1,92.92 8�543.40 37�472.64 4 15�289.38 7�1,89.76 7�189.76 15�289.38 7�189.76 7�189.76 59�337.80 5 101192.92 61291.04 81,543.40 101192.92 61291.04 8,1543.40 50,054.72 6 201385.84 61291.04 9,11442.07 201385.84 61291.04 9,1442.07 721237.90 7 61069.96 71189.76 121138.28 61069.96 71189.76 121,138.28 50,796.00 8 81088.48 9,11442.07 810�88.4,8 9,1442.07 35,061.10 9 61291.04 51,392.32 61291.04 5,1392.32 23,366.72 10 71189.76 91,885.92 71189.76 9,1885.92 341151.36 I I - 808.48 091.30 8M88.48 091.30 33�559.56 m 5,096.46 41493.60 4,,948.50 52096.46 42493.60 41948.50 292 77.12 671227.48 611112.96 1011747.57 671227.48 611112.96 1011747.57 460,176.02 A-1 60297.00058\33719007.8 2021-03-16 Agenda Packet Page 215 of 724, Total Deposit for Deposit for I st Installment 22-23 Deposit for 2nd Installment 22-23 22-23 Phase Pinnacle Vibe Cleo Pinnacle Vibe Cleo I ............... ............... ............... ....... .................. 2 8i250.30 8i250�.30 1615,00.60 ............... ..................... ..............."I'l""I'll""I'll'll""I'll'"'I'll",'ll""I'll""II............... ...... 3 101396.68 8i7l4420 101396.68 8i7l4420 381221.76 ............... ............... ............... ............... ...... 4 1515951.02 75333.60 7i333460 151595.02 71333.60 7i333460 6015,24.44 ............... ............... ............... ............... ...... 5 101396.68 65416.90 8i7l4420 101396.68 61416.90 8i7l4420 5111055.56 ............... ............... ............... ............... ...... 6 201793.36 65416.90 9i63049�4 201793.36 61416.90 9i630�494 731682.40 ........................ ............... ............... ............... ...... 7 151595.02 7�333.60 12�381.04 15.1595.02 7.133,3.60 12i381.04 70.1619.32 ............... ........ ............... ............... ........ 8 8�250.30 9fi30.94 8.1250.30 9fi30.94 35.1762.48 ............... ............. ............... ............... ........ 9 6�416.90 5�500.20 61416.90 5�500�.20 23�834.20 ............... ............. ............... ............... ........ 10 7�333.60 1003.70 71333.60 1 OM83.70 34�834.60 ............... ............. ............... ............... ........ I I 8�250.30 805.20 81250.30 805.20 34�23 1.00 ............... ............. ............... ............... ........ -Ar A m 5,198.3 4,583.50 5,047444' 5,198.34 4,583.50 5,047.4 T 29,658.56 ............... ............... 77�975.10 62�335.60 94�151.76 77�975.10 621335.60 94�p 15 1.76 468.X4.92 Grand Total 182208.78 j23�448.56 1=95 9=9=33 1=82 2�0878 123448456 1=95�899.33 1=1,003 1 l3,34 A-2 60297.00058\33719007.8 2021-03-16 Agenda Packet Page 216 of 724, RESOLUTION NO. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA, ACTING FOR ITSELF AND IN ITS CAPACITY AS THE LEGISLATIVE BODY OF' COMMUNITY FACILITIES DISTRICT NO�. 16-1 (MILLENIA), AUTHORIZING AND PROVIDING FOR THE ISSUANCE OF SPECIAL TAX BONDS FOR IMPROVEMENT AREA NO. 2 OF SUCH COMMUNITY FACILITIES DISTRICT, APPROVING THE FORM OF' BOND INDENTURE, BOND PURCHASE AGREEMENT, PRELIMINARY OFFICIAL STATEMENT AND OTHER DOCUMENTS RELATED THERETO AND AUTHORIZING CERTAIN ACTIONS IN CONNECTION WITH THE ISSUANCE OF SUCH BONDS WHEREASI the City Council (the "City Council") of the City of Chula Vista(the 4'City"), did previously conduct proceedings to form and did form a community facilities district and designate improvement areas therein for the purpose of financing the acquisition or construction of certain public improvements pursuant to the terms and provisions of the "Mello-Roos Community Facilities Act of 1982",,being Chapter 2.5,Part 1,Division 2,Title 5 of the Government Code of the State of California(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"), such Community Facilities District designated as Community Facilities District No. 16-1(Millenia)(the"Community Facilities District") and the improvement areas were designated as "Improvement Area No. I"and "Improvement Area No. 2" and collectively, the "Improvement Areas;" and WHEREAS, this City Council has previously declared its intention to issue bonds for the Community Facilities District for each of the Improvement Areas to finance the acquisition or construction of such improvements, such bonds to be issued pursuant to the terms and provisions of the Act, the City of Chula Vista Statement of Goals and Policies Regarding the Establishment of Community Facilities Districts,as amended to date(the"Goals and Policies")and the City of Chula Vista Debt Policy; and WHEREAS, at this time this City Council desires to set forth the general terms and conditions relating to the authorization,issuance and administration of such bonds for Improvement Area No. 2 of the Community Facilities District to be designated as the "City of Chula Vista Community Facilities District No. 16-1 (Millenia) Improvement Area No. 2 2021 Special Tax Bonds" (the "Improvement Area No. 2 Bonds"); and WHEREAS,the forms of the following documents have been presented to and considered for approval by this City Council: A. Bond Indenture by and between the Community Facilities District and Wilmington Trust, National Association, as fiscal agent (the "Fiscal Agent"') setting forth the terms and conditions relating to the issuance, sale,delivery and administration of the Improvement Area No�. 2 Bonds (the "Bond Indenture"),- 1 60�297.00�05 8\33468178.9 2021-03-16 Agenda Packet Page 217 of 724, B. Bond Purchase Agreement by and between the Community Facilities District and Stifel, Nicolaus & Company, Incorporated, the designated underwriter (the "Underwriter") authorizing the sale of the Improvement Area No. 2 Bonds to the Underwriter(the "Bond Purchase Agreement"); C. Preliminary Official Statement containing information including but not limited to the Community Facilities District and the Improvement Area No.2 Bonds,including the terms and conditions thereof(the "Preliminary Official Statement"); D. Continuing Disclosure Agreement by and between the Community Facilities District and Spicer Consulting Group, as dissemination agent(the "Dissemination Agent"), pursuant to which the Community Facilities District will be obligated to provide ongoing annual disclosure relating to the Improvement Area No. 2 Bonds (the "Continuing Disclosure Agreement"); E. Deposit Agreement for Community Facilities District No. 16-1 (Millenia) Improvement Area No. 2 by and between the City,the Community Facilities District and SLF IV-Millenia, LLC (the "Owner") to provide for the advance by Owner of monies in the event the payment of special taxes is delayed on certain parcels in the Community Facilities District due to the Treasurer-Tax Collector of the County of San Diego's segregation process (the "Deposit Agreement"); and WHEREASI this City Council, with the aid of City staff, has reviewed and considered the Bond Indenture,the Bond Purchase Agreement,the Deposit Agreement,the Continuing Disclosure Agreement and the Preliminary Official Statement and finds those documents suitable for approval, subject to the conditions set forth in this resolution; and WHEREAS, Section 5852.1 of the Government Code of the State of California ("Section 5 852.1") provides that the City Council obtain from an underwriter, financial advisor or private lender and disclose, in a meeting open to the public, prior to authorization of the issuance of the Improvement Area No. 2 Bonds, good faith estimates of: (a) the true interest cost of the Improvement Area No. 2 Bonds, (b) the finance charge of the Improvement Area No. 2 Bonds, meaning the sum of all fees and charges paid to third parties, (c) the amount of proceeds of the Improvement Area No.2 Bonds received less the finance charge described above and any reserves or capitalized interest paid or funded with proceeds of the Improvement Area No. 2 Bonds and(d)the sum total of all debt service payments on the Improvement Area No. 2 Bonds calculated to the final maturity of the Improvement Area No. 2 Bonds plus the fees and charges paid to third parties not paid with the proceeds of the Improvement Area No. 2 Bonds; and WHEREAS, in accordance with Section 5852.1, the City Council has obtained such good faith estimates from Harrell & Company Advisors, LLC, the City's municipal advisor, and such estimates are disclosed in Exhibit A attached hereto; and WHEREAS, all conditio�ns,things and acts required to exist, to have happened and to have been performed precedent to and in the issuance of the Improvement Area No. 2 Bonds as contemplated by this resolution and the documents referred to herein exist,have happened and have 2 60�297.00�05 8\33468178.9 2021-03-16 Agenda Packet Page 218 of 724, been performed or have been ordered to have been performed in due time, form and manner as required by the laws of the State of California, including the Act and the applicable policies and regulations of the City. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Chula Vista, acting for itself and in its capacity as the legislative body of Community Facilities District No. 16-1 (Millenia), that: SECTION 1. Recitals. The above recitals are true and correct. SECTION 2. Determinations. This legislative body hereby makes the following determinations pertaining to the proposed issuance! of the Improvement Area No. 2 Bonds: (a) The Goals and Policies generally require that the full cash value of the properties within Improvement Area No. 2 subject to the levy of the special taxes must be at least four(4)times the principal amount of the Improvement Area No. 2 Bonds and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act on property within Improvement Area No. 2 or a special assessment levied on property within Improvement Area No. 2 (collectively, "Land Secured Bonded Indebtedness"). The Act authorizes the City Council, acting as the legislative body of the Community Facilities District, to sell the Improvement Area No. 2 Bonds only if the City Council has determined prior to the award of the sale of the Improvement Area No. 2 Bonds that the value of such properties within Improvement Area No. 2 will be at least three (3) times the amount of such Land Secured Indebtedness. The full cash value of the property within Improvement Area No. 2 which will be subject to the special tax to pay debt service on the Improvement Area No. 2 Bonds will be at least four(4)times the amount of the Land Secured Bonded Indebtedness allocable to such properties. The Goals and Policies further provide that the full cash value of each development area for which no final subdivision map has been filed must also be at least four(4) times the Land Secured Bonded Indebtedness allocable to each such property. Final subdivision maps havebeen filed for each development area in Improvement Area No. 2, therefore, there are no unmapped development areas remaining within Improvement Area No. 2. The foregoing determinations are based upon the full cash value of such properties and development areas as shown upon an appraisal of the sub ect properties prepared j by Kitty Siino&Associates, Inc., a state certified real estate appraiser, as defined in Business and Professions Code Section I I 340(c)�. Such determination was made in a manner consistent with the Goals and Policies and California Debt and Investment Advisory Commission guidelines. 3 60�297.00�05 8\33468178.9 2021-03-16 Agenda Packet Page 219 of 724, (b�) The terms and conditions of the Improvement Area No. 2 Bonds as contained in the Bond Indenture are consistent with and conform to the Goals and Policies. (c) As a result of the current status of development of the property within Improvement Area No.2.the relative overall lack of diversity of ownership of property within such Improvement Area and the need for the Underwriter to understand fully the status of the development and other facto�rs that affect the credit worthiness of the Improvement Area No. 2 Bonds, the private sale of the Improvement Area No. 2 Bonds will result in a lower overall cost to the Community Facilities District than a sale upon sealed bid. SECTION 3. Improvement Area No. 2 Bonds Authorized. Pursuant to the Community Facilities District Law,this Resolution and the Bond Indenture, Improvement Area No. 2 Bonds in an aggregate principal amount not to exceed $13,000,000 are hereby authorized to be issued. The date, manner of payment, interest rate or rates, interest payment dates, denominations, form, registration privileges,manner of execution,place of payment,terms of redemption and other terms, covenants and conditions of the Improvement Area No. 2 Bonds shall be as provided in the Bond Indenture as finally executed. SECTION 4. Authorization and Conditions. The City Manager,any Deputy City Manager, the Director of Finance/Treasurer and such other official or officials of the City as may be designated in writing by this City Council or the City Manager(each,an"Authorized Officer")are each hereby authorized and directed to execute and deliver the final form of the various documents and instruments described in this Resolution, with such additions thereto or changes therein as such Authorized Officer may deem necessary and advisable provided that no additions or changes shall authorize an aggregate principal amount of Improvement Area No. 2 Bonds in excess of $13,,000,000, a true interest cost of the Improvement Area No. 2 Bonds in excess of four and a half percent (4.50%) and an underwriter's discount in excess of one and fifteen hundredth percent (1.15%)of the par amount of the Improvement Area No.2 Bonds(excluding original issue discount, if any). The approval of such additions or changes shall be conclusively evidenced by the execution and delivery of such documents or instruments by an Authorized Officer,upon consultation with and review by the City Attorney and Best Best&Krieger LLP,the Community Facilities District's bond counsel. SECTION 5. Bond Indenture. The form of Bond Indenture by and between the Community Facilities District and the Fiscal Agent, with respect to the Improvement Area No. 2 Bonds as presented to this City Council and on file with the City Clerk is hereby ap�p�roved. An Authorized Officer is hereby authorized and directed to cause the same to be completed and executed on behalf of the Community Facilities District, subject to the provisions of Section 4 above. SECTION 6. Official Statement and Continuing Disclosure,,,,,,,,,,A,greement. The City Council hereby approves the form of the Preliminary Official Statement as presented to this City Council and on file with the City Clerk,together with any changes therein or additions thereto deemed advisable by the Director of Finance/Treasurer or,in the absence of the Director of Finance/Treasurer,another Authorized Officer. Pursuant to Rule 15c2-12 under the Securities Exchange Act of 1934 (the "Rule") the Director of Finance/Treasurer or, in the absence of the Director of Finance/Treasurer, 4 60�297.00�05 8\33468178.9 2021-03-16 Agenda Packet Page 220 of 724, another Authorized Officer is authorized to determine when the Preliminary Official Statement is deemed final, and the Director of Finance/Treasurer or such other Authorized Official is hereby authorized and directed to provide written certification thereof. The execution of the final Official Statement,which shall include such changes and additions thereto deemed advisable by the Director of Finance/Treasurer or, in the absence of the Director of Finance/Treasurer, another Authorized Officer pursuant to the! Rule, shall be conclusive evidence of the! approval of the final Official Statement by the Community Facilities District. The City Council hereby authorizes the distribution of the final Official Statement by the Underwriter as the initial purchaser of the!Improvement Area No. 2 Bonds. The form of Continuing Disclosure Agreement by and between the Community Facilities District and the Dissemination Agent as presented to this City Council and on file with the City Clerk is hereby approved.An Authorized Officer is hereby authorized and directed to cause the same to be completed and executed on behalf of the Community Facilities District, subject to the provisions of Sections 3 and�4 above. SECTION 7. De-posit Agreement. The form of Deposit Agreement by and between the City,,the Community Facilities District and the Owner,in substantially the form presented,with such minor modification as may be required or approved by the City Attorney and on file with the City Clerk is hereby approved.An Authorized Officer is hereby authorized and directed to cause the same to be completed and executed on behalf of the Community Facilities District and the City. SECTION 8. Sale of Improvement Area No.2 Bonds. This City Council hereby authorizes and approves the negotiated sale of the Improvement Area No.2 Bonds to the Underwriter.The form of the Bond Purchase Agreement is hereby approved and an Authorized Officer is hereby authorized and directed to execute the Bond Purchase Agreement on behalf of the Community Facilities District upon the execution thereof by the Underwriter, subject to the provisions of Section 3 above. SECTION 9. IMp,rovement,Area No.2 Bonds Prepared and Delivered. Upon the execution of the Bond Purchase Agreement, the Improvement Area No. 2 Bonds shall be prepared, authenticated and delivered,all in accordance with the applicable terms of the Community Facilities District Law and the Bond Indenture, and any Authorized Officer and other responsible City officials, acting for and on behalf of the Community Facilities District, are hereby authorized and directed to take such actions as are required under the Bond Purchase Agreement and the Bond Indenture to complete all actions required to evidence the delivery of the Improvement Area No. 2 Bonds upon the receipt of the purchase price thereof from the Underwriter. SECTION 10. Actions. All actions heretofore taken by the officers and agents of the City with respect to the establishment of the Community Facilities District and the sale and issuance of the Improvement Area No. 2 Bonds are hereby approved, confirmed and ratified, and the proper officers of the City, acting for and on behalf of the Community Facilities District, are hereby authorized and directed to do any and all things and take any and all actions and execute any and all certificates, agreements, contracts, and other documents, which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the Improvement Area No. 2 Bonds in accordance with the Community Facilities District Law, this Resolution, the Bond Indenture,the Bond Purchase Agreement,the Continuing Disclosure Agreement,the Deposit 5 60�297.00�05 8\33468178.9 2021-03-16 Agenda Packet Page 221 of 724, Agreement and any certificate,agreement,contract,and other document described in the documents herein approved. SECTION 11. Effective Date. This resolution shall take effect from and after its adoption. Presented by Approved as to form by Tiffany Allen Glen R. Googins Director of Development Services City Attorney 6 60�297.00�05 8\33468178.9 2021-03-16 Agenda Packet Page 222 of 724, EXHIBIT A SB 450 GOOD FAITH ESTIMATES The good faith estimates set forth herein are provided with respect to the Bonds in accordance with California Government Code Section 5852.1. Such good faith estimates have been provided to the City by Harrell & Company Advisors, LLC, the City's Municipal Advisor (the "Municipal Advisor"). Principal Amount. The Municipal Advisor has informed the City that, based on the Community Facilities District's financing plan and current market conditions,its good faith estimate of the aggregate principal amount of the Bonds to be sold is $11,255,000 (the"Estimated Principal Amount"). True Interest Cost of the Bonds. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate,its good faith estimate of the true interest cost of the Bonds,which means the rate necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received for the Bonds, is 3.62%. Finance Charge ofthe Bonds. The Municipal Advisor has informed the City that,assuming that the Estimated Principal Amount of the Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate,its good faith estimate of the finance charge for the Bonds,which means the sum of all fees and charges paid to third parties(or costs associated with the Bonds), is $422,000. Amount of'Proceeds to be Received. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the Bonds is sold, andbased on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the amount of proceeds expected to be received by the Community Facilities District's Improvement Area No.2 for sale of the Bonds, less the finance charge of the Bonds, as estimated above, and any reserves or capitalized interest on the Bonds paid or funded with proceeds of the Bonds, is $10,56,2,000. Total Payment Amount. The Municipal Advisor has informed the City that,assuming that the Estimated Principal Amount of the Bonds is sold,and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the total payment amount, which means the sum total of all payments the Community Facilities District's Improvement Area No. 2 will make to pay debt service on the Bonds, calculated to the final maturity of the Bonds, is $20,854,000 and the annual cost to administer the Bonds,not paid with the proceeds of the Bonds is $7500. The foregoing estimates constitute good faith estimates only and are based on market conditions prevailing at the time of preparation of such estimates on March 2, 20�2 1. The actual principal amount of the Bonds issued and sold, the true interest cost thereof, the finance charges thereof, the amount of proceeds received therefrom and total payment amount with respect thereto may differ from such good faith estimates due to (a) the actual date of the sale of the Bonds being A-1 60�297.00�05 8\33468178.9 2021-03-16 Agenda Packet Page 223 of 724, different than the date assumed for purposes of such estimates, (b) the! actual principal amount of Bonds sold being different from the Estimated Principal Amount, (c)the actual amortization of the Bonds being different than the amortization assumed for purposes of such estimates, (d)the actual market interest rates at the time of sale of the Bonds being different than those estimated for purposes of such estimates,(e)other market conditions,or(f)alterations in the Community Facilities District's Improvement Area No.2 financing plan,or a combination of such factors. The actual date of sale of the Bonds and the actual principal amount of Bonds sold will be determined by the! City based on various factors. The actual interest rates borne by the Bonds will depend on market interest rates at the time of sale thereof. The actual amortization of the Bonds will also depend, in part, on market interest rates at the time of sale thereof. Market interest rates are affected by economic and other factors beyond the control of the City or the Municipal Advisor. A-2 60�297.00�05 8\33468178.9 2021-03-16 Agenda Packet Page 224 of 724, BONDINDENTURE by and between a, Community Facilities District No. 16-1 (Millenia) and Wilmington Trust,National Association, as Fiscal Agent Dated as of April 1, 2021 Re: $[ City of Chula Vista Community Facilities District No. 16-1 (Millenia) Improvement Area No. 2 2021 Special Tax Bonds 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 225 of 724, TABLE OF CONTENTS Page ARTICLE I DEFINITIONS.................................................................................................. I ARTICLE 11 GENERAL AUTHORIZATION AND TERMS ............................................ 12 Section 2.01. Amount, Issuance and Purpose................................................................ 12 Section 2.02. Type and Nature of Bond......................................................................... 12 Section 2.03. Terms of the Bonds.................................................................................. 13 Section 2.04. Description of Bonds; Interest Rates ....................................................... 13 Section2.05. Payment.................................................................................................... 14 Section 2.06. Execution of Bonds.................................................................................. 14 Section 2.07. Order to Print and Authenticate Bonds.................................................... 14 Section 2.08. Books of Registration; Book Entry System............................................. 14 Section 2.09. Exchange of Bonds.................................................................................. 16 Section 2.10. Negotiability, Registration and Transfer of Bonds.................................. 16 Section 2.11. Authentication.......................................................................................... 16 ARTICLE III FUNDS AND ACCOUNTS............................................................................ 17 Section 3.01. Establishment of Special Funds............................................................... 17 Section 3.02. Special Tax Fund. .................................................................................... 17 Section 3.03. Debt Service Fund.................................................................................... 18 Section 3.04. Costs of Issuance Fund............................................................................ 19 Section3.05. Project Fund............................................................................................. 19 Section3.06. Reserve Fund ........................................................................................... 19 Section 3.07. Rebate Fund............................................................................................. 20 Section 3.08. Redemption Fund..................................................................................... 21 Section 3.09. Administrative Expense Fund.................................................................. 21 Section 3.10. Investment of Funds................................................................................. 21 Section 3.11. Disposition of Bond Proceeds.................................................................. 22 ARTICLE IV REDEMPTION............................................................................................... 22 Section 4.01. Notice of Redemption.............................................................................. 22 Section 4.02. Effect of Redemption............................................................................... 24 Section 4.03. Redemption Prices and Terms. ................................................................ 24 ARTICLE V SUPPLEMENTAL INDENTURES.......... 26 Section 5.01. Amendments or Supplements.................................................................. 26 ARTICLE VI MISCELLANEOUS CONDITIONS .............................................................. 28 Section 6.01. Ownership of Bonds ................................................................................ 28 Section 6.02. Mutilated, Lost, Destroyed or Stolen Bonds............................................ 28 Section 6.03. Cancellation of Bonds.............................................................................. 28 Section6.04. Covenants................................................................................................. 29 Section 6.05. Arbitrage Certificate ................................................................................ 32 Section6.06. Defeasance............................................................................................... 32 Section 6.07. Fiscal Agent............................................................................................. 33 i 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 226 of 724, TABLE OF CONTENTS (continued) Page Section 6.08. Liability of Fiscal Agent.......................................................................... 34 Section 6.09. Provisions Constitute Contract .......................................................... 36 Section 6.10. CUSIP Numbers....................................................................................... 36 Section 6.11. Entire Agreement; Severability..........................................................#0#0#0 37 Section 6.12. Unclaimed Money.................................................................................... 37 Section 6.13. Nonpresentment of Bonds........................................................................ 37 Section 6.14. Continuing Disclosure ............................................................................. 37 Section 6.15. Execution of Documents and Proof of Ownership by Owners................ 37 Section 6.16. Notices to and Demands on District and Fiscal A�Yzent............................ 38 Section6.17. Applicable Law........................................................................................ 38 Section 6.18. Payment on Business Day........................................................................ 38 Section6.19. Counterparts............................................................................................. 39 ARTICLE VII BONDFORM ................................................................................................. 39 Section7.01. Form of Bonds ......................................................................................... 39 Section7.02. Temporary Bonds..................................................................................... 39 ARTICLE VIII EVENT OF DEFAULT................................................................................... 39 Section 8.01. Events of Default ..................................................................................... 39 Section 8.02. Application of Revenues and Other Funds after Default......................... 40 EXHIBIT A FORM OF BOND.........................................................................................A-1 EXHIBIT B REQUISITION FOR COSTS OF ISSUANCE............................................. B-1 EXHIBIT C REQUISITION FOR COSTS ........................................ C-1 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 227 of 724, BONDINDENTURE This Bond Indenture dated as of[April 1,202 1],is entered into by and between Community Facilities District No. 16-1 (Millenia), a community facilities district organized and existing under the laws of the State, and Wilmington Trust, National Association, as Fiscal Agent, to establish the terms and conditions and pertaining to the issuance of the Bonds as defined herein. ARTICLE I DEFINITIONS Definitions. As used in this Indenture, the following terms shall have the following meanings: "Acquisition/Financing Agreement" means that certain Acquisition/Financing Agreement dated as of February 6, 2018 by and between the City, the District, and SLF IV- Millenia, LLC, a Delaware limited liability company, as such agreement may be amended from time to time. "Act" means the "Mello-Ro�o�s Community Facilities Act of 1982", as amended, being Chapter 2.5, Part 1, Division 2, Title 5 of the Government Code of the State of California. "Administrative Expense Fund"' means the fund by that name established pursuant to Section 3.01 hereof. "Administrative Expenses"means the expenses directly related to the administration of the District, including,but not limited to,the following: the costs of computing the Improvement Area No. 2 Special Taxes and preparing the annual Improvement Area No. 2 Special Tax collection schedules (whether by the City or a designee thereof or both); the costs of collecting the Improvement Area No. 2 Special Taxes (whether by the County, the City or otherwise); the costs of remitting the Improvement Area No. 2 Special Taxes to the Fiscal Agent; the costs of the Fiscal Agent(including its legal counsel)in the discharge of the duties of the Fiscal Agent required under this Indenture; the costs of the City, the District or any designee thereof of complying with the arbitrage rebate requirements or incurred in participating in and responding to an audit by the Internal Revenue Service; the costs of the City, the District, or any designee thereof of complying with City or District disclosure requirements associated with applicable federal or state securities laws and of the Act or otherwise agreed to by the City or property owners developing within Improvement Area No. 2; the costs associated with preparing Improvement Area No. 2 Special Tax disclosure statements and responding to public inquiries regarding the Improvement Area No. 2 Special Taxes; the costs of the City, District or any designee thereof related to an appeal of the Improvement Area No. 2 Special Tax; and the costs of any credit enhancement obtained by the City or the District (but excluding the costs of any credit enhancement required to be providedby SLF IV — Millenia, LLC and/or its successor). Administrative Expenses shall also include Delinquency Collection Expenses. "Administrative Expense Requirement"means an annual amount equal,to $75,000,or such lesser amount as may be designated by written instruction from an Authorized Representative to the Fiscal Agent, to be allocated as the first priority of Improvement Area No. 2 Special Taxes received each Fiscal Year for the payment of Administrative Expenses. 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 228 of 724, "Annual Debt Service" means, for each Bond Year, the sum of(a) the interest payable on the Outstanding Bonds in such Bond Year, and(b) the principal amount of the Outstanding Bonds scheduled to be paid in such Bond Year, including from mandatory sinking fund payments. "Assistant Director of Finance"means the Assistant Director of Finance of the City. "Authorized Representative" means the City Manager, Director of Finance/Treasurer or Assistant Director of Finance of the City, acting on behalf of the District, or any other person designated in writing by the City Manager or the Director of Finance/Treasurer and authorized to act on behalf of the District under or with respect to this Indenture and all other agreements related hereto. "Averaize Annual Debt Service"means the average annual debt service on the Bonds based upon a Bond Year during the term of the Bonds. "Bond Counsel" means an attorney or firm of attorneys, selected by the District, of nationally recognized standing in matters pertaining to the tax treatment of interest on bonds issued by states and their political subdivisions, duly admitted to the practice of law before the highest court of the State. "Bondowner" or 44Owner", or any similar term, means any person who shall be the registered owner or his duly authorized attorney, trustee, representative or assign of any Outstanding Bond which shall at the time be registered. "Bonds" means the $[ ] City of Chula Vista Community Facilities District 16- 1 (Millenia) Improvement Area No. 2 2021 Special Tax Bonds issued pursuant to this Indenture. "Bond Year" means each twelve-month period extending from September 2 in one calendar year to September I of the succeeding calendar year, except in the case of the initial Bond Year which shall be the period from the Delivery Date to and including September 1, 202 1. "Busines �1 means a day that is not a Saturday or a Sunday or a day of the year on which banks or trust companies in New York, New York, Wilmington Delaware, Los Angeles, California, or where the Principal Corporate Trust Office is located, are not required or authorized to open or to remain open. "Cqp,,,i,t,a,l,,i,zed Interest Sub-Account"means the sub-account by that name within the Interest Account of the Debt Service Fund established pursuant to Section 3.01 hereof. '4C*t " means the City of Chula Vista, California. "'City Manage.11 means the City Manager of the City, acting for and on behalf of the District. "Code"means the Internal Revenue Code of 1986, as amended. "Costs of Issuance" means the costs of issuing the Bonds, including but not limited to, all printing and document preparation expenses in connection with this Indenture and any 2 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 229 of 724, supplemental indenture, the Bonds, and any and all other agreements, instruments, certificates or other documents issued in connection therewith; any computer and other expenses incurred in connection with the Bonds; the initial fees and expenses of the Fiscal Agent (including without limitation, acceptance fees and first annual fees payable in advance); and other fees and expenses incurred in connection with the formation of the District and the issuance of the Bonds, to the extent such fees and expenses are approved by the District. "Costs of Issuance Fund"means the fund by that name established pursuant to Section 3.01 hereof. "CoMptroller of the Curre shall mean the Comptroller of the Currency of the United States. "Debt Service Fund" means the fund created and established pursuant to Section 3.01 hereof "Debt Service on Parity Refunding Obligations"' means, the gross debt service due in any Bond Year on any refunding bonds or other refunding obligations which have, or purport to have, a lien upon the Net Improvement Area No. 2 Special Tax Revenues,on a parity with the lien of the Bonds. "Delayed Specia-i r i ax Revenues"'means proceeds of the Improvement Area No. 2 Special Tax received by the District from the payment of Delayed Tax Bills in an amount not greater than the amount of Unpaid Special Taxes transferred from the Deposit Fund to the Special Tax Fund pursuant to the Deposit Agreement. "Delayed Tax Bills,"' shall have the meaning set forth in the Deposit Agreement. "Delll,,i,n,q,,,u,e,nc,v ollection Expenses"means those fees and expenses of the District incurred by or on behalf of the District in or related to the collection of delinquent Improvement Area No. 2 Special Taxes. "Delinquency Proceeds"' means the amounts collected from the redemption of delinquent Improvement Area No. 2 Special Taxes including the penalties and interest thereon and from the sale of property sold as a result of the foreclosure of the lien of the Improvement Area No.2 Special Tax resulting from the delinquency in the payment of Improvement Area No. 2 Special Taxes due and payable on such property. "Deliver Date" means the date on which the Bonds are issued and delivered to the initial purchaser thereof "De,p,,o,,,s,,,i,,t,,,,,,,,,,,"",""Agreement" means that certain Deposit Agreement for Community Facilities District No. 16-1 (Millenia) Improvement Area No. 2 dated as of March—, 2021 by and between the City, the District, and SLF IV- Millenia, LLC, a Delaware limited liability company. (.'Deposit Fund" shall. have the meaning set forth in the Deposit Agreement. 3 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 230 of 724, "Deposit " shall mean DTC. and its successors and assigns or if(a), the then Depository resigns from its functions as securities depository of the Bonds, or(b)the District discontinues use of the Depository pursuant to this Indenture, any other securities depository which agrees to follow procedures required to be followed by a securities depository in connection with the Bonds and which is selected by the Treasurer. "Director of Finance/Treasurer", means the Director of Finance/Treasurer of the City, acting for and on behalf of the District. "District" means Community Facilities District No. 16-1 (Millenia) situated in and formed by the City of Chula Vista, California. "DTC" shall mean The Depository Trust Company, New York, New York, and its successors and assigns. "Fiscal 1� means Wilmington Trust, National Association, a national banking association duly organized and existing under and by virtue of the laws of the United States of America, at its Principal Corporate Trust Office in Costa Mesa, California, and any successor thereto. "Fiscal Year" means the 12 month period beginning July I of each year and terminating on June 30 of the following year, or any other annual accounting period hereinafter selected and designated by the District as its fiscal year in accordance with applicable law. "Government Obligationsli�means obligations described in Paragraph I of the definition of Permitted Investments. "Gross Proceeds"has the meaning ascribed to such term in Section 14,8(f)(6) of the Code. "Improyernent Area No. 2"'means Improvement Area No. 2 of the District. "Improvement Area No. 2 Special Tax" means the Improvement Area No. 2 Special Tax authorized to be levied in the District pursuant to the Act and the Improvement Area No. 2 Special Tax RMA. "Improyernent Area No. Tax Revenues" means (a) the proceeds of the Improvement Area No. 2 Special Tax levied by the District within Improvement Area No. 2 of the District pursuant to the Improvement Area No. 2 Special Tax RMA and received by the District, minus� the Delayed Special Tax Revenues, (b) the Delinquency Proceeds and (c) amounts transferred from the Deposit Fund to the Fiscal Agent pursuant to the Deposit Agreement. "Improvement Area No. 2 Special Tax RMA"means the rate and method of apportionment of the Improvement Area No. 2 Special Tax originally authorized to be levied on property within Improvement Area No. 2 of the District as approved at a special.election held within Improvement Area No. 2 of the District on September 13, 2016, as modified and approved at a special election held within Improvement Area No.2 of the District on February 18,2020 and as it may be modified from time to time in accordance with the Act. 4, 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 231 of 724, "Indenture"means this Bond Indenture, as amended or supplemented pursuant to the terms hereof "Independent Accountant" means any certified public accountant or firm of such certified public accountants appointed and paid by the District, and who, or each of whom - I. is in fact independent and not under domination of the District or the City-, 2. does not have any substantial interest, direct or indirect, in the D�istrict or the City; and 3. is not an officer or employee of the District or the City, but who may be regularly retained to make annual or other audits of the books of or reports to the City or the District. "Infon-nation Services"' the Electronic Municipal Market Access System (referred to as "EMMA"), a facility of the Municipal Securities Rulemakin Board (at http�://emma.msrb.Qlg); 9 and, in accordance with then current guidelines of the Securities and Exchange Commission, and such other addresses and/or such other services providing information with respect to called bonds as the District may designate in writing to the Fiscal Agent. "Interest Pqyment Date"' means March I and September I of each year, commencing September I� 202 1. "Investment Agreement"' means any investment satisfying the requirements of Paragraph I I of the definition of Permitted Investments. "Legislative B means the City Council of the City, acting as the legislative body of the District. "Maximum Annual Debt Service"' means, as of the date of any calculation, the largest Annual Debt Service during the current or any future Bond Year. "Moody's"means Moody's Investors Service, Inc., its successors and assigns. "Net Improvement Area No. 2 S,pecial Tax Revenues" means the Improvement Area No. 2 Special Tax Revenues minus amounts applied annually to fund the Administrative Expense Requirement. "Nominee" shall mean the nominee of the Depository which may be the Depository, as determined from time to timeby the Depository. "Outstan 11)means as to the Bonds, all of the Bonds, except: I. Bonds theretofore canceled or surrendered for cancellation in accordance with Section 6.03 hereof-, 5 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 232 of 724, 2. Bonds fo�r the transfer or exchange of or in lieu of or in substitution for which other Bonds shall have been authenticated and delivered by the Fiscal Agent pursuant to the terms hereof; and 3. Bonds for the payment or redemption of which monies shall have been theretofore deposited in trust (whether upon or prior to the maturity or the redemption date of such Bonds). "Participant" shall mean a member of or participant in the Depository. "Permitted Investments" means any of the following which at the time of investment are legal investments under the! laws of the State for the moneys proposed to be invested therein (the Fiscal Agent shall be entitled to rely upon any written investment direction from an Authorized Representative of the District as a certification to the Fiscal Agent that such investment constitutes a Permitted Investment)�: 1. A. Direct obligations (other than an obligation subject to variation in principal payment) of the United States of America("United States Treasury Obligations"); B. Obligations fully and unconditionally guaranteed as to timely payment of principal and interest by the United States of America; C. Obligations fully and unconditionally guaranteed as to timely payment of principal and interest by any agency or instrumentality of the United States of America when such obligations are backed by the full faith and credit of the United States of America, or D. Evidences of ownership of proportionate interests in future interest and principal payments on obligations described above held by a bank or trust company as custodian, under which the owner of the investment is the real party in interest and has the right to proceed directly and individually against the obligor and the underlying government obligations are not available to any person claiming through the custodian or to whom the custodian may be obligated. 2. Federal Housing Administration debentures. 3. The listed obligations of government-sponsored agencies which are not backed by the full faith and credit of the United States of America.- A. Federal Home Loan Mortgage Corporation (FHLMC) (1) Participation certificates (excluded are stripped mortgage securities which. are purchased at prices exceeding their principal amounts) (2) Senior Debt obligations B. Farm Credit Banks (formerly: Federal Land Banks, Federal Intermediate Credit Banks and Banks for Cooperatives) (1) Consolidated system-wide bonds and notes 6 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 233 of 724, C. Federal Home Loan Banks (FHL Banks) (1) Consolidated debt obligations D. Federal National Mortgage Association (FNMA), (1) Senior debt obligations (2) Mortgage-backed securities (excluded are stripped mortgage securities which are purchased at prices exceeding their principal amounts) E. Student Loan Marketing Association (SLMA) (1) Senior debt obligations (excluded are securities that do not have a fixed par value and/or whose terms do not promise a fixed dollar amount at maturity or call date) F. Financing Corporation (FICO) (1) Debt obligations G. Resolution Funding Corporation (REFCO�RP) (1) Debt obligations 4. Unsecured certificates of deposit, time deposits, and bankers' acceptances (having maturities of not more than 30 days) of any bank the short-term obligations of which are rated"A- t�1 or better by S&P,. 5. Deposits the aggregate amount of which are fully insured by the Federal Deposit Insurance Corporation (FDIC), in banks which have capital and surplus of at least $5 million. 6. Commercial paper(having original maturities of not more than 270 days rated "A- t" by S&P and "Prime-I"by Moody's. 7. Money market funds rated "AAm-F" or"AAm-G"by S&P, or better. 8. State Obligations, which means: A. Direct general, obligations of any state of the United States of America or any subdivision or agency thereof to which is pledged the full faith and credit of a state the unsecured general. obligation debt of which is rated "AY'by Mo�o�dy's and "A"by S&P, or better, or any obligation fully and unconditionally guaranteed by any state, subdivision or agency whose unsecured general. obligation debt is so rated. B. Direct general short-term obligations of any state agency or subdivision or agency thereof described in (A) above and rated "A-I+"by S&P and"Prime-Y'by Moody's. 7 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 234 of 724, C. Special Revenue Bonds (as defined in the United States Bankruptcy Code) of any state, state agency or subdivision described in A. above and rated "AA" or better by S&P and "AA" or better by Moody's. 91. Pre-refunded municipal obligations rated"AAA"by S &P and"AAA"by Moody's meeting the following requirements: A. the municipal obligations are(1)not subject to redemption prior to maturity or(2) the trustee for the municipal obligations has been given irrevocable instructions concerning their call and redemption and the!issuer of the municipal obligations has covenanted not to redeem such municipal obligations other than as set forth in such instructions; B. the municipal obligations are secured by cash or United States Treasury Obligations which may be applied only to payment of the principal of, interest and premium on such municipal obligations; C. the principal of and interest on the United States Treasury Obligations (plus any cash in the escrow)has been verified by the report of independent certified public accountants to be sufficient to pay in full all principal of, interest, and premium, if any, due and to become due on the municipal obligations ("Verification"); D. the cash or United States Treasury Obligations serving as, security for the municipal obligations are held by an escrow agent or trustee in trust for owners of the municipal obligations; E. no substitution of a United States Treasury Obligation shall be permitted except with another United States Treasury Obligation and upon delivery of a new Verification; and F. the cash or United States Treasury Obligations are not available to satisfy any other claims, including those by or against the trustee or escrow agent. 10. Repurchase agreements: With (1) any domestic bank, or domestic branch of a foreign bank, the long term debt of which is rated at least "A" by S&P and Moody's,; or (2) any broker-dealer with "retail customers" or a related affiliate thereof which broker-dealer has, or the parent company (which guarantees the provider) of which has, long-term debt rated at least "A" by S&P and Moody's, which broker-dealer falls under the jurisdiction of the Securities Investors Protection Corporation, or (3) any other entity rated "A" or better by S&P and Moody's, provided that.- A. The market value of the collateral is maintained at levels and upon such conditions as would be acceptable to S&P and Moody's to maintain an "A"rating in. an "A"rated structured financing (with a market value approach),- B. The Fiscal Agent or a third party acting solely as agent therefor or for the District (the "Ho�lder of the Collateral") has possession of the collateral or the collateral has been 8 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 235 of 724, transferred to the Holder of the Collateral in accordance with applicable state and federal laws (other than by means of entries on the transferor's books); C. The repurchase agreement shall state and an opinion of counsel shall be rendered at the time such collateral is delivered that the Holder of the Collateral has a perfected first priority security interest in the collateral, any substituted collateral and all proceeds thereof (in the case of bearer securities, this means the Holder of the Collateral is in possession), D. The repurchase agreement shall provide that if during its term the provider's rating by either Moody's or S&P is withdrawn or suspended or falls below "A-"by S&P or "AY' by Moody's, as appropriate, the provider must, at the direction of the District or the Fiscal Agent, within 10 days of receipt of such direction, repurchase all collateral and terminate the agreement, with no penalty or premium to the District or Fiscal Agent. Notwithstanding the above, collateral levels need not be as specified in "A" above, so long as such collateral levels are 103% or better and the provider is rated at least "A" by S&P and Moody's, respectively. 11. Investment agreements with a domestic or foreign bank or corporation the long- term debt or financial strength of which, it or its guarantor is rated at least "AA-" by S&P and "Aa3"by Moody's; provided that,by the terms of the investment agreement: A. the invested funds are available for withdrawal without penalty or premium, upon not more than seven days' prior notice; the District and the Fiscal Agent hereby agree to give or cause to be given notice in accordance with the terms of the investment agreement so as to receive funds thereunder with no penalty or premium paid; B. the investment agreement shall state that it is the unconditional and general obligation of, and is, not subordinated to any other obligation of, the provider thereof; or, in the case of a bank, that the obligation of the bank to make payments under the agreement ranks pari passu with the obligations of the bank to its other depositors and its other unsecured and unsubordinated creditors, C. the District and the Fiscal Agent receives the opinion of domestic counsel that such investment agreement is legal, valid, binding and enforceable upon the provider in accordance with its terms and of foreign counsel (if applicable); D. the investment agreement shall provide that if during its term (1) the p�rovider's rating by either S&P or Moody's falls below "AA2' or 4'Aa3", respectively, the provider shall, at its option, within 10 days of receipt of publication of such downgrade, either (a) collateralize the investment agreement by delivering or transferring in accordance with applicable state and federal laws (other than by means of entries on the provider's books) to the District, the Fiscal Agent or a Holder of the Collateral free and clear of any third- party liens or claims the market value of which collateral is maintained at levels and u-pon such conditions as would be acceptable to S & P and Moody's to maintain an "A"rating in an "A"rated structured financing (with a market value approach); or (b) transfer and assign the investment agreement to a then qualifying counterparty with ratings specified above; and 9 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 236 of 724, (2) the p�rovider's rating by either S&P or Moody's is withdrawn or suspended or falls below "A-" or "AY', respectively, the provider must, at the direction of the District or the Fiscal Agent, within 10 days of receipt of such direction, repay the principal of and accrued but unpaid interest on the investment; E. The investment agreement shall state and an opinion of counsel shall be rendered, in the event collateral is required to be pledged by the provider under the terms of the! investment agreement, at the time such collateral is delivered, that the Holder of the Collateral has a perfected first priority security interest in the collateral,any substituted collateral and all proceeds thereof(in the case of bearer securities, this means the Holder of the Collateral is in possession)�; F. the investment agreement must provide that if during its term (1) the provider shall default in its payment obligations, the provider's obligations under the investment agreement shall, at the direction of the District or the Fiscal Agent,be accelerated and amounts invested and accrued but unpaid interest thereon shall be repaid to the District or Fiscal Agent, as appropriate, and (2) the provider shall become insolvent, not pay its debts as they become due, be declared or petition to be declared bankrupt, etc. ("Event of Insolvency"'), the provider's obligations shall automatically be accelerated and amounts invested and accrued but unpaid interest thereon shall be repaid to the District or Fiscal Agent, as appropriate. 12. The Local Agency Investment Fund (LAIF) administered by the treasurer of the State to the extent such deposits remain in the name of and control of the Fiscal Agent. Whenever reference is made in this definition of Permitted Investments to "collateral," collateral shall be limited to (i) cash and securities issued or guaranteed by the United States Government, including United States Treasury obligations and any other obligations the timely payment of the principal of and interest on which are guaranteedby the United States Government, and (ii) bonds, notes, debentures, obligations or other evidences of indebtedness issued or guaranteed by the Government National Mortgage Association, Federal National Mortgage Association or Federal Home Loan Mortgage Corporation, or any other agency or instrumentality of the United States or America including but not limited to, mortgage participation certificates, mortgage pass-through certificates, and other mortgage-backed securities. "Prepayments" means Improvement Area No. 2 Special Tax Revenues identified to the Fiscal Agent by an Authorized Representative as representing a prepayment of the Improvement Area No. 2 Special Tax. (.'Principal Colporate Trust Office" means the office of the Fiscal Agent in Costa Mesa, California or such other offices as may be specified to the District by the Fiscal Agent in writing. (Vroject'l means the public improvements as set forth and described in Exhibit A to the Acquisition/Financing Agreement. (Vroject Costs"' means all expenses of and incidental to the construction, acquisition, or both, of the Project. 10 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 237 of 724, "Project Fund" means the fund by that name established pursuant to Section 3.01 hereof "Rebate Fund" means the fund by that name established pursuant to Section 3.01 hereof "Record Date" shall mean the fifteenth (15th) calendar day of the month immediately preceding an Interest Payment Date. "Redemption Fund" means the fund by that name established pursuant to Section 3.01 hereof "Re t'on Books" shall have the meaning given such term in Section 2.0�8 hereof ,gistra i "Regulations" means the regulations promulgated under the Internal Revenue Code of 1986, as amended. "Reserve Fund"means the fund by that name established pursuant to Section 3.01 hereof "Reserve Requirement" means an amount initially equal to $[ ] which amount shall, as of any date of calculation, be equal to the least of(i) Maximum Annual Debt Service for the Bonds, (ii) one hundred twenty-five percent (125%) of Average Annual Debt Service for the Bonds, (iii) ten percent (10%) of the original issue price of the Bonds calculated in accordance with Treasury Regulations Section 1.148-2(t)(1) and (iv) $[ I "Securities Depositor " means, as of the Delivery Date, The Depository Trust Company, 55 Water Street, New York, New York 10041 and, in accordance with then current guidelines of the Securities and Exchange Commission, such other addressees providing depository services with respect to bonds as the District may designate in writing to the Fiscal Agent. ",,,S,,pecial Tax Consultant" means any person or firm possessing demonstrated experience and expertise in the preparation of special tax formulas and/or the administration of special taxes levied for community facilities districts. Any such person or firm shall be appointed and paid by the D�istrict and who, or each of whom— I. is in fact independent and not under domination of the District or the City; 2. does not have any substantial interest, direct or indirect, in the D�istrict or the City; and 3. is not an officer or employee of the District or the City, but who may be regularly retained by the City or other community facilities districts formed by the City to administer the levy of special taxes within such community facilities districts. ",,,S,,pecial Tax Fund" means the fund by that name established pursuant to Section 3'.01 hereof "Standard & Poor's" or'--S&P" means S&P Global Ratings, its successors and assigns. "State" means the State of California. 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 238 of 724, "Supplemental Indenture" means any bond indenture then in full force and effect which has been duly approved by resolution of the! Legislative Body under and pursuant to the Act at a meeting of the Legislative Body duly convened and held,at which a quorum was present and acted thereon, amendatory hereof or supplemental hereto; but only if and to the extent that such Supplemental Indenture is specifically authorized hereunder. "Tax Certificate" means the certificate delivered by the District on the Delivery Date relating to the requirements of Section 148 of the Code, as it may be amended and supplemented from time to time. "Tax Ex means, with reference to a Permitted Investment, a Permitted Investment the interest earnings on which are excludable from gross income for federal income tax purposes pursuant to Section 103(a), of the Code, other than one described in Section 57(a)(5)(C) of the Code. "Term Bonds" means the Bonds maturing on September 1, 20[_] and on September 1, 20[_]. "Treasurer"means the Treasurer of the City acting for and on behalf of the District. "Unpaid Special Taxes"' shall have the meaning set forth in the Deposit Agreement. "Yield"has the meaning assigned to such term for purposes of Section 1 48(f) of the Code. ARTICLE 11 GENERAL AUTHORIZATION AND TERMS Section 2.01. Amount suance and PUrpose. Pursuant to the provisions of the Act,the Legislative Body has authorized the issuance of the Bonds in an aggregate principal amount of $[ ]. The Bonds shall be designated City of Chula Vista Community Facilities District No. 16-1 (Millenia) Improvement Area No. 2 2021 Special Tax Bonds. The purpose of the Bonds shall be to (a) pay the cost and expense of a portion of the Project, (b) fund the Reserve Fund, (c) fund capitalized interest on a portion of the Bonds through September 1, 2021 and (d) pay the Costs of Issuance. Section 2.02. Type and Nature of Bond. The Bonds and interest thereon, together with any premium paid thereon upon redemption, are not obligations of the City, but are limited obligations of the District secured by and payable from an irrevocable first lien on the Net Improvement Area No. 2 Special Tax Revenues and on the monies in the funds and accounts established herein (includin g the investment earnings thereon) with the exception of the Project Fund, the Rebate Fund and the Administrative Expense Fund. Except for the Net Improvement Area No. 2 Special Tax Revenues, neither the faith and credit nor the taxing power of the District or the City is pledged for the payment of the Bonds or the interest thereon, and no Owner of the Bonds may compel the exercise of taxing power by the District, except as to the Improvement Area No. 2 Special Taxes, or the City or the forfeiture of any of their property. The principal of and interest on the Bonds and premiums upon the redemption thereof, if any, are not a debt of the District or the City, the State of California or any of its political subdivisions within the meaning of any constitutional or statutory limitation or restriction. The Bonds are not a legal or equitable 12 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 239 of 724, pledge,charge,lien or encumbrance,upon any of the District's property,or upon any of its income, receipts or revenues, except the amounts which are, under this Indenture and the Act, set aside! for the payment of the Bonds and interest thereon and neither the members of the Legislative Body, the City Council of the City, nor any persons executing the Bonds are liable personally on the Bonds by reason of their issuance. Notwithstanding anything contained in this Indenture, the District shall not be required to advance any money derived from any source of income other than the Net Improvement Area No. 2 Special Tax Revenues for the payment of the interest on or the principal of the Bonds or for the performance of any covenants herein contained. Nothing in this Indenture or in any Supplemental Indenture shall preclude the redemption prior to maturity of any Bonds subject to call and redemption or the payment of the Bonds from proceeds of the refunding bonds issued under the Act or under any other law of the State. Section 2.03. Terms of the Bonds. The Bonds shall mature on September 1. in the years, and in the respective principal amounts set forth opposite such years, and shall bear interest at the respective rates per annum, as follows.- Maturity Date Principal Interest Maturity Date Principal Interest (September jJ Amount Rate (Sep�temb�er 11 Amount Rate Section 2.04. Description of Bonds terest Rates. The Bonds shall be issued in fully registered form in denominations of $5,000 or any integral multiple thereof within a single maturity and shall be numbered as desired by the Fiscal Agent. The Bonds shall be dated as of the Delivery Date, and shall mature and be payable on September I in the years and in the aggregate principal amounts and shall bear interest at the rates set forth in this Indenture. The Bonds shall mature and be payable in the years and in the aggregate principal amounts and shall bear interest at the rates set forth in Section 2.03. Interest shallbe payable with respect to each Bond on each Interest Payment Date (commencing September 1, 20�2 1), until the principal sum of that Bond has been p�aid;provided,however,that if at the maturity date of any Bond(or if the same is redeemable and shall be duly called for redemption, then at the date fixed for redemption) funds are available for the payment or redemption thereof, in full accordance with the terms of this Indenture, such Bond shall. then cease to bear interest. 13 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 240 of 724, Section 2.05. Payment. The principal of and interest on the Bonds shall be payable in lawful money of the United States of America. The principal of the Bonds and any premium due! upon the redemption thereof shall be payable upon presentation and surrender thereof at maturity or the earlier redemption thereof at the Principal Corporate Trust Office of the Fiscal Agent. Interest on any Bond shall be payable from the Interest Payment Date next preceding the date of authentication of that Bond, unless (i) such date of authentication is an Interest Payment Date, in which event interest shall be payable from such date of authentication, (11) the date of authentication is after a Record Date but prior to the immediately succeeding Interest Payment Date, in which event interest shall be payable from the Interest Payment Date immediately succeeding the date of authentication or (iii) the date! of authentication is prior to the close of business on the first Record Date, in which event interest shall be payable from the date of the Bonds; provided, however, that if at the time of authentication of a Bond, interest is in default, interest on that Bond shall be payable from the last Interest Payment Date to which the interest has been paid or made available for payment. Interest on any Bond shall be paid to the person whose name shall appear in the books of registration as required by Section 2.08 as the owner of such Bond as of the close of business on the Record Date immediately preceding such Interest Payment Date. Such interest shall be paid by check of the Fiscal Agent mailed to such Bondowner at his or her address as it appears on the books of registration as required by Section 2.08 or, upon the request in writing prior to the Record Date of a Bondowner of at least $1,0�O�O�,000 in aggregate principal amount of Bonds, by wire transfer in immediately available funds to an account in the United States designated by such Owner. Interest with respect to each Bond shall be computed using a year of 360 days comprised of twelve 30-day months. Section 2.06. Execution of Bonds. The Bonds shall be executed manually or in facsimile by the Mayor of the City and countersigned by the City Clerk of the City, acting on behalf of the District. The Bonds shall then be delivered to the Fiscal Agent, for authentication and registration. In case an officer who shall have signed or attested to any of the Bonds by facsimile or otherwise shall cease to be such officer before the authentication, delivery and issuance of the Bonds, such Bonds nevertheless may be authenticated, delivered and issued, and upon such authentication, delivery and issue, shall be as binding as though those who signed and attested the same had remained in office. Section 2.07. Order to Print and Authenticate Bonds. The Director of Finance/Treasurer is hereby instructed to cause Bonds in the form as set forth herein, to be printed, and to proceed to cause said Bonds to be authenticated and delivered to an authorized representative of the purchaser, upon payment of the purchase price as set forth in the purchase contract for the sale of the Bonds. Section 2.08. Books of Re2istrationo Book Entry System, There shall be kept by the Fiscal Agent, sufficient books for the registration and transfer of the Bonds (the (.'Registration Books") and, upon presentation for such purpose, the Fiscal Agent shall, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on said register, Bonds as hereinbefore provided. The ownership of the Bonds shall be established by the Bond registration books held by the Fiscal Agent. Whenever any Bond or Bonds shall be surrendered for registration of transfer or exchange,the Fiscal Agent shall authenticate and deliver a new Bond or Bonds of the same maturity, for a like aggregate principal amount of authorized 14 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 241 of 724, denominations; provided that the Fiscal Agent shall not be required to register transfers or make exchanges of(i) Bonds for a period of 15 days next preceding the date of any selection of the Bonds to be redeemed, or(ii) any Bonds chosen for redemption. The Bonds shall be initially issued in the form of a single, fully registered Bond for each maturity(which may be typewritten). Upon initial issuance, the ownership of such Bonds shall be registered in the name of the Nominee identified below as nominee of the Depository. Except as hereinafter provided, all of the Outstanding Bonds shall be registered in the name of the nominee of the Depository,, which may be the Depository, as determined from time to time pursuant to this Section. With respect to the Bonds registered in the name of the Nominee, neither the District nor the Fiscal Agent shall have any responsibility or obligation to any Participant or to any person on behalf of which such a Participant holds an interest in the Bonds. Without limiting the immediately preceding sentence, neither the District nor the Fiscal Agent shall have any responsibility or obligation with respect to (i) the accuracy of the records of the Depository, the Nominee, or any Participant with respect to any ownership interest in the Bonds (ii) the delivery to any Participant or any other person, other than an Owner of a Bond as shown in the Registration Books, of any notice with respect to the Bonds,, including any notice of redemption, (iii) the selection by the Depository and its Participants of the beneficial interests in the Bonds to be redeemed in the event the District redeems the Bonds in part, or(iv) the payment to any Participant or any other person, other than an Owner of a Bond as shown in the Registration Books, of any amount with respect to principal of or interest on the Bonds. The District and the Fiscal Agent may treat and consider the person in whose name each Bond is registered as the holder and absolute Owner of such Bond for the purpose of payment of principal and interest with respect to such Bond for the purpose of giving notices or prepayment if applicable, and other matters with respect to such Bond for the purpose of registering transfers with respect to such Bond, and for all other purposes whatsoever. The District shall pay all principal of and interest on the Bonds only to or upon the order of the respective Owner of a Bond, as shown in the Registration Books,, or his respective attorney duly authorized in writing, and all such payments shall be valid and effective to fully satisfy and discharge the District's obligations with respect to payment of principal of and interest on the Bonds to the extent of the sum or sums so paid. No person other than an Owner of a Bond, as shown in the Registration Books,, shall receive a Bond evidencing the obligation of the District to make payments of principal and interest pursuant to this Indenture. Upon delivery by the Depository to the Owners of the Bond, and the District of written notice to the effect that the Depository has determined to substitute a new nominee in place of the Nominee, and subject to the provisions herein with respect to Record Dates, the word Nominee in this Indenture shall refer to such nominee of the Depository. In.the event(i)the Depository determines not to continue to act as securities depository for the Bonds, or (ii) the Depository shall no longer so act and gives notice to the District of such determination,then the District will discontinue the book-entry system with the Depository. If the District determines to replace the Depository with another qualified securities depository, the District shall prepare or direct the preparation of a new, single, separate, fully registered Bond,per maturity, registered in the name of such successor or substitute qualified securities depository or its nominee. if the District fails to identify another qualified securities depository to replace the Depository, then the Bonds shall no longer be restricted to being registered in the register in the 15 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 242 of 724, name of the Nominee, but shall be registered in whatever name or names Owners of the Bonds transferring or exchanging Bonds shall designate, in accordance with the provisions hereof and the District shall prepare and deliver Bonds to the Owners thereof for such purpose. In the event of a reduction in aggregate principal amount of Bonds Outstanding or a refunding of part of the Bonds Outstanding, DTC, in its discretion, (a) may request the District to prepare and issue a new Bond or(b)may make an appropriate notation on the Bond indicating the date and amounts of such reduction in principal, but in such event the Registration Books maintained by the Fiscal Agent shall be conclusive as to what amounts are Outstanding on the Bond, except in the case of final maturity, in which case the Bond must be presented to the Fiscal Agent prior to payment. Notwithstanding any other provision of this Indenture to the contrary, so long as any Bond is registered in the name of the Nominee, all payments of principal and interest with respect to such Bond and all notice with respect to such Bond shall be made and given respectively, as instructed by the Depository and acceptable to the District. The initial Nominee shall be Cede & Co., as Nominee of DTC. Section 2.09. Exchane of Bonds. Bonds may be exchanged at the Principal Corporate Trust Office, for a like aggregate principal amount of Bonds of authorized denominations, interest rate and maturity, subject to the terms and conditions of this Indenture, including the payment of certain charges, if any, upon surrender and cancellation of a Bond. Upon such transfer and exchange, a new registered Bond or Bonds of any authorized denomination or denominations of the same maturity and for the same aggregate principal amount will be issued to the transferee in exchange therefor. Section 2.10. Nmotiability , Repistration and Transfer of Bonds. The transfer of any Bond may be registered only upon the Registration Books upon surrender thereof to the Fiscal Agent,, together with an assignment duly executed by the Owner or his attorney or legal representative, in satisfactory form. Upon any such registration of transfer, a new Bond or Bonds shall be authenticated and delivered in exchange for such Bond, in the name of the transferee, of any denomination or denominations authorized by this Indenture, and in an aggregate principal amount equal to the principal,amount of such Bond or Bonds, so surrendered. In all cases in which Bonds shall be exchanged or transferred, the Fiscal Agent shall authenticate the Bonds in accordance with the provisions, of this Indenture. All Bonds, surrendered in such exchange or transfer shall forthwith be canceled. The Fiscal Agent may make a charge for every such exchange or registration of transfer of Bonds sufficient to reimburse it for any tax or other governmental. charge required to be paid with respect to such exchange or registration or transfer. Section 2.11. Authentication. Only such of the Bonds as shall bear thereon a certificate of authentication substantially in the form set forth in Exhibit A hereto�, manually executed by the Fiscal Agent, shall be valid or obligatory for any purpose or entitled to the benefits of this Indenture, and such certificate of the Fiscal Agent shall be conclusive evidence that the Bonds so authenticated have been duly executed, authenticated and delivered hereunder, and are entitled to the benefits of this Indenture. 16 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 243 of 724, ARTICLE III FUNDS AND ACCOUNTS Section 3.01. Establishment of Special Funds. The following funds and accounts identified in this Section 3.01 are hereby created and established and shall be maintained by the Fiscal Agent: A. Special Tax Fund; B. Debt Service Fund, and within the Debt Service Fund, the Interest Account, and the Capitalized Interest Sub-Account, and the Principal Account- within the Interest Account, C. Rebate Fund; D. Redemption Fund; E. Project Fund; F. Reserve Fund; G. Administrative Expense Fund; and H. Costs of Issuance Fund. The District may, through written instructions from an Authorized Representative, direct the Fiscal Agent to establish such other accounts or sub-accounts, as may be necessary to carry out the administration of the Bonds and the proceeds of the Bonds. Section 3.02. Special Tax Fund. A. Commencing Fiscal Year 2021-2022,the District shall,not later than February 15th and August 15th of each year,transfer Improvement Area No. 2 Special Tax Revenues to the Fiscal Agent and, except as set forth in the following sentence, such amounts shall be deposited in the Special Tax Fund. Improvement Area No. 2 Special Tax Revenues representing Prepayments shall be deposited into the Redemption Fund and the Administrative Expense Fund as set forth in written instructions from an Authorized Representative. B. The Improvement Area No. 2 Special Tax Revenues deposited in the Special Tax Fund shall be held in trust and deposited in the following accounts of the Special Tax Fund or transferred to the following other funds and accounts on the dates and in the amounts set forth in the following paragraphs and in the following order of priority: I. The Fiscal Agent shall each Fiscal Year transfer to the Administrative Expense Fund from the Improvement Area No. 2 Special Tax Revenues received by the Fiscal Agent during such Fiscal. Year an amount equal to the Administrative Expense Requirement. 2. The Fiscal Agent shall transfer to the Interest Account of the Debt Service Fund, on each Interest Payment Date and date for redemption of the Bonds, an amount required to 17 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 244 of 724, cause the aggregate amount on deposit in the Interest Account to equal the amount of interest due or becoming due and payable on such Interest Payment Date on all Outstanding Bonds or to be paid on the Bonds being redeemed on such date. 3. The Fiscal Agent shall transfer to the Principal Account of the Debt Service Fund, on each September 1, an amount required to cause the aggregate amount on deposit in the Principal Account to equal the principal amount o�f, and premium (if any) on the Bonds coming due and payable on such September 1,whether at maturity or by mandatory sinking fund payments on the Term Bonds. 4. On or after September 2 of each year after making the deposits and transfers required under 1. through 3. above, the!Fiscal Agent shall transfer the amount, if any,necessary to replenish the amount then on deposit in the Reserve Fund to an amount equal to the Reserve Requirement. 5. On or after September 2 of each year after making the deposits and transfers required under 1. through 4. above, upon receipt of written instructions from an Authorized Representative, the Fiscal Agent shall transfer from the Special Tax Fund to the Rebate Fund the amount specified in such request. 6. On or after September 2 of each year after making the deposits and transfers required under 1. through 5. above, upon receipt of a written request of an Authorized Representative, the Fiscal Agent shall transfer from the Special Tax Fund to the Administrative Expense Fund the amounts specified in such request to pay those Administrative Expenses which the District reasonably expects will become due and payable during such Fiscal Year or the cost of which Administrative Expenses have previously been incurred and paid by the District from funds other than the Administrative Expense Fund in excess of the Administrative Expense Requirement for such Fiscal Year. 7. If, on or after September 2 of each year, after making the deposits and transfers required under 1. through 6. above, monies remain in the Special Tax Fund, such monies shall be transferred to the Project Fund until the Project Fund is closed. C. The Fiscal Agent shall, upon receipt of Improvement Area No. 2 Special Tax Revenues representing Prepayments,, immediately transfer Prepayments to the Redemption Fund and utilize such funds to redeem Bonds pursuant to Section 4.03B as set forth in written instructions to be delivered to the Fiscal Agent by an Authorized Representative; provided, however,that any portion of a Prepayment constituting Administrative Expenses shall be deposited into the Administrative Expense Fund as set forth in such written instructions. The Fiscal Agent may conclusively rely upon such instructions. D. When there are no longer any Bonds Outstanding, any amounts then remaining on deposit in the Special Tax Fund shall be transferred to the District and used for any lawful purpose under the Act. Seeflon 3.03. Debt Service Fund. 18 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 245 of 724, A. Interest Account. All moneys in the Interest Account, including the Capitalized Interest Sub-Account, shall be used and withdrawn by the Fiscal Agent solely for the purpose of paying interest on the Bonds as it shall become due and payable (including accrued interest on any Bonds redeemed prior to maturity). Funds in the amount of$ deposited in the Capitalized Interest Sub-Account shall be used and withdrawn to pay interest on the Bonds on September 1, 2021 prior to using any other funds on deposit in the Interest Account for such purpose. B. Principal Account. All moneys in the Principal Account shall be used and withdrawn by the! Fiscal Agent solely for the purpose of(i) paying the principal of the! Bonds at 0 the maturity thereof, or (ii) paying the principal of the Term Bonds upon the mandatory sinking fund redemption thereof pursuant to this Indenture. Section 3.04. Costs of Issuance Fund. The Fiscal Agent shall,upon receipt of a payment request in the form set forth in Exhibit B hereto duly executed by an Authorized Representative, disburse money from the Costs, of Issuance Fund, if any, on such dates, and in such amounts as specified in such requisition to pay the Costs of Issuance related to the Bonds. Any amounts remaining on deposit in the Costs of Issuance Fund on the earlier of the date on which all Costs of Issuance have been paid as stated in writing by an Authorized Representative delivered to the Fiscal Agent or six months after the Delivery Date of the Bonds shall be transferred to the Pro ect Fund. Upon such transfer the Costs of Issuance Fund shall be closed. Section 3.05. Project Fund. The Fiscal Agent shall, from time to time, disburse monies from the Project Fund to pay the Project Costs. Upon receipt of a payment request in the form set forth in Exhibit C hereto duly executed by an Authorized Representative (which payment request shall not exceed the corresponding payment request provided to the City under the Acquisition/Financing Agreement), the Fiscal Agent shall pay the Project Costs from amounts in the Project Fund directly to the contractor(s) or such other person(s), corporation(s) or entity(ies) specified in the payment request (including reimbursements, if any, to the District). The Fiscal Agent may rely on an executed payment request as complete authorization for said payments. After the final payment or reimbursement of all Project Costs, as certified by delivery of a written notice from an Authorized Representative to the Fiscal Agent, the Fiscal Agent shall transfer excess monies, if any, on deposit in, or subsequently deposited in, the Project Fund to the Special Tax Fund and the Fiscal Agent shall apply the amount so transferred in accordance with Section 3.02 herein. Upon such transfer the Project Fund shall be closed. Notwithstanding anything herein to the contrary, if on the date which is three (3) years from the Delivery Date of the Bonds, any funds derived from the Bonds remain on deposit in the Project Fund, the Fiscal Agent shall, upon the receipt of written instructions from an Authorized Representative, immediately restrict the yield on such amounts so that the Yield earned on the investment of such amounts is not in excess of the Yield on the Bonds,unless in the written opinion of Bond Counsel delivered to the Fiscal Agent such restriction is not necessary to prevent an impairment of the exclusion of interest on the Bonds from gross income for federal income tax purposes. Section 3.06. Reserve Fund. Moneys on deposit in the Reserve Fund shall be used solely for the purpose of paying the principal of and interest on the Bonds as such amounts shall become 19 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 246 of 724, due and payable in the event that the moneys in the Special Tax Fund and the Debt Service Fund for such purpose are insufficient therefor or redeeming Bonds as described below. The Fiscal Agent shall, when and to the extent necessary, withdraw money from the Reserve Fund and transfer such money to the Debt Service Fund or the Redemption Fund for such purpose. All Permitted Investments in the Reserve Fund shall be valued at their fair market value semi-annually on March I and September I and on any other date as requested in writing by an Authorized Representative. On any date after the transfers required by Section 3.02B(l), (2) and (3) have been made for any Bond Year, if the amount on deposit in the Reserve Fund is less than the Reserve Requirement, the Fiscal Agent shall transfer to the Reserve Fund from the first available monies in the Special Tax Fund an amount necessary to increase the balance therein to the Reserve Requirement. If on September I of each year following the payment of scheduled debt service on the Bonds due and payable on such date, or the first Business Day thereafter if September 1. is not a Business Day, the amount on deposit in the Reserve Fund is in excess of the Reserve Requirement, the Fiscal Agent shall transfer such excess to the Special Tax Fund. In connection with any optional or extraordinary mandatory redemption of Bonds from Prepayments, or a partial defeasance of Bonds, amounts in the Reserve Fund may be applied to such redemption or partial defeasance, so long as the amount on deposit in the Reserve Fund following such redemption or partial defeasance equals the Reserve Requirement. The District shall set forth in a written request of an Authorized Representative the amount in the Reserve Fund to be transferred to the Redemption Fund on a redemption date or to be transferred pursuant to this Indenture to partially defease Bonds, and the Fiscal Agent shall make such transfer on the applicable redemption or defeasance date, subject to the limitation in the preceding sentence. Upon receipt of written instructions from an Authorized Representative instructing the Fiscal Agent to transfer certain moneys representing a Reserve Fund credit for the prepayment of a Special Tax obligation, the Fiscal Agent shall transfer the amount specified in such instructions from the Reserve Fund to the Redemption Fund for the purpose of redeeming Bonds pursuant to such instructions. Whenever the balance in the Reserve Fund exceeds the amount required to redeem or pay the Outstanding Bonds, including interest accrued to the date of payment or redemption and premium, if any, due upon redemption, the Fiscal Agent shall transfer the amount in the Reserve Fund to the Redemption Fund to be applied, on the next succeeding Interest Payment Date, to the payment and redemption, in accordance with Section 4.03, of all of the Outstanding Bonds. In the event that the amount so transferred from the Reserve Fund to the Redemption Fund exceeds the amount required to pay and redeem the Outstanding Bonds, the balance in the Reserve Fund shall be transferred to the District to be used for any lawful purpose of the District as set forth in the Act. Section 3.07. Rebate Fund. The District shall calculate Excess Investment Earnings as defined in, and in accordance with,the Tax Certificate,and shall,in writing,direct the Fiscal Agent to transfer funds to the Rebate Fund from funds furnished by the District as provided for in this Indenture and the Tax Certificate. N otwith standing the foregoing, the Tax Certificate, including the method of computing Excess Investment Earnings (as defined in the Tax Certificate) may be modified, in whole or in 20 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 247 of 724, part, without the consent of the Owners of the Bonds, upon receipt by the District of an opinion of Bond Counsel to the effect that such modification shall not adversely affect the exclusion from gross income for federal income tax purposes of interest on the Bonds then Outstandino Zn* The Fiscal Agent shall not be responsible for calculating rebate amounts or for the adequacy or correctness of any rebate report or rebate calculations. The Fiscal Agent shall be deemed conclusively to have complied with the provisions of this Indenture regarding calculation and payment of rebate if it follows the directions of the District and it shall have no independent duty to review such calculations or enforce the! compliance by the District with such rebate requirements. Section 3.08. Redemption Fund. Monies may be deposited by the District or the Fiscal Agent pursuant to the terms of Sections 3.02C or 3.06 into the Redemption Fund and shall be set aside and used solely for the purpose of redeeming Bonds in accordance with Section 4.03A or Section 4.03B, as applicable. Following the redemption of any Bonds, if any funds remain in the Redemption Fund, such funds shall be transferred to the Special Tax Fund. a, Section 3.09. Administrative Expense Fund. The Fiscal Agent shall deposit from time to time the amounts authorized for deposit therein pursuant to Section 3.02. The moneys in the Administrative Expense Fund shall be used to pay Administrative Expenses from time to time upon receipt by the Fiscal Agent of a written request executed by an Authorized Representative specifying the name and address of the payee and the amount of the Administrative Expense and a description thereof and further stating that such request has not formed the basis of any prior request for payment. Section 3.10. Investment of Funds. Unless otherwise specified in this Indenture,monies in the Special Tax Fund, the Debt Service Fund, the Project Fund, the Reserve Fund, the Costs of Issuance Fund and Administrative Expense Fund shall, at the written direction of an Authorized Representative given at least two (2) days prior, be invested and reinvested in Permitted Investments (including investments with the Fiscal Agent or an affiliate of the Fiscal Agent or investments for which the Fiscal Agent or an affiliate of the Fiscal Agent acts as,investment advisor or provides other services so long as the investments are Permitted Investments). Monies in the Redemption Fund and the Rebate Fund shall, at the written direction of an Authorized Representative, be invested in Government Obligations. Notwithstanding anything herein to the contrary, in the absence of written investment instructions, the Fiscal Agent shall hold all such amounts uninvested. The District acknowledges that to the extent regulations of the Comptroller of the Currency or other applicable regulatory entity grant the District the right to receive brokerage confirmations of security transactions as they occur,the District specifically waives receipt of such confirmations to the extent permitted by law. The Fiscal Agent will furnish the District periodic cash transaction statements, which include detail for all investment transactions made by the Fiscal Agent hereunder. Obligations purchased as investments of monies in any fund or account shall be deemed at all times to be a part of such fund or account. Except as provided otherwise herein, any income realized on or losses resulting from investments in any fund or account shall,be credited or charged 21 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 248 of 724, to such fund or account. Subject to the restrictions set forth herein and/or any written investment instructions received by Fiscal Agent pursuant to this Section 3.10, monies in said funds and accounts may be from time to time invested by the Fiscal Agent in any manner so long as: (1) Monies in the Project Fund, Administrative Expense Fund and Rebate Fund shall be invested in obligations which will by their terms mature as close as practicable to the date the District estimates the monies represented by the particular investment will be needed for withdrawal from such fund; and (2) Monies in the Special Tax Fund, the Debt Service Fund, the Redemption Fund and the Reserve Fund shall be invested only in obligations which will by their terms either mature or allow for withdrawals at par on such dates so as to ensure the!payment of principal and interest on the Bonds as the same become due; provided, however, that except for Permitted Investments which permit withdrawal at par at any time, investment of monies on deposit in the Reserve Fund shall have an average aggregate weighted term not greater that five (5) years. The Fiscal Agent shall sell or present for redemption any obligations so purchased whenever it may be necessary to do so in order to provide monies to meet any payment or transfer for such funds and accounts or from such funds and accounts. The Fiscal Agent shall not be liable for any loss from any investments made or sold by it in accordance with the provisions of this, Indenture. Section 3.11. Disposi,tion of Bond Proceeds. Upon the receipt of$,[ ] as the sale proceeds for the Bonds (being the par amount of $[ .00, plus/less net original issue premium/discount of $[ ] and less the underwriter's discount of$[ ]), the Fiscal Agent shall transfer or set aside and deposit or cause to be deposited such funds as follows-. $[ ] shall be deposited in the Project Fund-, $[ ] shall be deposited in the Reserve Fund; $[ ] shall be deposited into the Costs of Issuance Fund; and $[ ] shall be deposited in the Capitalized Interest Sub-Account of the Interest Account of the Debt Service Fund. The Fiscal Agent may establish such temporary funds or accounts on its records, as it may deem appropriate to facilitate such deposits. ARTICLE IV REDEMPTION Section 4.01. Notice of Redemp ion. A. Notice to Bondholders: So long as the Bonds are held in book-entry form by the Depository,or its Nominee,notice of redemption should be given to the Depository in such manner 22 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 249 of 724, 0 as is set forth in the procedures of the Depository, at least thirty(30) days but not more than forty- five(45)days prior to the redemption date. If the Bonds are!no longer registered to the Depository, or its Nominee, the Fiscal Agent shall mail, at least thirty (30) days but not more than forty-five (45)days prior to the date of redemption,notice of redemption,by first-class mail,postage prepaid, to the original purchaser of the Bonds and the respective registered Owners of the Bonds at the addresses appearing on the Bond registry books. The notice of redemption shall: (a) state the redemption date; (b) state the redemption price; (c) state the bond registration numbers, dates of maturity and CUSIP numbers of the Bonds to be redeemed, and in the case of Bonds to be redeemed in part, the respective principal portions to be redeemed; provided, however, that whenever any call includes all Bonds of a maturity, the numbers of the Bonds of such maturity need not be stated; (d) state that such Bonds must be surrendered at the Principal Corporate Trust Office of the Fiscal Agent; (e) state that further interest on such Bonds will not accrue from and after the designated redemption date; (f)state the date of the issue of the Bonds as originally issued; (g) state the rate of interest bome by each Bond being redeemed; and (h) state that any other descriptive information needed to identify accurately the Bonds being redeemed as the District shall direct. B. Further Notice: In addition to the notice of redemption given pursuant to Section 4.0 1 A above, further notice shall be given as set out below, but no defect in said further notice nor any failure to give all or any portion of such further notice shall in any manner defeat the effectiveness of a call for redemption if notice thereof is given as above prescribed. Each further notice of redemption shall be sent at the same time that the notice of redemption is mailed to the Bondholders pursuant to Section 4.0 1 A by registered or certified mail or overnight delivery service to the Securities Depository and to at least one (1) Infort-nation Services that disseminate notice of redemption of obligations similar to the Bonds or, in accordance with the then-current guidelines of the Securities and Exchange Commission, such other services providing information on called bonds, or no such other services, as District may determine in its sole discretion. C. Conditional Notice: Any notice of optional redemption of the Bonds delivered in accordance with Section 4.03A may be conditional and if any condition stated in the notice of redemption shall not have been satisfied on or prior to the redemption date, said notice shall be of no force and effect and the District shall not be required to redeem such Bonds and the redemption shall not be made and the Fiscal Agent shall within a reasonable time thereafter give notice, to the persons and in the manner in which the notice of redemption was given, that such condition or conditions were not met and that the redemption was canceled. D. Right to Rescind.- The District may rescind any optional redemption and notice thereof for any reason on any date prior to the date fixed for redemption by causing written notice of the rescission to be given to the owners of the Bonds so called for redemption. Any optional redemption and notice thereof shall be rescinded if for any reason on the date fixed for redemption moneys are not available in the Debt Service Funci or otherwise held in trust for such purpose in an amount sufficient to pay in full on said date the principal of, interest, and any premium due on the Bonds called for redemption. Notice of rescission of redemption shall be given in the same manner in which notice of redemption was originally given. The actual receipt by the owner of 23 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 250 of 724, any Bond of notice of such rescission shall not be a condition precedent to rescission, and failure to receive such notice or any defect in such notice shall not affect the validity of the rescission E. Failure to Receive Notice: So long as notice has been provided as set forth in Section 4.0 1 A above, the actual receipt by the Owner of any Bond of notice of such redemption shall not be a condition precedent to redemption, and failure to receive such notice shall not affect the validity of the proceedings for redemption of such Bonds or the cessation of interest on the date fixed for redemption. F. Certificate of Givinjiz Notice: The notice or notices required by this Section shall be given by the Fiscal Agent on behalf of the District. A certificate by the Fiscal Agent that notice of call and redemption has been given to the registered Owners of the Bonds as herein provided shall be conclusive as against all parties, and no Owner whose Bond is called for redemption may object thereto, or object to cessation of interest on the redemption date, by any claim or showing that he failed to receive actual notice of call and redemption. Section 4.02. Effect of Redemption. When notice of redemption has been given substantially as provided for herein, and when the amount necessary for the redemption of the Bonds called for redemption is set aside for that purpose in the Debt Service Fund,the Redemption Fund or an escrow fund, as provided for herein,the Bonds designated for redemption shall become due and payable on the date fixed for redemption thereof, and upon presentation and surrender of said Bonds at the place specified in the notice of redemption, said Bonds shall be redeemed and paid at the redemption price out of the Debt Service Fund or the Redemption Fund and no interest will accrue on such Bonds or portions of Bonds called for redemption from and after the redemption date specified in said notice, and the Owners of such Bonds so called for redemption after such redemption date shall look for the payment of principal and premium, if any, of such Bonds or portions of Bonds only to the Debt Service Fund or the Redemption Fund, as applicable. All Bonds redeemed shall be canceled forthwith by the Fiscal Agent and shall not be reissued. Upon surrender of Bonds redeemed in part, a new Bond or Bonds of the same maturity shall be registered, authenticated and delivered to the registered Owner at the expense of the District, in the aggregate principal amount of the unredeemed portion. All unpaid interest payable at or prior to the date fixed for redemption shall continue to be payable to the respective registered owners of such Bonds or their order, but without interest thereon. Section 4.03. Redemption Prices and Terms. A. Opfional Redemp,,t,i,,o,,n. The Bonds may be redeemed at the option of the District prior to maturity as a whole, or in. part on any Interest Payment Date on and after September 1, 2025, from such maturities as are selected by the District, and by lot within a maturity, from any source of funds, at the following redemption prices (expressed as percentages of the principal amount of the Bonds tobe redeemed), together with accrued interest to the date of redemption: Redemption Date Redemption Price Any Interest Payment Date from September 1, 2025 through, March 1, 103% 20 September 1, 2028 and March 1, 2029 102 24 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 251 of 724, September 1, 2029 and March 1, 2030 101 September 1, 2030 and any Interest Payment Date thereafter 100 B. Extraordinary Mandatory Redemption. The Bonds shall be subject to extraordinary mandatory redemption on any Interest Payment Date, prior to maturity, as a whole, or in part as nearly as practicable on a pro rata basis among maturities of authorized denominations, from amounts deposited to the Redemption Fund in connection with a Prepayment of Improvement Area No. 2 Special Taxes pursuant to the Improvement Area No. 2 Special Tax RMA. An Authorized Representative shall deliver written instructions to the Fiscal Agent not less than 60 days prior to the redemption date directing the Fiscal Agent to utilize the Improvement Area No. 2 Special Tax Revenues transferred to the Redemption Fund pursuant to Section 3.02C and Section 3.06 to redeem Bonds pursuant to this Section �4.03B. Such extraordinary mandatory redemption of the! Bonds shall be at the following redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), together with accrued interest thereon to the date of redemption.- Redemption Date Redemption Price Any Interest Payment Date from September 1, 20�21 through March 1, 103% 2028 September 1, 2028 and March 1, 2029 102 September 1, 2029 and March 1, 2030 101 September 1, 2030 and any Interest Payment Date thereafter 100 C. Mandato,rv,,,,,,,,,,,,S,,,,ink,i,n,g,,,,,,,,,,,,Fund Redemption. The Term Bonds maturing on September 1, 20[_] are subject to mandatory sinking fund redemption, in part by lot, on September I in each year commencing September 1, 20[_] at a redemption price equal to the principal amount of the Term Bonds to be redeemed, plus accrued and unpaid interest thereon to the date fixed for redemption, without premium, in the aggregate principal amount and in the years shown on the following redemption schedule: Redemption Date Principal (Sep�temb�er t) Amount (maturity) The Term Bonds maturing on September 1, 20�[_], are subject to mandatory sinking fund redemption, in part, by lot, on September I of each year commencing September 1, 20[_], at a redemption price equal to the principal amount of the Term Bonds to be redeemed, plus accrued and unpaid interest thereon to the date fixed for redemption, without premium, in the aggregate principal amounts and in the years shown in the following redemption schedule. Redemption Date Principal September 1) Amount 25 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 252 of 724, (maturity) In the event of a partial optional redemption or extraordinary mandatory redemption of the Term Bonds maturing on September 1, 20[_] or September 1, 20[_] each of the remaining mandatory sinking fund payments for the applicable maturity of the Term Bonds so redeemed will be reduced, as nearly as practicable, on a pro rata basis in integral multiples of$5,000. D. Purchase in Lieu of Redemption. In lieu of such an optional, extraordinary mandatory or mandatory sinking fund redemption, the District may elect to purchase such Bonds at public or private sale at such prices as the District may in its discretion determine; provided, that, unless otherwise authorized by law, the purchase price (including brokerage and other charges)thereof shall not exceed the principal amount thereof,plus the applicable premium,if any, stated above, plus accrued interest to the purchase date. E. Notice and Selection of Bonds for Optional Redemption. In the event the District shall elect to redeem Bonds as provided in Section 4.03A, the District shall give written notice to the Fiscal Agent of its election so to redeem not less than sixty (60) days prior to the redemption date,the principal amount of the Bonds to be redeemed and the maturities from which such Bonds are to be redeemed,and the principal amount of the Bonds to be redeemed from each such maturity. The notice to the Fiscal Agent shall be given not less than sixty (60) days prior to the redemption date or such shorter period as shall be acceptable to the Fiscal Agent in its sole discretion. If less than all of the Bonds Outstanding are to be redeemed, the portion of any Bond of a denomination of more than $,5,000 to be redeemed shall be in the principal amount of$5,000 or a multiple thereof, and, in selecting portions of such Bonds for redemption, the District shall treat each such Bond as, representing that number of Bonds of $5,000 denomination which is obtained by dividing the principal amount of such Bond to be redeemed in part by $5,000. ARTICLE V SUPPLEMENTAL INDENTURES Section 5.01. Amendments or Supplements. The Legislative Body may,by adoption of a resolution from time to time, and at any time but without notice to or consent of any of the Bondholders, approve a Supplemental. indenture hereto for any of the following purposes: (a) to cure any ambiguity, to correct or supplement any provision herein which may be inconsistent with any other provision herein,or to make any other provision with respect to matters or questions arising under this Indenture or in any Supplemental Indenture, provided that such action. shall. not be materially adverse to the interests of the Bondowners; (b) to add to the covenants and agreements of and the limitations and the restrictions upon the District contained in this Indenture, other covenants, agreements, limitations and 26 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 253 of 724, restrictions to be observed by the District which are not contrary to or inconsistent with this Indenture as theretofore in effect; (c) to modify, alter, amend or supplement this Indenture in any other respect which is not materially adverse to the interests of the Bondowners; and (d) to amend any provision of this Indenture relating to the Code as may be necessary or appropriate to assure compliance with the Code and the exclusion from gross income of interest on the Bonds. Exclusive of the Supplemental Indentures hereto provided for in the first paragraph of this Section 5.01, the Owners of not less than 60% in aggregate principal amount of the Bonds then Outstanding shall have the right to consent to and approve the adoption by the District of such Supplemental Indentures as shall be deemed necessary or desirable by the District for the purpose of waiving, modifying, altering, amending, adding to or rescinding, in any particular, any of the ten-ns or provisions contained in this Indenture; provided, however, that nothing herein shall permit, or be construed as permitting, (a) an extension of the maturity date of the principal of, or the payment date of interest on, any Bond, or (b) a reduction in the principal amount of, or redemption premium on,any Bond or the rate of interest thereon without the consent of the affected Bondowner(s), or permit, or be construed as permitting, (x) a preference or priority of any Bond or Bonds over any other Bond or Bonds, (y) a reduction in the aggregate principal amount of the Bonds the Owners,of which are required to consent to such Supplemental Indenture,or(z)creating of a pledge of or lien or charge upon the Net Improvement Area No. 2 Special Tax Revenues superior to the pledge provided for in Section 2.02 hereof, without the consent of the Owners of all Bonds then Outstanding. If at any time the District shall desire to approve a Supplemental Indenture, which pursuant to the terms of this Section 5.0 1 shall require the consent of the Bondowners, the District shall so notify the Fiscal Agent and shall deliver to the Fiscal Agent a copy of the proposed Supplemental, Indenture. The District shall, at the expense of the District, cause notice of the proposed Supplemental Indenture to be mailed,postage prepaid,to all Bondowners at their addresses as,they appear in the Registration Books. Such notice shall briefly set forth the nature of the proposed Supplemental Indenture and shall state that a copy thereof is on file at the principal office of the District for inspection by all Bondowners. The failure of any Bondowner to receive such notice shall not affect the validity of such Supplemental, Indenture when consented to and approved as, in this Section 5.01 provided. Whenever at any time within one year after the date of the first mailing of such notice,the District shall receive an instrument or instruments purporting to be executed by the Owners of not less than 60% in aggregate principal amount of the Bonds then Outstanding, which instrument or instruments shall refer to the proposed Supplemental Indenture described in such notice, and shall specifically consent to the approval thereof by the Legislative Body substantially in the form of the copy thereof referred to in such Notice as on file with the District, such proposed Supplemental Indenture, when duly approved by the Legislative Body, shall thereafter become a part of the proceedings for the issuance of the Bonds. in determining whether the Owners of 60%of the aggregate principal amount of the Bonds have consented to the approval of any Supplemental Indenture, Bonds which are owned by the District or by any person directly or indirectly controlling or controlled by or under the direct or indirect common control with the 27 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 254 of 724, District, shall be disregarded and shall be treated as though they were not outstanding for the purpose of any such determination. Upon the approval of any Supplemental Indenture hereto and the receipt of consent to any such Supplemental Indenture from the Owners of the appropriate aggregate principal amount of Bonds in instances where such consent is required pursuant to the provisions of this Section 5.01, this Indenture shall be, and shall be deemed to be, modified and amended in accordance therewith, and the respective rights, duties and obligations under this Indenture of the District and all Owners of Bonds then Outstanding shall thereafter be determined, exercised and enforced hereunder, subject in all respects to such modifications and amendments. Notwithstanding anything herein to the contrary, no Supplemental Indenture shall be entered into which would modify the duties of the Fiscal Agent hereunder, without the prior written consent of the Fiscal Agent. ARTICLE VI MISCELLANEOUS CONDITIONS Section 6.01. Ownershil) of Bonds. The person in whose name any Bond shall be registered shall be deemed and regarded as the absolute Owner thereof for all purposes, and payment of or on account of the principal and redemption premium, if any, of any such Bond, and the interest on any such Bond, shall be made only to or upon the order of the registered Owner thereof or his legal representative. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Bond, including the redemption premium, if any, and interest thereon, to the extent of the sum or sums so paid. Section 6.02. Mutilated, Lost, Destroyed or Stolen Bonds. If any Bond shall become mutilated, the Fiscal Agent shall authenticate and deliver a new Bond of like tenor, date and maturity in exchange and substitution for the Bond so mutilated, but only upon surrender to the Fiscal Agent of the Bond so mutilated. Every mutilated Bond so surrendered to the Fiscal Agent shall be canceled. If any Bond shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Fiscal Agent and, if such evidence is satisfactory to the Fiscal Agent and, if an indemnity satisfactory to the Fiscal, Agent shall be given, the Fiscal Agent shall authenticate and deliver a new Bond of like tenor and maturity, numbered and dated as the Fiscal Agent shall determine in lieu of and in substitution for the Bond so lost, destroyed or stolen. Any Bond issued under the provisions of this Section 6.02 in lieu of any Bond alleged to have been lost, destroyed or stolen shall be equally and proportionately entitled to the benefits hereof with all other Bonds secured hereby. The Fiscal Agent shall not treat both the original Bond and any replacement Bond as being Outstanding for the purpose of determining the principal amount of Bonds which may be executed, authenticated and delivered hereunder or for the purpose of determining any percentage of Bonds Outstanding hereunder, but both the original and replacement Bond shall be treated as one and the same. Section 6.03. Cancellation of Bonds. All Bonds paid or redeemed, either at or before maturity, shall be canceled upon the-payment or redemption of such Bonds, and shall be delivered to the Fiscal. Agent when such payment or redemption is made. All Bonds canceled under any of the provisions of this Indenture shall be destroyed by the Fiscal Agent, which shall execute and provide the District with a certificate of destruction. 28 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 255 of 724, Section 6.04. Covenants. As long as the Bonds are Outstanding and unpaid, the District shall (through its proper members, officers, agents or employees) faithfully perform and abide by all of the covenants and agreements set forth in this Section 6.04; provided, however, that said covenants do not require the District to expend any funds other than the Improvement Area No. 2 Special Tax Revenues. A. The District will review the public records of the County of San D�iego, California, in connection with the collection of the Improvement Area No. 2 Special Taxes not later than July I of each year to determine the amount of the Improvement Area No. 2 Special Tax collected in the prior Fiscal Year and will commence and diligently pursue to completion,judicial foreclosure proceedings against (i) properties under common ownership with delinquent Improvement Area No. 2 Special Taxes in the aggregate of$5,000 or more by October I following the close of the Fiscal Year in which the Improvement Area No. 2 Special Taxes were due, and (ii) against all properties with delinquent Improvement Area No. 2 Special Taxes in the aggregate of$,5,000 or more by October I following the close of any Fiscal Year if the amount of the Reserve Fund is less than the Reserve Requirement. B. The District shall preserve and protect the security of the Bonds and the rights of the Bondowners and defend their rights against all claims and demands of all persons. Until such time as an amount has been set aside sufficient to pay Outstanding Bonds at maturity or to the date of redemption if redeemed prior to maturity, plus unpaid interest thereon and p�remium, if any, to maturity or to the date of redem tion if redeemed -prior to maturity the District will faithfully p I perform and abide by all of the covenants,,undertakings, and provisions contained in this Indenture or in any Bond issued hereunder. C. The District will not issue any other obligations payable,principal or interest, from the Improvement Area No. 2 Special Taxes which have, or purport to have,, any lien upon the Improvement Area No. 2 Special Taxes superior to or, except as permitted in the following sentence, on a parity with the lien of the Bonds herein authorized. Nothing in this Indenture shall prevent the District from issuing and selling, pursuant to law, refunding bonds or other refunding obligations payable from and having a first lien upon the Net Improvement Area No. 2 Special Taxes on a parity with the Outstanding Bonds so long as the is,suance of such refunding bonds or other refunding obligations results in a reduction in each Bond Year on the Annual Debt Service on the Bonds when combined with the Debt Service on Parity Refunding Obligations following the issuance of such refunding bonds or other refunding obligations. D. The District will duly and punctually pay or cause to be paid the principal of and interest on each of the Bonds issued hereunder on the date, at the place and in the manner provided in said Bonds, but only out of Net Improvement Area No. 2 Special Tax Revenues and such. other funds as may be herein provided. E. The District shall comply with all requirements of the Act so as to assure the timely collection of the Improvement Area No. 2 Special Taxes in an amount sufficient to pay the Annual Debt Service on the Bonds when due, Administrative Expenses when due and amounts, if any, to replenish the Reserve Fund to the Reserve Requirement. Prior to July I of each year, the District shall ascertain the parcels on which the Improvement Area No. 2 Special Taxes are to be levied in the following Fiscal Year,taking into account any subdivisions of parcels during the current Fiscal 29 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 256 of 724, Year. The District shall effect the levy of the Improvement Area No. 2 Special Tax in accordance with the Improvement Area No. 2 Special Tax RMA and the Act each Fiscal Year so that the computation of such levy is complete and transmitted to the Auditor of the County of San Diego before the final date on which the Auditor of the County of San Diego will accept the transmission of the Improvement Area No. 2 Special Tax for the parcels within Improvement Area No. 2 for inclusion on the next real property tax roll. Upon completion of the computation of the amount of the Improvement Area No. 2 Special Tax levy, the District shall prepare or cause to be prepared, and shall transmit or cause to be transmitted to the Auditor of the County of San Diego, such data as such Auditor requires to include the levy of the Improvement Area No. 2 Special Tax on the next real property tax roll. The District finds and determines that,historically, delinquencies in the payment of special taxes authorized pursuant to the Act in community facilities districts in Southern California have from time to time been at levels requiring the levy of special taxes at the maximum authorized rates in order to make timely payment of principal of and interest on the outstanding indebtedness of such community facilities, districts. For this reason, the District has determined that, absent the certification described below, a reduction in the Maximum Special Tax (as such term is defined in the Improvement Area No. 2 Special Tax RMA) authorized to be levied below the levels provided would interfere with the timely retirement of the Bonds. The District has determined it to be necessary in order to preserve the security for the Bonds to covenant, and, to the maximum extent that the law permits it to do so, the District does covenant, that it shall not initiate proceedings to reduce the Maximum Special Tax rates (as set forth in the Improvement Area No. 2 Special Tax RMA), unless,, in connection therewith, (i) the District receives a certificate from one or more Special Tax Consultants which, when taken together, certify that, on the basis of the parcels, of land and improvements existing in Improvement Area No. 2 as of the July I preceding the reduction, the Maximum Special, Tax which may be levied on all Assessor's Parcels (as such term is defined in the Improvement Area No. 2 Special Tax RMA) of taxable property on which a completed structure is located in each Fiscal Year will equal at least I 10% of the largest sum of the Annual Debt Service on the Bonds to remain Outstanding and the Debt Service on Parity Refunding Obligations outstanding ("Maximum Debt Service") after the reduction is approved and will not reduce the Maximum Special Tax payable from parce I Is on which a completed structure is located or to be located at buildout of Improvement Area No. 2 as, proposed to less than 110% of the Maximum Debt Service, and(ii) the City Council, acting as the legislative body of the District, finds pursuant to this Indenture that any reduction made under such conditions will not adversely affect the interests of Bondowners. Any reduction in the Maximum Special Tax approved pursuant to the preceding sentence may be approved without the consent of the Owners of the Bonds. The District covenants that, in the event that any initiative is adopted by the qualified electors which purports to reduce the Maximum Special Tax below the levels authorized pursuant to the Improvement Area No. 2 Special.Tax RMA or to limit the power or authority of the District to levy Improvement Area No. 2 Special Taxes pursuant to the Improvement Area No. 2 Special Tax RMA, the District shall, from funds available hereunder, commence and pursue legal action in order to preserve the authority and power of the District to levy Improvement Area No. 2 Special Taxes pursuant to the Improvement Area No. 2 Special Tax RMA. 30 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 257 of 724, F. The District will at all times keep�, or cause to be kept, proper and current books and accounts(separate from all other records and accounts) in which complete and accurate entries shall be made of all transactions relating to the Improvement Area No. 2 Special Tax Revenues and other funds herein provided for. G. The District will not directly or indirectly use or permit the use of any proceeds of the Bonds or any other funds of the District or take!or omit to take any action that would cause the Bonds to be"private activity bonds"within the meaning of Section 141 of the Code, or obligations which are "federally guaranteed" within the meaning of Section 149(b) of the Code. The D�istrict will not allow five percent (5%) or more of the proceeds of the Bonds to be used in the trade or business of any non-governmental units and will not loan five percent(5%)or more of the proceeds of the Bonds to any non-governmental units. H. The District covenants that it will not take any action, or fail to take any action, if any such action or failure to take action would adversely affect the exclusion from gross income of the interest on the Bonds under Section 103 of the Code. The D�istrict will not directly or indirectly use or permit the use of any proceeds of the Bonds or any other funds of the District, or take or omit to take any action, that would cause the Bonds to be "arbitrage bonds" within the meaning of Section 148(a)of the Code. To that end,the District will comply with all requirements of Section 148 of the Code to the extent applicable to the Bonds. In the event that at any time the District is of the opinion that for purposes of this Section it is necessary to restrict or limit the yield on the investment of any monies held under this Indenture or otherwise the D�istrict shall so instruct the Fiscal Agent in writing, and the Fiscal Agent shall take such action as may be necessary in accordance with such instructions. Without limiting the generality of the foregoing, the District agrees that there shall be paid from time to time all amounts required to be rebated to the United States of America pursuant to Section 148(f) of the Code and any temporary, proposed or final Treasury Regulations as may be applicable to the Bonds from time to time. This covenant shall survive payment in full or defeasance of the Bonds. The District specifically covenants to pay or cause to be paid to the United States of America at the times and in the amounts determined under Section 3.07. Notwithstanding any provision of this Section, if the District shall obtain an opinion of Bond Counsel to the effect that any action required under this covenant is no longer required,, or to the effect that some further action is required, to maintain the exclusion from gross income of the interest on the Bonds pursuant to Section 103 of the Code, the Fiscal Agent may rely conclusively on such opinion in complying with the provisions hereof, and the covenant hereunder shall be deemed to be modified to that extent. 1. The District shall not directly or indirectly extend the maturity dates of the Bonds or the time of payment of interest with respect thereto. J. Not later than October 30 of each year, commencing October 30, 2021, and until October 30 following the final maturity of the Bonds, the District shall supply or cause to be supplied the information, if any, then required by Government Code Section 53359.5 to the California Debt and Investment Advisory Commission. 31 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 258 of 724, K. The District covenants that it will not adopt any policy pursuant to Section 5 3 34 1.1 of the Act permitting tender of Bonds in full payment or partial payment of any Improvement Area No. 2 Special Taxes unless it first receives a certificate of a Special Tax Consultant that accepting such tender will not result in the District having insufficient Net Improvement Area No. 2 Special Tax Revenues to pay the principal of and interest on the Bonds when due. L. The District shall do and perform or cause to be done and performed all acts and things required to be done or performed by or on behalf of the District under the provisions of this Indenture. The District warrants that upon the date of execution and delivery of the Bonds, the conditions, acts and things required by law and this Indenture to exist, to have happened and to have been performed precedent to and in the execution and delivery of such Bonds do exist, have happened and have been performed and the execution and delivery of the Bonds shall comply in all respects with the applicable laws of the State. M. The District covenants that it will comply with the Depos,it Agreement and will not amend the Deposit Agreement in such a way that is materially adverse to the interests of Bondowners. Section 6.05. Arbitrage Certificate. On the basis of the facts, estimates and circumstances now in existence and in existence on the date of issue of the Bonds,as determined by the Treasurer, said Treasurer is hereby authorized to certify that it is not expected that the proceeds of the Bonds will be used in a manner that would cause the Bonds to be arbitrage bonds. Such certification shall be delivered to the purchaser together with the Bonds. Section 6.06. Defeasance. If the District shall pay or cause to be paid, or there shall otherwise be paid, to the Owner of an Outstanding Bond the interest due thereon and the principal thereof, at the times and in the manner stipulated in the Indenture, then the Owner of such Bond shall cease to be entitled to the pledge of the Net Improvement Area No. 2 Special Tax Revenues, and, other than as set forth below, all covenants, agreements and other obligations, of the District to the Owner of such Bond under the Indenture shall thereupon cease, terminate and become void and discharged and satisfied. In the event of the defeasance of all Outstanding Bonds, the Fiscal Agent shall pay over or deliver to the District all money or securities held by it pursuant to the Indenture which are not required for the payment of the principal of,premium, if any, and interest due on such Bonds. Any Outstanding Bond shall be deemed to have been paid within the meaning expressed in the preceding paragraph if such Bond is paid in any one or more of the following ways: (a) by paying or causing to be paid the principal. of, premium,, if any, and interest on such Bond, as and when the same shall become due and payable-, (b�) by depositing with the Fiscal Agent, in trust, at or before maturity, money which, together with the amounts then on deposit in the funds established pursuant to the Indenture (exclusive of the Rebate Fund) and available for such purpose, is fully sufficient to pay the principal of, premium, if any, and interest on such Bond, as and when the same shall become due and p�ayable; or 32 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 259 of 724, (c) by depositing with the Fiscal Agent or an escrow bank appointed by the District, in trust,noncallable Permitted Investments of the type!described in subparagraph I of the definition thereof,in such amount as an Independent Accountant shall determine(as set forth in a verification report from such Independent Accountant) will be sufficient, together with the interest to accrue thereon and moneys then on deposit in the funds established under the Indenture (exclusive of the Rebate Fund) and available for such purpose, together with the interest to accrue thereon, to pay and discharge the principal of, premium, if any, and interest on such Bond, as and when the same shall become due and payable!i then, at the election of the District, and notwithstanding that any Outstanding Bonds shall not have been surrendered for payment, all obligations of the D�istrict under the Indenture with respect to such Bond shall cease and terminate, except for the obligation of the Fiscal Agent to pay or cause to be paid to the Owners of any such Bond not so surrendered and paid, all sums due thereon and except for the covenants of the District to preserve the exclusion of the interest on the Bonds from gross income for federal income tax purposes. Notice of such election shall be filed with the Fiscal Agent not less than ten (10) days prior to the proposed defeasance date, or such shorter period of time as may be acceptable to the Fiscal Agent. In connection with a defeasance under (b) or (c) above, there shall be provided to the District and the Fiscal Agent(i)a report of the Independent Accountant verifying the determination made pursuant to paragraph (b) or (c) above, as applicable (the "Verification Report") stating its opinion as to the sufficiency of the moneys or securities deposited with the Fiscal Agent or the escrow bank, together with the interest to accrue thereon and moneys, then on deposit in the funds established under the Indenture (exclusive of the Rebate Fund) and available for such purpose, together with the interest to accrue thereon to pay and discharge the principal of, premium, if any, and interest on all such Bonds to be defeased in accordance with the Indenture as and when the same shall become due and payable, and (ii) an opinion of Bond Counsel (which may rely upon the opinion of the Independent Accountant) to the effect that the Bonds being defeased have been defeased in accordance with the Indenture and are no longer Outstanding. The Verification Report and opinion of Bond Counsel shall be acceptable in form and substance to the District, and addressed to the District and the Fiscal Agent. S,ection 6.07. Fiscal Agent, The District hereby appoints Wilmington Trust, National Association as Fiscal Agent for the Bonds. The Fiscal Agent is hereby authorized to and shall mail or otherwise provide for the payment of interest payments to the Bondholders, and upon written instruction of the District shall select Bonds for redemption, give notice of redemption of Bonds and maintain the Bond Register. The Fiscal Agent is hereby authorized to pay the principal of and premium, if any, on the Bonds when the same are duly presented to it for payment at maturity or on call and redemption, to provide for the registration of transfer and exchange of Bonds presented to it for such purposes, to provide for the cancellation of Bonds all as provided in this Indenture, and to provide for the authentication of Bonds, and shall perform all other duties assigned to or imposed on it as provided in this Indenture. The Fiscal Agent shall keep accurate records of all Bonds paid and discharged by it. The District shall from time to time, subject to any agreement between the District and the Fiscal Agent then in force, pay to the Fiscal Agent compensation for its services, reimburse the Fiscal Agent for all its advances and expenditures, including, but not limited to, advances to and 33 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 260 of 724, fees and expenses of independent accountants or counsel employed by it in the exercise and performance of its powers and duties hereunder, and indemnify and hold the Fiscal Agent, its officers, directors, agents and employees, harmless from and against losses, claims, expenses and liabilities not arising from its own negligence or willful misconduct which it may incur in the exercise and performance of its powers and duties hereunder. Such obligations shall survive the termination or discharge of this Indenture, The District may at any time at its sole discretion remove the Fiscal Agent initially appointed, and any successor thereto, by delivering to the Fiscal Agent a written notice of its decision to remove the Fiscal Agent and may appoint a successor or successors thereto, provided that any such successor, other than the Treasurer, shall be a bank or trust company having a combined capital (exclusive of borrowed capital) and surplus of at least fifty million dollars ($50�,000,000), and subject to supervision or examination by Federal or State authority. Any removal shall become effective only upon acceptance of appointment by the successor Fiscal Agent or the Treasurer. If any bank or trust company appointed as a successor publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purposes of this Section the combined capital and surplus of such bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. The Fiscal Agent may at any time resign and be discharged from its duties and obligations hereunder by giving written notice to the District and by giving to the Owners notice of such resignation, which notice shall be mailed to the Owners at their addresses, appearing in the Registration Books. Upon receiving such notice of resignation,the District shall promptly appoint a successor Fiscal Agent by an instrument in writing. Any resignation or removal of the Fiscal Agent and appointment of a successor Fiscal Agent shall become effective only upon acceptance of appointment by the successor Fiscal Agent. Any corporation or association into which the Fiscal Agent may be converted or merged, or with which it may be consolidated, or to which it may sell or transfer all or substantially all, of its corporate trust business and assets as a whole or substantially as a whole, or any corporation or association resulting from any such conversion, sale, merger, consolidation or transfer to which the Fiscal Agent is a party, will be and become the successor Fiscal Agent under this Indenture and will, have and succeed to the rights, powers, duties, immunities, and privileges as its predecessor, without the execution or filing of any instrument or paper or the performance of any further act. Such successor Fiscal Agent must be a bank or trust company having a combined capital (exclusive of borrowed capital) and surplus of at least fifty million dollars ($50,000,000), and subject to supervision or examination by Federal, or State authority. Seeflon 6.08. Liability of Fiscal A . The recitals of fact and all promises, covenants and agreements contained herein and in the Bonds shall. be taken as statements, promises, covenants and agreements of the District, and the Fiscal Agent assumes no responsibility for the correctness of the same and makes no representations as to the validity or sufficiency of this Indenture or of the Bonds, and shall incur no responsibility in respect thereof, other than in connection.with its duties or obligations herein or in the Bonds or in the certificate of authentication on the Bonds. The Fiscal Agent shall be under no responsibility or duty with respect to the issuance of the Bonds. The permissive rights of the Fiscal, Agent to do things enumerated in this Indenture 34 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 261 of 724, shall not be construed as a duty and, with respect to such permissive rights, the Fiscal Agent shall not be liable in connection with the performance of its duties hereunder, except for its own negligence or willful misconduct. The Fiscal Agent shall have no responsibility with respect to any information, statement or recital in any official statement, offering memorandum or any other disclosure material prepared or distributed with respect to the Bonds. Neither the Fiscal Agent nor any of its directors, officers, employees, agents or affiliates shall be responsible for nor have any duty to monitor the performance or any action of the District or any Owner, or any of their respective directors,members,officers,agents,affiliates or employee,nor shall it have any liability in connection with the malfeasance or nonfeasance by any such party. The Fiscal Agent shall have no liability for any action taken, or errors in judgment made, in good faith by it or any of its officers, employees or agents, unless it shall have been negligent in ascertaining the pertinent facts. The Fiscal Agent may rely conclusively and shall be protected in acting upon any notice, resolution, request, consent, order, certificate, report, bond or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties. The Fiscal Agent may consult with counsel, who may be counsel to the District, with regard to legal questions, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered hereunder in good faith and in accordance therewith. The Fiscal Agent shall be entitled to request and receive written instructions from the District and shall have no responsibility or liability for any losses or damages of any nature that may arise from any action taken or not taken by the Fiscal Agent in accordance with the written direction of District. Whenever in the administration of its duties under this Indenture, the Fiscal Agent shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of bad faith on the part of the Fiscal Agent be deemed to be conclusively proved and established by a written certificate of the District,, and such certificate shall be full warrant to the Fiscal Agent for any action taken or suffered under the provisions of this Indenture upon the faith thereof, but in its discretion the Fiscal Agent may, in lieu thereof, accept other evidence of such matter or may require such additional evidence of such matter or may require such additional evidence as to it may seem reasonable. The Fiscal Agent shall have no duty or obligation to enforce the collection of funds to be deposited with it hereunder or as to the correctness of any amounts received, and its liability shall be limited to the proper accounting for such funds as, it actually receives. No provision of this Indenture or any other document related hereto shall require the Fiscal Agent to risk, expend or advance its own funds or otherwise incur any financial liability in the performance of its duties or the exercise of its rights hereunder. The Fiscal Agent shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of District or any of the Bondowners,pursuant to the provisions of this Indenture, unless such party or parties shall have offered to the Fiscal Agent security or indemnity against the costs, expenses and liabilities which may be incurred by it in compliance with such request or direction. The permissive right of the Fiscal Agent to do things enumerated in this Indenture shall,not be construed as a duty. 35 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 262 of 724, The Fiscal Agent may execute any of the duties of the Fiscal Agent or powers hereof and perform any of its duties through attorneys, agents and receivers and shall not be answerable for the conduct of the same if appointed by it with reasonable care. The Fiscal Agent shall be responsible for only those duties expressly set forth in this 0 Indenture and no implied duties or obligations shall be read into this Indenture against the Fiscal Agent. In no event shall the Fiscal Agent be responsible or liable for special, indirect, punitive, incidental or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Fiscal Agent has been advised of the likelihood of such loss or damage and regardless of the form of action. The Fiscal Agent shall not be charged with knowledge of (A) any events or other information,, or (B) any default under this Indenture or any other agreement unless a responsible officer of the Fiscal Agent shall have actual knowledge thereof. Section 6.09. Provisions Constitute Contract. The provisions of this Indenture shall constitute a contract between the District and the Bondowners and the provisions hereof shall be enforceable by any Bondowner for the equal benefit and protection of all B,ondowners similarly situated by mandamus, accounting, mandatory injunction or any other suit, action or proceeding at law or in equity that is now or may hereafter be authorized under the laws of the State in any court of competent jurisdiction. Said contract is made under and is to be construed in accordance with the laws of the State. No remedy conferred hereby upon any Bondowner is intended to be exclusive of any other remedy, but each such remedy is cumulative and in addition to every other remedy and maybe exercised without exhausting and without regard to any other remedy conferred by the Act or any other law of the State. No waiver of any default or breach of duty or contract by any Bondowner shall affect any subsequent default or breach of duty or contract or shall impair any rights or remedies on said subsequent default or breach. No delay or omission of any Bondowner to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed as a waiver of any such default or acquiescence therein. Every substantive right and every remedy conferred upon the Bondowners may be enforced and exercised as often as may be deemed expedient. In case any suit, action or proceeding to enforce any right or exercise any remedy shall be brought or taken and should said suit, action or proceeding be abandoned or be determined adversely to the Bondowners then, and in every such case, the District and the Bondowners sball be restored to their former positions, rights and remedies as if such suit, action or proceeding had not been brought or taken. After the issuance and delivery of the Bonds, this Indenture shall be irrevocable, but shall be subject to modification to the extent and in the manner provided in this Indenture, but to no greater extent and in no other manner. S I if available will be ect*on 6.10. CUSIP Numbers. CUSIP identification numbers, I imprinted on the Bonds, but such numbers shall not constitute a part of the contract evidenced by 36 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 263 of 724, the Bonds and no liability shall hereafter attach to the District or the Fiscal Agent, or any of the officers or agents thereof because of or on account of said numbers. Section 6.11. Entire Agreement; Sever . This Indenture and the exhibits hereto set forth the entire agreement and understanding of the parties related to this transaction and supersedes all prior agreements and understandings, oral or written. If any covenant, agreement or provision, or any portion thereof, contained in this Indenture, or the application thereof to any person or circumstance, is held to be unconstitutional, invalid or unenforceable, the remainder of this Indenture and the application of any such covenant, agreement or provision,or portion thereof, to any other persons or circumstances, shall be deemed severable and shall not be affected, and this Indenture and the Bonds issued pursuant hereto shall remain valid and the Bondholder shall retain all valid rights and benefits accorded to them under this Indenture and the Constitution and laws of the State of California. If the provisions relating to the appointment and duties of a Fiscal Agent are held to be unconstitutional, invalid or unenforceable, said duties shall be performed by the Treasurer. Section 6.12. Unclaimed Mone . All money which the Fiscal Agent shall have received from any source and set aside for the purpose of paying or redeeming any of the Bonds shall be held in trust for the respective owners of such Bonds, but any money which shall be so set aside or deposited by the Fiscal Agent and which shall remain unclaimed by the Owners of such Bonds for a period of one year after the date on which any payment or redemption with respect to such Bonds shall have become due and payable shall be transferred to the District; provided, however, that the Fiscal Agent,before makimz such payment, shall cause notice to be mailed to the Owners of such Bonds, by first-class mail, postage prepaid, not less than 90 days prior to the date of such payment to the effect that said money has,not been claimed and that after a date named therein any unclaimed balance of said money then remaining will be transferred to the District. Thereafter, the Owners of such Bonds shall look only to the District for payment and then only to the extent of the amount so received without any interest thereon. Section 6.13. Nonpresentment of Bonds. Except as otherwise provided in Section 6�.12 hereof, in the event any Bonds shall not be presented for payment when the principal thereof becomes due, if funds sufficient to pay such Bonds shall be held by the Fiscal Agent for the benefit of the Owners thereof, all liability of the District to the Owners thereof shall forthwith cease and be completely discharged and thereupon it shall be the duty of the Fiscal Agent to hold such funds (subject to Section 6.12 hereof),without liability for interest thereon, for the benefit of the Owners of such Bonds, who shall thereafter be restricted exclusively to such funds for any claim of whatever nature on, or with respect to, such Bonds. Section 6.14. Continuing Disclosure. The District hereby covenants and agrees that it will comply with and carry out all of the provisions of that certain Continuing Disclosure Agreement dated as of April 1, 2021 between the District and Spicer Consulting Group (the "Continuing Disclosure Agreement"). Notwithstanding any other provision of this Indenture, failure of the District to comply with the Continuing Disclosure Agreement shall,not be considered an Event of Default under the provisions of this Indenture. Section 6.15. Execution of Documents and Proof of Ownership by Owners. Any request, consent, declaration or other instrument which this Indenture may require or permit to be executed 37 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 264 of 724, by Owners may be in one or more instruments of similar tenor, and shall be executed by Owners in person or by their attorneys appointed in writing. Except as otherwise herein expressly provided, the fact and date of the execution by any Owner or his attorney of such a request, consent, declaration or other instrument, or of a writing appointing such an attorney, may be proved by the certificate of any notary public or other officer authorized to take acknowledgments of deeds to be recorded in the state in which he purports to act, that the person signing such request, declaration or other instrument or writing acknowledged to him the execution thereof,or by an affidavit of a witness of such execution,duly sworn to before such a notary public or other officer. Any request, consent, declaration or other instrument or writing of the Owner of any Bond shall bind all future Owners of such Bond in respect of anything done or suffered to be done by the District or the Fiscal Agent in good faith and in accordance therewith. Section 6.16. Notices to and Demands on District and Fiscal Agent. Any notice or demand which by any provision of this Indenture is required or permitted to be given or served by the Fiscal Agent to or on the District may be given or served by being deposited postage prepaid (first class, registered or certified) in a post office letter box addressed (until another address is filed by the District with the Fiscal Agent) as follows: City of Chula Vista Finance Department 276 Fourth Avenue Chula Vista, California 91910 Attention: Director of Finance/Treasurer RE.- Community Facilities District No. 16-1 (Millenia) Improvement Area No. 2 2021 Special Tax Bonds Any notice or demand whichby any provision of this Indenture is required or permitted to be given or served by the District to or on the Fiscal Agent may be given or served by being deposited postage prepaid (first class, registered or certified) in a post office letterbox addressed (until another address is filed by the Fiscal Agent with the District) as follows: Wilmington Trust,National Association 650 Town Center Drive, Suite 800 Costa Mesa, California 92626 Attention: Corporate Client Services Section 6.17. Ap,p,,,I,,,i,,cable Law. This Indenture shall be governed by and enforced in accordance with the laws of the State of California applicable to contracts made and performed in. the State of California. Section 6.18. Paym nt on Business Dgy. In. any case where the date of the payment of interest on or of principal (and premium, if any) of the Bonds or the date fixed for redemption is other than a Business Day, the payment of interest or principal (and premium, if any) need not be made on such datebut may be made on the next succeeding day which is a Business Day with the 38 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 265 of 724, same force and effect as if made on the date required, and no interest shall accrue for the period from and after such date. Section 6.19. Counterparts. This Indenture may be executed in counterparts, each of which shall be deemed an original. ARTICLE VII BONDFORM Section 7.01. Form of Bonds. The format of the Bonds as authorized and to be issued for these proceedings shall be substantially in the form as set forth in the attached, referenced and incorporated Exhibit A. Section 7.02. Temiporary Bonds. Any Bonds issued under this Indenture may be initially issued in temporary form exchangeable for definitive bonds. The Bonds may be issued as one temporary bond with an attached maturity schedule and interest rate schedule to represent all Bonds. The temporary bond may be printed, lithographed or typewritten, shall be of such denominations as may be determined by the District and may contain such references to any of the provisions of this Indenture as, may be appropriate. Every temporary Bond shall be executed by the District in substantially the same manner as provided in Section 2.06 hereof If the District issues one or more temporary Bonds,, it will execute and furnish definitive Bonds without delay upon the request of any Owner and thereupon the temporary bonds may be surrendered for cancellation at the Principal Corporate Trust Office of the Fiscal Agent, and the District shall deliver in exchange for such temporary bonds an equal aggregate principal amount of definitive Bonds of the same interest rates and maturities. Until so exchanged, the temporary bonds shall be entitled to the same benefits under this Indenture as definitive Bonds issued hereunder. ARTICLE VIII EVENTOFDEFAULT Section 8.01. Events of Default. The following events shall be Events of Default under this Indenture. (a) Default in the due and punctual payment of the principal of any Bond when and as the same shall become due and payable, whether at maturity as therein expressed, by proceedings for redemption, by declaration or otherwise. (b) Default in the due and punctual payment of interest on any Bond when and as such interest shall become due and payable. (c) Default by the District in the observance of any of the other covenants, agreements or conditions on its part in this Indenture or in the Bonds contained, if such default shall have continued for a period of thirty (30) days after written notice thereof, specifying such default and requiring the same to be remedied, shall have been given to the District by the Fiscal Agent or to the District and the Fiscal Agent by the Owners of not less than twenty-�five percent (25%) in aggregate principal amount of the Bonds at the time Outstanding;provided that such default(other than a default arising from nonpayment of the Fiscal Agent's fees and expenses, which must be cured within such 30-day period unless waived by the Fiscal Agent) shall not constitute an Event 39 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 266 of 724, of Default under this Indenture if the District shall commence to cure such default within said thirty (30) day period and thereafter diligently and in good faith shall cure such default within a reasonable period of time; or (d) The filing by the District of a petition or answer seeking reorganization or arrangement under the federal bankruptcy laws or any other applicable law of the United States of America, or if a court of competent jurisdiction shall approve a petition, filed with or without the consent of the District, seeking reorganization under the federal bankruptcy laws or any other applicable law of the United States of America, or if,under the provisions of any other law for the relief or aid of debtors, any court of competent jurisdiction shall assume custody or control of the District or of the whole or any substantial part of its property. Section 8.02. Application of Revenues and Other Funds after Default. If a default in the payment of the Bonds shall occur and be continuing, all revenues and any other funds then held or thereafter received under any of the provisions of this Indenture shall be applied as follows and in the following order: A. To the payment of any expenses necessary in the opinion of the District to protect the interest of the owners of the Bonds and payment of reasonable charges and expenses of the Fiscal Agent (including reasonable fees and disbursements of its counsel) incurred in and about the performance of its powers and duties under this Indenture; B. To the payment of the principal of and interest then due with respect to the Bonds (upon presentation of the Bonds to be paid, and stamping thereon of the payment if only partially paid, or surrender thereof if fully paid) subject to the provisions, of this Indenture, as follows: First: To the payment to the persons entitled thereto of all installments of interest then due in the order of the maturity of such installments, and, if the amount available shall not be sufficient to pay in full any installment or installments maturing on the same date,then to the payment thereof ratably, according to the amounts due thereon, to the persons entitled thereto, without any discrimination or preference; and Second: To the payment to the persons entitled thereto of the unpaid principal of any Bonds which shall have become due, whether at maturity or by call for redemption, with interest on the overdue principal, at the rate bome by the respective Bonds on the date of maturity of redemption, and if the amount available shall not be sufficient to pay in full all the Bonds,together with such interest, then to the payment thereof ratably, according to the amounts of principal due on such date to the persons entitled thereto, without discrimination or preference. (Remainder of page intentionally left blank) 40 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 267 of 724, IN WITNESS WHEREOF, the District and the Fiscal Agent have executed this Bond Indenture effective the date first above written. COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA) By: David Bilby Director of F inance/Tre a surer WILMINGTON TRUST, NATIONAL ASSOCIATION as Fiscal Agent By: Authorized Officer S-1 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 268 of 724, EXHIBIT A FORM OF BOND UNLESS THIS BOND IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE SECURITIES DEPOSITORY (AS DEFINED IN THE INDENTURE OF TRUST) TO THE TRUSTEE FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY BOND ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. R - United States of America State of California CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA) IMPROVEMENT AREA NO, 2 2021 SPECIAL TAX BONDS Interest Rate Maturity Date Bond Date CUSIP No. % September 1, 20 [April 202 1 Registered Owner: Cede & Co. Principal Amount: Community Facilities District No. 16-1(Millenia) (the "District"), situated in Chula Vista, Califomia, for value received, hereby promises to pay, solely from Net Improvement Area No. 2 Special Tax Revenues (as hereafter defined), to the registered owner named above, or registered assigns,on the maturity date set forth above,unless,redeemed prior thereto as hereinafter provided, the principal amount set forth above and to pay interest on such principal amount semiannually on each March I and September 1, commencing September 1, 2021, (each, an "Interest Payment Date"') at the interest rate set forth above, until the principal amount hereof is paid or made available for payment. The principal of and premium, if any, on this Bond are playable to the registered owner hereof in lawful money of the United States of America upon presentation and surrender of this Bond at maturity or redemption at the corporate trust office or agency of Wilmington Trust, National Association (the "Fiscal Agent") in Costa Mesa, California (or such other office designated by the Fiscal Agent). Interest on this Bond is payable from the Interest Payment Date next preceding the date of its authentication, unless (i) such date of authentication is an Interest Payment Date, in which event interest shall. be payable from such date of authentication, (ii) the date of authentication is after the 15th calendar day of the month preceding A-I 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 269 of 724, the Interest Payment Date (the "Record Date") but prior to the immediately succeeding Interest Payment Date, in which event interest shall be payable from the Interest Payment Date! immediately succeeding the date of authentication or (Iii) the date of authentication is prior to the close of business on the first Record Date, in which event interest shall be payable from the! Bond Date above; provided, however, that if at the time of authentication of this Bond, interest is in default, interest on this Bond shall be payable from the last Interest Payment Date to which the interest has been paid or made available for payment. Interest on this Bond shall be payable by check of the Fiscal Agent mailed first class,postage prepaid,to the registered owner hereof at such registered owner's address as it appears on the registration books maintained by the Fiscal Agent as of the close of business on the Record Date preceding the Interest Payment Date or,upon request in writing prior to the Record Date received from a registered owner of at least $1,000,000 in aggregate principal amount of the Bonds, by wire transfer in immediately available funds to an account in the United States of America designated by such registered owner. This Bond is one of a duly authorized issue of the "City of Chula Vista Community Facilities District No. 16-1 (Millenia) Improvement Area No. 2 2021 Special Tax Bonds" (the "Bonds") issued in the aggregate principal amount of$[ ] pursuant to the Mello-Roos Community Facilities Act of 1982, constituting Sections 53311, et seq. of the California Government Code, as amended (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"), for the purpose of financing certain public improvements in and for the District. The creation of the Bonds and the terms and conditions thereof are provided for by a Bond Indenture (the "Indenture") dated as of April 1, 2021, and this reference incorporates the Indenture herein, and by acceptance hereof the owner of this Bond assents to said terms and conditions. All capitalized terms used herein shall have the same meaning as set forth in the Indenture unless otherwise specified herein. The Indenture is authorized under, this Bond is issued under, andboth are to be construed in accordance with, the laws of the State of California. Pursuant to the Act and the Indenture,the principal of,premium, if any, and interest on this Bond are payable solely from, and shall be secured by a pledge of and hen upon, the proceeds of the Improvement Area No. 2 Special Tax (as defined in the Indenture) levied and received by the District and the proceeds of the redemption and sale of property sold as a result of foreclosure of the lien of the Improvement Area No. 2 Special Tax to the amount of such lien and penalties thereon minus amounts applied annually to fund the Administrative Expense Requirement (together,the "Net Improvement Area No. 2 Special Tax Revenues") and certain funds held under the Indenture. The Bonds are not general, obligations of the City of Chula Vista or the District, but are special, limited obligations of the District, and neither the faith and credit nor the taxing power of the District, the City of Chula Vista, the State of California, or any political subdivision thereof is pledged to the payment of the Bonds. Except for the Net Improvement Area No. 2 Special Tax Revenues, no other revenues or taxes are pledged to the payment of the Bonds. The District will review the public records of the County of San Diego, California, in connection.with the collection of the Improvement Area No. 2 Special Taxes and will commence and diligently pursue to completion,judicial foreclosure proceedings against (i) properties under common ownership with delinquent Improvement Area No. 2 Special Taxes in the aggregate of $5,000 or more by October I following the close of the Fiscal Year in which the Improvement A-2 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 270 of 724, Area No. 2 Special Taxes were due, and (ii) against all properties with delinquent Improvement Area No. 2 Special Taxes in the aggregate of$5,000 or more by October I following the close of any fiscal year if the amount in the Reserve Fund is less than the Reserve Requirement. The Bonds may be redeemed at the option of the District prior to maturity as a whole, or in part on any Interest Payment Date on and after September 1, 2025, from such maturities as are selected by the District, and by lot within a maturity, from any source of funds, at the following redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), together with accrued interest to the date of redemption: Redemption Date Redemption Price Any Interest Payment Date from September 1, 2025 through March 1, 103% 2028 September 1, 2028 and March 1, 2029 102 September 1, 2029 and March 1, 2030 101 September 1, 2030 and any Interest Payment Date thereafter 100 The Bonds are subject to extraordinary mandatory redemption on any Interest Payment Date, prior to maturity, as a whole, or in part as nearly as practicable on a pro rata basis among maturities in authorized denominations, from the amounts deposited in the Redemption Fund in connection with the prepayment of Improvement Area No. 2 Special Taxes pursuant to the Improvement Area No. 2 Special Tax RMA. Such extraordinary mandatory redemption of the Bonds shall be at the following redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), together with accrued interest thereon to the date of redemption: Redemption Date Redemption Price Any Interest Payment Date from September 1, 20�21 through March 1, 103% 2028 September 1, 2028 and March 1, 2029 102 September 1, 2029 and March 1, 2030 101 September 1, 2030 and any Interest Payment Date thereafter 100 The Term Bonds maturing on September 1, 20 are subject to mandatory sinking fund redemption, in part, by lot, on September I of each year commencing September 1, 20 at a redemption price equal to the principal amount of the Term Bonds to be redeemed, plus accrued and unpaid interest thereon to the date fixed for redemption, without premium, in the aggregate principal amounts and in the years shown in the following redemption. schedule. Redemption Date Principal (S,ep�temb�er t) Amount A-3 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 271 of 724, (maturity) The Term Bonds maturing on September 1, 20 are subject to mandatory sinkimz fund redemption, in part, by lot, on September I of each year commencing September 1, 20 at a redemption price equal to the principal amount of the Term Bonds to be redeemed, plus accrued and unpaid interest thereon to the date fixed for redemption, without premium, in the aggregate principal amounts and in the years shown in the following redemption schedule. Redemption Date Principal (Septemberj) Amount (maturity) Notice of redemption with respect to the Bonds to be redeemed shall be given by the Fiscal Agent to the registered owner thereof at least 30 days but not more than 45 days prior to the redemption date, by first class mail, postage prepaid, at their addresses appearing on the Bond Register; provided, however, so long as the Bonds, are registered in the name of the Nominee, notice shall be given in such manner as complies with the requirements of the Depository. This Bond shall be issued only in fully registered fon-n in the denominations of$51,000 or any integral multiple thereof. No transfer hereof shall be valid for any purpose unless made by the registered owner, by execution of the form of assignment printed hereon, and authenticated as herein provided, and the principal hereof, interest hereon and any redem-ption premium shall be payable only to the registered owner or to such owner's order. Interest on this Bond shall be payable to the person whose name appears upon the Bond Register as the registered owner hereof as of the close of business on the Record Date or to such person's, order. The Fiscal Agent shall require the registered owner requesting transfer or exchange to pay any tax or other governmental charge required to be paid with respect to such transfer or exchange. The Fiscal Agent shall not be required to register,transfer or make exchanges of(i)Bonds for a period of 15 days next preceding the date of any selection of Bonds to be redeemed or(ii) any Bonds chosen for redemption. This Bond shall not 'become valid or obligatory for any purpose until the certificate of authentication hereon printed shall have been dated and manually signed by the Fiscal Agent. IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and things required by law to exist, happen and be performed precedent to and in the issuance of this Bond have existed, happened and been performed in due time, form and manner as required by law, and that the amount of this Bond, together with all other indebtedness of the District, does not exceed any debt limit prescribed by the laws or Constitution of the State of California. IN WITNESS WHEREOF, the Community Facilities District No. 16-1 (Millenia), has caused this Bond to be dated 2021 and to be signed by the Mayor of the City of A-4, 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 272 of 724, Chula Vista by his or her manual signature and attested by the City Clerk by his or her manual signature. City Clerk, City of Chula Vista, for and on Mayor, City of Chula Vista, for and on behalf behalf of Community Facilities District No. of Community Facilities District No. 16-1 16-1 (Millenia) (Millenia) A-5 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 273 of 724, CERTIFICATE OF AUTHENTICATION This is one of the Bonds described in the within defined Indenture. Dated: 2021 Wilmington Trust,National Association, as Fiscal Agent By:_ Authorized Officer A-6 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 274 of 724, ASSIGNMENT For value received the undersigned do(es) hereby sell, assign and transfer unto (Name, Address, and Tax Identification or Social Security Number of Assignee) the within-mentioned registered Bond and hereby irrevocably constitute(s) and appoint(s), .attorney, to transfer the same on the books of the Fiscal Agent with full power of substitution in the premises. Dated: Signature Guaranteed: NOTICE: Signature must be guaranteed by a NOTICE: The signature on this assignment qualified guarantor. must correspond with the name as it appears on the face of the within Bond in every particular, without alteration or enlargement or any change whatsoever A-7 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 275 of 724, EXHIBIT B REQUISITION FOR COSTS OF ISSUANCE REQUISITION NO. PERTAINING TO DISBURSEMENTS FROM COSTS OF ISSUANCE FUND FOR COSTS OF ISSUANCE The undersigned hereby states and certifies: (i) that the undersigned is the duly appointed, qualified and acting Director of Finance/Treasurer of the City of Chula Vista (the "City") and as such is an Authorized Representative of Community Facilities District No. 16-1 (Millenia) (the "District") within the meaning of the Bond Indenture hereinafter defined, (ii) that, pursuant to Section 3.0�4 of the Bond Indenture, dated as of �[April 1, 20�21] (the "Bond Indenture"), between Wilmington Trust, National Association, as, fiscal agent (the "Fiscal Agent"),by and between the Fiscal Agent and the District,the undersigned hereby requests the Fiscal Agent to disburse,upon receipt of an invoice or invoices, from the payees designated on Attachment A attached hereto and incorporated herein by this reference, from the from the Cost of Issuance Fund established under the Bond Indenture to each such payee, amounts not to exceed the respective sum set forth in Attachment A opposite the designation for each such payee; (iii) that such payments should be made in accordance with the payment instructions contained in such invoices; and (iv) that the amounts to be disbursed are properly chargeable to the Cost of Issuance Fund. Date: Community Facilities District No. 16-1 (Millenia) By: David Bilby, Director of Finance/Treasurer City of Chula Vista B-1 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 276 of 724, ATTACHMENT A COSTS OF ISSUANCE Payee Description of Cost of Issuance Amount B-2 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 277 of 724, EXHIBIT C REQUISITION FOR COSTS REQUISITION NO. PERTAINING TO DISBURSEMENTS FROM THE PROJECT FUND TO FUND PROJECT COSTS The undersigned hereby states and certifies: (i) that the undersigned is the duly appointed, qualified and acting Director of Finance/Treasurer of the City of Chula Vista (the "City") and as such is an Authorized Representative of Community Facilities District No. 16-1 (Millenia) (the "D�istrict") within the meaning of the Bond Indenture hereinafter defined, (ii) that, pursuant to Section 3.0�5 of the Bond Indenture, dated as of [April 1, 20�21] (the "Bond Indenture"), between Wilmington Trust, National Association, as, fiscal agent (the "Fiscal Agent"),by and between the Fiscal Agent and the District,the undersigned hereby requests the Fiscal Agent to disburse to the payees designated on Attachment A attached hereto and incorporated herein by this reference, from the Project Fund established under the Bond Indenture to each such payee,the respective sum set forth in Attachment A opposite the designation for each such payee; (iii) that such payments should be made in accordance with the payment instructions contained in Attachment A; and (iv) that the amounts to be disbursed are properly chargeable to the Project Fund. Date: Community Facilities District No. 16-1 (Millenia) By: David Bilby, Director of Finance/Treasurer City of Chula Vista C-1 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 278 of 724, ATTACHMENT A PROJECT COSTS Payee Description of Project Costs Amount C-2 60297.00058\33470603.5 2021-03-16 Agenda Packet Page 279 of 724, Jones Hall Drqft 3-4-2021 BOND PURCHASE AGREEMENT $[PAR] CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO�. 16-1 (MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS 12021 Community Facilities District No. 16-1 (Millenia) c/o City of Chula Vista 276 Fourth Avenue Chula Vista, CA 919 10 Attention: Director of Finance/Treasurer Ladies and Gentlemen: Stifel,Nicolaus&Company, Incorporated, as underwriter(the"Underwriter")offers to enter into this Bond Purchase Agreement (this "Agreement") with Community Facilities District No. 16-1 (Millenia)(the"District"),which,upon your acceptance of this offer,will be binding upon the District and the Underwriter. This offer is made subject to the acceptance by the District of this Agreement on or before 11:5 9 p.m. on the date set forth above. Terms not otherwise defined herein have the meanings given them in the Indenture described below. I. Upon the terms and conditions and in reliance upon the respective representations, warranties and covenants herein, the Underwriter hereby agrees to purchase from the District, and the District hereby agrees to sell to the Underwriter,all(but not less than all)of the above-captioned bonds (the "Bonds") at a purchase price (the "Purchase Price") of$ (equal to the par amount of the Bonds of$[PAR],plus net original issue premium of$ less an Underwriter's discount of$ The Bonds will be issued by the District under the Mello-Roos Community racinties Act of 1982 (constituting Section 53311 et seq. of the California Government Code) (the "Act")�, the City of Chula Vista Community Facilities District Ordinance (the "City CFD Ordinance," and together with the Act, the "Community Facilities District Law") and a resolution adopted on March , 2021 (the "Bond Resolution") by the City Council (the"City Council") of the City of Chula Vista(the "City") acting as the legislative body of the District. The special taxes that provide a source of payment for the Bonds (the "Special Taxes") will be levied on property within Improvement Area No. 2 of the District under Ordinance No. 3492 adopted by the City Council on July 28, 2020 (the "Ordinance"). In addition to the Ordinance, the City Council adopted the following in connection with initial formation of the District, subsequent change proceedings, and the levy of the Special Taxes: (i) Resolution No. 2016-154 (the "Resolution of Intention to Form the District"), (ii) Resolution No. 2016-155 (the "Resolution of Intention to 2021-03-16 Agenda Packet Page 280 of 724, Incur Bonded Indebtedness"), (iii) Resolution No. 2016-184 (the "Resolution of Formation"), (iv) Resolution No. 2016-185 ("Resolution Declaring Necessity to Incur Bonded Indebtedness"), (v) Resolution No. 2016-186 (the "Resolution Declaring Election Results"), (vi) Resolution No. 2020-001 (the "Resolution of Intention to Consider Changes to Rate and Method"), (vii) Resolution No.2020-029("Resolution Calling Special Election re: Changes to Rate and Method"), and (viii) Resolution No. 2020-30 ("Resolution Declaring Election re: Changes to Rate and Method"; collectively, the "Formation Resolutions and Ordinance"). Together, the City CFD Ordinance, the Bond Resolution and the Formation Resolutions and Ordinance are referred to as the "Resolutions and Ordinances.") The Bonds, will be issued under the terms of a Bond Indenture (the "Indenture"), dated as of April 1,202 1,by and between the District and Wilmington Trust,National Association,as Fiscal Agent (the "Fiscal Agent"). The proceeds of the sale of the Bonds,will be used by the District to (i) ay the p , cost and expense of acquisition of certain public facilities required in connection with the development of the District,(ii)pay capitalized interest on the Bonds through September 1,202 1,(iii)fund a Reserve Fund securing the Bonds, and,(iv)pay costs of issuance of the Bonds. Proceeds of the Bonds will be applied in accordance with the Indenture. In anticipation of the issuance of the Bonds, the City, the District, and SLF IV-Millenia, LLC, a Delaware limited liability company ("SLF") have entered into a Deposit Agreement dated as of March , 2021 (the "Deposit Agreement"), pursuant to which SLF has delivered$[1,003,113.34] in immediately available funds(the"Deposit")to the District for use by the District for the payment of debt service on the Bonds in the event of delays in receipt by the District of Special Taxes levied within Improvement Area No. 2 with respect to certain parcels therein as described in the Deposit Agreement. The District acknowledges and agrees that: (i) the primary role of the Underwriter is to purchase securities for resale to investors in an an'ns-length commercial transaction between the District and the Underwriter and that the Underwriter has financial and other interests that differ from those of the District,and in connection therewith and with the discussions,undertakings and procedures leading up to the consummation of such transaction,the Underwriter is and has been acting solely as a principal, and is not acting as the agent or fiduciary of the District, (ii) the Underwriter is not acting as a municipal advisor (within the meaning of Section 15B of the Securities Exchange Act of 1934, as amended), financial advisor or fiduciary to the District or any other person or entity and has not assumed any advisory or fiduciary responsibility to the District with respect to the transaction contemplated hereby and the discussions, undertakings and proceedings leading thereto (irrespective of whether the Underwriter has provided other services or is currently providing other services to the District on other matters), (Ili) the only obligations the Underwriter has to the District with respect to the transaction contemplated hereby expressly are set forth in this Agreement, except as otherwise provided by applicable rules and regulations of the Securities and Exchange Commission or the rules of the MSRB or other law,and(iv)the District has consulted its own.legal.) accounting,,tax, municipal, financial and other advisors, as applicable, to the extent it has deemed appropriate in. connection with the transaction contemplated herein. The District acknowledges that it has previously provided the Underwriter with an acknowledgement of receipt of the required Underwriter disclosure under Rule G-17 of the MSRB. 2. The Bonds will mature on the dates and in the principal amounts and will bear interest at the rates (and have the redemption terms) as set forth in Exhibit A hereto. Subject to Section 14, the Underwriter agrees, to make a bona fide public offering of all of the Bonds at the offering prices set forth on the cover of the Final Official Statement described below. Additional details related to the! establishment of the issue price of the Bonds is set forth,in Section 14. -2- 2021-03-16 Agenda Packet Page 281 of 724, 3. The District agrees to deliver to the Underwriter as many copies, of the Final Official Statement (defined below), relating to the Bonds, as are requested by the Underwriter for delivery to each of its customers purchasing Bonds no later than the settlement date of the transaction. The District has authorized and approved the Preliminary Official Statement dated March 2021 (the "Preliminary Official Statement"), and the final Official Statement dated the date hereof (the"Final Official Statement")and consents to their distribution and use by the Underwriter and the execution and approval of the Final Official Statement by a duly authorized officer of the District. The District deemed the Preliminary Official Statement final as of its date for purposes of Rule 15c2-12 of the Securities and Exchange Commission ("Rule 15c2-12"), except for information allowed by Rule 15c2-12 to be omitted, and has executed a certificate to that effect substantially in the form of Exhibit D�. In connection with issuance of the Bonds, and in order to assist the Underwriter in complying with Rule 15c2-12, the District will execute a Continuing Disclosure Agreement, dated as of April 1, 2021 (the "Continuing Disclosure Agreement"), between the District and [Spicer Consulting Group, LLC], as dissemination agent. The fonn of the Continuing Disclosure Agreement is attached as Appendix F to the Preliminary Official Statement. 4. The District represents and warrants to the Underwriter that: (a) The District is duly organized and validly existing as a community facilities district under the laws of the State of California (the "State"), and has the full legal right, power and authority, among other things, (i) upon satisfaction of the conditions in this Agreement and,the Indenture, to issue the Bonds as provided. herein, and(ii)to secure the Bonds in the manner set forth in the Indenture. (b) The City Council has the full legal right, power and authority to adopt the Resolutions and Ordinances, and the District has the full legal right, power and authority(i) to enter into this Agreement, the Indenture, the Deposit Agreement.) and the Continuing Disclosure Agreement,the Acquisition/F'inancing Agreement dated as of February 6, 2018 (the "Acquisition Agreement"), by and among the City,the District and SLF(collectively, the "District Documents"), (11)to issue, sell and deliver the Bonds to the Underwriter as provided herein,and(111)to carry out and consummate all other transactions on its part contemplated by the Final Official Statement and each of the District Documents, and the District and the City Council have complied with all provisions, of applicable law, including the Act, in all matters relating to such.transactions. (c) The District has duly authorized (i) the execution. and delivery by the District of the Bonds and the execution, delivery and due performance by the District of its obligations under the District Documents, (ii) the distribution. and use of the Preliminary Official Statement and execution, delivery and distribution of the Final Official Statement, and(iii)the taking of any and all such action as may be required on the part of the District to carry out, give effect to and consummate! the transactions on its part contemplated by such instruments. All co�nsents or approvals necessary to be obtained by the District in connection with the -3- 2021-03-16 Agenda Packet Page 282 of 724, foregoing have been received, and the consents or approvals so received are still in full force and effect. (d) The Resolutions and Ordinances have been duly adopted by the City Council and are in full force and effect; and the District Documents, when executed and delivered by the District and the other party thereto, will constitute a legal, valid and binding obligation of the District enforceable against the District in accordance with their terms, except as enforceability thereof may be limited by bankruptcy, insolvency or other laws affecting creditors' rights generally. (e) When delivered to the Underwriter,the Bonds will have been duly authorized by the City Council and duly executed, issued and delivered by the District and will constitute legal, valid and binding special obligations of the District enforceable against the District in accordance with their respective terms, except as enforceability thereof may be limited by bankruptcy, insolvency or other laws affecting creditors' rights generally, and will be entitled, to the benefit and security of the Indenture. The information (excluding information relating to The Depository Trust Company ("D'TC") and its book-entry system, CUSIP numbers, information provided by the Underwriter and information under the captions "IMPROVEMENT AREA NO. 2—Market Absorption Study" and"—Appraisal Report and Supplement to Appraisal Report," and "PROPERTY O�"ERSHIP AND DEVELOPMENT"(collectively,the"Excluded Information")contained. in the Preliminary Official Statement, is, and as of the Closing Date such information in the Final Official Statement will be true and,correct in all material respects, and except for the Excluded Information as to which no view is expressed,the Preliminary Official Statement,does not as of its date and the Final Official Statement will not as of the Closing Date contain any untrue or misleading statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (g) If, at any time up to and including 25 days after the End of the Underwriting Period (as defined, below), any event known to the officers of the District participating in the issuance of the Bonds occurs with respect to the District or the City as a result of which the Final Official Statement as then amended or supplemented includes an untrue statement of a material fact, or omits to state any material fact necessary to make the statements therein, in light of the circumstances under which, they weremade, not misleading, the District shall promptly notify the Underwriter in writing of such event and shall provide a supplement to the Underwriter so that the Final Official Statement,, as supplemented, does not contain an untrue statement or omit any material fact. Any information supplied by the District for inclusion in any amendments or supplements to the Final Official Statement will not contain any untrue or misleading statement of a material fact relating to the District or the City or omit to state any material fact relating to the District or the City necessary to make the statements therein in the light of the circumstances under which they were made not misleading. As used herein, the ten-n "End of the Underwriting Period" -4- 2021-03-16 Agenda Packet Page 283 of 724, means the later of such time as: (i) the Bonds, are delivered to the Underwriter; or(ii)the Underwriter does not retain,directly or as a member of an underwriting syndicate, an unsold balance of the Bonds for sale to the public. Unless the Underwriter gives notice to the contrary,the End of the Underwriting Period shall be deemed to be the Closing Date (as described in Section 7 below). Any notice delivered pursuant to this provision shall be written notice delivered to the District at or prior to the Closing Date, and shall specify a date (other than the Closing Date) to be deemed the "End of the Underwriting Period." (h) Neither the adoption of the Resolutions and Ordinances, the execution and delivery of the District Documents, nor the consummation of the transactions on the part of the District contemplated herein or therein or the compliance by the District with the provisions hereof or thereof will conflict with, or constitute on the part of the District, a violation of, or a breach of or default under, (i) any material indenture, mortgage, commitment, note or other agreement or instrument to which the District is a party or by which it is bound, (ii) any provision of the State Constitution or (iii) any existing law, rule, regulation, ordinance, judgment, order or decree to which the District or the City (or the members of the City Council or any of its officers in their respective capacities as such) is subject, that could have a material adverse effect on the ability of the District to perform its obligations under the District Documents. (i) The District has not previously issued or entered into any obligation and the District has not entered into any contract or arrangement of any kind which might give rise to any lien or encumbrance on the Special Taxes. Except as is specifically disclosed in the Final Official Statement, to the best knowledge of the District, there is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, public board or body, pending with respect to which the District or the District has been served with process or threatened, which in any way questions the powers of the City Council,the City or the District referred to in paragraph(b) above,or the validity of any proceeding taken by the City Council, in connection with the issuance of the Bonds,or wherein an unfavorable decision,ruling or finding could materially adversely affect the transactions contemplated by the District Documents, or which in any way, could adversely affect the validity or enforceability of the Resolutions and Ordinances, the Bonds or the District Documents or, to the knowledge of the District, which in any way questions the exclusion from gross income of the recipients thereof of the interest on. the Bonds for federal income tax purposes or in any other way questions the status of the Bonds under State tax laws or regulations. (k) Any certificate signed by an official of the District authorized to execute such, certificate and delivered to the Underwriter in connection with the transactions contemplated by the District Documents shall be deemed a representation and warranty by the District to the Underwriter as to the truth of the statements therein contained. -5- 2021-03-16 Agenda Packet Page 284 of 724, (1) The District has not been notified of any listing or proposed listing by the Internal Revenue Service to the effect that it is a bond issuer whose arbitrage certifications may not be relied upon. (m) The Bonds will be paid from Net Improvement Area No.2 Special Tax Revenues (as defined in the Indenture)received by the District and amounts held in certain funds and accounts established and pledged under the Indenture. (n) The Special Taxes may lawfully be levied in accordance with the Amended and Restated Rate and Method of Apportionment of Special Tax for Improvement Area No. 2 (the "Rate and Method"), the Resolutions and Ordinances as described in the Preliminary Official Statement,and the Final Official Statement, and, when levied, will be secured by a lien on the property on which they are levied. (o) The Indenture creates a valid pledge of, and first lien upon,the Net Improvement Area No. 2 Special Tax Revenues deposited thereunder, and the amounts held in certain funds and accounts established and pledged under the Indenture, subject in all cases to the provisions of the Indenture permitting the application thereof for the purposes and on the terms and conditions set forth therein. (p) Except as disclosed in the Final Official Statement, in the last five years, neither the City, nor the District, nor any other entity for which the City Council is the legislative body, has failed to comply with any undertaking under Rule l5c2-12 in any material resp�ect. (q) The District has deposited the Deposit in the Deposit Fund in accordance with the Deposit Agreement. 5. The District covenants with the Underwriter that the District will cooperate with the Underwriter (at the cost of the Underwriter), in qualifying the Bonds for offer and sale under the securities or Blue Sky laws of such jurisdictions of the United States as the Underwriter may reasonably request; provided, however, that the District shall not be required to consent to suit or to service of process, or to qualify to do business, in any jurisdiction. The District consents to the use by the Underwriter of the District Documents in the course of its compliance with the securities or Blue Sky laws of the various jurisdictions. 6. At 9:00 a.m. on 2021 (the "Closl*ng Date") or at such other time and/or date as shall have been mutually agreed upon. by the District and the Underwriter, the District will deliver or cause to be delivered to the Underwriter the Bonds in definitive form, through,the facilities of DTC, duly executed and authenticated by the Fiscal Agent together with. the other documents 'mentioned in Section 8 hereof; and the Underwriter will accept such delivery and pay the Purchase Price of the Bonds by delivering to the Fiscal Agent for the account of the District a check payable in federal funds or making a wire transfer in federal funds payable!to the order of the Fiscal Agent. The activities relating to the final execution and delivery of the Bonds and the Indenture and the payment therefor and the delivery of the certificates., o�p�inions and other instruments, as described in Section 8 of this Agreement shall occur at the offices of Best Best & Krieger LLP, San Diego, California, as bond counsel to the District ("Bond Counsel"). The payment for the Bonds and -6- 2021-03-16 Agenda Packet Page 285 of 724, simultaneous delivery of the Bonds to the Underwriter is herein referred to as the "Closing." The Bonds will be delivered as fully registered Bonds initially in denominations of$5,000 each and any integral multiple thereof The Bonds,will be registered in the name of Cede &Co., as nominee of The Depository Trust Company, and will be made available for checking by the Underwriter at such place as the Underwriter and the Fiscal Agent shall agree not less than 24 hours prior to the Closing. 7. The Underwriter has the right to cancel its obligations to purchase the Bonds if between the date hereof and the Closing Date: (a) the House of Representatives or the Senate of the Congress of the United States, or a committee of either, shall have pending before it, or shall have passed or recommended favorably, legislation introduced previous to the date hereof, which legislation, if enacted in its form as introduced or as amended,would have the purpose or effect of imposing federal income taxation upon revenues or other income of the general character to be derived by the District or by any similar body under the Indenture or upon interest received on obligations of the general character of the Bonds, or of causing interest on obligations of the general character of the Bonds, to be includable in gross income for purposes of federal income taxation, and such legislation, in the Underwriter's reasonable judgment, materially adversely affects the market price or marketability of the Bonds or the ability of the Underwriter to enforce contracts for the sale of the Bonds; or (b) legislation shall be approved by a committee of the House of Representatives or the Senate of the Congress of the United States, or legislation shall be favorably reported or re-repo�rted by such a committee or be introduced, by amendment or otherwise in or be passed by the House of Representatives or the Senate, or recommended to the Congress of the United States for passage by the President of the United States, or be enacted or a decision by a federal court of the United States or the United States Tax Court shall have been rendered, or a ruling, release, order, circular, regulation or official statement by or on behalf of the United States Treasury Department,, the Internal Revenue Service or other governmental agency shall have been made or proposed to be made having the purpose or effect, or any other action or event shall have occurred which has the purpose or effect,directly or indirectly,of adversely affecting the federal income tax consequences of owning the Bonds, including causing interest on the Bonds to be included in gross income for purposes of federal income taxation, or imposing federal income taxation upon revenues or other income of the general character to be derived by the District under the Indenture or upon interest received on obligations of the general character of the Bonds, or the Bonds and also including adversely affecting the tax-exempt status of the District under the Code,which,,in the reasonable judgment of the Underwriter,materially adversely affects the market price or marketability of the Bonds or the ability of the Underwriter to enforce contracts for the sale of the Bonds; or (c) legislation shall have been enacted, or actively considered for enactment with an effective date prior to the Closing, or a decision by a court of the United States shall have been rendered, the effect of which is, that the Bonds, including any underlying obligations, or the Indenture, as the case may be, is not exempt from the registration,qualification or other requirements of the Securities Act of 1933, -7- 2021-03-16 Agenda Packet Page 286 of 724, as amended and as then in effect, the Securities Exchange Act of 1934, as amended and as then in effect, or the Trust Indenture Act of 1939, as amended and as then in effect; or (d) a stop order, ruling, regulation or official statement by the Securities and Exchange Commission or any other governmental agency having jurisdiction of the subject matter shall have been issued or made or any other event occurs, the effect of which is that the issuance, offering or sale of the Bonds, including any underlying obligations, or the execution and delivery of the Indenture as contemplated hereby or by the Final Official Statement, is or would be in violation of any provision of the federal securities laws, including the Securities Act of 1933, as amended and as then in effect, the Securities Exchange Act of 1934,, as amended and as then in effect, or the Trust Indenture Act of 1939, as amended and as then in effect; or (e) any event shall have occurred or any information shall have become known to the Underwriter which causes the Underwriter to reasonably believe that the Final Official Statement as then amended or supplemented includes an untrue statement of a material fact, or omits to state any material fact necessary to make the statements therein,in light of the circumstances under which they were made, not misleading, and the District fails to amend or supplement such Final Official Statement to cure such omission or misstatement under Section 4(g); or (f) there shall have occurred (1) any outbreak or escalation of hostilities, or any national or international calamity or crisis, including the declaration by the United States of a national emergency or war, (2) any other calamity or crisis in the financial markets of the United States or elsewhere, or(3) the sovereign debt rating of the United, States is downgraded by any major credit rating agency or a payment default occurs on United States Treasury obligations,the effect of which on the financial markets of the United States is such as, in the reasonable judgment of the Underwriter, would materially adversely affect the market price or marketability of the Bonds or the ability of the Underwriter to enforce contracts for the sale of the Bonds; or (g) there shall be in force a general suspension of trading on the New York Stock Exchange other major exchange shall be in force, or minimum or maximum prices for trading shall have been fixed and,be in force, or maximum ranges for prices for securities shall have been required and be in force on any such exchange,whether by virtue of determination by that exchange or by order of the Securities and Exchange Commission or any other governmental authority having jurisdiction, the effect of which, on the financial markets of the United States is such as,in the reasonable judgment of the Underwriter,wouldmaterially adversely affect the market price or marketability of the Bonds or the ability of the Underwriter to enforce contracts for the sale of the Bonds; or (h) a general banking moratorium shall have been declared by federal,New York or State authorities; or 2021-03-16 Agenda Packet Page 287 of 724, (i) any proceeding shall be pending or threatened by the Securities and Exchange Commission against the District or the City; or additional material restrictions not in force as of the date hereof shall have been imposed upon trading in securities generally by any governmental authority or by any national securities exchange which adversely affects the Underwriter's ability to sell the Bonds; or (k) the Comptroller of the Currency, The New York Stock Exchange or other national securities exchange, or any governmental authority, shall impose, as to the Bonds or obligations of the general character of the Bonds, any material restrictions not now in force, or increase materially those now in force, with respect to the extension of credit by, or the charge to the net capital requirements of, or financial responsibility requirements of, the Underwriter; or (1) an amendment to the federal or State constitution shall be enacted or action taken by any federal or State court, legislative body,regulatory body or other authority materially adversely affecting the tax status of the District, its property, income or securities(or interest thereon)�,the validity or enforceability of the Special Tax or the ability of the District to issue the Bonds and levy the Special Tax as contemplated by the indenture, the Rate and Method, the Resolution of Fo�n-nation,, the Ordinance and the Final Official Statement; (m) the entry of any order by a court of competent jurisdiction which enjoins or restrains the City from issuing permits,licenses or entitlements within the District or which order, in the reasonable opinion of the Underwriter, otherwise materially and adversely affects development of the real property located in the District, or (n) the commencement of any action, suit or proceeding described in Section 40) hereof which, in the judgment of the Underwriter, materially adversely affects the market price or marketability of the Bonds or the ability of the Underwriter to enforce contracts for the sale of the Bonds. 8. The obligation of the Underwriter to purchase the Bonds is subject(a) to the performance by the District of its obligations to be performed by it hereunder at and-prior to the Closing, (b) to the accuracy as of the date hereof and as of the time of the Closing of the representations and warranties of the District herein, (c) to the accuracy of, and in reliance on, the representations and covenants of SLF, Pinnacle New Homes LLCI a Delaware limited liability company ("Pinnacle Homes"), and Lennar Homes of California, Inc., a California corporation ("Lennar Homes" and together with SLF and Pinnacle Homes, the "Developers" and each a "Developer") contained in the Letters of Representation delivered 'in connection with, the Preliminary Official Statement and Closing Certificates delivered as of the Closing Date, in substantially the forms attached hereto as Exhibits G and H, respectively, with such additional changes as may be agreed to by the Developers and the Underwriter, and (d) to the following conditions, including the delivery by the District of such documents as are enumerated herein in form and substance satisfactory to the Underwriter: (a) At the time of Closing, (1) the Final Official Statement and the District Documents shall be in full force and effect and shall, not have been amended., -9- 2021-03-16 Agenda Packet Page 288 of 724, modified or supplemented except as may have been agreed to by the Underwriter, and (ii)the District shall have duly adopted and there shall be in full force and effect such resolutions and ordinances (including, but not limited to, the Resolutions and Ordinances) as, in the opinion of Bond Counsel, shall be necessary in connection with the transactions contemplated hereby. (b) Receipt of the Bonds, executed by the District and authenticated by the Fiscal Agent, at or prior to the Closing. The terms of the Bonds, when delivered, shall in all instances be as described in Final Official Statement. (c) At or prior to the Closing,the Underwriter shall receive the following documents in such number of counterparts as shall be mutually agreeable to the Underwriter and the District: (i) A final approving opinion of Bond Counsel dated the Closing Date in the form attached to the Final Official Statement. (ii) A letter or letters of Bond Counsel addressed, to the Underwriter, which includes a statement to the effect that Bond Counsel's final approving opinion may be relied u on bv the Underwriter to the same extent as if such p W opinion were addressed to the Underwriter, and further provides: (A) the statements contained in the Final Official Statement on the cover page and under the captions "INTRODUCTION — Sources of Payment for the Bonds... .INTRODUCTION — Description of the Bonds," "INTRODUCTION — Tax Exemption," "THE BONDS" (other than information relating to DTC and its book-entry only system and information in the section entitled "Debt Service Schedule", as to which no opinion need be expressed)�, "SOURCES OF PAYMENT FOR THE BONDS" (except information in the sections entitled "_ Special Taxes Are Not Within Teeter Plan" and —Assignment of Assessor Parcel Numbers and Delayed Special Tax Revenues — Projected Home Closing Schedule By Phase," as to which no opinion need be expressed)," and"TAX MATTERS," and in Appendices C and E thereto, excluding any material that may be treated as included under such captions by reference to other documents,, insofar as such statements expressly summarize certain provisions of the Indenture, the Rate and Method, the Act and the form and content of Bond Counsel's final opinion are accurate in.all material respects, (B) this Agreement and the Continuing Disclosure Agreement have been duly executed and delivered by, and constitute valid and binding obligations of, the District, subject to bankruptcy, insolvency, reorganization, moratorium and other laws affecting enforcement of creditors' rights in general and to the application of equitable principles if equitable remedies are sought; and 10- 2021-03-16 Agenda Packet Page 289 of 724, (C) the Bonds are not sub ect to the registration requirements of the j Securities Act of 193 3,as amended,and the Indenture is exempt from qualification under the Trust Indenture Act of 1939, as amended. (iii) A letter of Stradling Yocca Carlson & Rauth, a Professional Corporation addressed to the District and the Underwriter ("Disclosure Counsel")�, to the effect that during the course of serving as Disclosure Counsel in connection with the issuance of the Bonds and without having undertaken to determine independently or assuming any responsibility for the accuracy, completeness or fairness of the statements contained in the Preliminary Official Statement or the Final Official Statement, no information came to the attention of the attorneys in such firm rendering legal services in connection with the issuance of the Bonds that would lead them to believe that the Preliminary Official Statement or the Final Official Statement (excluding therefrom the financial statements, any financial or statistical data, assessed or appraised. valuations, absorption schedules or forecasts, charts, numbers, estimates, projections, assumptions or expressions of opinion included in the Preliminary Official Statement and the Final Official Statement, infon-nation regarding DTC, and the appendices to the Preliminary Official Statement and the Final Official Statement,as to which no opinion need be expressed),as of the date thereof or the Closing Date.) contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. (iv) A letter of Jones Hall, A Professional Law Corporation, dated the Closing Date, addressed to the Underwriter and in form and substance acceptable to the Underwriter. (v) The Final Official Statement executed on behalf of the District by a duly authorized officer. (vi) Certified copies of the Resolutions and Ordinances. (vii) Evidence of recordation in the real property records of the County of San Diego of the Notice of Special Tax Lien relating to Improvement Area No. 2 of the District, and the Amendment to Notice of Special Tax Lien, each 'in the form required by the Act. (viii) A certificate of Spicer Consulting Group, LLC, Temecula, California, in form.and substance as set forth.in Exhibit B hereto,dated as of the Closing Date. (ix) A certificate of the District, in form and substance as set forth in Exhibit C hereto, dated as of the Closing Date. (x) Evidence that Federal Form 8038 has been executed by the! District and will be filed with the Internal. Revenue Service. 2021-03-16 Agenda Packet Page 290 of 724, (xi) Executed copies of the District Documents. (xii) A non-arbitrage certificate executed by the District in form and substance satisfactory to Bond Counsel. (xiii) An opinion, dated the Closing Date and addressed to the Underwriter, of the City Attorney, as counsel to the District, to the effect that: (A) the District is duly organized and validly existing as a community facilities district under and by virtue of the Constitution and laws of the State (including the Act),- (B) the City Council of the City, acting as legislative body of the District, has the full legal right,power and authority to adopt the Resolutions and Ordinance- (C) the Resolutions and Ordinances were duly adopted at meetings of the City Council, acting as legislative body of the District, which were called and held under law and with all public notice required by law and at which a quorum was present and acting throughout, and the Resolutions and Ordinance are in full force and effect and have not been amended or repealed; (D�) to their best knowledge,based,on reasonable due diligence,no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, regulatory agency, public board or body is pending with respect to which the District has been served with process or threatened,in any way affecting the existence of the City,the District or the titles of the District's officials to their respective offices, or seeking to restrain or to enjoin the issuance, sale or delivery of the Bonds or the application of the proceeds thereof in accordance with the Indenture, or the collection or application of the Special Taxes to pay the principal of and interest on the Bonds, or in any way contesting or affecting the validity or enforceability of the Bonds,the District Documents or any action of the District contemplated by any of said documents, or in any way contesting the completeness or accuracy of the Final Official Statement or the powers of the District or its authority with.respect to the Bonds, the District Documents or any action on the part of the District contemplated by any of said documents,wherein an unfavorable decision,ruling,or finding could materially adversely affect the validity or enforceability of the Bonds or the District Documents; (E) the execution and delivery of the Bonds and the District Documents, and compliance with the!provisions of each,will not conflict with or constitute a breach of or default under any loan agreement, note, ordinance, resolution, indenture, contract, agreement or other instrument of which the District is a party or is otherwise subject or -12- 2021-03-16 Agenda Packet Page 291 of 724, bound, a consequence of which could be to materially and adversely affect the ability of the District to perform its, obligations under the Bonds or the District Documents; and (F) all approvals, consents, authorization, elections and orders of or filings or registrations with any governmental authority, board, agency or commission having jurisdiction which would constitute a condition precedent to, or the absence of which would materially adversely affect, the ability of the District, to perform its obligations under the Bonds or the District Documents, have been obtained or made, as the case may be, and are in full force and effect. (xiv) In connection with printing and distribution of the Preliminary Official Statement, an executed certificate of the District substantially in the form attached hereto as Exhibit D. (xv) A certificate of the Fiscal Agent in the form attached hereto as Exhibit E, and an opinion of its counsel in form and substance satisfactory to the Underwriter and Bond Counsel. (xvi) An opinion of counsel to the Fiscal Agent dated the Closing Date, addressed to the Underwriter and the District to the effect that(a)the Fiscal Agent is a national banking association duly organized and validly existing under the laws of the jurisdiction of its organization and has the corporate power to execute and deliver the Indenture, (b) the execution and delivery by the Fiscal Agent of the Indenture, and its performance of its obligations thereunder,, have been and are as of the date hereof duly authorized by all necessary corporate action, (c) the Indenture has been duly executed and delivered and constitutes the valid and legally binding obligation of the Fiscal Agent enforceable against it in accordance with its terms except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors'rights generally and by general principles of equity(regardless of whether enforcement is sought as a proceeding in equity or at law)�, and(d) the Bonds have been duly authenticated and delivered by the Fiscal Agent. (xvii)A certificate of Harrell & Company Advisors, LLC, the District's 0 municipal advisor (the "MuniMpal Advi*sor"), in the form and substance attached hereto as Exhibit F. (xviii) A Letter of Representations from each of the Developers, addressed to the District and the Underwriter in connection with. the printing of the Preliminary Official Statement dated the date of the Preliminary Official Statement, and a Closing Certificate for each of the Developers, addressed to the District and the Underwriter, dated the Closing Date, in the forms attached hereto as Exhibits G and H, respectively. -13- 2021-03-16 Agenda Packet Page 292 of 724, (xix) A Continuing Disclosure Certificate from Pinnacle Homes and Lennar Homes, substantially in the form attached to the Preliminary Official Statement as Appendix G. (xx) (A) A negative assurance letter or letters regarding the Final Official Statement from respective counsel to the Developers addressed to the District and the Underwriter in form and substance acceptable to Disclosure Counsel and the Underwriter, and (B) an opinion of counsel to each of Pinnacle Homes and Lennar Homes addressed to the District and the Underwriter in form and substance acceptable to Disclosure Counsel and the Underwriter, to the effect that the Continuing Disclosure Agreement of such Developer has been duly authorized, executed and delivered by such Developer. (xxi) A certificate of Kitty Siino & Associates, Inc., the appraiser, in the form and substance attached hereto as Exhibit 1. (xxii)A certificate of Meyers Research, LLC, the market absorption consultant, in the form and substance attached hereto as Exhibit J. (xxiii) Such additional legal opinions, certificates, pro�ceedings,, instruments and other documents as the Underwriter, Disclosure Counsel or Bond Counsel may reasonably request to evidence compliance by the District with legal requirements, the truth and accuracy, as of the time of Closing, of the respective representations of the District herein contained and the due performance or satisfaction by the District at or prior to such time of all agreements then to be performed and all conditions then to be satisfied. If the District is unable to satisfy the conditions to the obligations of the Underwriter contained in this Agreement,or if the obligations of the Underwriter to purchase and accept delivery of the Bonds shall be terminated for any reason permitted by this Agreement, this Agreement shall terminate and neither the Underwriter nor the District shall be under further obligation hereunder; except that the respective obligations to pay expenses,as provided in Section I I shall continue in full force and effect. 9. The obligations of the District to issue and deliver the Bonds on the Closing Date is subject, at the option of the District, to the performance by the Underwriter of its obligations to be performed hereunder at or prior to the Closing Date. 10. All representations, warranties and agreements of the District hereunder shall remain operative and in full force and effect, regardless of any investigations made by or on. behalf of the Underwriter or the District and shall survive the Closing. 11. The District shall pay or cause to be paid all reasonable expenses incident to the performance of its obligations under this Agreement, including, but not limited to, delivery of the Bonds,costs of printing the Bonds,the Preliminary O�fficial Statement and the Final Official Statement, any amendment or supplement to the Preliminary O�fficial Statement or Final Official Statement and this, Agreement, fees and disbursements of Bond Counsel and Disclosure Counsel, the Municipal Advisor and other consultants engaged by the District, including the fees and expenses of the special tax consultant and fees of the Fiscal Agent. -14- 2021-03-16 Agenda Packet Page 293 of 724, The Underwriter shall pay the California Debt Investment and Advisory Commission fee, all advertising expenses in connection with the public offering of the Bonds, and all other expenses incurred by it in connection with its public offering and distribution of the Bonds, including fees and expenses of its counsel, meals,transportation, and lodging(but not entertainment expenses), and fees and disbursements in connection with the qualification of the Bonds for sale under the securities or '"Blue Sky" laws of the various jurisdictions and the preparation of"Blue Sky" memoranda. 12. Any notice or other communication to be given to the District under this Agreement may be given by delivering the same in writing at its address, set forth above, and any notice or other communication to be given to the Underwriter under this, Agreement may be given by delivering the same in writing to the following: Stifel, Nicolaus &Company, Incorporated, One Montgomery Street, 35th Floor, San Francisco, California 94104, Attention: Sara Brown. 13. This Agreement is made solely for the benefit of the District and the Underwriter (including the successors or assigns of the Underwriter) and no other person, including any purchaser of the Bonds, shall acquire or have any right hereunder or by virtue hereof. This Agreement supersedes and replaces all prior negotiations, agreements and,understanding among the parties hereto in relation to the sale of the Bonds by the District. 14. Establishment of issue Price. (a) The Underwriter agrees to assist the District in establishing the issue price of the Bonds and shall execute and deliver to the District at Closing an "issue price" or similar certificate, together with the supporting pricing wires or equivalent communications, substantially in the form attached hereto as Exhibit K, with such modifications as may be appropriate or necessary, in the reasonable judgment of the Underwriter, the District and Bond Counsel (as defined herein), to accurately reflect, as applicable, the sales price or prices or the initial offering price or prices to the public of the Bonds. All actions to be taken by the District under this section to establish the issue price of the Bonds may be taken on behalf of the District by the Municipal Advisor and any notice or report to be provided to the District may be provided to the District's Municipal Advisor. (b) Except as otherwise set forth in Exhibit A attached hereto, the District will treat the first price at which 10�% of each maturity of the Bonds (the "10% test") is sold to the public as the issue price of that maturity. At or promptly after the execution of this Agreement, the Underwriter shall report to the District the price or prices at which it has sold to the public each maturity of Bonds. If at that time the 10% test has not been satisfied as to any maturity of the Bonds, the Underwriter agrees to promptly report to the District the prices at which it sells the unsold Bonds of that maturity to the public. That reporting obligation shall continue, whether or not the Closing Date has occurred, until the 10%test has been satisfied as to the Bonds of thatmaturity or until all Bonds of that maturity have been sold to the public, provided that the Underwriter's reporting obligation after the date of the Closing may be at reasonable periodic intervals or otherwise upon request of the District or Bond Counsel. For purposes of this Section., if Bonds mature on the same date but have different interest rates, each separate CUSIP number within that maturity will be treated as a separate maturity of the Bonds. For clarity, and notwithstanding any other condition to Closing set forth in this Agreement,the sale of 10%of each maturity of the Bonds to the public prior to the Closing Date shall not be a condition to Closing. -15- 2021-03-16 Agenda Packet Page 294 of 724, (c) The Underwriter confirms that it has o�ffered the Bonds to the public on or before the date of this, Agreement at the o�ffering price or prices (the "initial offering price"), or at the corresponding yield or yields, set forth in Exhibit A attached hereto, except as otherwise set forth therein. Exhibit A also sets forth, as of the date of this Agreement,the maturities, if any, of the Bonds for which the 10%test has not been satisfied and for which the District and the Underwriter agree that the restrictions set forth in the next sentence shall apply,which will allow the District to treat the initial offering price to the public of each such maturity as of the sale date as the issue price of that maturity (the "hold-the-offering-p rice rule"). So long as the hold-the-offering-price rule remains applicable to any maturity of the Bonds, the Underwriter will neither offer nor sell unsold Bonds of that maturity to any person at a price that is higher than the initial offering price to the public during the period starting on the sale date and ending on the earlier of the following: (1) the close of the fifth(5th)business day after the sale date; or (2) the date on which the Underwriter has sold at least 10%of that maturity of the Bonds to the public at a price that is no higher than the initial offering price to the public. The Underwriter will advise the District promptly after the close of the fifth(5th)business day after the sale date whether it has sold 10% of that maturity of the Bonds to the public at a price that is no higher than the initial offering price to the public. (d) The Underwriter confirms that: (1) any selling group agreement and any third-party distribution agreement relating to the initial sale of the Bonds to the public, together with the related pricing wires, contains or will contain language obligating each dealer who is a member of the selling group and each broker-dealer that is a party to such third-party distribution agreement, as applicable: (a)(i)to report the prices at which it sells to the public the unsold Bonds of each maturity allocated to it,whether or not the Closing has occurred,until either all Bonds of that maturity allocated to it have been sold or it is notified by the Underwriter that the 10% test has been satisfied as to the Bonds of that maturity, provided that the reporting obligation after the date of the Closing may be at reasonable periodic intervals or otherwise upon request of the Underwriter, and (ii) to comply with the hold-the-offering-price 'rule, if applicable, in each case if and for so long as directed by the Underwriter, (b) to promptly notify the Underwriter of any sales of Bonds that, to its knowledge, are made to a purchaser who is a related party to an underwriter participating in the initial sale of the Bonds to the public (each such term being used as defined below), and (c) to acknowledge that, unless otherwise advised by the dealer or broker- dealer,the Underwriter shall assume that each order submitted by the dealer or broker-dealer is a sale to the public. -16- 2021-03-16 Agenda Packet Page 295 of 724, (2) any selling group agreement relating to the initial sale of the Bonds to the public, together with the related pricing wires, contains or will contain language obligating each dealer that is a party to a third-party distribution agreement to be employed in connection with the initial sale of the Bonds to the public to require each broker-dealer that is a party to such third-party distribution agreement to (A)report the prices at which it sells to the public the unsold Bonds of each maturity allocated to it, whether or not the Closing has occurred,until either all Bonds of that maturity allocated to it have been sold or it is notified by the Underwriter or the dealer that the 10% test has been satisfied as to the Bonds of that maturity, provided that the reporting obligation after the date of the Closing may be at reasonable periodic intervals, or otherwise upon request of the Underwriter or the dealer, and(B)comply with the hold- the-offering-price rule, if applicable, if and for so long as directed by the Underwriter or the dealer and as set forth in the related pricing wires. (e) The District acknowledges that, in making the representations set forth in this subsection, the Underwriter will rely on (i) in the event a selling group has been created in connection with the initial sale of the Bonds to the public, the agreement of each dealer who is a member of the selling group to comply with the requirements for establishing issue price of the Bonds, including, but not limited to, its agreement to comply with the hold-the-offering-price rule,if applicable to the Bonds, as set forth in a selling group agreement and the related pricing wires, and(ii)in the event that a third- party distribution agreement was employed in connection with the initial sale of the Bonds to the public, the agreement of each broker-dealer that is a party to such agreement to comply with the requirements for establishing issue price of the Bonds, including, but not limited to, its agreement to comply with the hold-the-offering-pric e rule, if applicable to the Bonds, as set forth in the third-,party distribution agreement and the related pricing wires. The District further acknowledges that the Underwriter shall not be liable for the failure of any dealer who is a member of a selling group, or of any broker-dealer that is a party to a third-party distribution agreement, to comply with its corresponding agreement to comply with the requirements for establishing issue price of the Bonds, including,but not limited to,its agreement to comply with the hold-the-offering-price-rule if applicable to the Bonds. (f) The Underwriter acknowledges that sales of any Bonds to any person that is a related party to an underwriter participating in the initial sale of the Bonds to the public (each such term being used as defined below) shall not constitute sales to the public for purposes of this section. Further, for purposes of this section: (1) "public"means any person other than an underwriter or a related party; (2) "underwriter"means(A)any person that agrees pursuant to a written contract with the District (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds to the public and(B,) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (A) to participate in the initial sale of the Bonds to the public (including a member of a selling group or a party to a third-party distribution agreement participating in the 'initial sale of the Bonds to the public), (3) a purchaser of any of the Bonds is a "related party" to an underwriter if the underwriter and the purchaser are subject, directly or indirectly, to (i) more than 50% common ownership of the voting power or the total value of their stock, if both entities -17- 2021-03-16 Agenda Packet Page 296 of 724, are corporations (including direct ownership by one corporation of another), (ii) more than 50% common ownership of their capital interests, or profits interests, if both entities are partnerships (including direct ownership by one partnership of another), or (iii) more than 50%, common ownership of the value of the outstanding stock of the corporation or the capital interests or profit interests of the partnership, as applicable, if one entity is a corporation and the other entity is a partnership (including direct ownership of the applicable stock or interests by one entity of the other); and (4) "sale date"means the date of execution of this Agreement by all parties. 15. Indemnification. The Underwriter will indemnify and hold harmless the District and each of its officers and employees, and each person who controls the District within the meaning of Section 15 of the Securities Act of 1933, as amended or Section 20 of the Securities Exchange Act of 1934, as amended, against any and all losses, claims, damages, liabilities and expenses to which the City may become subject, insofar as such losses, claims, damages, liabilities or expenses(or actions in respect thereof), arise out of or are with reference to the statements under the caption ",LJND�ERWRITING" in the Preliminary O�fficial Statement and the Final Official Statement. [Signature Page Follows on Next Page] 2021-03-16 Agenda Packet Page 297 of 724, 16. This Agreement shall be governed by and construed in accordance with the laws of the State of California. Very truly yours, STIFEL, NICOLAUS & COMPANY, INCORPORATED By: Its: Managing Director The foregoing is hereby agreed to and accepted as of the date first above written: COMMUNITY FACILITIES DISTRICT NO. 16-1 (Millenia) By: Authorized Officer Time of Execution: California time S-1 2021-03-16 Agenda Packet Page 298 of 724, EXHIBIT A CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO�. 16-1 (MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS MATURITY SCHEDULE Subject to Hold-The- Maturity Principal Interest 10%Test Offering-Price -(September 1) Amount Rate Yield Price Satisfied* Rule T:Term Bond. C:Priced to optional redemption date of September 1.,20—,at par. At the time of execution of this Agreement and assuming orders are confirmed immediately after the execution of this Agreement. A-1 2021-03-16 Agenda Packet Page 299 of 724, REDEMPTION TERMS Optional Redemption. The Bonds may be redeemed at the option of the District on or prior to maturity as a whole, or in part on any Interest Payment Date on and after September 1, 20�, from such maturities as are selected by the District, and by lot within a maturity, from any source of funds, at the following redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), together with accrued interest to the date of redemption: Redemption Date Redemption Price Any Interest Payment Date from September 1, 2025 through March 1, 2028 103% September 1, 2028 and March 1, 2029 102 September 1, 2029 and March 1, 2030 101 September 1, 2030 and any Interest Payment Date thereafter 100 Extraordinary Mandatory Redemption. The Bonds shall be subject to extraordinary mandatory redemption on any Interest Payment Date,prior to maturity, as a whole, or in part as nearly as practicable on a pro rata basis among maturities of authorized denominations, from amounts deposited to the Redemption Fund in connection with a Prepayment of Improvement Area No. 2 Special Taxes pursuant to the Improvement Area No. 2 Special Tax RMA. Such extraordinary mandatory redemption of the Bonds shall be at the following redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), together with accrued interest thereon to the date of redemption: Redemption Date Redemption Price Any Interest Payment Date from September 1, 2021 through March 1, 20�28 103% September 1, 2028 and March 1, 2029 102 September 1, 2029 and March 1, 2030 101 September 1, 2030 and any Interest Payment Date thereafter 100 Mandatory Sinking Fund Redemption. The Term Bonds maturing on September 1,20[_] are subject to mandatory sinking fund redemption,in part by lot,on September I in each year commencing September 1, 20[_] at a redemption price equal to the principal amount of the Term Bonds to be redeemed,plus accrued and unpaid interest thereon to the date fixed for redemption,without premium, in the aggregate principal amount and in the years shown on the following redemption schedule: Redemption Date Principal (September Amount (maturity) The Term Bonds maturing on. September 1, 20[_], are subject to mandatory sinking fund redemption, in part, by lot, on September I of each year commencing September 1, 20[_], at a redemption price equal to the principal amount of the Term Bonds to be redeemed, plus accrued and unpaid interest thereon to the date fixed for redemption, without premium, in the aggregate principal amounts, and in the years shown in the following redemption schedule. A-2 2021-03-16 Agenda Packet Page 300 of 724, Redemption Date Principal (September Amount (maturit Y) In the event of a partial optional redemption or extraordinary mandatory redemption of the Term Bonds maturing on September 1,20[_] or September 1,20[_] each of the remaining mandatory sinking fund payments for the applicable maturity of the Term Bonds so redeemed will be reduced, as nearly as practicable, on a pro rata basis in integral multiples of$5,000. Capitalized terms used but not defined in this Exhibit shall have the meanings given to such terms in the Indenture. A-3 2021-03-16 Agenda Packet Page 301 of 724, EXHIBIT B $[PAR] CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO�. 16-1 (MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS CERTIFICATE OF SPECIAL TAX CONSULTANT Spicer Consulting Group, LLC ("Special Tax Consultant"), Temecula, California, was retained as Special Tax Consultant and assisted in the preparation of and has reviewed the Amended Rate and Method of Apportionment of Special Tax(the "Rate and Method") set forth in Appendix A to the Preliminary Official Statement dated � 2021 (the "Preliminary Official Statement")and the Official Statement dated 2021 (the"Official Statement") each relating to the above-referenced bonds (the "Bonds") being issued by Community Facilities District No. 164 (Millenia) (the "District"). Based upon the Special Tax Consultant's review of the Preliminary Official Statement, the Official Statement, and such other documents as it deems relevant in the circumstances, the Special Tax Consultant hereby certifies that the Special Tax, if collected in the maximum amounts permitted under the Rate and Method, would generate at least I 10% of the gross annual debt service on the Bonds, provided that the annual debt service figures on the attached debt service schedule,which were relied upon by Special Tax Consultant, are substantially true and correct. Although the Special Tax if collected, in the maximum amounts under the Rate and, Method will generate at least 110% of the gross annual debt service payable with respect to the Bonds each year., no representation is made herein as to actual amounts that will be collected in future years. All information with respect to the Rate and Method and all other information sourced to the Special Tax Consultant in the Preliminary Official Statement and the Official Statement is true and correct as of the date of the Preliminary Official Statement.)the date of Official Statement and as of the date hereof, and a true and correct copy of the Rate and Method is attached to the Preliminary O�fficial Statement and the O�fficial Statement as Appendix A. The Special Tax Consultant is duly authorized to enter into the Continuing Disclosure Agreement,dated as of April 1,2021 (the"Continuing Disclosure Agreement"),between the District and the Special Tax Consultant,, as dissemination agent, and has duly executed and delivered the Continuing Disclosure Agreement, and assuming due authorization. and execution by the District, the Continuing Disclosure Agreement is legal, valid and binding upon, the Special Tax Consultant and enforceable against Special Tax Consultant in accordance with.its terms. Dated: [Closing Date] SPICER CONSULTING GROUP, LLC By.- Authorized Representative B-1 2021-03-16 Agenda Packet Page 302 of 724, EXHIBIT C $[PAR] CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO�. 16-1 (MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS DISTRICT CLOSING CERTIFICATE 1, the undersigned, hereby certify that I am the of the City of Chula Vista (the "City"), the City Council of which is the legislative body for Community Facilities District No. 16-1 (Millenia), (the"District"), a community facilities district duly organized and existing under the laws of the State of California (the "State") and that as such, I am authorized to execute this Certificate on behalf of the District in connection with the issuance of the above-referenced bonds (the "Bonds"). I hereby further certify on behalf of the District that: (A) to my best knowledge, after reasonable inquiry, no litigation is pending with respect to which the District has been served with process or threatened (1) to restrain or enjoin the issuance of any of the Bonds or the collection of Net Improvement Area No. 2 Special Tax Revenues pledged.under the Indenture; (2) in any way contesting or affecting the authority for the issuance of the Bonds or the validity or enforceability of the Bonds or the District Documents; or (3) in any way contesting the existence or powers of the District; (B) the representations and warranties made by the District in the Bond Purchase Agreement dated 1 2021 (the"Agreement"),between the District and Stifel, Nicolaus & Company, Incorporated are true and correct in all material respects on the Closing Date,with the same effect as if made on the Closing Date; (C) no event affecting the District has occurred since the date of the Final Official Statement that,as of the Closing Date,would,cause any statement or information contained in the Final Official Statement under the caption "ABSENCE OF LITIGATION" to be incorrect or incomplete in any material respect or would cause the information contained under such caption in the Final Official Statement to contain an untrue statement of a material fact or omit to state a material fact necessary in order to make such statements therein, in the light of the circumstances under which they were made,not misleading; (D�) as of the date hereof, the District Documents are in full force and effect in. accordance with their terms and have not been amended, modified or supplemented except in such case as may have been agreed to by the Underwriter; and C-1 2021-03-16 Agenda Packet Page 303 of 724, (E) the District has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied under the District Documents prior to issuance of the Bonds. Capitalized terms not defined herein shall have the same meaning set forth in the Agreement. IN WITNESS WHEREOF, the undersigned has executed this certificate as of the date herein below set forth. Dated: [Closing Date] COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA) By: Name: Title: C-2 2021-03-16 Agenda Packet Page 304 of 724, EXHIBIT D CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO�. 16-1 (MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS 1,the undersigned, hereby certify that I am the of the City of Chula Vista(the "City"), the City Council of which is the legislative body for Community Facilities District No. 16-1 (Millenia) (the "District"), a community facilities district duly organized and existing under the laws of the State of California(the "State") and that as such, I am authorized to execute this, Certificate on behalf of the District in connection with the issuance of the above-referenced bonds (the "Bonds"). I further hereby certify on behalf of the District as follows: (1) This Certificate is delivered in connection with the offering and sale of the Bonds in order to enable the underwriter of the Bonds to comply with Rule 15c2-12 of the Securities Exchange Commission ("Rule 15c2-12"). (2) In connection with the offering and sale of the Bonds, there has been prepared a Preliminary Official Statement, setting forth information concerning the Bonds, the City and the District(the "Preliminary Official Statement"). (3) As used herein, "Permitted Omissions" shall mean the offering price(s)�, interest rate(s), selling compensation, aggregate principal amount, principal amount per maturity, delivery dates,ratings and other terms of the Bonds depending on such matters, all with respect to the Bonds. (4) The Preliminary Official Statement is,, except for the Permitted Omissions, deemed final within the meaning of Rule 15c2-12. IN WITNESS WHEREOF, I have hereunto set my hand as of 202 1. COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA) By: Name: Title: D-1 2021-03-16 Agenda Packet Page 305 of 724, EXHIBIT E $[PAR] CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO�. 16-1 (MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS CERTIFICATE OF WILMINGTON TRUST, NATIONAL ASSOCIATION The undersigned hereby states and certifies that the undersigned is an authorized officer of Wilmington Trust, National Association, as Fiscal Agent (the "Fiscal Agent") under that certain Indenture, dated as of April 1,2021 (the"Indenture"),between Community Facilities District No. 16- 1 (Millenia) (the "District") and the Fiscal Agent, relating to the captioned bonds (the "Bonds") and as such, is familiar with the following facts and. is authorized and qualified to certify the following facts on behalf of the Fiscal Agent: (1) The Fiscal Agent is duly organized and existing as a national banking association under the laws of the United States of Americal having the full power and authority to enter into and perform its duties under the Indenture. (2) The Indenture has been duly authorized, executed and delivered by the Fiscal Agent and the Bonds have been authenticated by a duly authorized representative of the Fiscal Agent in accordance with the Indenture. (3) There is no action, suit, proceeding or investigation, at law or in equity, before or by any court or governmental agency, public board or body pending against the Fiscal Agent or threatened against the Fiscal Agent which in the reasonable judgment of the Fiscal Agent could affect the existence of the Fiscal Agent or in any way contesting or affecting the validity or enforceability of the Indenture or contesting the powers of the Fiscal Agent or its authority to enter into and perform its obligation under the Indenture. Capitalized terms not defined herein have the same meaning as is set forth in the Bond Purchase Agreement dated � 2021, between the District and Stifel Nicolaus & Company, Incorporated,relating to the Bonds. Dated: [Closing Date] WILMINGTON TRUST,NATIONAL ASSOCIATION, as Fiscal Agent By Authorized Officer E-1 2021-03-16 Agenda Packet Page 306 of 724, EXHIBIT F $[PAR] CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO�. 16-1 (MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS CERTIFICATE OF MUNICIPAL ADVISOR The undersigned hereby states and certifies as follows: (1) The undersigned is an authorized officer of Harrell & Company Advisors, LLC., which has acted as municipal advisor (the "Municipal Advisor") to Community Facilities District No. 164 (Millenia)(the"Issuer")in connection with the issuance of the above-referenced bonds(the"Bonds"), and as such, is familiar with the facts herein certified and is authorized and qualified. to certify the same. (2) The Municipal Advisor has participated in the preparation of the Preliminary Official Statement dated 2021 (the "Preliminary Official Statement"), and the final Official Statement dated 2021 (the "Official Statement"') relating to the Bonds. (3) Nothing has come to the attention of the Municipal Advisor which has led it to believe that the Preliminary Official Statement or the Official Statement contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading. Dated: [Closing Date] HARRELL & COMPANY ADVISORS, LLC,as Municipal Advisor By: Authorized Officer F-1 2021-03-16 Agenda Packet Page 307 of 724, EXHIBIT G $[PAR] CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO., 16-1 (MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS LETTER OF REPRESENTATIONS Qinsert name of developer]) 12021 Community Facilities District No. 16-1 (Millenia) 276 Fourth Avenue Chula Vista, Califomia 91910 Stifel, Nicolaus &Company, Incorporated One Montgomery Street, 35th Floor San Francisco, California 94104 In connection with the issuance and sale of the above-captioned bonds (the "Bonds"), and pursuant to the Bond Purchase Agreement(the"Bond Purchase Agreement")to be executed by and between Community Facilities District No 16-1 (Millenia) (the "District"), and Stifel, Nicolaus & Company, Incorporated, as underwriter(the "Underwriter"), the undersigned certifies that he or she is familiar with the facts herein certified and is authorized and qualified to certify the same as,an authorized officer or representative of[SLF IV-Millenia, LLC, a Delaware limited liability company], [Pinnacle New Homes LLC, a Delaware limited liability company] [Lennar Homes of California, Inc., a California corporation](the "Developer"), and, the undersigned, on behalf of the Developer, hereby further certifies, represents, warrants and covenants as follows: I. The Developer is duly organized and validly existing under the laws of the State of and has all requisite right, power and authority (i) to execute and deliver this Letter of Representations,and(ii)to develop its property in the District as described in the Preliminary Official Statement. 2. While the Bonds or any refunding obligations related thereto are outstanding, Developer will not bring any action, suit, proceeding, inquiry or investigation at law or in equity, before any court, regulatory agency, public board or body, that in any way seeks to challenge or overturn the formation of the District, to challenge the adoption of the ordinance levying Special Taxes within the District, to invalidate the District or any of the Bonds or any refunding obligations, or to invalidate the special tax liens imposed under Section 3115.5 of the Streets and Highways Code based on.recordation of the notices of special tax lienrelating thereto. The foregoing covenant shall not prevent Developer in any way from bringing any other action., suit, proceeding, inquiry, or investigation at law or in equity relating to the following: (i) that the Special Taxes have not been levied in accordance with. the methodologies contained in the rate and method of apportionment of G-1 2021-03-16 Agenda Packet Page 308 of 724, special tax (the "Rate and Method of Apportionment") pursuant to which the Special Taxes are levied, (ii)the application or use of the Special Taxes levied and collected, or(iii)the enforcement of the obligations of the City of Chula Vista(the"City")and/or the District under any agreement among or between the Developer, the City and/or and the District or to which Developer is a party or of which it is a beneficiary. 3. All information submitted by Developer directly to: (i)Kitty Siino&Associates,Inc., in connection with the preparation of the Appraisal Report and the Supplement to Appraisal Report described in the Preliminary Official Statement including any updates thereto made prior to the date hereof, and (ii) Meyers Research, LLC in connection with the preparation of the Market Absorption Study described in the Preliminary Official Statement including any updates thereto made prior to the date hereof, in each case as, more specifically identified in Appendix A and Appendix B hereto, was when given, true and correct in all material respects and did not omit to state any material fact necessary to make such information, in light of the circumstances under which it was provided, not misleading; and, except for any such information that was modified or supplemented by subsequent information submitted by or on behalf of Developer or the information that is otherwise contained in the Preliminary Official Statement,no material change has occurred with respect to such information as of the date hereof. 4. As of the date hereof, the information in the Preliminary Official Statement under the captions [SLF: "INTRODUCTION — The District and Improvement Area No. 2 — General," "INTRODUCTION — Property Ownership and Development Status... ..SOURCES OF PAYMENT FOR THE BONDS —Assignment of Assessor Parcel Numbers and Delayed Special Tax Revenues" "IMPROVEMENT AREA NO. 2 — General Description of Millenia, the District and Improvement Area No. 2," "IMPROVEMENT AREA NO. 2 —Description of Authorized. Facilities (but only the second and third paragraphs thereof), "PROPERTY OWNERSHIP AND THE DEVELOPMENT — General Description of the Development," "— SLF and the Contracted Project Manager," and"—The Development"] [LENNAR HOMES: "INTRODUCTION — Property Ownership and Development Status,," "SOURCES OF PAYMENT FOR THE BONDS—Assignment of Assessor Parcel Numbers and Delayed Special Tax Revenues — Projected Home Closing Schedule By Phase," and "PROPERTY OWNERSHIP AND THE DEVELOPMENT — General Description of the Development," "— Builders in Improvement Area No. 2" and "— Lennar Homes Development and Financing Plan"] [PINNACLE HOMES: "INTRODUCTION — Property Ownership, and Development Status,"and"SOURCES OF PAYMENT FOR THE BONDS—Assignment of Assessor Parcel Numbers and Delayed Special Tax Revenues—Projected Home Closing Schedule By Phase," "PROPERTY OWNERSHIP AND THE DEVELOPMENT — General Description of the Development," "— Builders, in Improvement Area No. 2" and "— Pinnacle Homes Development and Financing Plan"] solely as such information pertains to Developer, its Affiliates (as defined below)�, [SLF only: the District and the Millenia project generally,the Deposit Agreement, the assessor parcel segregation process of the County of San Diego Tax Collector,] the property owned by Developer and/or its Affiliates in Improvement Area No. 2 of the District (the "Property"), Developer's plans for the development of the Property and Developer's contractual arrangements with respect thereto and the Developer's compliance with its undertakings to provide continuing disclosure pursuant to the SEC's Rule 15c2-12 (but in all cases under all captions excluding therefrom (i) information regarding the Appraisal Report that does not pertain to Developer or the Property, the! Market Absorption Study that does not pertain to Developer or the Property), market value ratios and annual special tax ratios, and (ii) information which is identified as having been provided by a source other than the Developer) is true and correct in all material respects and does not contain any untrue G-2 2021-03-16 Agenda Packet Page 309 of 724, statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. 5. Except as disclosed in the Preliminary Official Statement, Developer has not been adjudicated as 'bankrupt or discharged from any or all of its debts or obligations or granted an extension of time to pay its debts or a reorganization or readjustment of its debts within the past ten years. Except as disclosed in the Preliminary Official Statement, Developer does not have any proceedings pending (with service of process to Developer having been accomplished) or, to the Actual Knowledge of the Undersigned (as defined below), threatened in which Developer may be adjudicated as bankrupt, become the debtor in a bankruptcy proceeding, be discharged from any or all of its debts or obligations, be granted an extension of time to pay its debts or obligations, or be granted a reorganization or readjustment of its debts or obligations. 6. Except as disclosed in the Preliminary Official Statement,no action, suit,proceeding, inquiry or investigation, at law or in equity, before or by any court, regulatory agency, public board or body, is pending against the Developer (with proper service of process or proper notice to the Developer having been accomplished), or to the Actual Knowledge of the Undersigned, overtly threatened in writing against the Developer(a)which, if successful, is reasonably likely to materially and adversely affect the Developer's ability to complete the development and sale of the Property as described in the Preliminary Official Statement, or to pay its Special Taxes, or ordinary ad valorem property tax obligations related to the Pro erty when due, or (b) which challenges or questions the p I validity or enforceability of the Bonds or the Continuing Disclosure Agreement to be executed by the Developer in connection with the issuance of the Bonds. 7. Except as disclosed in the Preliminary Official Statement, to the Actual Knowledge of the Undersigned, no other public debt secured by a tax or assessment on the Property is in the process of being authorized and no assessment districts or community facilities districts have been or are in the process of being formed which include any portion of the Property. 8. Except as disclosed in the Preliminary Official Statement, there are no events of monetary default or events which with the passage of time would constitute a monetary default under any loan or similar credit arrangement to which Developer is a party the result of which could have a material adverse effect on the Developer's ability to complete the development and sale of the Property as described in the Preliminary Official Statement or to pay its Special Taxes related to the Property prior to delinquency. 9. Except as disclosed below or in the Preliminary Official Statement, with respect to property owned by Developer or its Affiliates located within the boundaries of a development project in California, to the Actual Knowledge of the Undersigned, within the last five years, neither Developer nor any of its Affiliates has (i) been delinquent to any material extent in the payment of any property taxes, special taxes, or assessments levied or assessed against such property, (ii.)had any such. property become either tax deeded to any governmental agency or the subject of judicial foreclosure proceedings for failure to pay such property taxes, special taxes, or assessments levied or assessed against such property, (iii) caused a draw on a reserve fund relating to such assessment district or community facilities district financing,or(iv)failed to cure such delinquencies within forty- five days, of becoming aware of such delinquencies. Although it is the!policy of Developer to pay all taxes applicable to property owned by it when due in the absence of a bona fide dispute as to the amount owned, it is possible that Developer and some of its Affiliates have,within the past five years, failed to pay property taxes on parcels that at one time or another were considered to be within, the G-3 2021-03-16 Agenda Packet Page 3 10 of 724, boundaries of a proposed development project, but were subsequently considered scrap or remnant parcels not suitable for construction of residences and having minimal or no value or use to Developer or its Affiliates. Such parcels,may have ended up being tax deeded to the state or a local agency. To the Actual Knowledge of the Undersigned,no such parcels were within a community facilities district or assessment district. 10. [FOR PINNACLE HOMES AND LENNAR HOMES ONLY] The Developer agrees to execute and deliver at Closing the Continuing Disclosure Certificate substantially in the form attached as Appendix G to the Preliminary Official Statement (the "Developer Continuing Disclosure Certificate"),with such additional changes as may be agreed to by the Developer and the Underwriter. Except as disclosed in the Preliminary Official Statement, to the Actual Knowledge of the Undersigned, the Developer is not aware of any material failures by it to comply in all material respects with previous continuing disclosure undertakings in a written certificate or agreement executed by it to provide periodic continuing disclosure reports or notices of material events respecting securities offerings in California within the past five years. 11. [FOR PINNACLE HOMES AND LENNAR HOMES ONLY] To the Actual Knowledge of the Undersigned, execution and delivery of the Developer Continuing Disclosure Certificate and the performance by the Developer of its obligations under the Developer Continuing Disclosure Certificate, will not conflict with or constitute a breach of or default under any loans, lines of credit, agreements, or other contractual or financial obligations of the Developer, or any applicable lawl regulation,judgment or decree. 12. As used in this Certificate,the term"Actual Knowledge of the Undersigned"means the knowledge that the undersigned currently has as of the date of this Certificate or has obtained through (i) interviews with such current officers and responsible employees of the Developer and its Affiliates (or its members or agents) as the undersigned has reasonably detennined are likely, in the ordinary course of their respective duties',to have knowledge of the matters set forth in this Certificate including, if the undersigned is not the chief financial officer of Developer(or, if Developer doesnot have a chief financial officerl the person who performs the functions usually associated with such officer)the chief financial officer or such person(or such other person who may have been approved by the Underwriter),and(ii)reviews of documents that were reasonably necessary for the undersigned to obtain knowledge of the matters set forth in this Certificate. The undersigned has not conducted any extraordinary inspection or inquiry other than such inspections or inquiries as are prudent and customary in connection with the ordinary course of the Developer's financial operations, such as those interviews and reviews mentioned above. 13. As used in this Certificate,, the term "Afriliate" of Developer means any person directly (or indirectly through. one or more intermediaries) that exercises managerial control over Developer or that is under'managerial control of Developer, and about whom information, could be 'material to potential investors in their investment decision regarding the Bonds (including without limitation infori-nation relevant to the proposed development of the Property,or to Developer's ability to pay the special taxes levied on.the Property prior to delinquency). 14. Until the date which is twenty-five days after the "End of the Underwriting Period" (as defined in Section 4,(g) of the Bond Purchase Agreement), if any event shall occur of which Developer becomes aware, as a result of which it may be necessary to supplement the O�fficial Statement in order to make the statements in the Official Statement under the caption referenced in Section.3 hereof regarding Developer, its Affiliates,the Property, or the development of the Property, G-4 2021-03-16 Agenda Packet Page 311 of 724, in light of the circumstances existing at such time, not misleading in any material respect, Developer shall forthwith give written notice thereof to the District and the Underwriter and shall reasonably cooperate with them in furnishing any information available to Developer for any supplement to the Official Statement necessary so that the statements in the Official Statement under the caption referenced in Section 4 hereof, as so supplemented, will not be misleading in any material respect in light of the circumstances existing at such time. 15. Developer agrees to deliver a Closing Certificate dated the date of issuance of the Bonds at the time of issuance of the Bonds, in substantially the form attached as Exhibit H thereto. 16. All capitalized terms not otherwise defined herein shall have the meaning set forth in the Bond Purchase Agreement. [Remainder of page intentionally left blank] G-5 2021-03-16 Agenda Packet Page 312 of 724, The undersigned has executed this Letter of Representations solely in his or her capacity as an officer or authorized representative of the Developer and he or she will have no personal liability arising from or relating to this Letter of Representations. Any liability arising from or relating to this Letter of Representations may only be asserted against the Developer. [DEVELOPER] By: Name: Title: [EXECUTION PAGE OF LETTER OF REPRESENTATIONS] G-6, 2021-03-16 Agenda Packet Page 313 of 724, APPENDIX A DEVELOPER PROVIDED INFORMATIO�N IN APPRAISAL REPORT See yellow highlighted information on attached selected pages of the Appraisal Report. G-7 2021-03-16 Agenda Packet Page 314 of 724, APPENDIX B DEVELOPER PROVIDED INFORMATION IN MARKET ABSORPTION STUDY See yellow highlighted information on attached selected pages of the Market Absorption Study. G-8 2021-03-16 Agenda Packet Page 315 of 724, EXHIBIT H $[PAR] CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO�. 16-1 (MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS CLOSING CERTIFICATE Qinsert name of developer]) [Clo�sing D�ate] Community Facilities D�istrict No. 16-1 (Millenia) 276 Fourth Avenue Chula Vista, Califomia 91910 Stifel, Nicolaus &Company, Incorporated One Montgomery Street, 35th Floor San Francisco, California 94104 Ladies and Gentlemen: Reference is made to the above-captioned bonds (the "Bonds") and to the Bond Purchase Agreement. n .,dated 20�21 (the"Bo d Purchase Agreement"), entered into in connection therewith. This certificate is delivered pursuant to the Bond Purchase Agreement. Capitalized terms used herein and not otherwise defined have the meanings ascribed to them in the Letter of Representations ([insert name of developer]) (the "Letter of Representations"), dated i 2021, delivered by [SLF IV-Millenia, LLC, a Delaware limited liability company], [Pinnacle New Homes LLC, a Delaware limited liability company] [Lennar Homes of California, Inc., a California corporation] (the "Developer"). The undersigned certifies that he or she is familiar with the facts herein certified and is authorized and qualified to certify the same as an authorized officer or representative of the Developer, and the undersigned, on behalf of the Developer, further certifies as follows: I. The Developer has received the final Official Statement dated 2021 relating to the Bonds (the "Official Statement"'). To the Actual Knowledge of the Undersigned, each statement, representation and warranty made in the Letter of Representations is true and correct in all material respects on and as of the date hereof with the same effect as if made on the date hereof,except that all references therein to the Preliminary Official Statement shall be deemed to be references to the Official Statement. 2. To the Actual Knowledge of the Undersigned, no event has occurred since the date of the Preliminary Official Statement affecting the statements, and information described in Paragraph 4 of the Letter of Representations (and sub ect to the limitations and exclusions contained in Paragraph H-1 2021-03-16 Agenda Packet Page 316 of 724, 4 of the Letter of Representations)relating to the Developer, its Affiliates, [SLF only: the District and the Millenia project generally, the assessor parcel segregatio�n process,of the County of San Diego I ax Collector,the Deposit AgreementJ ownership of the Property,the Developer's development plan as it relates to the Property,the Developer's financing plan,the Developer's lenders, if any, and contractual arrangements of the Developer or any Affiliates(including,if material to the Developer's development plan or the Developer's financing plan, other loans of such Affiliates), which should be disclosed in the Official Statement for the purposes for which it is to be used in order to make such statements and information contained in the Official Statement not misleading in any material respect. 3. For the period through 25 days after the "End of the Underwriting Period" as defined in the Bond Purchase Agreement (provided the Developer may assume the End of the Underwriting Period is the Closing Date (as defined in the Bond Purchase Agreement), unless it receives written notice from the Underwriter that the End of the Underwriting Period is later than the Closing Date), if any event relating to or affecting the Developer, its Affiliates, [SLF'only: the District and the Millenia project generally, the assessor parcel segregation process of the County of San Diego Tax Collector, the Deposit AgreementJ the proposed development of the Property, ownership of the Property, the Developer's development plan, the Developer's financing plan, the Developer's lenders, if any, and contractual arrangements of the Developer or any Affiliates (including, if material to the Developer's development plan or the Developer's financing plan, other loans of such Affiliates) shall occur as a result of which it is necessary, in the opinion of the Underwriter, the District or counsel to the District, to amend or supplement the Official Statement in order to make the Official Statement not misleading in the light of the circumstances existing at the time it was delivered to a purchaser,the Developer shall reasonably cooperate with the District and the Underwriter in the preparation and publication of a supplement or amendment to the Official Statement, in form and substance satisfactory to the Underwriter and the District which will amend or supplement the Official Statement so that it will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at the time the Official Statement is delivered to a purchaser, not misleading. H-2 2021-03-16 Agenda Packet Page 317 of 724, The undersigned has executed this Closing Certificate solely in his or her capacity as an officer of the Developer and he or she will have no personal liability arising from or relating to this Closing Certificate. Any liability arising from or relating to this Closing Certificate may only be asserted against the Developer. [DEVELOPER] By: Name: Title: H-3 2021-03-16 Agenda Packet Page 318 of 724, EXHIBIT I $[PAR] CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS CERTIFICATE OF APPRAISER The undersigned, on behalf of Kitty Siino &Associates, Inc. (the "Ap�p raise r")�, was retained by the City of Chula Vista as Appraiser in connection with the issuance by Community Facilities District No�. 16-1(Millenia)of the above-captioned bonds and has prepared the Appraisal Report dated January 11, 2021 (the "Appraisal") and the Supplement to Appraisal Report dated as of February 25, 2021 (the "Appraisal Supplement"), and hereby certifies that: I. No events or occurrences have been ascertained by the Appraiser or have come to the Appraiser's attention that would materially change the opinions set forth in the Appraisal or the Appraisal Supplement. 2. The Appraiser consents to the reproduction of the Appraisal and the Appraisal Supplement as Appendix B-I and Appendix B-2, respectively to the Preliminary Official Statement dated 1 2021 (the "Preliminary Official Statement"), and the Official Statement dated 1 2021 (the "Official Statement"), and to the references to the Appraiser, the Appraisal and the Appraisal Supplement made in the Preliminary O�fficial Statement and the Official Statement. 3. The Appraisal and the Appraisal Supplement attached to the Preliminary Official Statement and the Official Statement are true and correct copies of such documents. 4. The Appraiser has reviewed the Preliminary Official Statement and the Official Statement, and the statements concerning the Appraiser, the Appraisal and,the Appraisal Supplement contained in the Preliminary Official Statement and the Official Statement are true, correct and complete in all material respects and do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. Dated: [Closing Date] KITTY SIINO & ASSOCIATES, INC. By: Authorized Officer 2021-03-16 Agenda Packet Page 319 of 724, EXHIBIT J $[PAR] CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS CERTIFICATE OF MARKET ABSORPTION ANALYST The undersigned, on behalf of Meyers Research, LLC, Solano Beach, California ("Meyers Research"), was retained by the City of Chula Vista as the market absorption analyst in connection with the issuance by Community Facilities District No. 16-1 (Millenia) (the "District") of the above- captioned bonds and has prepared,a report entitled"Market Absorption Analysis Chula Vista CFD 16-, 1 (Millenia TA No. 2)" dated [November 2020] (the "Market Absorpti*on Study"), and certifies that: I. The assumptions made in the Market Absorption Study are reasonable. 2. Meyers Research is not aware of any event or act that occurred since the date of the Market Absorption Study which, in its opinion, would materially and,adversely affect the conclusions set forth in the Market Absorption Study. 3. Meyers Research co�nsents to the reproduction of the Market Absorption Study as Appendix I to the Preliminary Official Statement dated 1 2021 (the "Preliminary Ofricial Statement"), and the Official Statement dated 1 20�21 (the "Ofricial Statement"'), and to the references to Meyers Research and the Market Absorption Study in the Preliminary Official Statement and the Official Statement. 4. The Market Absorption Study attached to the Preliminary Official Statement and the Official Statement is a true and correct copy of such document. 5. Meyers Research has reviewed the Preliminary Official Statement and the Official Statement, and, the statements concerning Meyers Research and, the Market Absorption Study contained in the Preliminary Official Statement and the Official Statement are true, correct and complete in all material respects and do not contain any untrue statement of a material, fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. Dated: [Closim4 Date] MEYERS RESEARCH, LLC By.- Authorized Officer J-1 2021-03-16 Agenda Packet Page 320 of 724, EXHIBIT K FORM OF ISSUE PRICE CERTIFICATION $[PAR] CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO�. 16-1 (MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS The undersigned, Stifel, Nicolaus & Company, Incorporated ("Stifel"), hereby certifies as set forth below with respect to the sale and issuance of the above-captioned obligations (the "Bonds"). I. Bond Purchase Agreement. On 1 2021 (the "Sale Date"), Stifel and the Issuer executed a Bond Purchase Agreement(the "Purchase Agreement") in connection with the sale of the Bonds. Stifel has not modified the Purchase Agreement since its execution on the Sale D�ate. 2. Price. (a) As of the date of this Certificate, for each [Maturity] [[of the General Rule Maturities] of the Bonds,the first price at which at least 10%of each such Maturity of the Bonds was sold to the Public(the"10% Test") was the respective price for such Maturity listed in Schedule A attached hereto. (b) [Stifel offered the H old-the-Offering-Price Maturities to the Public for purchase at the respective initial offering prices listed in Schedule A (the "Initial Offering Prices") on or before the Sale Date. A copy of the pricing wire or equivalent communication for the Bonds is attached to this certificate as Schedule B. (c) As set forth in the Bond Purchase Agreement, Stifel has agreed in writing that, (i) for each Maturity of the Hold-the-Offering-Price Maturities, it would neither offer nor sell any of the Bonds of such Maturity to any person at a price that is higher than the Initial Offering Price for such Maturity during the Holding Period for such Maturity(the"hold-the-offering- price rule"),and(ii)any selling group agreement shall contain the agreement of each dealer who is a member of the selling group, and any retail distribution agreement shall contain the agreement of each broker-dealer who is a party to the retail distribution agreement.) to comply with the hold-the-offering-price-rule. Pursuant to such agreement, no Underwriter (as defined below) has offered or sold any Maturity of the Hold-the-Offering-Price Maturities at a price that is higher than the respective Initial Offering Price for that Maturity of the Bonds during the Holding Period.] (d) [** With respect to each of the General Rule Maturities of the Bonds: (1) As of the date of this Certificate, Stifel has not sold at least 10%of the Bonds of these Maturities at any single price. K-1 2021-03-16 Agenda Packet Page 321 of 724, (2) As of the date of this Certificate, Stifel reasonably expects that the first sale to the Public of Bonds of these Maturities will be at or below the respective price or prices listed on the attached Schedule A as the "Reasonably Expected Sale Prices for Undersold Maturities." (3) Stifel will provide actual sales information (substantially similar to the information contained on Schedule B)as to the price at which the first 10%of each such Maturity (i.e., the Undersold Maturity or Maturities) is sold to the Public. (4) On the date the 10%Test is satisfied with respect to all Maturities of the Bonds, Stifel will execute a supplemental certificate substantially in the form attached hereto as Schedule C with respect to any remaining Maturities for which the 10% Test has not been satisfied as of the Closing Date.**] 3. Defined Terms. (a) "General Rule Maturities"means those Maturities of the Bonds listed in Schedule A hereto as the "General Rule Maturities." (b) "Hold-th e-Ofj�ring-Price Maturities)I means those Maturities of the Bonds listed. in Schedule A hereto as the "Hold-the-Offering-Price Maturities." (c) "Holding Period" means, with respect to a Hold-the-Offering-Price Maturity, the period, starting on the Sale Date and ending on the earlier of(i) the close of the fifth business day after the Sale Date ( -1 2021), or (ii) the date on which Stifel has sold at least 10%of such Hold-the-Offering-Price Maturity to the Public at prices that are no higher than the Initial Offering Price for such Hold-the-Offering-Price Maturity. (d) "Issuer,"means Community Facilities District No. 16-1 (Millenia). (e) "Maturity�1 means Bonds with the same credit and payment terms. Bonds with different maturity dates, or Bonds with the same maturity date but different stated interest rates, are treated as separate Maturities. (f) "Public"means, any person (including an individual, trust, estate,partnership, association, company, or corporation) other than an Underwriter or a related party to an Underwriter. The term "related party" for purposes of this certificate generally means any two or more persons who have greater than 50 percent common ownership, directly or indirectly. (g) it Underwriter," means (i) any person that agrees pursuant to a written contract with the Issuer(or with.the lead Underwriter to form an underwriting syndicate)to participate in the 'initial sale of the Bonds to the Public, and (ii) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (i) of this, paragraph to participate in the! initial sale of the Bonds to the Public (including a member of a selling group or a party to a retail distribution agreement participating in the initial sale of the Bonds to the Public). 4. Reserve Fund. The funding of the Reserve Fund under the Indenture(as defined in the Purchase Agreement), and as provided in the Tax Certificate, is reasonably required, was a vital factor in K-2 2021-03-16 Agenda Packet Page 322 of 724, marketing the Bonds, facilitated the marketing of the Bonds at an interest rate comparable to that of bonds and other tax-exempt obligations of a similar type, and is not in excess of the amount necessary for such purpose. 5. The representations set forth in this certificate are limited to factual matters only. Nothing in this certificate represents Stifel's interpretation of any laws, including specifically Sections 103 and 148 of the Internal Revenue Code of 1986,as amended,and the Treasury Regulations thereunder. The undersigned understands that the foregoing information will be relied upon by the Issuer with respect to certain of the representations set forth in the Tax Certificate of the Issuer dated , 2021 and with respect to compliance with the federal income tax rules affecting the Bonds, and by Bond Counsel, in connection with rendering its opinion that the interest on the Bonds is, excluded from gross income for federal income tax purposes, the preparation of the Internal Revenue Service Form 8038-G, and other federal income tax advice that it may give to the Issuer from time to time relating to the Bonds. S�TIFEL,NICOLAUS & COMPANY, INCORPORATED By: Managing Director By: Director Dated: [Closing Date] K-3 2021-03-16 Agenda Packet Page 323 of 724, SCHEDULE A TO ISSUE PRICE CERTIFICATE [Schedules to be up�dated at pricing in the event there are Hold-the-Offering-Price-Maturit*les] +,a Actual Sales Informlation. as of Closing Date Maturitv/CUSIP C Date Sold Time Sold Par Amount Sale Price Reasonably Expected Sales Prices for Undersold Maturities as of Closin2 Date Matur*t I y/CUSIP C Par Amount Offer Prices K-4 2021-03-16 Agenda Packet Page 324 of 724, [**SCHEDULE B TO ISSUE PRICE CERTIFICATE Actual Sales for Undersold Maturities as of the Closint!Date Maturift CUSIP Date Sold Time Sold Par Amount Sale Price **1 K-5 2021-03-16 Agenda Packet Page 325 of 724, [**SCHEDULE C TO ISSUE PRICE CERTIFICATE SUPPLEMENTAL ISSUE PRICE CERTIFICATE OF UNDERWRITER $[PAR] CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS The undersigned, Stifel, Nicolaus & Company, Incorporated ("Stifel"), hereby certifies as set forth below with respect to the sale and issuance of the ab�ove-captio�ned o�bligations (the "Bonds")�. I. Issue Price., (a) Stifel sold at least 10% of the Maturities of the Bonds to the Public at the price or prices shown on the Issue Price Certificate dated as of the Closing Date (the "I O�% Test")�. With respect to each of the Maturities of the Bonds,, Stifel had not satisfied.the 10% Test as of the Closing Date (the "Undersold Maturities"). (b) As of the date of this Supplemental Certificate, Stifel has satisfied the 10%Test with respect to the Undersold Maturities. The first price or prices at which at least 10% of each such Undersold Maturity was sold to the Public are the respective prices listed on Exhibit A attached hereto. 2. Defined Terms. (a) "Issuer"means Community Facilities District No. 16-1 (Millenia). (b) "Maturity�1 means Bonds with the same credit and payment terms. Bonds with different maturity dates, or Bonds with the same maturity date but different stated interest rates, are treated as separate Maturities. (c) "Public 19)means, any person (including an individual, trust, estate,partnership, association, company.) or corporation) other than an Underwriter or a related party to an Underwriter. The term "related party" for purposes of this certificate generally means any two or more persons who have greater than 50 percent common ownership, directly or indirectly. (d) it Underwriter," means (1) any person that agrees pursuant to a written. contract with the Issuer(or with the lead Underwriter to form an.underwriting syndicate)to participate in the initial sale of the Bonds, to the Public, and (2) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (1) of this paragraph to participate in the! initial sale of the Bonds to the Public (including a member of a selling group or a party to a retail distribution agreement participating in the initial sale of the Bonds to the Public). K-6 2021-03-16 Agenda Packet Page 326 of 724, 3. The representations set forth in this,certificate are limited to factual matters only. Nothing in this certificate represents Stifel's interpretation of any laws, including specifically Sections 10�3 and 148 of the Internal Revenue Code of 19�86,as amended,and the Treasury Regulations thereunder. The undersigned understands that the foregoing information will be relied upon by the Issuer with respect to certain of the representations set forth in the Tax Certificate of the Issuer dated 1 2021 and with respect to compliance with the federal income tax rules affecting the Bonds, and by Bond Counsel, in connection with rendering its opinion that the interest on the Bonds is excluded from gross income for federal income tax purposes, the preparation of the Internal Revenue Service Form 8038-G, and other federal income tax advice that it may give to the Issuer from time to time relating to the Bonds. STIFEL, NICOLAUS & COMPANY, INCORPORATED By: [Title] By: [Title] Dated: [Closing Date] K-7 2021-03-16 Agenda Packet Page 327 of 724, EXHIBIT A TO SUPPLEMENTAL ISSUE PRICE CERTIFICA. K-8 2021-03-16 Agenda Packet Page 328 of 724, APPRAISAL REPORT COMMUNITY FACILITIES DISTRICT 16=1 IMPROVEMENT AREA NO. 2 (MILLENIA) GTAY RANCH, CHULA VISTA Chula Vista, California (Appraisers' File No. 2020-1226) Prepared For City of Chula Vista 276 Fourth Avenue Chula Vista, California 91910 Prepared Kitty Siino & Associates, Inc. 115 East Second Street, Suite 100 Tustin, California 92780 e%fl,e%A fx 1% -1 .0- A I'%f%rX t� f%A /�V/�I V-Y -1 U 1A a T at-Tvwt a8c,-Y/�7 1 IL"t KITTY S11NO & ASSOCIATES, INC. REAL ESTATE APPRAISERS & CONSULTANTS January 11, 20�21 Kim Elliott, Facilities Finance Manager City of Chula Vista 276 Fourth Avenue Chula Vista, California 91910 Reference: Appraisal Report Community Facilities Diistrict No. 16-1 Improvement Area 2 (Portion of) Millenia, Otay Ranch Southwest Quadrant of SR 125 and Birch Road, Chula Vista, California Dear Ms. Elliott: At the request and authorization of the City of Chula Vista, we have completed an Appraisal Report ofImprovement Area No. 2 of Community Facilities District No. 16-1 of the City of Chula Vista ("CFD No. 16-1 IA 2") which consists of a portion of the residential neighborhoods and commercial land known as Millenia in Otay Ranch. Meridian Development has been contracted by the property owner, SLF-IV Millenia LLC, to manage the development of Millenia. Current on-site builders/developers within Improvement Area 2 include Lennar Homes of California and Pinnacle New Homes LLC (a joint venture entity formed by SLF-IV Millenia LLC and Meridian Development). Millenia is proposed for a total of about 3,10,010 multi-family high density residential units and 75 acres of commercial use. Improvement Area No. 2, which is the subject of this appraisal,, consists of 335 proposed residential units,, 41 of which have closed to individuals as of' November 15, 20�2O�, with the remaining residential lands ranging from builder-owned model homes and standing inventory to homes under construction to mass graded pads. In addition, there is a commercial site within Improvement Area 2. The valuation methods used in this report are the Sales Comparison Approach and a Discounted Cash Flow Analysis along with a mass appraisal technique for the existing homes as defined within this report. The fee simple estate of' the subject property has been valued subject to the lien of CFD1 No. 16-1 IA 2. It is the appraiser's understanding that all improvements to be funded by and any fee credits to be received as a result of the issuance of the Special Tax Bonds of CFD No. 16-1 IA 2 are in place or have accrued to the subject properties. 115 East Second Street,Suite 100,Tustin, California 92780 (714)5441-9978-Phone, (714)544-9985—Fax, E-Mail: kssiino@msn.com 202 f_03-t 6 Kim Elliott City of Chula Vista January 11, 20,21 Page Two As a result of our investigation,1 the concluded minimum market value for the subject property is: Pinnacle by Meridian Meridian Ownership 11)11707010101 Individual Owners (36 houses) 185,330, 40 Subtotal Pinnacle $ 29),50,07840, Vibe by Lennar Lennar Ownership 13),60070,010, Individual Owners (5 houses) 251423, 68 Subtotal Vibe $ 16)101237268 Cleo by Lennar Lennar Ownership $ 9),83570010, SLIF IV Millenia,l LLC Ownershi 3563510010 Aggregate Value for CFD No. 16-1 11A 2 58,9949108 The values are stated subject to the Assumptions and Limiting Conditions, and the Extraordinary Assumptions of this report, the Appraiser)s Certification and are as of' November 15,120201. Some supporting documentation concerning the data, reasoning and analyses may be retained in the appraiser's files. The information contained in this report is specific to the needs of the client and for the intended use stated in this report. This Appraisal Report is intended to comply with both the Uniform Standards of Professional Appraisal Practice CUSPAP" January 20,20) and with the Appraisal Standards of the California Debt and Investment Advisory Commission ("CIDIAC"). The appraiser is not responsible for unauthorized use of this report. This letter of transmittal is part of the attached report,1 which sets forth the data and analyses upon which our opinion of'value is, in part, predicated. Respectfully submitted, KITTY S1111N0 & ASSOCIATES, INC. Kitty S. Siino, MAI California State Certified General Real Estate Appraiser(AGO04793) A 0 J1 0 202f-03-M Pligica-tual UCISI& -1 aglu -7.1 U.1 TABLE OF CONTENTS Assumptions and Limiting Conditions............................................................................... i Extraordinary Assumptions .............................................................................................iii Aerial Photo of Millenia including CFD1 No. 2016-1 Improvement Area 2 .........................iv Purpose of the Appraisal................................................................................................ 1 TheSubject Property...................................................................................................... 1 Intended Use of'the Report............................................................................................ 2 Definitions ...................................................................................................................... 2 PropertyRights Appraised ............................................................................................. 5 EffectiveDate of'Value................................................................................................... 6 Dateof' Report................................................................................................................ 6 Scopeof Appraisal ........................................................................................................ 6 RegionalArea Map.......................................................................................................... 9 County of San Diiego Area Description.......................................................................... 10, City of Chula Vista Area Description ............................................................................. 18 Otay Ranch and Immediate Area Surroundings Description......................................... 22 Community Facilities District No. 16-1............................................................................ 27 Subject Property Descriptions....................................................................................... 28 San Diiego County Housing and Office Markets............................................................ 49 Highest and Best Use Analysis ..................................................................................... 60 Valuation Analyses and Conclusions ............................................................................ 65 Appraisal Report Summary ........................................................................................... 94 Appraiser's Certification ............................................................................................... 96 ADDENDA CFD, No. 16-1 Improvement Area 2 Boundary Map Map Nos. 16081,116377, 164018 and 164019 Builder-Owned Homes Discounted Cash Flow Analyses Finished Lot Land Sales Map and Summary Chart Commercial Land Sales Map and Summary Chart Improved Residential Sales Map and Summary Chart Appraisers' Qualifications A 0 J1 0 a Q 1� Pligica-tual at-INICt -1 aglu 3%-7 U.1 ASSUMPTIONS AND LIMITING CONDITIONS 1 This report might not include full discussions of'the data, reasoning and analyses that were used in the appraisal process to develop the appraiser's opinion of value. Some supporting documentation concerning the data, reasoning and analyses may be retained in the appraiser's files. The information contained in this report is specific to the needs of the client and for the intended use stated in this report. The appraiser is not responsible for unauthorized use of this report. 2. No responsibility is assumed for legal or title considerations. Title to the property is assumed to be good and marketable unless otherwise stated in this report. 3. It is assumed that the subject property is subject to the special tax lien of CFD No. 16-1 IA 2. 4. Responsible ownership and competent property management are assumed unless otherwise stated in this report. 5. The information furnished by others is believed to be reliable; however, no warranty is g�iven for its accuracy. 6. All engineering is assumed to be correct. Any plot plans and illustrative material used in this report are included only to assist the reader in visualizing the property and may not be to scale. 7. It is assumed that there are no hidden or unapparent conditions of either property, subsoil or structures that would render them more or less valuable. No responsibility is assumed for such conditions or for arrang�ing for engineering studies that may be required to discover them. 8. It is assumed that there is full compliance with all applicable federal, state and local environmental reg�ulations and laws unless otherwise stated in this report. 9. It is assumed that all applicable zoning and use regulations and restrictions have been complied with, unless nonconformity has been stated,, defined and considered in this appraisal report. 10. It is assumed that all required licenses, certificates of'occupancy or other leg�islative or administrative authority from any local,, state or national governmental or private entity or organization have been or can be obtained or renewed for any use on which the value estimates contained in this report are based. 11. Any sketch or photograph included in this report may show approximate dimensions and is included only to assist the reader in visualizing the properties. Maps, photographs and exhibits found in this report are provided for reader reference Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e i A Q 11 i ja '%QQ 11 6" P118CIL-tua T aCrSC;L a8c;71-71 UT 7/�*-J purposes only. No guarantee regarding accuracy is expressed or implied unless otherwise stated in this report. No survey has been made for the purpose of this report. 12. It is assumed that the utilization of the land and improvements (if any) are within the boundaries or property lines of the property described and that there is no encroachment or trespass unless otherwise stated in this report. 13. The appraiser is not qualified to detect hazardous waste and/or toxic materials. Any comment by the appraiser that might suggest the possibility of the presence of such substances should not be taken as confirmation of the presence of hazardous waste and/or toxic materials. Such determination would require investigation by a qualified expert relating to asbestos, urea-formaldehyde foam insulation or other potentially hazardous materials that may affect the value of the property. The appraiser)s value estimate is predicated on the assumption that there is no such material on or in the property that would cause a loss in value unless otherwise stated in this report. No responsibility is assumed for any environmental conditions or for any expertise or engineering knowledge required to discover them. The appraiser's descriptions and resulting comments are the result of the routine observations made during the appraisal process. 14. Proposed improvements, if any, are assumed to be completed in a good workmanlike manner in accordance with the submitted plans and specifications. 15. The distribution,1 if any, of the total valuation in this report between land and improvements applies only under the stated program of utilization. The separate allocations for land and buildings, if any,1 must not be used in conjunction with any other appraisal and are invalid if so used. 16. The Americans with Disabilities Act ("ADA"') became effective on January 26, 1992 and has been updated several times since then. The appraiser has made no specific compliance survey and analysis of the property to determine whether they conform to the various detailed requirements of the ADA,1 nor is the appraiser a qualified expert regarding the requirements of' the ADA. It is possible that a compliance survey of the property,1 together with a detailed analysis of the requirements of the ADA,,, could reveal that the property is not in compliance with one or more of the requirements of the ADA. If so,1 this fact could have a negative effect upon the value of'the property. Since the appraiser has no direct evidence relating to this issue, a possible noncompliance with requirements of the ADA in estimating the value has not been considered. 17. It is assumed there are no environmental concerns that would slow or thwart development of the subject properties and that the soils are adequate to support the highest and best use conclusions. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page # QA1114 H-M* 1 11 11 1 /�V/�I-V gU11UCt I Ct%.,rSUL -Y-7-t I Z, 18. It is assumed that�the sales information provided by the builders is�true and accurate. We have reviewed and analyzed the sales along with checking samples on various public record documents and �the information appears to be correct. 19. Possession of this, report, or a copy thereof, does not carry with it �the right of publication. It may not be used for any purpose by any person other than the party to whom it is addressed without the written consent of the appraiser, and in any event, only with proper qualification and only in its entirety. Permission is g�iven for this appraisal �to be published as a part of�the Official Statement or similar document for the San Diego, County CIFID No. 16-1 IA 2 Special Tax Bonds. EXTRAORDINARY ASSUMPTIONS 1. It is assumed �that the remaining costs to develop the various neighborhoods and the planned non-residential property within the subject property are true and correct. We have received summarized remaining costs, provided by the builders. We have reviewed these costs and they appear reasonablel; however, we are not experts in the cost estimating field and are relying on these costs, in �the valuation. If actual remaining costs differ, it may change the value conclusions. 2. It is assumed that the master developer completes construction on Metro Park in accordance with the �thresholds in the Millenia Parks Agreement. This is anticipated per the master builder. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) J Kitty Siino&Associates, Inc. Page N -%arm t�_Q QAIIIJ A3-t6* 1 11 11 1 /�V/�I_V gU11UCt I Ct%.,rSC;L _L a8 C;-Y-7 1 /Z' al,I� Appraisal Report City of Chula Vista CFDI 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page iv 4 4 A A Q 41 1, p -I U P-1 ;]L U I at-�rSI g1c,-t a a8c;71-7 ty 0 T 7 Vt PURPOSE OF THE APPRAISAL The purpose of'this appraisal report is to estimate the value of the fee simple interest of' the subject property, subject to the special tax lien of the City of Chula Vista CFID No. 16- 1 Improvement Area No. 2 Special Tax Bonds. THE SUBJECT PROPERTY The subject property consists of 335 proposed residential units and one commercial parcel within Millenia, a village within Otay �Ranch in the City of Chula Vista. The entire Millenia project is expected to include approximately 3,000 proposed residential units and up to 3.3 million square feet of commercial development. Chula Vista CFID 16-1 Improvement Area 2, the subject of this report includes three residential neighborhoods within Millenia and one parcel designated for commercial/mixed use. The ownership and condition of'the lands is detailed below. Description No. Ownership Condition/Status Lots Pinnacle by Meridian (Units 1-126 of Lot 1 of ap No. �16377) Units 1-36 of Map 16377 36 Individuals Completed Houses/Closed Units 121-126 of Map 16377 6 Meridian Model Homes None 0 Meridian Homes over 95% Complete Unit 37-78 42 Meridian Homes U/C(41 In escrow) Units 79-120 42 Meridian Finis�hed Lots (0 in escrow) subtotal Pinnacle 126 Vib�e by Lennar Homes(Units 1-92 of�Lot 1 of ap 16409) Units 7, 8,29-31 of Map 16409 5 Individuals Completed Houses/Closed Units 3-5 of Map 16409 3 Lennar Model Homes Homes Units 1-2, 6 and 9-16 of Map 16,409 11 Lennar Homes over 95% Complete(9 In escrow) Units 26-28 and 32-53 of Map 16409 25 Lennar Homes U/C(22 In escrow) Units 17-25 and 54-92 of Map 16409 48 Lennar Finished Lots (0 in escrow) subtotal Vibe 92 Cleo by Lennar Homes(Units 93-209 of Lot 1 of Map��16 08) Units 93-97, 104-109, 114-125 and 201-209 32 Lennar Homes and Models U/C (24 in escrow) Units 98-103, 110-113, 126-200 85 Lennar Finished Building pads subtotal Cleo 117 Commercial Parcel Lot 19 of'Tract M p 16081 N/A SLIF IV- 8.34-acre Finis�hed Lot Millenia LLC Total Residential Units 335 Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page I A 0 J1 0 a— -�-?-2* 1 202 f-03-t 6 PligV'i-tua 1 UCISI& -1 aglu 31-7 Ul INTENDED USE OF THE REPORT It is the appraiser's understanding that the client, the City of' Chula Vista, will utilize this report in disclosure documents related to the sale of the Special Tax Bonds of CFD1 No. 16-1 A 2. This report may be included in the Official Statement or similar document to be distributed in connection with the marketing and offering of the bonds. It is the appraiser's understanding that there are no other intended uses of this report. DEFINITIONS Market Value The term "Market Value"' as used in this report is defined as: "Th�e most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently, knowledgeably and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specitied date and the passing of title from seller to buyer under conditions whereby.- 1. buyer and seller are typically motivated; 2. both parties are well informed or well advised, and each acting in, what he or she considers his or her own best interest; 3. a reasonable time is allowed for exposure in the open market; 4. payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto,- and 5. the price represents the normal consideration for the property sold unaffected by special or creative financincl or sales concessions granted by anyone associated with the sale. Inherent in the Market Value definition is exposure time or the time the subject properties would have been exposed on the open market prior to the appraisal in order to sell at the concluded values. In the case at hand and considering current market conditions the exposure time for each individually owned property, each builder-owned property or the master developer owned property in a bulk sale, is less than one year. ' 'The Appraisal of Real Estate, 13 th �Edition Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 2 -4 4 A A Q I I I P 11QQ 1 U P-1gullua T aCrSC;L a8c;71_;N T 7 lAggregate Retail Proceeds As used in �the Diiscounted Cash Flow Analysis, Aggregate �Retail Proceeds is defined: "The sum of the appraised values of the individual units, as if all of the units were completed and available for retail sale, at date of value. Th�e sum includes an allowance fo�r lot premiums, when applicable. Th�is is not the market value of the project in bulk. Bulk Value Bulk Value is defined as: Th�e value of a group of lots, parcels, or homes to a single purchaser, on a specified date, under the terms and conditions of the definition, of market value. Discounted Cash Flow (DCF) Analysis A Diiscounted Cash Flow Analysis is: Th�e procedure in which a discount rate is applied to a set of projected income streams and a reversion. The analysis specifies the quantity, variability, timing, and duration of the income streams as well as the quantity and timing of the reversion and discounts each to its present value at a specified yield rate. Finished Lot, The term "Finished Lot" is defined as: "A parcel which has legal entitlements created by a recorded subdivision, map, whose physical characteristics are a fine graded level pad per lot with infrastructure contiguous to each individual lot, asphalt paved roads and the necessary utilities. This term assumes the payment of all applicable development fees with the exception of building permit and plan check fees." Finished Pad The term "Finished Pad"' is defined as: "A parcel which has legal entitlements created by a condominium map, whose physical characteristics are a fine graded level pad with infrastructure contiguous to each individual unit, asphalt paved roads and the necessary utilities. Th�is term assumes the payment of all applicable development fees with the exception of building permit and plan, check fees. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 3 A 0 J1 1 0 -%n a t�— f-()3-t 6 Pligica-tua I at-ISIC;L I(28U,_Y-7-7 %J I Minimum Market Value The term "Minimum Market Value"' as used in this report is defined as: "The base market value of a new home. Th�at is, most buyers purchase some upgrades, options andlor lot premiums when purchasing a new home. Th�e sales price fo�r the new home typically includes the base price for the plan, plus any upgrades, options or lot premiums, less concessions, if any, which were given or paid fo�r by the builder. The concluded minimum market value is for the base value of the plan only, not taking into consideration any upgrades, options or premiums." Mass Appraisal The term "Mass Appraisal"' as used in this report is defined as: "The process of valuing a universe of properties as of a given date using standard methodology employing common data and allowina for statistical testingIY2 In the case at hand, the statistical testing included reviewing all original builder sales and reviewing the Multiple Listing Service ("MLS"') for any re-sales and/or listings of each plan �type. In addition,, we have determined �the actual range of sales prices for each plan �type which will be utilized in �the valuation process. The search of the MLS resulted in no current listings and no re-sales within the subject properties other than builder listings. SU Pad A superpad is defined within this report as: A mass graded pad which is created in order to create earthwork balances within future subdivision parcels. Requires additional grading prior to building construction, may require additional mapping and may require additional entitlements. A rough-graded site with roads and utility lines extended to the boundary of the parcel. Extraordina[y Assumptions The term 69 extraordinary assumption"' is defined by USPAP as: "An assumption, directly related to a specific assignment, which�, if found to be false, could alter the appraiser's opinions or conclusion" USPAP 2014-2015 Edition Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 4 A i r"h 11 0 %4 a 1 f-()3-t 6 P-18unuct JL at.'r%.& JL a8u.,-Y-ti 1�kif L There are �two extraordinary assumptions in �this report. The first extraordinary assumption in this report is�that�the reported remaining costs as received from the builders and master developer or their consultants are true and accurate. We have reviewed the costs and they appear reasonable; however, we are not experts in the field of cost estimating. It should be noted that �these costs were relied upon in the valuation of �the subject property and if�the costs changel �the values may change. The second extraordinary assumption is that the master developer commences and completes construction of Metro Park in a �timely manner which does not limit occupancy on �the Meridian or Lennar parcels. Per the master developer, while Cleo and Vibe are subject to the specific threshold for Metro Park, the master developer has satisfied the thresholds in the Park Agreement that would limit building permit issuances and occupancies. The only remaining specific threshold is �that the master developer completed the park construction in one year however the City can allow permits �to continue within Millenia as long as the park is being completed in a timely manner. PROPERTY RIGHTS APPRAISED The property rights being appraised are of a fee simple estate interest, subject to easements of record and subject �to CFD1 No. 16-1 IA 2. The definition of "fee simple estate" is defined as: "absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the govemmental powers of taxation, eminent domain, police power, and escheat.113 EFFECTIVE DATE OF VALUE The subject properties are valued as of November 15, 20,20. 3The Appraisal o�f Real Estate, 13thEdition Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 5 A A 0 11 0 "1 44 f-()3-t 6 P-18CIL-tua T aCTIZ& -1 a8c;-y"t I U I DATE OF REPORT The date of this report is January 11, 20�21. SCOPE OF APPRAISAL The purpose of�this appraisal is�to report the appraiser's best estimate of the market value for the subject property, CFD No. 16-1 IA 2, which is known as a portion of' Millenia. Millenia is being developed by SLF-IV Millenia LLC into a mixed-use master planned community previously known as �the Otay Ranch Eastern Urban Center (EUC) which is a portion of Otay Ranch Village 12. Meridian Development has been contracted to manage all aspects of'the remaining lands. The entire Millenia project is proposed for about 3,000 residential units, 42.3 acres of commercial use and 20 acres of public use while the subject property includes three proposed residential neighborhoods totaling 335 units and one commercial parcel. All �three residential parcels are sold to builders with the master developer owning the commercial parcel. This appraisal will be presented in �the following format: 0 County of San Diiego Description 0 City of Chula Vista Description 0 Immediate Surroundings / Otay Ranch / Millenia Description 0 Brief Description of City of'Chula Vista CFD1 16-1 IA 2 0 Subject Property Descriptions 0 San Diiego County Residential and Commercial Market Analysis 0 Highest and Best Use Analysis 0 Valuation Procedure,1 Analyses and Conclusions 0 Appraisal Report Summary In valuing �the subject property, the value estimates will be based upon the highest and best use conclusion using �the Sales Comparison Approach. The Sales Comparison Approach to value is defined as: a set of procedures in which a value indication is derived b comparing the y property being appraised to similar properties that have been sold recently, then applying appropriate units of comparison and making adjustments to the sales prices of the comparables based on the elements of comparison. The Sales Comparison Approach may be used to value improved properties, vacant land or land being considered as th�ough� vacant; it is the most common and preferred Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 6 QA1114 A3-t6* 1 11 11 1 /�V/�I_V gU11UCt I Ct%.,rSC;L _Y-tz. I Z, method of land valuation wh�en an adequate supply of comparable sales is available."4 In the Sales Comparison Approach,1 market value is estimated by comparing properties similar to the subject that have recently been sold,,, are listed for sale or are under contract. Neither a cost or income approach was utilized as they were not considered necessary �to arrive at credible results. A Discounted Cash Flow Analysis will also be completed for each ownership for the builder-owned homes. We will also utilize a mass appraisal technique which included reviewing all builder sales and searching the MLS for any re- sales and/or listings. The due diligence of this appraisal report included �the following: 1 Compiled demographic information and related �that data �to the subject properties �to perform a feasibility/demand analysis. 2. Gathered and analyzed information on the subject marketplace,y reviewed several real estate brokerage publications on historical and projected growth in �the subject market and researched the micro and macro-economic outlook within San Diieg�o County and the Otay Ranch area. 3. Inspected the subject properties between October 1, 20,20, and November 15, 20,20. 4. Had the site flown by an aerial photographer on October 14,1 20201. 5. Interviewed representatives and or consultants from Meridian Development in order to obtain information on Pinnacle and the commercial parcel. 6. Interviewed representatives from Lennar in order to obtain information on Vibe and Cleo. 7. Reviewed the Eastern Urban Center Sectional Planning Area ("SPA") Plan. 8. Reviewed Preliminary Title Reports on �the subject properties as provided by the property owners. 9. Reviewed a Final EIR for the subject property. 10. Searched the area for relevant comparable residential land sales,,l inspected and verified each sale with a buyer or seller or broker familiar with �the transaction. 4 Dictionary of Real Estate Appraisal, Fourth Edition,2002 Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) J Kitty Siino&Associates, Inc. Page 7 QA1114 A3-t6* 1 11 11 1 /�V/�I_V gU11UCt I Ct%.,rSC;L _Y-tJ I Z, 11- Searched the area for relevant comparable commercial land sales, inspected and verified each sale with a buyer or seller or broker familiar with the transaction when available. 12. Searched the area for relevant comparable new home residential projects, including sales prices and interviewed representatives from each comparable project. 13. Reviewed sales brochures and websites on the subject neighborhoods along with comparable neighborhoods. 14. Reviewed developer sales information on each home including current escrows. 15. Reviewed Multiple Listing Service information to determine if' there were any re- sales, pending re-sales, or listings of existing homes. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 8 f-()3-t 6 P-18ujauct JL aLr�,& JL a8u.,-Y-t-t%if L R'EGIONAL AREA MAP "I au T 1�111 ��IlI ............ 4 III Lancaster Qui a I I'd )�.-Palmdale Ade,lanto,lpf? "I I, I, Vilcto ............ rvilile pa,I'llkh 0 A I V,a I ley Lucerne Va I ey .1a Hesper ��,ightwood,,( San Fernando plGabriel I It, 1�1.S e ountain, IIII '(0 liderness La ke,,Arrowhe�'� �19 13 1 rCity 11�1,Qrestl f 66-1 f L B4 Bea r. a ank %�� Z�,I�r RI Linn I ng Spri III LISCOY Pasaden A .I I I I I..... 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Page 9 A Q 11 j %4? t�_Q 202 It-()3-It 6 11Ua I UCA.Cel, fla8c;_Y-tJ UI Z4_ COUNTY OF SAN DIEG�O AREA DESCRIPTION General Surroundings The subject property is located in the City of Chula Vista in the southwestern most portion of the County of San Diego (the "County"'). The County is located in the southwest corner of the State of California bordering Mexico on the south,1 Imperial County to the east, and �Riverside and Orange Counties to the north and the Pacific Ocean to the west. The County has approximately 4,525 square miles (325 square miles of which is water) and includes terrain from ocean beaches to foothills to mountains and deserts. San Diieg�o County has 70, miles of coastline and the climate ranges from Mediterranean to semi-arid. P0 t,ion The San Diego, region experienced faster growth rates than most of California during the past several decades. In 20019 the County had a larger population than 20 of the 50 states. I The County has experienced an increasing growth pattern for the past fifty years. Between January 1990 and January 200�0, the population grew from 2,480,072 to 2,813,,833 or an annual average growth of approximately 1.15 percent per year. According to the California Department of Finance,1 the January 20,20 population for the County is estimated at 3,343,355 which is an increase of O�.1 percent from January 2019 and suggests an average annual increase of O�.86 percent for the previous twenty years. The slowdown in growth appears to be due to the recession which began in the mid- 2000,s along with the build-out of easily developable land. Current projections from SANDAG are for the County population to increase by one million people by 2050 which reflects a 0.86 percent average annual increase over the next thirty years. Transportation Four major interstate freeways bisect the Countyl; these are Interstate 5, Interstate 15,,l Interstate 8 and Interstate 805. Interstate 5 is the major north/south arterial throug�hout the State of California. It generally follows the coastal route in the San Diego County area. Interstate 15 is also a north/south arterial; however,1 it is located inland and through the Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 10 A 0 J1 0 Y"tv 202 f_03-t 6 PligV'i-tua 1 UCISI& -1 aglu 9 a 4 U 1��_?_41 1 more mountainous regions of�the County. Interstate 8 provides east/west access�through �the southern portion of �the County, while Interstate 8015 generally parallels Interstate 5 beginning near Del Mar,,, providing a third north/south route between 1-15 and 1-5. The subject area is served by State Route 125, a toll road giving access to the inland areas of southern San Diego County east of 1-15. State Route 125 begins in Santee about 15 miles north and provides access through �the communities of El Cajon,1 La Mesa,1 Lemon Grove,y La Presa and Chula Vista and on to the national border with Mexico where it becomes State Route 905. The County is well served with train service by Amtrak,1 Metrolink and �the regional Coaster. In addition, downtown San Diieg�o has a trolley which provides access around the downtown area and to the Mexican border. Air service is provided by San Diego International Airport (approximately 15 miles northwest), Palomar Airport in Carlsbad (approximately 40, miles north) and Brown Field, three miles south of the subject in Otay Mesa near the Mexican border. Econo Beginning February 201,1 20,20, the U.S. along with the world began experiencing an unprecedented economic disruption due to the COVID-1 9 pandemic. Original predictions were for the virus to overwhelm hospitals and staff. While the U.S. has lost over 250,000 people due to COVID-1 9 as of the date hereof, and except for a few exceptions, hospitals have had �the capacity �to treat �the patients. The Federal,, State, County and City Governments ("Governments") shut down non-essential businesses and areas where social gatherings occur in order to slow the spread of the virus. This created a strain on small and large businesses alike. Restaurants and hotels were hit hard and travel reduced drastically as citizens were urged to stay home. Layoffs occurred with reports of 40 million people in the U.S. filing for unemployment in the past eight months. This disruption orig�inally caused extreme volatility in the stock market with an overall drop of 37 percent on March 23, 20201,1 however the stock market has now rose �to near previous highs. The Federal Government attempted to curtail the job losses and hardships with �the approval of the Coronavirus Aid, Relief and Economic Security (CARES)Act which was signed into Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 11 A 0 J1 1 0 -%a— t-—Q 202 f_03-t 6 Pligica-tua I at-INIC;L JL a8u.,-Y-t vi //�-t law March 2T 20,20. The CARES Act appropriated over two-trillion dollars to people and businesses who were financially stunted by the COVID-19 pandemic. On April 9,1 2020, the Federal Reserve took additional action to provide up to $2.3 trillion in loans to support the economy and on April 23, 2020,,, Congress passed an additional $,484 billion in relief for small businesses and hospitals. It appears these stimuli helped shore up the economy. Currently �the relief funds have generally been expended and �the government is deciding on when and if future help will occur. Job losses were huge with the Nation's unemployment for October 2020 at 6.6 percent compared to 3.5 percent in February 20201. In June the news was positive with most states beginning�to re-open,1 however since then) �there has been surging cases of COVID in several states creating the need for additional shut-downs of' non-essential activity once again. Most economists believe the economy will have good growth once COVID ends, however the timetable for ending the virus has not yet been discovered. While there has been positive news on a vaccine, the �time �table to vaccinate �the public is uncertain at �this �time. Per the Congressional Budget Office, their prediction is that by the end of 20�22, economic output will still be five percent below the output prior to the pandemic. Prior�to the COVI D-1 9 pandemic) �the nation was experiencing a strong economy. As with the rest of'the nation, San Diieg�o County experienced a sig�nificant multi-year recession, now known as the Great Recession, between 2007 and mid-2012. The County, which had strong employment over the previous decade,, saw unemployment rates increase significantly between 20,017 and 20110. Unemployment had declined substantially since that time with the last few years showing historically low unemployment, however this changed due to COVID,. The unadjusted unemployment rate for the County was estimated at 7.7 percent (per the October 2020, Employment Development Department report),1 which is significantly higher�than the February 20,20, rate of 3.2 percent,1 however a decrease from the peak during the recession of 11.0 percent in 201 O�. The current unemployment rate for the County of 7.7 percent is lower than the California rate of 9.0 percent and higher than �the October 20,20 National rate of 6.7 percent. Below is a �table depicting San Diiego County in relationship to unemployment rates of �the surrounding counties. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 12 Q A1114_A3_t 6* I r", I i F 11 4Q t�_Q /�V/�I V 8U11UCt I Ct%.,rSUL _L a8c;-Y-to I /N Jur"Isdict'ion As of Unemployment Rate Los Angeles County 1 O�/20 12.1% Riverside County 101/20 9.0% San Bernardino County 1 O�/20 9.1% Orange County 101/20 7.5% [Sa�n Diego County 10/20 17.17% So�urce- State of Califomia E.D.D. Octo�ber 20�20 Report Over the past 20 years,1 the San Diego County economy has had significant cycles with home prices almost doubling from 1995 to 2005, then failing by over 50 percent during the Great Recession taking prices back to 20�O�2/03 levels. Home values appeared to hit bottom in 20,019 then remained essentially flat for two to three years with the majority of the San Diiego County housing market seeing an improvement beginning in mid-20112 with increases since that time. When COVID hit, home sales stopped for a few months. However, new home sales began surging in May/June and have not eased yet. This is thought to be due to 1) Millennials finally entering the market; 2) historically low interest rates and 3) what is being called the COVID, factor. The COVID, factor brought a rush to own as people were restricted to their homes along with working from homes creating the need for a home-office and more space to spread out which most apartments do not provide. The existing home market was stag�nant for a longer time due the unknowns as homeowners did not want to move. New home sales took off and have been a bright spot in the COVID, economy with minimal inventory of existing homes. However, due to the limited supply and increased demand, prices have increased which has led existing homeowners to beg�in to move. Prices have surpassed the pre-recession highs with prices still rising. During the Great Recession, the Federal Government attempted to correct the strug�g�ling economy by implementing several economic stimulus packages during the Great Recession. The Federal Reserve Board ("Board"') has kept interest rates below historical averages, dropping rates to zero in December 20018 until the December 2015 Board meeting, when they began raising interest rates. The final increase in December 20�18 Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 13 A 0 J1 0 4 a p— 01gica-tua 1 UCISI& -1 -Y"t-7 202 f aglu appeared �to partially affect �the economy with home sales slowing and stock market volatility. In 2019 �the Board stopped the increases and dropped the rate �three times. On March 3, 2020 the Board dropped rates 50 basis points due to the stock market reaction to the COVID-1 9 pandemic while on March 16, 2020 the Board dropped the rate another 100 basis points to the historical level of 01 �— 0.25 percent. At �the most recent meeting of �the Board, rates were left unchanged. The Federal Interest Rate in �the US averaged 5.69 percent from 1971 to 2019 reaching an all-time high of'20 percent in March 1980 and the previous low of .25 percent in December 2008. While the Government has enacted several stimulus packages �to try and stabilize the economy during �the COVID-19 pandemic and is reviewing additional relief, it is too early to tell how much these will help. The first 2020 UCLA Anderson Forecast ("Forecast") was issued March 12, 2020, but for �the first time in its 68-year history,, the Forecast was updated four days later on March 16, 2020, due �to �the COVID,-19 pandemic. The latest Forecast dated September 30, 2020, states the nation's forecast is better than expected, however only compared to their earlier forecast (dated June 24, 20�20) which declared the nation)s economy was in a "depression-like"' crisis. Between June 24, 20,20 and September 30, 20,20, the economy opened more quickly �than anticipated due to �the quick adaptation by consumers and businesses to virtual interactions, safe physical distancing, unprecedented monetary support by the Federal Reserve and the fiscal stimulus. The Forecast does state that the good news is not without caveat and �that is that it assumes the widespread availability and usage of an effective vaccine in early 20,21 or that �the pandemic abates and is relatively mild in 2021 and 2022. Estimates are for the economy not to return to its fourth quarter 2019 peak until early 2023. The GDP decline was 9.1 percent between April and June with an estimated 6.4 percent growth from July to September. After �this projected �third quarter increase,, the fourth quarter GDP would be 4.5 percent below the fourth quarter 2019. This compares to a 4.0 peak to troug�h decline during the Great Recession of 20�O�8. The National Forecast states that even as the economy recovers, unemployment will continue. Following the peak of 14.7 percent in April and declining to 7.7 percent in Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 14 QA1114 A3-t6* 1 11 11 1 1 a8u.,-Y-)v v I /�V/�I_V gUlMa I a%.,rSC;L September, the Forecast predicts �the U.S. will end �the year with a 7.8 percent unemployment rate followed by a rate of 6.3 percent at the end of 20�21 and 4.7 percent at the end of 2022 which is still above the pre-COVID national unemployment rate in February 2020 of3-5 percent. The Forecast for California looks at the COVID-1 9 risk similar�to a transactions, "tax"' �that is highest for crowds and less with more distance. Essential activities with low COVID-1 9 "taxes"' (i.e. on-line shopping, virtual workspaces, zoom meetings, groceries, take-out restaurants) have already recovered and will grow as the economy grows. Avoidable activities with high COVID,-19 transaction "taxes" (i.e. air traveli hotels,1 mass transit in person classes, entertainment venues) have not recovered and will likely remain at low employment levels, even as the economy grows. California's economy is expected to largely track that of the U.S.,1 with areas such as leisure and hospitality hit harder in California than the overall U.S. The final positive in the California Forecast is that the tech industry and its workers have been doing well with 349,0010, workers in Santa Clara County (Silicon Valley) and 2501,1000 in Los Angeles. While �the Bay Area, New York and Los Angeles have seen spectacular growth in the tech workforce in the past, the Forecast predicts slower growth in major cities in the future owing to the great acceptance of remote working which will create tech industry growth in more suburban areas. We have reviewed San Diieg�o's Economic Pulse prepared by the San Diego Regional Economic Development Corporation and dated August 21, 20,20. Within �the County, 'the unemployment rate was 7.7 percent in October which is down from 12.3 percent in July but far above the 3.6 rate of one year prior. During the COVID-1 9 pandemic San Diego non-f'arm employment lost 144,1400 jobs or a total of 1 O�.2 percent of' its workforce. This is a higher percentage �than �the California total loss of 1.6 million jobs which is about 8.0 percent. The largest sector of job losses in San Diiego County during �the COVID-19 pandemic is by far Leisure and Hospitality (-60,800 jobs) followed by Trade, Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 15 -4 4 A A Q 11 i P "I 1 U P-1gulaua T aCrSC;L a8c;Tj f T 7 Transportation and Utilities (-18,14010, jobs) and Government (-14,500 jobs). As of �the November 20,20, San Diiego Economic Pulse,, 52.4 percent of lost jobs have been recovered. The Economic Pulse believes creative training programs will be the key to get the workers employed in growing occupations for economic recovery. New home sales have surged with pending new home sales in July 2020 (latest statistic available), up 58 percent year over year in San Diiego County. During the Great Recession,, commercial real estate hit bottom in 2010 with local absorption levels returning to positive territory in 20,12 and generally growing until COVID, hit. Office vacancy rates stabilized in 20,12 with rents rising between 20,13 to early 20201. Retail vacancies which grew during the Great Recession generally leased up with retail construction occurring once again,,, generally after 20�16. This is evidenced by the successful Otay Ranch Town Center adjacent �to �the north of Millenia along with Millenia Commons, 'the Ayres Hotel and additional retail space developed and leased during this time. Chesnut Properties purchased one commercial parcel for office construction in Millenia and was in escrow on two additional parcels in 2017. They have building plans underway on �the first parcel however have not yet begun construction. In early 20,18 escrows on �the additional two commercial parcels in Millenia (including the subject commercial parcel) were cancelled. We have reviewed CBRE's US Real Estate Market Outlook for 2021 which includes the effect of COVID, on commercial real estate in the Nation. Overall, they believe that demand for office space will remain muted as most office occupiers plan for a gradual re-entry into �the office throughout 20,21. Conclusion, Population in �the County has increased over �the past 30 years with predictions for continued population growth. The nation's economy stalled during �the Great Recession with a resurgence beginning in 2012. The County economy along with most of'California and the Nation experienced the longest economic expansion in history between 2010 and 20201. While the expansion began slowing slightly in late 2019,1 the COVID-19 pandemic brought �the economy �to a halt in early 2020. Unemployment during �this �time rose from under 4 percent to over 12 percent in the County then lowered slig�htly to 7.7 percent in Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 16 A 0 J1 0 1;Q -� 1 202 f-03-t 6 PligV'i-tua 1 UCISI& -1 aglu Ul October 2020. While several counties in California are beginning �to cautiously reopen, no one knows how long it will be until �the economy and life gets back to what was the pre- COVID, normal. The one bright spot is new home sales which are showing a sig�nificant increase year over year. The commercial market is anticipated to be more stagnant in 2021 than was forecast in early 2020,due�to COVID. In conclusionl �the County is expected �to continue �to grow in population due to its Southern California location and availability of land, however residential real estate will enjoy more growth than commercial real estate. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 17 Q All"I-A3-t 6* 1 11 11 1 P 1111;Q t�-Q /�V/�I V 8U11UCt I Ct%.,rSUL -L a8c;-Y-)j V I C ATY OF CHULA VISTA The subject property is located in �the City of Chula Vista ("City"), located in the southern portion of'San Diego County. Chula Vista is the second largest city in San Diieg�o County, bordered by the San Diieg�o Bay and Coronado to the west, Imperial Beach to the southwest �the California-Mexico border �to �the south,, unincorporated area �to �the �East, Lemon Grove �to �the north, and National City �to �the northwest. The City contains an estimated 50.1 square miles of land with Mediterranean and semi-arid climates. San Diego County averages 10 inches of precipitation annually. Rain occurs mainly between �the months of December and March. Elevation ranges from sea level �to 1,,591 feet. The City is located 7 miles southeast of downtown San Diiego. The City of Chula Vista was incorporated in 1911. In 1997, the City annexed 9,11 O�O acres, the largest annexation in County history. Below is a map outlining the City with the black star representing the approximate site of the subject property. 13 a P k, rlak,PW, B rcotd vray D' ("I e v i em We P.t e r ......... ........... .......... ...... ......... 4# 0 San�bte,'�,, 5 Okiipt Hill J,kov n a vl'!Ki $ a V dril C o &�".(........... S*'Ovs D" /",/...... .. .................... .0" .... ...... ""n Nafional Cily'� 0 . ............... ........ li, 7 'vn'� 101" Ridge kqi��pje�, 'R� ell It F"Al /P ....................1, ........................... Un, ........... .............. C,�ka,n .......... IF- .......... Oy_ak.l ..................... ............/////////// ............ ....... ......... ......................... C ta t hul t E�f,(X Ea k A Ej IL .......... g .......... .......... All .............. .......... "v ki u,6,6 1"W I I(*Ie Man (Aiy VaOl 8each ("ARY Mesa NhoOl/ 0 elf"a r C I e e at c" M ........... ................. ...................... Our(MO FON ............... ....................................... Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 18 A 0 J1 0 1;a t� f%At f_03-t 6 Plvgvatua 1 aCA.Ct I aglu 3%_)"t ki I /�"t The City began as a 5,0�O�O�-acre development with �the first house being built in 1887 and by 1889, having 10, homes on �the development. The completion of the Sweetwater Dam in 1888 permitted irrigation after which Chula Vista became,,, for a while,,, the largest lemon- growing center in the world. This agriculture base helped the City get through the Great Depression. Agriculture does not continue to be as important to the City as it once was as now over 2501,,0001 people reside in Chula Vista. popullation, Chula Vista is �the second largest City in San Diiego County. As of January 1,1 20120, 'the City had a population of 272,1202, which is a 0.4 percent increase from �the January 2019 which was 271,032. Since the year 20�O�O Chula Vista has experienced almost a 50 percent population increase indicating a very rapid growth in the population over the past 15 years,, although it appears to be slowing. Between 20,00 and 20101 the City population increased an average annual growth rate of 3.46 percent while between 20,10, and 20,16 the rate slowed to just over one percent per year showing the effects of the Great Recession. In 2016 Chula Vista was one of California's top 10 cities with the largest numerical change of cities, with population growth. The City of Chula Vista has a median age of 34 years old with roughly 60% of�the homes in the area owner-occupied. Econo Chula Vista has been undergoing business expansion and attraction while collaborating with Baja California officials�to create an environment for economic growth and prosperity. The City established economic development initiatives that have created quality infrastructure, a strong consumer base and a well-educated and experienced workforce. The City has two, major malls besides �the Otay Ranch Town Center and the historic downtown shopping district. Otay Ranch Town Center has more �than 1010, �top specialty stores. According to the City's June 30th2019 Comprehensive Annual Financial Report (latest available for review),,, the top employers in the City are as reported on the following page. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 19 QA1114 A3-t6* 1 11 11 1 /�V/�I_V gU11UCt I Ct%.,rSC;L _L a8c;-Y Employer No. of Empl,oyees —Sweetwater Union High School District 41133 Chula Vista Elementary School District 31680 —Sharp Chula Vista Medical Center 21287 Rohr Inc./Goodrich Aerostructures 11928 Southwestern College 11,743 Wal-Mart 11323 City of Chula Vista 11208 Scrip�p�s Mercy Hosp�ital —Chula Vista 1 1073 While COVID,-19 has disrupted the economy in the City of Chula Vista, similar to all of Southern California and San Diiego County,1 new home sales have been a bright spot. While new home sales are up significantly, existing home listings were way down. It is thought that this trend is a reaction to the COVID-1 9 pandemic with people owning homes staying put while millennials may be finally beginning to move out,,, partially due to low interest rates. Education The City is home to two school districts,,, one elementary level and one high school level. The Chula Vista Elementary School District is the largest kindergarten through sixth grade district in the State of California with 49 campuses. Wolf Canyon Elementary will be serving the subject property. Sweetwater Union High School District serves as the primary secondary school district with Eastlake Middle School and Olympian High School serving the subject property. Mater Dlei Catholic High School is located within Otay Ranch (about 0.5 miles northwest of subject) along with the Chula Vista Academy of the Arts Charter School (K-8 th on Mater Dlei campus). High Tech High Chula Vista,,, a public charter school for grades 9-12 is located within one mile southeast of the subject. Southwestern College is a community college in the city located about two and one-half miles northwest of the subject. Southwest College serves approximately 19,10,00 students annually. Transportation The City is served by a large network of freeways and highways that include 1-5 along the western edge of the City,y which runs south to Tijuana and north to Los Angeles and onto Northern California. The 1-80�5 serves as a bypass to the 1-5. State Route 54 and State Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 20 P -%1;z7 t 6* I r"' I i I V 8U11UCt I Ct%.,rSC;L J-)V Route 125 serve as highways to East County cities. At the subject the 125 Freeway is a �toll road. The San Diiego International Airport is located about 12 miles northwest of�the city and serves as the city's primary commercial airport. Brown Field,,, a municipal airport is located about three miles south of the subject. Summa In summary,,, the City of Chula Vista experienced substantial growth in the last 20 years with future growth predicted. The City will play a significant role in the region's growth and is emerging as the hub of civic and cultural activity in South San Diego County. As the second largest City in the County and historically one of the fastest g�rowing cities in the nation coupled with the business-friendly atmosphere and availability of land, there are many opportunities for both growing businesses and growing families in the City of Chula Vista. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 21 -4 0;; A A Q 11 i P ni;_ 1 U P-1gui-tua T a%7rSC;L a8c;Tj 7 T 7 OTAY RANCH AND IMMEDIATE SURROUNDINGS The Otay Ranch is a 5,300-acre pedestrian friendly master planned community located in �the eastern portion of the City of Chula Vista. The master developer of Otay Ranch and the City planned a village planning concept which provides urban villages that are approximately one-mile square with distinct features defined by an open space system and major arterial streets. The concept promotes pedestrian-oriented villages providing essential facilities and services �to be located in each village core. The highest density residential is located in each core and residential densities decrease towards each village perimeter. Below is a map showing the overall Otay Ranch with the black star showing �the location of the project property. VILLAGE 5 VIL Al 't PE,ill cok4 VILLAGE I VILLAGE S 'WEST I'V'ERS E'2 I'll,.......... PN IGE LANNINIG AREA 2D The Millenia project in Otay �Ranch consists of approximately 206 acres of mixed-use development that is bounded by Birch Road on the north, Eastlake Parkway on the east, Hunte Parkway on the south and the State Route 125 Freeway (South Bay Expressway) on the west. It is fully entitled for about 3,10,010 residential uses and up�to 3.3 million square Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 22 QAIIIJ A3-t6* 1 11 11 11 1 a8c; /�V/�I_V gU11UCt I aLrSC;L feet of commercial and civic uses. Commercial development is �to consist of retail, office, civic and hospitality land uses. Current, existing development within the Millenia Village consists of a variety of residential and commercial projects. Below is an artist rendition of Millenia with the subject sites identified by blue stars and proposed development summarized on �the table. M IL L,E NA N, A L E XA IN fkl 10 U E "F,r L A v,j,nfl,9,,,, '�,,rj� P"04 HNIK 111,IN T, Ly"y",C h o",r P,ut P, pe v,ke S A le; C, t k,,40 �!Y,A 1,, e, fi, vv 0 t wff' "v'�n"'� 1� a f �'r' j, 'o PTI�A'R"'H�'(45"�71 i,C�'I'"V"'�'"'J Ht AY Rff% XT E L 0�4 "h'�"'4 oo't oi""'"w f -v W", "'v, ALE`,'XAPJ#41ILLERIA �jy IPA,�OLSE Fi,,(,'o;L�e,,�,)toe E'VQ( POe"TRO T114,11") �-Or 1111'11,"'Wjk�,'," �'an &KVIVILAP I 1WHAA.fif(COt J t i 1�v v� 0"-,t �'f'f k"f t b'v'Farf)"'lle,41,j trl,�,t M,e ii vf',s ir� r r r 7,,,�,,i[4�i FT 5, tay B�-i')'D'nr* V,R'ew 1"11 F/� n� 1, N,'11 I t o'j t q'V- 1061'� o'� v A, ",J)J R" 't's o(-"i "I�x h 4A y T A" I "d, ..... 01 , , ,� �'�""/ �"0�"11 f ij -'A j I/' b f""', yo"' fr" R 'o I I' t 4 4 IMPULtN16A C."011MA410 P4 S zu,,,m4f 14 1 IW,N A P LA C E I R,1 J 0 V011,TA L nuirrt,'A ��Foo�, I " ®rlp 1 0 n 1""""e, e"m 11"n"'i ie'�'tr'r)�e rvt S �","W"'y L.fn IWMr A c r,,,'rf e-"y i r n r, 'f 1�1' f w("' fe a f i"A i 11 r '�-dl j �3" wv t�j vw' 'f�'ir'�euf' u'v 'r, 'u,'e Id% q2" fr" f4 t 1� v J t q 0 1 P 11 ff t'� r 'N ri t 6 n f 1, '241, 1 u 1�A 0 0�' 6, 'a a w,a"f"� 'it A",Idy �'O "'A( 1'�r Y"'ov n JA r"""i h�' m r L" � Rhase I Wile6lia Product Status DU/SF Acres Densit Pulse Apts. �Fully 273 DU 9.28 Ac 29.4/Ac Leased Evo, Metro &Trio 'Townhome Sold Out 217 DU 12.8 Ac 17.0/Ac Element&Z by S,hea Homes SFD/SFA Sold Out 176 DU 10.26 Ac* 17.2/Ac* Rhase 2 Wile6lia MaI2 160,81 6— "Invent 19— Lot 1 1 Office Proposed 700,000 SF 10.93 Ac N/A Millenia Commo�ns by Retail Completed 105,000 SF 9.85 Ac N/A Sudberry Properties Lot 2 Millenia Place by Sudberry Retail Completed 2 5,2 51 S F 2.85 Ac N/A Propeirtie,s,Lot 3 Alexan Millenia by Trammel Api L S. Completed 309 DU 9.25 Ac 33-4/Ac Crow Lots 4-6 Think- Chestnut—Lot 7 Office Proposed 324,100 SF 7.06 N/A Lot 8 & 21 Ryan Co�. Apts. Proposed 480 DU 12-08 37.2/Ac Volta & Duetta Lot 9-10 Affordable Completed 210 DU 4.02 Ac 52.2/Ac Apts. I Lot 11 (Option to Chelsea I Affordable 1 Proposed 200 DU 1 3.07 Ac 1 1 9.54/Ac i� Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 23 J QAIIIJ H-M* 1 11 11 1 F %,I i--Q /�V/-.IL-V gUHUCt I Ct%.,r%.C;L -L a8c;J-)7 U1 Pihnacib/�Me'ridiah Lot 12-13 SFA, Selling 126 5.95 Ac 21 I/Ac Skylar by KB Home Lot 14 SFA Sold Out 79 DU 7.27 Ac 10.9/Ac 1,Vibe �y Le' nnar Lot 15 SFA, Selling 92 OU 547 Ac, 16.82/Ac Bouleva �Lennar Lot 17 SFA Sold Out 78 DU 3.74 Ac 20.9/Ac Alexan Rivue by'Trammel Apts. Completed 253 DU 8.272 Ac 30.6/Ac Crow Lot 18 C N/A ommercial Lot I 'Mixed/Offic'e, Proposed 700,000 S F 8.54 Ac, Ayres Hotel—Lot 20 Hotel Completed 2.5 1 Ac N/A and Open C1 elo by,Lebhaif,Lot,22, , SFA, Selling , - 117 DU - 76A6, ,,5.2 22.,2,/Ac Immediately north of Millenia,,, on the north side of Birch Road is a large retail center known as the Otay Ranch Town Center. Major tenants include Macy)s, D,SW Shoes,,, AMC Theatres,1 H & M,1 Bath & Body Works, Barnes & Noble,1 Aldo,, Sephora,, and Best Buy. Restaurants include Panera Bread,, Cheesecake Factory,, Panda Express and Jersey Mike's Subs. North of this retail area and along the northerly side of Olympic Parkway is another retail center with Home Depot,y Walmart, Walgreens,, Chase Bank and Chevron as anchors. Also, at this location, on the south side of Olympic Parkway is a new,, Residence Inn by Marriott. Further north are residential neighborhoods in the community of Eastlake consisting of both sing�le-f'amily detached and attached product along with Eastlake High School, Eastlake Country Club and other community related facilities. Southwestern College (the local community college) is located about two miles northwest. North of Chula Vista are the communities of Lemon Grove, Springs Valley, Rancho San Diego and El Cajon. Most areas east of Millenia consist of existing residential neighborhoods with both single- family detached and attached homes. The "Summit at Eastlake" is a neighborhood retail center at the southeast corner of Eastlake Parkway and Birch Road. It is anchored by a Von's market with supporting tenants that include a Denny's restaurant, In-and-Out Burger and Bank of' America. "Windingwalk at Otay Ranch"' is an attached residential project located adjacent to the retail center and there is a large vacant land parcel at the northeast corner of Eastlake Parkway and Hunte Parkway. Approximately two miles to the east and adjacent of Lower Otay Lake is the U.S. Olympic Training Center. It is on 155 acres and includes living and dining facilities with almost 300 beds as well as the training facilities. There are six, natural g�rass athletic fields as well as other training facilities for athletes. It is one of three such facilities in the country. Most of the land east Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 24 F I a8u.,_YVv ul /�V/�I-V gUlMa I a%.,rSC;L of Otay Lakes consists of vacant unincorporated land. An ecological preserve totaling 11 375 acres is located just east of Otay Lakes. Land southerly of'Millenia is also vacant and proposed for the future Otay Ranch Villages 8 and 9. Immediately to the southeast is a university site containing 375 acres of land owned by �the City of Chula Vista that are also within �the Otay Ranch master plan. This proposed university is projected for 20,10,010 students and would offer cross border programs. The Otay River basin is just over one mile south and Brown Field Municipal Airport about three miles south. The international border with Mexico is about 4.5 miles south and the Tijuana Airport, known as General Abelardo 1. Rodriguez International Airport,1 is adjacent �to the border and parallels Brown Field. There are �two international border crossings nearby. One at the termination of' Interstate 805 and the other at the termination of'State Route 905. State Route 125, known as �the South Bay �Expressway, is a toll road that forms �the westerly boundary of Millenia. On and off-ramps at Birch Road provide immediate access to Millenia as well as areas to the east and west. Just west of the toll road are existing residential neighborhoods of Village 6 and Village 7 of Otay Ranch in Chula Vista. Several schools are located just west of SR 125 including Olympic High Schooli Wolf Canyon Elementary, �East Hills Academy and Mater Dei Catholic High School. Otay Ranch Village 2 is also located west of' SR 125 with new homes currently selling in the villages known as Escaya and Montecito. Of'the projects currently offering product for sale, several are larger, single family detached homes that don't compete directly with �the subject attached products. Interstate 805 is about 4.5 miles to the west and is a major freeway connecting with the international border to the south and combining with Interstate 5 to the north. 1-5 travels throug�h the City of San Diieg�o, and the cities of Imperial Beach and National City. Major U.S. Navy facilities including North Island Naval Air Station are located in San Diego Bay. San Diiego International Airport, also known as Lindbergh Field,1 is less than twelve miles northwest. Millenia is in the path of g�rowth in inland area of southwestern San Diego County. It is in �the heart of�the Otay Ranch Master Plan Community with an urbanized development plan that will be within walking distance �to employment, retail shopping and recreation. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 25 A 0 J1 1 0 -% 202 f-03-t 6 PligV'i-tua I at-INIC;L JL a8u.,-Y V IL vi Immediate Surrounding As described, Millenia is a village within the larger master planned community of Otay Ranch. The community is accessible via SR 125, Birch Road, Olympic Parkway and Eastlake Parkway, all major improved streets providing access into Millenia. 4 Adjacent to the north is the Freeway Commercial area within Otay Ranch which has been developed into the Otay Ranch Town Center. Adjacent to the west is Village 11 which was developed in the early 201010,s while to the south are the future villages of Otay Ranch Village 8 and 9. SR 125 forms the western border of Millenia beyond which is the existing Otay Ranch Village 7, beyond which are the Villages of' 2 & 3, all of which are nearing build-out. Within Millenia there are existing apartments,1 new homes, both attached and detached, over 11,000,000 planned square feet of office space,,, a new hotel and a 135,000 square foot retail center. Millenia is master planned as a walking neighborhood making walking to restaurants, shops, parks, the library and on scenic trails the emphasis of the community. As discussed and shown under the previous section) the subject property refers to four parcels that are scattered throughout the community. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 26 A Q 11 i p n4e% 1JL 6" 018ullua T a%7r%,C;L a8c;7102. UT 7 C;1TY OF CHULA VISTA COMMUN1TY FAGILITIES DISTRMT NO. 16-1 A Resolution ofIntention to form City of Chula Vista CFD No. 16-1 (Millenia)was approved via Resolution No. 2016-154 by the City Council on August 2,1 2016. At that time a CFD1 Report was prepared by Willdan Financial Services which included a brief description of CFD1 No. 16-1; a brief description of the facilities required at the time of formation to meet the needs of CFD1 No. 16-11; a brief' description of' the boundaries of CFD1 16-1 and an estimate of the cost offinancing the bonds used to pay for the facilities. The types of facilities eligible to be financed by CFD1 16-1 include street and bridge improvements,, sidewalks,,, trails, medians, traffic signalization and sig�nage, street lights,,, utilities, storm water collection and conveyance facilities, off'-site storm detention and treatment facilities, park and recreation facilities, fire facilities and equipment,, library facilities and equipment, 'transit facilities, fiber optic telecommunication system facilities,1 general governmental office,,, administrative and meeting facilities,,, bus and rapid transit facilities and land, rig�hts of way and easements necessary for any of such facilities. The proposed maximum authorized bonded indebtedness for CFD1 No. 16-1 is $20,000,000 for Improvement Area No. 1 (bonds sold in 2018) and $211,000,000 for Improvement Area No. 2 (the subject property). The proceeds of CFD No. 16-1 will be used to fund public facilities as described above. At time of the CFD1 Report, the estimated cost of such facilities was approximately $94.4 million,1 thus the CFD will not generate sufficient funds to finance all of the costs. Any facilities costs not covered by CFD bond proceeds and special taxes will remain the responsibility of the developer. The CFD1 Report also included the Rate and Method of Apportionment (RMA) which provides sufficient information to allow a property owner within CFD No. 16-1 to estimate the Maximum Special Tax for his or their property. Per the latest sources and uses report (dated December 1, 20201), CFD No. 16-1 IA 2 bonds are anticipated to fund $101,,563,,0115,, with $1,10,22,786 in capitalized interest and debt service reserve fund and $473,252 in issuance costs and underwriter's discount (all amounts subject to change). Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 27 4 4 A A Q 41 , p '%4 / -I U P-1 -IL U I at-�rSC;L -7 1 g1c,-t a a8c;-109 Or' SUBJECT PROPERTY DESCRIPTIONS The subiect r)roperty consists of a portion of' the community known as Millenia in the .0 0 master planned community of Otay Ranch in the City of Chula Vista. Below is a map showing all of Millenia with the four subject parcels identified by different colored stars. ......................................I I....I.................. "94 1 IM d"A"'We ,3 ("1 161,11 111""""JA V"J,S,'"I"A "1 N, 01 1) CIT&III A M11,1EN"I A,, 11 -2 (EA:,STK'i?,N URRI 11, 41 N JII id"kivOzi MMI Nil hom''I Sk"F#MINI nl Uk ................ 1I —I..............I. .......... ...... 117 FIAMIJ uc X III .............................. *y-&..I I I I I I I I I I I I ..........I I.. .......... 10 III wall IN Iiii ON, Vg 117 IM Ve. AI 11, 111 -'I gP`1M7A:Ij II Nif 61111 I-V I i TO 11i i,Ij� .I.... rj—) I IN Nl� III ....... ...I....... PICA "N"Ili> 11� I/- Phu �JIJF, ��............ j��� [11 !-NI r..1 'IC"Pr IN 'I']I'd M I' IV fe Ww"filinijo a") ; Il I 'fill, IVOI OAN ............ F, Nil "LIA111"t"W Ww" 4111 1, Q PI ,,I�� �I;t`,;I'"ll 1, �1 'i��1, M 11111" N a VIM III 111111, 4 F W�, I Fill ]I .......I I.I....... .....I I.... IN i 1�1 if EII; I I'llo 4 "I............ 6W �111P dpjm' I $ 'If I P I A �I,-NIIII IN V,J"11 �,`1,f'r iii ldd"41 ar,� "IfIf VI V I'VIRNI II I, J AMA a 16 AI WIV, yJ N, IIIII 'i,,if I 03 it "IEP AVf I RMT .............. —............................................................................................................... ................. I% 1.X 71 MMIr-M iil '77..I I I I I I I I I I I I I I I I I I I I I. Njo `Ck:�,il -I,. AQ,I6z E;Vi As. im7i V NO F','Pri )II luli,Nrr,,,�IW I I NLW III NI4,119111A,771 f.11IF Color I D Lot/Tract Ownership Acres Units Number Blue Star Lot 19/16081 SLF — IV Millenia LLC 8.34 N/A commercial parcel] Black Star Lot 1 of Tract Pinnacle New Ho�mes 5.95 126 16377 LLC (Meridian) Green Star Lot 1 of 16409 Lennar Homes —,Vibe 4.47 92 Orange Star Lot 1 of 16408 Lennar Homes — Cleo 4.315 117 Each of the ownerships will be described on the following pages. Appraisal Report City of Chula Vista CFDI 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 28 202 it-03-It 6*gulaua T a%7r%.C;L I a8c;-YV-t S,LF �IV - Millenia LLC Owner SLF IV — Millenia LLC is the master developer ownership entity and has contracted with Meridian Development to act as development manager. SLF IV— Millenia LLC holds title to the commercial parcel shown below which is described in this section. MAP NO. __K�,O_V SHUT 4 Ot 8 SHEE TS CHULA VISTA TRACT NO. 09-03 OTAY RANCH MILIENIA P1,4ASE 2 (EASTMN URBAN CENTER) SE .5 UW47LTW AkMT AT L01A.,K, G RAPHIC SCALE 3 LOT, 1" ADIT J or I Owl; XIO'ft W I 0�-03� 4 4 2 ........- LOT '0 I UJ 16 -DO , 1 9 'F & LOT *N*� 21 LOT "B" I'll;lull,, �14111_0193 DIF LOT OPM11 LOT"Y 13 22 00F Il Pt IAT"E0 goo L O�F JA 09-6$ 16 I/ wl Ps Vol 14 LOT 'A' A % X 18 LOT T �v�to er AVANT SMMT LOT T PROJECT DESIGN CONSuLxANTS 'LOT PROJECT NO.336670 Ba 1804-5�41 Mm"I Lmn&Wa Add0wi%aff 11 EfflIgNmeding 6 SurvEm T'M.pcs-04-03 wo.,NO.OR-85,3F LQ I ............ Location-. South side of Bob Pletcher Way between Millenia Avenue and SR 125, Millenia, Otay Ranch, Chula Vista, California. Legal Property Description: Lot 19 of Map 160,81, City of Chula Vista Property Owner: SLF IV Millenia LLC,, a Delaware limited liability company. Assessor's Parcel No.: 643-060-69-00 Property Taxes: Per the San Diego County Assessor)s Office, the assessed value for APN 643-0160-69-00, is $2,458,925 and the 20,201/21 property taxes Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 29 03 4 4 4 A Q 41 1, n 4 1; t�—e%A _1UP-1 awalat-�r%.CeL g1c, fla8c;71M.1, OT 7 Z-f are $,29,825.12. The total property tax invoice includes $24,589.24 for the basic levy, $,3,645.84 for voter approved bonds and fixed charged assessments of $1,,590.04 which includes City of Chula Vista CFD, 97-2 in the amount of $1,1156.10 and $433-94 in miscellaneous charges. It should be noted that the subject CFD1 16-1 is not yet listed or included in the 20�20/21 property tax bill Three-Year Sales History: SLIF IV-Millenia LLC has held title to the subject property for more than three years. Size and Shape: Lot 19 of Tract 16081 is generally L shaped and totals 8.34 acres per Map 16081. ,Zoning�: The subject property is desig�nated Eastern Urban Center (Millenia) per the current City of Chula Vista Zoning Map. Per the Otay Ranch Eastern Urban Center (EUC) Sectional Planning Area (SPA) Plan, Lot 19 is shown as a portion of the Business District, The Business District which covers Lots 1 and 19 of Tract 160,81, allows for a low of' 800,000 square feet and a high of' 1,900,000 square feet. In addition,1 the Business District allows for a low of 01 dwelling units to a high of 225 dwelling units. Entitlements: The subject property is encompassed by Chula Vista Tract No. O�9- 03 (Otay Ranch Millenia Eastern Urban Center) with further mapping under Map No. 16081 which is known as Otay Ranch Millenia Phase 2 and divides the site into 22 lot of which the subject is shown as Lot 19. A copy of' the Map 160�81 is located in the Addenda. Per the Business District zoning, there will be between 80101,,000 and 1,900,000 square feet of office combined between Lots 1 and 19. In addition) there is the possibility of up to 225 dwelling units combined between Lots 1 and 19. It is the appraiser's understanding that the dwelling units, if developed, can be built on either lot or a portion on each lot. Topography: The subject property has been mass graded into a generally level superpad with surrounding infrastructure in place. Drainage for the lot is provided via an in-street storm drain system. Soils Condition: We have reviewed a letter to SLIF IV — Millenia, LLC regarding the Completion of Grading for Lots 12, 137 15)1 167 18, 19 and D of Millenia Phase 2, prepared by Geocon Incorporated and dated July 277 2016. The letter confirms that the grading of the subject lots was completed and from a geotechnical engineering standpoint, earthwork operations were performed in substantial conformance Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 30 n4z- p_Q QA1114 A3-t6* 1 11 11 1 _L a8c;-YVV /�V/�I_V gU11UCt I Ct%.,rSC;L with the recommendations provided in the referenced project geotechnical report. In addition, we have reviewed the Final Report of Testing and Observation Services Performed During Site Grading for Millenia Phase 2 prepared by Geocon and dated June 13, 2017. The report concludes that based on their observations and �test results,1 it is �the opinion of'Geocon Inc., that the grading was perforned in substantial conformance with the recommendations of �the referenced project geotechnical report. The report states several recommendations for construction. It is an assumption of �this report that the soils are adequate to support the highest and best use conclusion and that all recommend ations made relating �to soil conditions within any and all reports were adhered to or will be adhered to during construction. Seismic I nformation: Per the California Department ofConservation, the subject property is not located within an Alquist Priolo �Earthquake Study Zone. Environmental Concerns: We have reviewed a Phase I Environmental Site Assessment for the entire Millenia project prepared by Coast 2 Coast Environmental, Inc. of Del Mar, California and dated May 22,, 2013. Based on Coast 2 Coast)s observations, the following recog�nized environmental conditions were observed: Three sites within one-half mile radius of the perimeter of Millenia appear on the State of California Department of Toxic Substances Control's EnviroStor and School databases and/or the State Water Resources Control Board)s SLIC database. These sites were listed following soil testing for past pesticide use associated with agricultural row crops which were located on these sites from at least mid-1930s throug�h 1996. Previous Phase I Environmental Site Assessments of �the site have stated that it shared a similar agricultural history with the adjoining and nearby sites which were listed in the regulatory databases. In 20016 and 20,07 soil sampling was conducted on the property for org�anochlorine pesticides and arsenic. Toxophene, an insecticide, was found in concentrations above the U.S. EPA Reg�ion IX's Preliminary �Remediation Goals for residential use in the upper one foot of soil in three areas within Millenia. The following recommendations were made: A soil reuse plan was prepared which recommended special handling in three areas with all soil reused onsite and no recommend ations for offsite soil disposal necessary. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 31 QAIIIJ A3-t6* 1 11 11 1 _L a8c;-Y V v I /�V/�I_V gUHUCt I Ct%.,rSC;L Further environmental assessment of the site, beyond what is listed above,1 is not warranted at this time. It is an assumption of this report that the subject property is free and clear of any environmental issues which would slow or thwart development of the site and that all recommendations contained in the FEIR were adhered to. This is suggested by City inspectors on site throughout construction and via as-graded reports provided by the master developer. Flood Information: Per the City of' Chula Vista Website, the subject property is not located within a FEMA Flood Zone. Easements and Encumbrances-. We have reviewed a Preliminary title Report prepared by First American Title Company, Order Number NHSC-640�O�439 (06) amended October 201, 20,20. The exceptions are as follows: Item Nos. 1,1 27 3,, 4a, 4b and 5 refer to property taxes and special assessments including CFD1 97-2, CFD No. 18 (CVESD),,l 16-1 (subject CFD,) and CFD 14M-2 (Eastern Urban Center/Millenia). Item No. 6 refers to an agreement for the general plan amendment recorded in 1993. Item No. 7 refers to the Development Agreement recorded on the property while Item No. 8 pertains to Agreement Regarding Construction of Parks. Item No. 9 pertains to Resolution No. 20,019-224 which recorded in 2011. Item Nos. 10, 11, 14 and 15 are Subdivision Improvement Agreements and Supplemental Subdivision Improvement Agreements recorded on the site. Item No. 12 is in regards to a Grant of Easements, License and Maintenance Agreement for Tract No. 019-013. Item No. 13 pertains to the Maintenance Agreement for Interim Drainage Improvements. Item No. 16 is in regards to an Easement for a public trail (6'jogging path with a 20�'corridor) to be incorporated over Lot 19. Item No. 17 pertains to a Grant of Easements,1 License and Maintenance Agreement. Item Nos. 18 and 19 are for the Terms, Provisions and Easements contained in the Declaration of Restrictions, Grant of Reciprocal Easements, Joint Use and Maintenance Agreements. Item No. 21 pertains to water rights while Item No. 22 is in regards to the rights of parties in possession. Item NO. 23 states what the title company will need from the owner prior to issuing title insurance on the site. It is an assumption of'this appraisal report that the subject lands are free and clear of any liens and/or encumbrances other than CFD 16- 1 IA 1. The appraiser is not title experts and it is recommended that any concerns relating to title should be addressed to the appropriate experts. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 32 A Q 11 i p '%4Q 11 6" 018unua T aCrSC;L a8c;-Yvo UT 7 Utilities: All normal utilities serve or will serve �the subject property by �the following companies: Electrical: San Diiego Gas & Electric Company Natural Gas: San Diiego Gas & Electric Company Sewer: City of Chula Vista Water: Otay Water District Schools: Chula Vista Elementary School Diistrict Sweetwater Union High School District Streets/Access: Access to Millenia is via SR 125, exit Birch Road and east �to �the subject property. SR 125 is accessible via 1-5 or 1-805 east on SR 54. Millenia is bounded by SR 125 on the west, Birch Road on �the north and Eastlake Parkway on the east. Lot 19 of Tract 16081 has frontage along SR 125 with access via Birch Road to Millenia Avenue and south �to Lot 19. The northern border of the site is Bob Pletcher Way, which is completed, however not yet opened to provide access into Otay Ranch Village 7 to �the west. Bob Pletcher Way becomes Optima Way, east of Millenia Avenue. Current Condition: Lot 19 of Tract 16081 has been mass graded �to a superpad with utilities stubbed to the property line. Remaining Costs: Lot 19 of Tract 160�81 �— Commercial lands are typically sold either as raw land or in a superpad condition. This valuation is for the lands in their "as is" condition. As the property has already been mass graded and is in a superpad condition, 'there are no remaining costs to complete. The additional grading will be taken into consideration under�the valuation section later within �this report. There is a master developer monthly HOA fee of $45 per residence at buildout (currently $42 per month) and $,1,092 per acre for the commercial property. Proposed Improvements: Lot 19 of Tract 16081 is anticipated �to include commercial (office) development with the possibility of' a portion of the site to be developed with a �target of 1010 dwelling units and possibly up �to 225 residential units mixed with the commercial uses. It is the appraiser's understanding that �there are no plans at this �time in connection with the subject lot and that the possible residential units can be built either on Lot 1 or on Lot 19, or a portion of the units on each lot. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) J Kitty Siino&Associates, Inc. Page 33 QA1114 A3-t6* 1 11 11 1 _L a8c; /�V/�I_V gU11UCt I Ct%.,rSC;L Pinnacle New Homes LLC (Meridia PINNA C1 �-;A 4 PAI I I..MA 9C�l STICF-AV[-14LJF- ------------ 7r---H "T ...1-1--, '............. r-r 1,14-11 V M ............... ............ W.:-^0VVAY -C-:-L)i-PLk=A 77-7- 1,7 7, R1 L Ll [Ul 'Al W"Y L -p.......... t7 L.L L rr I _31A I I 4 H VVA MrE__1LQ4LL'-A- - ---------------------------------- ---------- ------- k� 1 Cpnlc�m 4VEN ur_ Location: Bounded by Strata Street (south),1 Orion Avenue (west), Optima Street (north), and Solstice Avenue (east), Millenia, Otay Ranch, Legal Property Description: Lot 1 of Tract Map 6377,, formerly Lot 12 and 13 of Tract 16081 within Chula Vista Tract No. 019-013 Otay Ranch Millenia Phase 2 (Eastern Urban Center), City of'Chula Vista. The property was further divided by a Condominium Plan into 126 units, in eight phases (including the model phase) and two recreation modules (dog park and swim club). Property Owner: Pinnacle New Homes, LLC, a Delaware Limited Liability Company as to Units 37-126. Individual homeowners as to Units 1-36. Assessors Parcel Nos.: 643-0�65-18 (subdivided AP Maps not yet available) Property Taxes: Per the San Diego, County Assessor's Office the Assessed value for APN 643-0165-18 is $3,753,,6010 and �the 20,20/21 property taxes are $97,738-60. The total property tax invoice includes $37,535.99 for �the basic levy, $,5,,565.45 for voter approved bonds and fixed charged assessments of' $,54,637.16 which includes City of' Chula Vista CFD, 14M in the amount of$12,246.40 and City of Chula Vista CFD1 97-2 in the amount of $1,1769.48 and CVESD CFD, No. 18 in the amount of $,401,491.010 and $130.26 in miscellaneous charges. In addition,1 there is a separate charge on Parcel Number 900�-000�-50-0�O (associated with APN 643-065-18-010)for$71,,000.101 for Sweetwater High CFD, No 18 and for Parcel 90�O�-000�-51-00 (also associated with Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 34 A A 0 ji p 8 "Q A -—Q 202 f_03-t 6 2-v8CIL-tua 1 at-M.Ct a fu_Y/V u I //�"t APN 643-065-18-0�0) for $,74,012.46. The property does not appear to have been subdivided by the County Assessor at this time. It should be noted �that the subject CFD 16-1 is not yet listed in �the 2020�/21 property tax. Three-Year Sales History: SLIF IV Millenia LLC sold the subject property to Pinnacle New Homes LLC (a joint venture formed by Meridian Development and SLIF IV Millenia LLC) on 10/5/2018. The sales price has been kept in our files for confidentiality purposes. Pinnacle New Homes LLC has closed 36 homes to individual homebuyers between May 13,1 2020 and November 15, 20,201. Size and Shape: Lot 1 of Tract 16377 is rectangular shaped and totals 5.95 acres. Zoning: The subject property is designated Eastern Urban Center (Millenia) per the current City of'Chula Vista Zoning Map. Per the Otay Ranch Eastern Urban Center (EUC) Sectional Planning Area (SPA) Plan,1 Lot 1 of Map 16377 is shown as a portion of the Southeastern and Northeastern Neighborhood Districts. The north half of �the site is in the Northeastern District which allows for a low of' l 50 dwelling units and a high of 475 dwelling units along with a low of 2,000, square feet of commercial use and a high of 5,000 square feet of' commercial use. The Southeastern Neighborhood District covers the southern half of the site along with the additional lands and allows for a low of 230 dwelling units and a high of 280, dwelling units. Per the City of Chula Vista Zoning Administrator,, the property was approved for 126 attached condominium units on October 24, 2018. Entitlements: The subject property is encompassed by Chula Vista Tract No. O�9- 03 (Otay Ranch Millenia Eastern Urban Center) with further mapping under Tract Map No. 16081 which is known as Otay Ranch Millenia Phase 2. A copy of the Map is located in �the Addenda where �the site is shown as Lots 12 and 13. Map 16377 was further recorded on the site showing �the property as Lot 1 of Map 16377 In addition, there have been eight condominium plans approved allowing for 126 units on the 5.95 acres allowing for a density of 21.2 dwelling units per acre. Topography: The subject property has been mass graded into a generally level superpad with surrounding streets (Strata Street, Orion Avenue,1 Optima Street, and Solstice Avenue) in place. Additional grading has been completed on condominium pads and internal streets. Drainage appears to be in an in-street storm drain system. Soils Condition: Please refer to the Soils Condition discussion above which relates to all of�the subject property. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) J Kitty Siino&Associates, Inc. Page 35 QA'114 A3-t6* 1 11 11 1 /�V/�I_V gU11UCt I Ct%.,rSC;L J/I I Seismic I nformation: Per the California Department ofConservation, the subject property is not located within an Alquist Priolo, �Earthquake Study Zone. Environmental Concerns: We have reviewed a Phase I Environmental Site Assessment on the Pinnacle Site prepared by Coast to Coast Environmental Inc. and dated May 25, 20,18. The report concluded that recognized environmental conditions were not found on the property during their assessment and that in their opinion,1 further environmental assessments of the property are not warranted. It is an assumption of this report that the subject property is free and clear of any environmental issues which would slow or thwart development of' the site and that all recommendations contained in environmental reports were adhered to. This is suggested by City inspectors on-site during construction. Flood Information: Per the City of' Chula Vista Website, the subject property is not located within a FEMA Flood Zone. Easements and Encumbrances-. We have reviewed a Preliminary Title Report prepared by First American Title (Order No. D,TR-616240�5 (CM) dated August 20, 20201. The report is for a sample unit within Pinnacle (Unit 36). The exceptions are as follows: Item Nos. 1, 2 and 8 refer to property taxes on the unit. Item Nos. 3 �thru 7 pertain to Special Assessments including CVESD CFD1 No. 18, Sweetwater Hig�h CFD, No. 18, CFD No. 97-2 (Otay Ranch Preserve)1,1 CFD1 No. 16-1 (subject CFD,) and CFD 14M-2 (Eastern Urban Center/Millenia). Item Nos. 9 and 10 are in regards to the development agreement. Item No. 11 pertains to a Parks Agreement. Item No. 12 refers to Resolution No. 2009-224, Item Nos. 13, 14)18, 19 and 31 refer to subdivision improvement agreements and supplemental agreements recorded September 23, 2013, December 28, 2015 and November 7, 20,19. Item Nos. 15 and 20, are in regards to grant of' easement, license and maintenance agreements for the underlying tract. Item No. 16 and 30 refer to SDGE Easements. Item No. 17 is for an agreement for interim drainage improvements. Item No. 21 7 22 and 23 refer to a declaration of restrictions, grant of reciprocal easements, joint use and maintenance agreements recorded March 23, 20116,1 April 15, 20,16 and December 19,1 2017. Item No. 24, 25 and 32 refer to CC & Rs recorded on the property. Item No. 26 relates to a temporary construction easement. Item No. 27 pertains to a deed of'trust for construction purposes. Item No. 28 refers to any statutory liens for labor or materials arising out of a work of improvement. Item No. 29 pertains to a Storm Water Management Plan. Item No. 33 refers to the master dispute resolution declaration Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 36 -4 4 A A Q I I I P 11QQ 1 U P-1gullua T aCrSC;L a8c;71 for Pinnacle. Item Nos. 34 and 35 are for easements for pedestrian and vehicular access and recreation facilities. Item No. 36 states the transaction may be subject to a Geographic Targeting Order issued pursuant to the Bank Secrecy Act and additional information needs to be submitted prior to issuing title insurance. It is an assumption of this appraisal that the subject lands are free and clear of any liens and/or encumbrances other than CFD 16-1 IA 2. The appraiser is not a title expert and it is recommended that any concerns relating to title should be addressed to appropriate experts. Utilities: All normal utilities serve or will serve the subject property by the following companies: Electrical: San Diiego Gas & Electric Company Natural Gas: San Diiego Gas & Electric Company Sewer: City of Chula Vista Water: Otay Water District Schools: Chula Vista Elementary School Diistrict Sweetwater Union High School District Streets/Access: Access to Millenia is via SR 125, exit Birch Road and east to the subject property. SR 125 is accessible via 1-5 or 1-805 east on SR 54. Millenia is bounded by SR 125 on the west, Birch Road on the north and Eastlake Parkway on the east. Access to the subject parcel is via Birch Road to Orion Avenue,,, south to the subject site. Current Condition: The subject site has been developed into 42 completed condominium units in seven buildings. The orig�inal site was mass graded and then further graded into building pads ready for 6-unit condominiums with utilities stubbed to each pad. The internal street is in place with utilities underground. There are an additional seven buildings which house 42 condominiums under construction and pads for the final seven buildings. At completion there will be a swim club, activity center and a dog park within Pinnacle. Costs to Complete: Meridian Development has given us remaining costs of$950,000 for the swim club and $,3,,575,443 in remaining land development fees. Meridian owns 90 remaining units. The individual owners are n ot responsible for any of these costs. Thereforel the remaining costs are $,4,525,,,443 ($375757443 + $950�,,,O�00) or $50,283 ($47525,1443 / 90) per unit average. These remaining costs will be taken into consideration later within the valuation section later in this report. HOA: Per NTB Realty Advisors,y Inc. the Assessment Schedule for Pinnacle at Millenia at build-out is estimated to be $,339.50 to $,389.36 per Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) J Kitty Siino&Associates, Inc. Page 37 QAIIIJ A3-t6* 1 11 11 1 /�V/�I_V gU11UCt I Ct%.,rSUL J/J I Z' month depending on �the plan. The master developer HOA monthly fee is $45 per residence.at buildout (currently$42) and is included in �the above amounts. Improvement Description: Pinnacle at Millenia is being developed into six floor plans. The first three are being marketed as City Towns at Pinnacle and are designed for first-time buyers and multi-generational families with street-level entry. The City Town homes all are two story with two plans (Plan 1 and 3) having a separate living quarters on �the bottom floor and Plan 2 having a sing�le level living area. Plans 4 through 6 are being marketed as �the Elevator Penthouses at Pinnacle with personal elevators in each plan with the living quarters on the third and fourth floors. All plans have attached garages. Home features include great room desig�ns with island kitchens,,, at minimum 10�-foot ceilings in the main living area and covered balconies and roof decks on select plans. Kitchens include quartz countertops and Whirlpool stainless appliances. The homes have tankless water heaters, Wi-Fi thermostats,,l water-smart plumbing fixtures and LED lighting �throughout. The homes range in size from 1,,362 �to 2,,522 square feet. We have reviewed sales information from the builder which included 77 total homes sales between February 2020, and November 15,1 2020�. Per Meridian, actual sales prices ranged from $439,900 to $689,1766. These prices include upgrades, options and premiums along with concessions offered by the builder. The most recent asking base prices ranged from $,457,1900 to $,616,9010. Out of the total 126 proposed houses, 36 have closed escrow to individuals,,l �there are six model homes owned by the builder (not released),1 42 units under construction which are under 95 percent complete (41 in escrow) and 42 remaining finished pads. Completed 95%Complete Plan Room Floors/ Sq. Ind. Bldr. Count Pa Ft. Owned Owned City'Towns at Pinnacle 1 3/3 2/2 1 1136 6 1* 2 3/2 2/2 11433 6 1* 3 4/3 2/2 11989 6 1* Elevator Penthouses at Pinnacle I 4 3/2 4/2 21185 6 1* 5 3+,/2 4/2 21380 6 1* 6 3+,/2 4/2 21522 6 1* Total 310 6 *One of each plan is a mo�del home. In addition to the above shown houses, there are 42 hom�es under construction and 42 finished pads. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 38 QAIIJ A3-t6* 1 11 11 1 F /�V/�I_V gUHUCt I Ct%.,r%.C;L _L a8c;j/-t I Z' Lennar Homes of California, Inc. (Vibe) m-Jrzb 5, V I"E .............. 1. 2W 1 2 WA 2n i n 2 rl 1 2 .3 66 6jo 6 10 71 ",a I 1 10 Y1 14 IN OWN 1,111,1110111 11.11 WON 00011,11 UT!! ! "111111 �,,!!!!!i #I 1 0, ------------- ----------—- ---------------- ...............I KIM ONYX LANE NFJ�,jkr-ATIC'�N CINtf-A FOCU S D P I V F 2 R S IR ----------1-11-11-11-11-11-11...................... ------ 3 3 R 221 - ? J, ................................ .. ..................... M, W4 KAI A.I P; ...... "Al (3) 3v 2X SJ 2 00 2' N9 A4 --------- KVO I'll, V ........... 110 09 P 2X 11 ...... z ;;5 2H, VON" (6 2 D 314 -------------- 6 pill rn 2 W 16 3 fl 2 -- M 413 59 2 R 21 M WX `4 %VM LIM P" W W, I,'m w 0"W W,R 1X POSIIA LANE 117 I..........FT----Tj.........T-F----1............. ........... Wo 0 45 -Al io P0 ...........- 4 �10/01& YNNIEN, go qg'wl MONTAGE AVeNUE RE," 0.1/11, MERIN, P I BUSINESS PLAN WM/ffl, SAO-,% ID INS --------------------------------- A", M=Mon r"'L 4 R PFVFPSE,, 4 Ar-Cr1;r.1n1-r.. V-VIGN E r! 28 X=4 STO RES1 DUNCE E::A -RIJISINESS PI-AN AT MILLENIA L o ca t i o n Northeast corner of Montage Avenue and Strata Street,1 Millenial Otay Ranch. Legal Property Description: Lot 1 of'Mar) 16409'of'Chula Vista Tract No. 09-03 (for condominium purposes). Formerly Lot 15 of Map 160181 within Chula Vista Tract No. O�9-0�3 Otay Ranch Millenia Phase 2 (Eastern Urban Center), City of Chula Vista. The property was further divided by a Condominium Plan into 92 units. Property Owner: Lennar Homes ofCalifornia, Inc. a California Corporation as to Units 1-6)1 9-28 and 32-92 of Lot 1 of Map 16409. Individual homeowners as to Units T, 8 and 29-31. Assessors Parcel Nos.: 643-0�65-19 (subdivided AP Maps not yet available) Property Taxes: Per the San Diiego County Assessor's Office the Assessed value for APN 643-0165-19 is $3,956,10,95 and �the 20,20/21 property taxes are $135,,,873-32. The total property tax invoice includes $39,560.94 for �the basic levy, $,5,,865.69 for voter approved bonds and fixed charged assessments of",90,446.69 which includes City of' Chula Vista CFD, 97-2 in �the amount of $619.64, CVESD CFD1 #18 in �the amount of $32,587-16, Sweetwater High CFD, #18 in the amount of$,57,141.46 and $,98.42 in miscellaneous charges. It appears that this, parcel has not been subdivided by the County Assessor at this time. It should Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 39 -03 4 4 A j r"h I I I P 11 Q r" n t�—Q, 1 -I U P-VgU11UCt I at.,A.C;L a8c;-Y be noted that the subject CFD 16-1 is not yet listed or included in the 2020�/21 property tax bill. Three-Year Sales History: SLF IV Millenia LLC sold the subject property to Lennar on June 24,1 2019 for $4,10,010,00,01. Lennar has closed five homes to individual homebuyers between October 23, 20�20 and November 15, 20�20. Size and Shape: Lot 1 of' Map 1640�9 is irregular in shape and encompasses 4.472 acres. Zoning: The subject property is designated Eastern Urban Center (Millenia) per the current City of'Chula Vista Zoning Map. Per the Otay Ranch Eastern Urban Center (EUC) Sectional Planning Area (SPA) Plan,1 Lot 1 of Map 1640�8 is shown as a portion of the Main Street Diistrict and as a portion of the Central Southern Neighborhood District. The Main Street Diistrict covers Lot 1 of Map 164019 along with additional lands and allows for a low of 100 dwelling units and a high of 772 dwelling units. In addition, 'the Main Street District allows for a low of 80,000 square feet of non-residential to a high of 10�0,00�O square feet of non-residential development. The Central Southern Neighborhood District covers a portion of lots 15 and 22 along with Lots 14 and 17 of Tract 160�81, and allows for a low of 130, dwelling units and a high of 294 dwelling units. In addition,,, the Central Southern Neighborhood Diistrict allows for a low of zero square feet of commercial space and a high of 5,0010, square feet of'commercial space. Entitlements: The subject property is encompassed by Chula Vista Tract No. O�9- 03 (Otay Ranch Millenia Eastern Urban Center) with further mapping under Tract Map No. 16081 which is known as Otay Ranch Millenia Phase 2. A copy of the Map is located in �the Addenda where �the site is shown as Lot 15. Map 1640�9 (for condominium purposes) was further recorded on �the site. In addition) �there have been approvals for 92 units on the 4.47 acres for an overall density of 20�.6 dwelling units, per acre. Topography: The subject property has been mass graded with �the lands originally graded into a generally level superpad with the surrounding streets of Montage Avenue and Strata Street in place. Additional grading has been completed on condominium pads and internal streets. Drainage appears �to be in an in-street storm drain system. Soils Condition: Please refer�to�the Soils Condition discussion above which relates �to all of the subject property. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 40 QAIIIJ A3-t6* 1 11 11 1 /�V/�I_V gU11UCt I Ct%.,rSC;L J V I Z' Seismic I nformation: Per the California Department ofConservation, the subject property is not located within an Alquist Priolo, �Earthquake Study Zone. Environmental Concerns: We have not received any environmental reports on the subject site to review. We have reviewed an original Phase I for the entire Millenia project which is discussed under the earlier description for the commercial parcel. It is an assumption of this report that the subject property is free and clear of any environmental issues which would slow or thwart development of the site and that all recommend ations, contained in environmental reports were adhered to. This is suggested by City inspectors on-site during construction. Flood Information: Per the City of' Chula Vista Website, the subject property is not located within a FEMA Flood Zone. Easements and Encumbrances-. We have reviewed a Preliminary Title Report prepared by CalAtlantic Title (Order No. 192002-0�01 151 dated Aug�ust 20, 20�20. The exceptions are as follows: Item Nos. 1, 2 and 9 refer to property taxes on the property. Item Nos. 3 thru 8 pertain to Special Assessments including CVESD CFD1 No. 18, Sweetwater High CFD No. 18, CFD No. 97-2 (0tay Ranch Preserve), CFD No. 16-1 (subject CFD) and CFD 14M-2 (Eastern Urban Center/Millenia). Item No. 10 refers to water rights. Item Nos. 11 & 12 are in regards to the development agreement. Item No. 13 pertains to a Parks Agreement. Item No. 14 refers to Resolution No. 2009-224,,l Item Nos. 15, 16, 19, 20, 30, 31, 36 and 37 refer to subdivision improvement agreements and supplemental agreements recorded September 23, 20�13, December 28, 2015,,l November Ti 2019 and August 13, 20,201. Item Nos. 1T 21)1 22) 23)1 25, 35, 40, and 44 are in regards to grants of easements, license and maintenance agreements for the underlying tract and utility and solar easements. Item No. 18 pertains to interim drainage improvements. Item Nos. 24) 26 and 38 refer to covenants, conditions, restrictions on the property. Item Nos. 27, 28 and 33 refer to the purchase agreement and right of first refusal between Lennar and the master developer. Item No. 34 refers to a storm water management agreement. Item Nos. 39,, and 43 pertain to condominium plans for Cleo and Vibe. Item No 41 refers to a solar energy CC & Rs for both Cleo and Vibe. Item No. 42 is in regards to the notice of builder's election of handling of construction claims. Item No. 45 states no known matters otherwise appropriate to be shown were deleted from the report. It is an assumption of this appraisal report that the subject lands are free and clear of'any liens and/or encumbrances other than CFD 16- 1 IA 2. The appraiser is not title experts and it is recommended that Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 41 -4 4 A A Q I I I P nQ- 1 U P-1gullua T aCrSC;L a8c;71 7 7 T 7 any concerns relating to title should be addressed �to the appropriate a experts. Utilities: All normal utilities serve or will serve the subject property by the following companies: Electrical: San Diiego Gas & Electric Company Natural Gas: San Diiego Gas & Electric Company Sewer: City of Chula Vista Water: Otay Water District Schools: Chula Vista Elementary School District Sweetwater Union High School Diistrict Streets/Access: Access to Millenia is via SR 125, exit Birch Road and east to the subject property. SR 125 is accessible via 1-5 or 1-805 east on SR 54. Millenia is bounded by SR 125 on the west, Birch Road on the north and Eastlake Parkway on �the east. Access �to the subject parcel is via Birch Road to Millenia Avenue,1 south to Strata Street and east to the subject site. Current Condition: The subject site has been developed into 19 units that are over 95 percent complete, 25 units, under construction (under 95 percent complete) and 48 remaining units to be constructed. The original site was mass graded and �then further graded into building pads ready for three to eight-unit condominiums with utilities stubbed to each pad. Some internal streets are in place with utilities underground. At completion there will be a pool, pool building and recreation center along with 92 units within Vibe. Costs, �to Complete: Per Lennar) �the total land development costs and fees for Vibe are estimated at $10,1750,315 and there are $3,903,461 remaining to be spent. Lennar owns 87 remaining proposed units. The individual owners are not responsible for any of' these costs. Therefore,,, the remaining costs of$,3,9013,1461 equate �to an average cost of$44,876 per remaining builder-owned unit. These remaining costs will be �taken into consideration later within the report. HOA-0 Per Lennar, Cleo and Vibe share �the same home owner's association. The current amount is estimated at $333 per month however will reach $2301 per month at buildout. The master developer HOA monthly fee is $45 per residence at buildout and is in addition �to �the above HOA fee. Improvement Description: Vibe at Millenia is being developed into�three floor plans with Spanish and Tuscan-style architecture. The current plans are all three story with a bedroom on �the first floor(ground level entry) along with a �two- Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) J Kitty Siino&Associates, Inc. Page 42 QA1114 A3-t6* 1 11 11 1 _L a8c;-Y 0 %J1 Z, /�V/�I_V gU11UCt I Ct%.,rSC;L car attached garage,, generally �the living area and kitchen on �the second floor and bedrooms on the third floor. Home features include an integrated solar energy system (provided �through a buyer-friendly SunStreet program), pre-wire in garage for electric/hybrid vehicle charging, tankless water heaters and LED light bulbs. Exteriors include insulated garage doors with automatic openers and fire- resistant roof shingles while interiors include �tile at entries and kitchen and raised-panel interior doors along with laundry rooms. Owner's suites include quartz countertops, 'tiled shower, shaker-style cabinetry and walk-in closets. Luxury kitchen's include GE Profile stainless appliances, quartz slab kitchen countertops, shaker-style cabinetry and islands with quartz slab countertops. All plans have balconies for extended indoor/outdoor living. In addition,1 Vibe has 96 connectivity))I valued at $4,950 in their everything�'s included (64ei)9) marketing line. The homes range in size from 1,681 �to 2,10,37 square feet. We have reviewed sales information from the builder which included 36 total homes sales between July 19, 20,20 and November 15,1 20,20. Per Lennar, actual sales prices ranged from $463,078 to $552,667. These prices include upgrades, options and premiums along with concessions offered by the builder. The most recent asking base prices ranged from $457,90101 �to $616,1900. Out of the total 92 proposed houses, five have closed escrow to individuals, three model homes are owned by �the builder (not released),1 11 units are over 95 percent complete (9 in escrow), 25 units are under construction which are under 95 percent complete (22 in escrow)and there are 48 remaining finished pads. Completed 95%Complete Plan Room Floors/ Sq. Ind. Bldr. I Count Parking Ft. I Owned Owned VIBE at Millenia 1 4/3 3/2 11681 2 5* 2 4/3.5 3/2 11819 0 5* 3 4/3.5 3/2 210 3 1 3 4! Total 1 4 1 5 14 *One of each plan is a mo�del home. In addition to the above shown houses, there are 25 hornes under constructio�n and 48 finished pads. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 43 QA1114-A 1 11 11 1 F '%QIQ V/�I V3-t 6*8U11UCt I Ct%.,rSC;L I a8C;_Y/-7 %JJL Lennar Homes of California, Inc. (Cleo) OPION AVENUE ------------------------------- --- ------------ ---- - ---- ----------------------- 177 IS1 72 1 pl� 184 196 187 ----ri--- I F9 192 1_9 191 3XR MA 6BR 5 6C 15 5 6 6A 5 615 613R 5R 6AR 6AR 5 6C 66P 176 2X W SR I X LEXINGTON LANEONEEN; 171 -------14 NONE 6A R 2XR 134 14], 1�4 124 M 1�31 2 1 IR 2R 5CR C3 C 2 1 1 R 2 R GAP 33XR 07 1 155 -W Hi M1 1�r, 113 7 5R 5 5R 5R 1 V, --- 3� III 1 1 141 170 MOMMONNimbi 6A 6 AR 6A 15� 3X 7 14F; 131 M M �Ln 4 151 4 5 5R 4R n H 0 M 171 3 R 3 W 3 R n CAMEO COURT 2X 16�� i j ju M M v > Ln I z z 0 0 �_Il 176 -.1 ,AL MEMEMEMEM .., > ---------------- 1 'C' ---- rr 6BR 5R M M M 764F I X SH WAH54HF4-0-M-M 0 rn 61 149 z 119 1 P 6RR 17 Im- 3 3 R rri z 2 U—'� 138 �9 M XR 13 4 160 148 4 R 6BR B 4 119 4R 6 115 3 1�7 11? 107 fa M M 6A OAR 128 (DAR , 5 R 45 1 R I or, 6A .........M-M-1 NEON d 5R 05 121 SR 5A A� 114. C�s P1 BUSINESS PLAN 2 6CR 2R 11 2 6C Sales 4 MENEM ME MENOMMENE min Closings 0 4 LIQUID LANE M C2� Starts 26 6� 5R SR 6AR 6AR 5 $ 6C 6C 5 6A 5R 6SR 6B 5R SR 6CR IQ,j 19U 159 2U4 207 21,8 19). 20D 201 909 CLE0 VIRE i�v LL-GLND S M=MODEL /_Ik...... Pl I P�4 �A Location: Northwest corner of Orion Avenue and Strata Street Millenia, Otay Ranch. Legal Property Description: Lot 1 of'Mar) 16408'of'Chula Vista Tract No. 09-03 (for condominium purposes). Formerly Lot 22 of Map 160181 within Chula Vista Tract No. O�9-0�3 Otay Ranch Millenia Phase 2 (Eastern Urban Center), City of Chula Vista. The property was further divided by a Condominium Plan into 117 units. Property Owner: Lennar Homes of California, Inc. a California Corporation Assessors Parcel Nos.: 643-0165-21 (subdivided AP Maps not yet available) Property Taxes: Per�the San Diiego County Assessor's Office the Assessed value for APN 643-0�65-21 is $4.690,000 and the 20�20/21 property taxes are $54,552.70. The total property tax invoice includes $46,899.99 for $6,953.87 for voter approved bonds and fixed charged the basic levy, Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 44 Q 41 1, 0 "1 Q A t-—Q f-()3-t 6*�;1CJL-tda I at_�rSC;L I a8c;-Y ov kil //�-t, ,-Assessments of$698.84 which includes City of Chula Vista CFD 97- 2 in the amount of'$60�3.00,,, and $95.84 in miscellaneous charges. It appears �that this parcel has not been subdivided by the County Assessor at this time. It should be noted that the subject CFD 16-1 is not yet listed or included in the 20�20/21 property �tax bill because of the development status of' the property. In addition,,, this sample �tax invoice does not include CVESD CFD #18 nor Sweetwater High CFD,#18 which are listed on the other subject property's tax invoices. Three-Year Sales History: SLF IV Millenia LLC sold the subject property to Lennar on December 5, 20,19 for $,4,,815,,01010. Lennar has sold 24 homes however none have closed as of' November 15, 20�2O�. The first closing is scheduled in February 20,21. Size and Shape: Lot 1 of Map 164018 is irregular in shape and encompasses 4.351 acres. ,Zoning�: The subject property is desig�nated Eastern Urban Center (Millenia) per�the current City of Chula Vista Zoning Map. Per the Otay Ranch Eastern Urban Center (EUC) Sectional Planning Area (SPA) Plan,y Lot 1 of Map 164019 is shown as a portion of �the Central Southern Neighborhood and the Main Street Districts. The Central Southern Neighborhood District allows for a low of 130 dwelling units and a high of 350 dwelling units and a low of zero commercial use and a high of 5,000, square feet of commercial use. The Main Street Diistrict covers Lot 1 of Map 16408 along with additional lands and allows for a low of 100 dwelling units and a high of 772 dwelling units. In addition, the Main Street Diistrict allows for a low of 80,0010, square feet of non-residential to a high of 1010,0010 square feet of' non-residential development. Entitlements: The subject property is encompassed by Chula Vista Tract No. O�9- 03 (Otay Ranch Millenia Eastern Urban Center) with further mapping under Tract Map No. 16081 which is known as Otay Ranch Millenia Phase 2. A copy of the Map is located in �the Addenda where �the site is shown as Lot 22. Map 1640�8 (for condominium purposes) was further recorded on �the site. In additionl �there have been approvals for 117 units on the 4.351 acres for an overall density of 26.9 dwelling units per acre. Topography: The subject property has been mass graded �the site originally graded into a generally level superpad with the surrounding streets of Orion Avenue and Strata Street in place. Additional grading has been completed on condominium pads and internal streets. Drainage appears �to be in an in-street storm drain system. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) J Kitty Siino&Associates, Inc. Page 45 QA1114 A3-t6* 1 11 11 1 /�V/�I_V gU11UCt I Ct%.,rSC;L J 0 1 1 Soils Condition: Please refer�to�the Soils Condition discussion above which relates �to all of the subject property. Seismic I nformation: Per the California Department ofConservation, the subject property is not located within an Alquist Priolo, �Earthquake Study Zone. Environmental Concerns: We have not received any environmental reports on the subject site to review. We have reviewed an original Phase I for the entire Millenia project which is discussed under �the earlier description for the commercial parcel. It is an assumption of this report that the subject property is free and clear of any environmental issues which would slow or thwart development of the site and that all recommend ations, contained in environmental reports were adhered to. This is suggested by City inspectors on-site during construction. Flood Information: Per the City of' Chula Vista Website, the subject property is not located within a FEMA Flood Zone. Easements and Encumbrances-. We have reviewed a Preliminary Title Report prepared by CalAtlantic Title (Order No. 192002-0�01 155 dated Aug�ust 21, 20�20. The exceptions are as follows: Itern Nos. 1, 2 and 9 refer to property taxes on the property. Itern Nos. 3 thru 8 pertain to Special Assessments including CVESD CFD1 No. 18, Sweetwater High CFD No. 18, CFD No. 97-2 (0tay Ranch Preserve), CFD No. 16-1 (subject CFD) and CFD 14M-2 (Eastern Urban Center/Millenia). Item No. 10 refers to water rights. Item Nos. 11 & 12 are in regards to the development agreement. Item No. 13 pertains �to a Parks Agreement. Item No. 14 refers �to Resolution No. 2009-224,,l Item Nos. 15, 16, 19, 20, 30, 31, 34 and 35 refer to subdivision improvement agreements and supplemental agreements recorded September 23, 20�13, December 28, 2015,,l November Ti 2019 and August 13,1 20,201. Itern Nos. 17, 21)1 22) 23)1 25 and 40 are in regards to grants of easements, license and maintenance agreements for the underlying tract and utility and solar easements. Item No. 18 pertains to interim drainage improvements. Item Nos. 24) 26), 32 and 36 refer to covenants, conditions, restrictions on �the property. Item Nos. 27, 28 and 33 refer to the purchase agreement and right of first refusal between Lennar and the master developer. Item No. 29 refers to a private park lot public access easement. Item No. 37 is in regard to a solar energy CC & Rs. Itern No. 38 is in regards to the notice of builder)selection of handling of construction claims. Item No. 39 pertains to condominium plans for Cleo and Vibe. Item No. 41 states no known matters otherwise appropriate to be shown were deleted from the report. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 46 _03 4 4 A i r"h I I I P nQe% -I U P_VgU11UCt I at.,A.C;L a8c;-Y 0/_. I It is an assumption of this appraisal report that �the subject lands are free and clear of'any liens and/or encumbrances other than CFD 16- 1 IA 2. The appraiser is not title experts and it is recommended �that any concerns relating to title should be addressed to the appropriate experts. Utilities: All normal utilities serve or will serve �the subject property by �the following companies: Electrical: San Diego, Gas & Electric Company Natural Gas: San Diego, Gas & Electric Company Sewer: City of Chula Vista Water: Otay Water District Schools: Chula Vista Elementary School District Sweetwater Union High School Diistrict Streets/Access: Access to Millenia is via SR 125, exit Birch Road and east to the subject property. SR 125 is accessible via 1-5 or 1-805 east on SR 54. Millenia is bounded by SR 125 on the west, Birch Road on the north and Eastlake Parkway on �the east. Access �to the subject parcel is via Birch Road to Millenia Avenue,1 south to Strata Street and east to the subject site. Current Condition: The subject site has been developed into 32 units which are currently under construction and 85 remaining units �to be constructed. There are six models included in the units under construction which are anticipated to open in January 2021; however) �the community is pre- selling and has sold out of released inventory. The original site was mass graded and then further graded into building pads ready for three to eig�ht-unit condominium buildings with utilities stubbed to each pad. Some internal streets are in place with utilities underground. At completion there will be a tot lot and access to the pool and social building/recreation center at Vibe. Costs �to Complete: Per Lennar, the total land development costs and fees for Cleo are estimated at $11,076,280 and there are $6,543,760 remaining to be spent. Lennar owns all 117 proposed units. Therefore, 'the remaining costs of$6,543,760 equate to an average of$55,930 per unit. These remaining costs will be �taken into consideration later within �the report. HOA: Per Lennar, Cleo and Vibe share the same home owner's association. The current amount is estimated at $333 per month however will reach $230 per month at buildout. The master developer HOA monthly fee is $45 per residence at buildout and is in addition to the above HOA fee. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 47 QA1114 A3-t6* 1 11 11 1 /�V/�I_V gU11UCt I Ct%.,rSC;L JOJ I Improvement Description: Cleo at Millenia is being developed into six floor plans with Spanish and Tuscan-style architecture. The current plans are all �three story with plans 5 and 6 having some living space on the first floor along with two-car garages while Plans 1 �through 4 are just garages downstairs. All plans have kitchens and living�/dining areas on the second floor and bedrooms on the �third floor. Home features include an integrated solar energy system (provided through a buyer-f'riendly SunStreet program), pre-wire in garage for electric/hybrid vehicle charg�ing�, tankless water heaters and LED, light bulbs. Exteriors include insulated garage doors with automatic openers and resistant roof' shingles while interiors include tile at entries and kitchen and raised-panel interior doors along with laundry rooms. Owner's suites include quartz countertops, tiled shower, shaker-style cabinetry and walk-in closets. Luxury kitchen's include GE Profile stainless appliances, quartz slab kitchen countertops, shaker-style cabinetry and islands with quartz slab countertops. All plans have balconies for extended indoor/outdoor living. In addition, Cleo has "connectivity"i valued at $4,950 in �their everything's included (giei)9) marketing line. The homes range in size from 1,182 to 1,675 square feet. Ten of�the proposed homes along the north side of�the site are planned to be four-story homes which we have not seen estimated square footages at this �time. We have reviewed sales information from �the builder which included 24 total homes sales between October 4, 2020 (date pre-selling began) and November 15, 20,20. Per Lennar,, actual sales prices ranged from $364,400 to $494,063. These prices include upgrades, options and premiums along with concessions offered by�the builder. The most recent asking base prices ranged from $364,900 to $458,19010. There are eight proposed Plans 1 and 2, seven proposed Plans 3 and 4, thirty-six Plan 5s, f'orty-one Plan 6s and ten 4-story product yet �to be determined. Out of�the total 117 proposed houses there are six model homes and 26 production homes under construction (under 95 percent complete) with 24 in escrow and 85 remaining building pads. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 48 A 0 ji 1 0 -%n a t-—Q 202 f_03-t 6 Pligica-tua I at-INIC;L JL a8u.,-Y 0-t vi SAN DIEG�O COUNTY HOUSING AND OFFICE MARKETS In reviewing the County's housing and office market, a study of population and economic growth needs to �be conducted. As of January 1, 20�20, the County had a population of' 3,343,355, which indicates an annual growth rate of 0.1 percent over the past year and an average rate of 0.86 percent over the past 20 years. It should be noted �this includes the slowdown during �the Great Recession. Projections are for the County �to continue at an annual 0.86 percent growth rate for�the next eleven years. Over the past twenty years the County has seen a rocky cycle in the housing market as with most of Southern California. The recession of�the early 1990,s impacted San Diego County; howeverl �the recovery was quicker�than inland areas due to�the coastal influence. Median housing prices (all types) in the County increased over 100 percent (from $250�,,,O�O�O in 1997 to $600,000 in 2005) then decreased to the low of $324,000 in 2011. According �to �the California Association of Realtors' most recent data, within overall Californial �the median price paid for an existing single-family detached home in September 20�20 of $712,430 is up O�.8 percent month over month from Aug�ust 20�20 at $706,900, and up 17.6 percent year over year from $605,680 in September 2019. Economic growth in the San Diiego area had been strong between 2000 and 20�07 with job losses occurring during �the Great Recession in 2008 �through 20,10 with an upturn beginning in 20111. The significant decrease of employment in 2020, was due �to COVID,. Below is a table depicting job growth in the County over this time period. San Diego Job Growth Year Employment Increase % Increase 2020 1 13861600* (159,500) (10.3%) 2019 11546,100 29,200 1.92% 2018 11516,900 19,500 1.30% 2017 11497,400 22,500 1.53% 2016 11474,900 20,000 1.37% 2015 11454,900 36,400 2�.57% 2014 1 11418,500 71300 0.52% 2013 1)411)200 1 37,300 1 2.71% Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 49 QA1114 H-M* 1 11 11 1 U /�V/�I-V gUHUCt I akr�,UL -L a8c;-Y 0 1 2012 11373,900 23,000 1.70% 2011 11350,900 19,000 1.43% 2010 11331,900 (93)400) (6.55%) 2009 11425,300 (22,500) .55%) 2008 11447,800 61500 0.45% 2007 11440,300 71500 0.52% 2006 11423,100 61800 0.48% 2005 11416,300 18,900 1.35% 2004 11397,400 21,300 1.55% 2003 11376,100 20,900 1.54% 2002 11355,200 12,500 0.93% 2001 11342,700 28,600 2.17% 2000 1)314)100 N/A N/A *Based on Octobser numbers per EDD The unemployment rate for the County was 7.7 percent in October 2020, below the high of 11 percent in early 2010 however significantly higher than the February 2020 unemployment rate of 3.2 percent and lower than the current California unemployment rate of 9.01 percent. The housing market was a sig�nificant factor in increasing the impact of the Great Recession. Due to increased interest rates and rising home prices between June 2004 and mid-20,06, the mortgage lender reaction was to create non-conventional financing alternatives such as sub-prime and non-conventional mortgages to artificially maintain the boom housing market of 2004 and 200�5. In 20�07 the housing market saw a shake- up due to the problems in the sub-prime and non-conventional mortgage markets. In March 2007 the Federal Government initiated efforts to stop or limit sub-prime mortgages. Unfortunately, the damage had already been done with sub-prime mortgages playing a role in the 2008 shake out of the housing market and contributing sig�nificantly to the U.S. economic downturn. Due to stricter income verification on new loans and the lack of available credit, coupled with job losses and declining home prices, sales of both new and existing homes slowed for the next few years. With the exception of a small increase in 2010, primarily due to government offered homebuyer credits, prices/sales essentially remained flat until mid-2012 when prices began a steady climb. Home ownership during this period across the U.S. saw a significant decline. Historically,1 since the 1970�s, home ownership generally was between 64 and 66 percent until around Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 50 A 0 J1 1 0 n I,- t�— f-()3-t 6 Pligica-tua I at-INIC;L T aglu_'Y%ov V1 2000 when it began growing with a peak at 69.2 percent in fourth quarter 2004 prior to �the Great Recession. After falling �to a low of 62.9 percent in second quarter 20,16, home ownership has been climbing with the current rate at 68.2 percent per 2020 second quarter data from FRED, (Federal Reserve Economic Data). Home ownership rates in San Diego County followed �the general statewide and national trend of decline from a high of 63 percent in 20,016 �to a low of 50.7 percent in 2016. The first quarter 20,19 homeownership rate in San Diiego County was just below the overall California average of 54 percent. Homeownership in California and San Diego County is lower than the national average due to �the higher cost of homes. Home loan mortgage rates have been and are still playing a large part in the housing market. The Federal Reserve Board had held mortgage rates at all-time lows after the Great Recession in an attempt to assist the housing market. Low rates appeared to help for quite a while however first-time buyers are now having a hard �time entering �the housing market due to rising prices. The Board had kept interest rates below historical averages dropping rates to near zero in December 20�O�8. There had been eight subsequent one-quarter point increases with the December 20,18 increase bringing �the Federal Rate �to 2.25-2.5 percent which appeared �to have a negative impact on home sales. In 2019, the Board reduced the rate three times, one-quarter percent each time. In 2020 due to COVID, the Board reduced the rate 1.5 percent to 0 — 0.25 percent,,, in two moves in March. The quoted average U.S. rate for a 301-year �fixed mortgage per FRED (Federal Reserve Economic Data) as of November 19, 2020 was 2.72 percent which is below the previous low of 3.3 percent which occurred in January 2013. Mortgage applications have been spiking due to these low rates. Most economists are predicting that, once the economy gets, back �to full speed, the lower interest rates will help �the housing market bounce back with some now stating that the housing market may have a V-shaped recovery while the overall economy will be more U-shaped or swoosh-shaped. With COVID surging once again and several states at least partially shutting down, it is looking like this recession will be longer�than originally forecast. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 51 4 4 A A Q 41 1' p '%Q- -I U P-1 a U I at_�rSC;L a8c;_Yo 7 T 7 g1c,-t a U Residential Land Development While there had been little land development going on in most of San D�iego County during the years 2008-2011, the second half'of 20�12 saw a resurgence. This was clearly visible in Otay Ranch. The increase in housing prices coupled with the limited availability of' supply made land development feasible once again for homebuilders. San Diego and Otay Ranch saw land development in 2012 and 20,13 with a bit of a lull in 2014 �then land development beginning again in 2015 and 20�16 with Otay Ranch Village Two and Millennia both building new homes and Otay Ranch Village Three grading for development. Other than Otay Ranch and Playa del Sol (about �two miles southwest of �the subject), �there have been minimal increases of new home development in the southern portion of' the County. It is interesting to note that, with the exception of Otay Ranch, large master planned communities have not come back as quick as smaller in-fill areas to develop in San Diego County. It is�thought that�the increase in regulations, which has significantly increased �the �time of processing entitlements,1 has limited the master developers in California. While prior to the recession it was not unusual to see several large master-planned communities selling lots to builders, there are few available on the market today. In San Diego County current master plans include Otay Ranch (Millenial Montecito and �Escaya currently selling),, Otay Mesa and Civita in the southern area of the County along with Rancho Tesoro (San Marcos), and Horse Creek Ridge (Fallbrook) in the northern portion of the County. While 20�20 was slated to have increases in residential builder land purchases) �the pandemic essentially stopped most residential land closings for three months. However, builders reportedly are once again looking for land as new home sales are a bright spot in the COVID, economy. Builders had slowed production due to the hard lessons learned in the previous recession when inventories sat and some new home projects had to close. Our search resulted in eleven residential land sales which are considered to be comparable to the subject residential properties, including two of' the subject parcels. These land sales all occurred over the past 42 months. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 52 4 4 A A Q 41 , p '%QQ -I U P-1 ;]L U I at_�rSC;L a8c;-yoo T 7 g1c,-t a U Home Sales and Pricii San Diiego has seen either flatness or increases in home values since January 20,12 per the Case-Shiller index. Below is a chart showing median home prices in the County including both new and existing homes (both detached and attached) over the past decade showing January numbers for each year. The current median home price of $749,10,010 (per California Association of Realtor's as of October 20120), shows that prices have increased in the past ten months $89,,000 or about 13.5 percent. This significant increase is due to what is being called the COVID, effect as people want to live in their own place rather rent in apartments with a higher density. Additionally, interest rates at all-time lows is allowing first-time homebuyers into �the market and making it attractive for move-up buyers to purchase new homes. Offsetting this is the fact many who currently own homes do not want to sell, thus supply is down while demand is up which has put pressure on prices. The �table below shows median home prices in January of each year. San Di�ego CounIty, M�ed�i�an Home Pri�ces 700 - 6110 600 J, 5,80 582' 590f 00U 530 49 0 500 - 468- 482, 479t, 6' 385'� 1-97 3! �400 %F wit — 332,:_ 300304', 2,866, 300 200 E 0 100 0 2000 2002 2004 2006 2008 2010 2012 201�4 2016 2018 2020 Year According �to �the California Association of Realtors within Californial �the median price paid for an existing single-family detached home in October 20�20 ($,711,30�O�) is up 17.5 percent year over year however down O�.2 percent month over month. Existing home sales Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 53 QAIIIJ A3-t6* 1 11 11 1 /�V/�I_V gUILIUCt I atr�,C;L I a8 C;_Y 0-7 V I in overall California were up 19.9 percent year over year as of October 20�20, mostly due �to COVID-19. This is a huge improvement compared �to May 20201's year over year change in existing home sales which was down 41 percent from May of 2019. While new home sales have been a bright spot in the economy during COVID, existing home sales essentially stopped as people decided not to move out of their home at �this �time constraining �the existing home supply. Home sales in Southern California were up 17.5 percent also. Per CAR the increase is partially due to the fall season typically being slower due to children getting back to school however not this year due to virtual teaching. Coupled with �this is the low interest rates which are fueling sales. Shown below is a �table comparing October 2019 to October 20,20 for both new and existing home sales and pricing in Southern California by county and for Southern California as a whole. Southern Caitfornia, (New and Used) Home Sales County Median Median Percent I Oct 2019 Oct 2020 Change Los Angeles $647,900 $728,160 12.4% Orange $820;000 $930,000 13.4% Riverside $420,000 $485,000 15.5% San Bernardino $319,000 $365,000 14.4% San Diego $6521000 $749,000 14.9% Ventura $660,000 $750,000 13.6% Source: California Association of Realtors Based on October 2020 median new and existing homes prices, in comparison to the majority of the surrounding counties, San Diego County is higher than the Inland Empire, Los Angeles and Ventura, while lower than Orange with a median home price of$749,0001 reflecting a 14.9 percent year over year increase. In a separate attempt to capture the, increase, in home, prices, the resale activity of existing homes in the subject area (per Corel-ogic) has been reviewed. The number of sales and sale prices of existing homes within zlip codes in the immediate area of the subject are shown in the table sho�wn below. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 54 A Q 11 i p '%!am 11 6" 018unua T aCrSC;L a8c;717 v u T 7 Sales of SFD Sept202O Sept 2020 Price % Border Homes Price Median Ghange Community ZIP To Sept Median Price/ from Sept Name Code Su4ject 2020 SFD Sq. Ft. 2019 Otay Ranch Village 1 1 21 3 91913 Subject 54 $728,000 $276 22.8% Northwest Chula Vista 91910 Northwest 46 $653,000 $354 11.0% West Chula Vista 91911 West -7 A 37 $583,000 $3tv 11.0% Northeast Chula Vista 91914 Northeast 22 $848,000 $308 11.8% Eastern Chula Vista 91915 East 15 $7501000 $293 10.5% South San Diego 92154 South 23 $580;000 $327 17.2% Source: CoreLogic September 2020 The table above depicts price changes over the past year on existing sing�le-family detached home sales prices. The above price increases relate to CAR's overall San Diego County increase of 14.9 percent year over year. We have reviewed The Ryness Report, a new home sales, marketing and research company's report dated November 15,1 20201. Within overall San Diiego County there are 69 new home projects selling with 21 of the new home projects located in the South Bay area of San Diego which houses the subject Otay Ranch. It is interesting to note that one year ago in San Diieg�o there were 100 new home projects selling suggesting 31 new home projects have sold out over the past year in San Diego County. Within Otay Ranch (includes the villages of Montecitoi Millenia and Escaya) there are currently 14 new home projects. The average year to date absorption of these new home projects ranges from a low of' 1.86 sales per month to a high of 16.8 sales per month. The low end of the absorption is generally for the higher priced single-family detached homes while the higher end of the absorption rate is for the more affordable attached units such as the subject product. The average sales rate for a new home project in the South Bay area for the week ending November 15, 2020 is 4.1 homes per month. This compares to an average new home sales rate per project in overall San Diiego County for the week ending November 15, 2020, of 3.25 sales per month. Thus, the subject market is selling at a greater rate than overall San Diieg�o County. The COVID-19 pandernic does not appear to be having a negative impact on new home sales in the overall San Diieg�o area nor the Otay Ranch area. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) J Kitty Siino&Associates, Inc. Pag�e 55 QA1114 A3-t6* 1 11 11 1 /�V/�I-V gU11UCt I Ct%.,rSC;L I Ct8V,J 7 1 1 In summary,, although both San Diego, County and �the subject submarket saw decreases in housing pricing and sales during the great recession, prices have now been generally increasing over the past eig�ht years with substantial appreciation over this time period. The current median home price in the County has surpassed previous all-time highs. New home projects within Otay �Ranch have been reduced during �the past year due to projects selling out and land ready for development becoming scarce. The year 20�20 began poised for huge growth until the COVID,-19 pandemic shook the existing home market, essentially stifling existing home sales for a few months. One positive impact of the COVID-1 9 pandemic on new home sales is that �the new home market has become the better option verses existing home sales. However, due to historically low interest rates putting pressure on home pricing, existing home sales are also now growing along with new homes sales. Despite uncertainty hitting the market with the COVID-19 outbreak, most observers agree that�the San Diego, County new housing market is still positive and the population is growing at a sustainable rate. Population is predicted to continue to increase, thus housing g�rowth will continue. Commercial Market In reviewing the County's commercial market, a study of housing growth, vacancy rates and competition needs to be conducted. As discussed above the County population is growing and housing growth is gaining strength in the South Bay area which includes Chula Vista. We have reviewed several studies prepared by commercial brokers in the area in regards to San Diieg�o's commercial real estate market including CBRE's recently released outlook for 2021. CBRE states �that 2020, has accelerated certain �trends �that benefited some sectors of commercial real estate and punished others. Industrial and log�istics have thrived in the COVID, era while office, retail and hotels have suffered. The beginning of 2021 will be in a flux with a full recovery of commercial real estate held back by the continued influence of COVID-19. CBRE anticipates Industrial and logistics �to have the strongest fundamentals and investor interest early in the year. They believe it will take until the Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 56 Q A1114_A3_t 6* I r", I i F -%!a t�_Q _J /�V/�I V 8U11UCt I Ct%.,r%,UL I a8U J 7Z. I /Z,* second half of 2021 before �the office sector begins �to either return to normal or begin �to undergo a permanent change. The office sector will need to wait until workers can safely go back to work to determine if'remote working levels will stay the same or go back to the 96 old))I normal. In 2021 they are predicting demand for office space will remain muted as most occupiers' plan for a gradual reentry to �the office throughout 20,21. CBRE believes that �the retail footprint will continue �to contract in 2021 however they anticipate e- commerce sales to slow in 2021 as brick-and-mortal sales come back. CBRE is forecasting a decline in the rate of' e-commerce sales growth in 2021 for the first time since 20,018. In the Third Quarter 2020 commercial office report,,, CBRE reports that the San Diieg�o unemployment rate fell in Q3, 2020, �to 9.9 percent down from a peak of 15.2 percent in May. However, this is still up significantly from February's 3.2 percent unemployment rate. Average asking rent for office product remained the same as Q2 at$3.15 per square foot full-service gross (FSG) however the vacancy rate increased to a total of 12.8 percent with net absorption for�the quarter at a negative 6015,585 square feet. Year to date leasing activity in Q3 was up 6.01 percent from Q2 however year �to date leasing activity for �the year is 34.5 percent lower than the previous 3-year average for this time period. While overall San Diego has an asking rate of $,3.15 per square foot FSG,,, the South County market which encompasses the subject has an asking rate of$2.55 per square foot FSG. The South San Diiego County submarket houses about �three percent of the �total office product in overall San Diieg�o County. There were no construction deliveries of new office space and no office space under construction within the subject South San Diiego submarket in Q3. CBRE identities the South San Diiego market as �the area south and southeast of the downtown market southerly of State Route 54. San Diieg�o's office market has experienced a wide fluctuation in vacancy over the past 18 years. In 20�O�O county-wide vacancy was only 5.4 percent with 20�O�9 showing the hig�hest vacancy rate at 19.2 percent, decreasing just about every year to 20,16 at 101.7 percent. Current vacancy increased �to 12.8 percent after having remained below 12 percent for four years. South San Diego reports total vacancy at 8.0 percent including sub-lease Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 57 A Q 11 i p %!an 11 6" P118unua T a%7rSC;L a8c;717 1 U T 7 space. As mentioned, net absorption was at a negative 605,,585 square feet with 5,950 square feet of�this negative net absorption in �the South San Diego, market. In addition to reviewing CBRE statistics we have also reviewed the draft marketing study completed by Meyers Research on the Millenia community. Meyers indicates �that �the office market is currently soft in San Diego, County, a fallout of the COVID-19 pandemic. While rates have stabilized, the vacancy rate has increased, a function of decreased demand for office space due to the Work at Home model due to COVID. Meyers Research also concludes that medical office conditions are relatively strong and stable when compared �to conventional office market conditions. This has resulted in major healthcare systems actively pursuing new developments around San Diieg�o County. Meyers Research projects an average of 64,,000 square feet of annual office absorption within Millenia which projects the entire 1.425 million square feet of space to be absorbed by 20�42 or in about 20 years. They project the initial phase to be absorbed in roughly four Years and it is unknown at this time if' Lot 1 or Lot 19 (subject property) will be developed next. The Meyers Research projections are based on analyses completed by CalTrans on office-oriented employment growth and also projections of job growth from Woods and Poole Economics. They project absorption of office space will accelerate at the subject location as this area of Chula Vista continues to grow. Our search in �the South San Diego, submarket resulted in quite a few commercial land sales, however none in the past three years were slated for office use. The majority of the sales are located near Brown Field in San Diiego's Otay Mesa area and are affiliated with �trucking and logistics. Within Millenia,, one of the commercial properties sold in 2017 however no construction has begun on �the property at this time. Current projections are for Chesnut to pull permits in 20�21 and beg�in construction. In summary, although south San Diego County is seeing commercial land sales in 20201, most are for industrial zoned lands with logistic uses. There is one commercial project in Millenia which is in the planning stages however commercial development is generally at Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 58 -4 4 A A Q 11 i P 11Q4 1 U P-IgUIL-tua T aCrSC;L a8c;-17-t T 72� ,-A standstill as investors and developers wait to see what�the "new normal"' is with the work C1 from home factor. Millenia is proposing the first office campus in the immediate area. While the need appears positive, absorption of the projected development in the entire community of Millenia (the subject and additional lands) is estimated at about 20, years. Despite uncertainty hitting the market with the COVID-19 outbreak, most observers agree that �the San Diiego County real estate market is still positive and �the population growing at a sustainable rate. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) J Kitty Siino&Associates, Inc. Pag�e 59 QA1114 H-M* 1 11 11 1 /�V/�I-V gU11UCt I Ct%.,r%.UL I Ct8U J 7 HIGHEST AND BEST USE ANALYS1S The highest and best use is a basic concept in real estate valuation due to the fact that it represents the underlying premise (i.e.,i land use) upon which the estimate of value is based. In this reportAhe highest and best use is defined as: "the reasonably probable and legal use of vacant land or an improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value"5 Proper application of this analysis requires the subject properties to first be considered "As If Vacant" in order to identify the "ideal"' improvements in terms of use, size and timing of development. The existing improvements (if any) are then compared to the "ideal" improvements to determine if the use should be continued, altered or demolished preparatory to redevelopment of the site with a more productive or ideal use. "As If Vacant," In the following analysis, we have considered the site I s probable uses, or those uses which are physically possible; the legality of use, or those uses which are allowed by zoning or deed restrictions; the financially feasible uses, or those uses which generate a positive return on investment; and the maximally productive uses, or those probable permissible uses which combine to give the owner of the land the highest net return on value in the foreseeable future. Physically Possible Uses Millenia has the physical characteristics suitable for a master-planned community. The site's topography is generally level, adjacent to &R 125 (to the west) and the successful Otay �Ranch Town Center (to the north). CFD1 No. 16-1 IA 2 consists of'f'our parcels ranging in size from four to nine acres which are being developed into 335 single family homes and a commercial site proposed for office use with a possible residential component. The parcels have all been mass graded ' The Appraisal of Real Estate, 1 11h Edition Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 60 A Q 11 i p %!az- 11 6" 018ullua T aCrSC;L a8c;717 v u T 7 and are generally level with the majority of surrounding streets in place. The three C1 residential sites have been further graded for residential lots and pads. We have reviewed Geotechnical Reports on portions of the subject property and it appears soil conditions are satisfactory for development. This is further suggested by development on some of' �the lands. We have reviewed a Phase One Environmental Site Assessment on portions of the subject property which concludes that the property is feasible �to develop from an environmental standpoint. It is an assumption of this report that the soils are adequate to support the hig�hest and best use conclusion,,, that any environmental concerns have been mitigated as recommended by �technical reports, and �that there are no environmental issues which would slow or thwart development of �the site. This is evidenced by City approvals along with City inspectors on site during construction. An engineered drainage system is being designed into a street drainage system �to alleviate any potential flooding problems and to control project water runoff. All standard utilities serve or are available to serve the subject property. The site has good access from SR 125 and Birch Road. Based on �the physical analysis, 'the size, access and �topography make �the subject property physically suited for numerous types of developmenti; however, the grading and development that has occurred on three of the four parcels suggests residential use with �the fourth parcel in a mass graded condition available for various types of development. Legality of Use The subject property is located in the master planned community of' Millenia (formerly known as a portion of �the Eastern Urban Center "EUC"), in Otay Ranch in �the City of Chula Vista, County of' San Diieg�o. Pursuant to the EUC Sectional Planning Area Plan,y �the subject four parcels are a portion of�the entire 2016+ acre property which has approvals for approximately 3,000 residential units,,l 13 acres of parks, 1.4 acres of Community Purpose Facility, 6.5 acres of schools,, and 42 acres of commercial land uses. The subject four parcels have been approved for 335 residential units on three parcels and commercial use with a possible residential component on the final parcel. Map 019-013 recorded on all of' Millenia with further mapping of Maps 16081,1 163777 16408 and 1640�9 Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) J Kitty Siino&Associates, Inc. Page 61 QA1114 H-M* , 11 11 1 /�V/�I-V gUHUCt I Ct%.,rSC;L I Ct8C;-Y 7 %J I covering �the subject four parcels. Based on �the legality of use analysis, the �type of development for which the subject property can be utilized is narrowed to residential and commercial land uses. This is consistent with the findings of the physically possible uses. Feasibility of Develqpment The �third and fourth considerations in �the highest and best use analysis are economic in nature, i.e., the use that can be expected to be most profitable. First residential land use will be discussed followed by a discussion on commercial land use. As discussed under �the San Diego County Housing and Office Market section earlier within this report, �the San Diiego market has showed good residential price increases and good absorption. According to the Market Absorption Study for CFD No. 16-1, IA 2 by Meyers Research, dated November 20,201, the existing three projects Pinnacle,1 Vibe and Cleo are selling at a good pace and will be sold out, generally by 2023. It should be noted �that their absorption estimates are using historical sales fig�ures and not 20�20 sales figures which have a much higher absorption rate. While the COVID-1 9 pandemic has violently affected �the economy, it has not negatively affected the new home market in San Diego. Population growth is still occurring in �the area and will continue �to create �the need for housing�. There are currently �three active,1 new home communities within Millenia which are all the subject properties. All previous residential, �for-sale communities in Millenia have sold and closed out. The subject three neighborhoods include attached condominiums, some allowing for first-time buyers to enter the market. Sales began in March 20�20 with 137 sales to date and 41 homes closed to individuals. Generally home prices within the community range from $3801,10,010 �to $5501,10100. Since opening,, average sales rates, within the subject communities have ranged from eight to sixteen sales per month, considered to be exceptional sales rates. All of the neig�hborhoods have been well received in the marketplace. Over�the past year,, 31 new home projects in San Diiego County have sold out, all pointing to the need for new homes. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 62 All"I-A3-t 6* I r"' I i P 111QQ t�-Q I V 8U11UCt I Ct%.,rSUL I a8U-Y 7 0 1 /N Meyers Research projects an average 64,800 square feet of office space will be absorbed per year suggesting �the initial phase of development will be absorbed in four to five years. At this time, it is unknown when Lot 1 or Lot 19 (subject) will be developed and what the mix of land uses will be. Based on �the above analysisl �the highest and best use for the subject property appears to be for both residential and future commercial development. Maximum Productivity Current market conditions suggest�that residential use in the subject market is in demand. This is evidenced by land sales and the absorption rates for new homes within the Otay Ranch. In light of' the population growth projected in the subject marketplace and the multi-family land sales and attached home sales occurring in �the Chula Vista area,1 it is our conclusion that�the subject property is feasible for residential development and future commercial development. 'Highest, and Best Use Conclusion — "As If Vacant"' The final determinant of highest and best use, as vacant, is the interaction of �the previously discussed factors (i.e., physical, legal, financial feasibility and maximum productivity considerations). Based upon the foregoing analysis, it is our opinion that the highest and best use for the subject property "As if Vacant"' is for residential neighborhoods at the correct price points and for future commercial land use. 'Highest, and Best Use — "As Improved" As earlier detailed, the subject property consists of' three residential neighborhoods, all which are currently selling, however models are not complete within one neighborhood. Meridian opened its Pinnacle products for sale in February 20,201. They have sold 77 homes suggesting an absorption rate of 8.1 homes per month. Lennar opened its Vibe project for sale in July 20�20 and has sold 36 suggesting a sales rate of8-0 units per month. Lennar opened its Cleo project for sale in October(without model homes) and has sold 24 suggesting a sales rate of over 16 homes per month. Cleo is a first-time buyer opportunity with pricing beg�inning at under$400,00�O�. All absorption rates are considered Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 63 A 0 J1 0 !QW 202 f-03-t 6 PligV'i-tua 1 UCISI& -1 aglu-'Y%7-7 U1 �to be excellent sales rate for homes in the South County market. Our search of�the local MLS revealed �there are no current listings and no re-sales within �the subject property. The homes appear in excellent condition with no physical depreciation of structures visually apparent. The sales rates within the subject and competitive projects in the immediate area suggests �there is demand for new homes in �the market at the right price points with current financing rates. This is confirmed by the Meyers Research absorption study. All of'the homes are of good design and appear to be of'good quality workmanship. Based on the subject neighborhood's sales rates, it is our conclusion that the hig�hest and best use for the subject �three residential parcels is for�the continued use, as improved. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 64 4 4 A A Q 41 , P 4AQ 1�—Q -I U P-1 ;]L U I at-�rSC;L g1c,-t a a8c;-tvv%1T 7 VALUATION ANALYSES AND CONCLUSIONS The Sales Comparison Approach will be the primary approach used to value the subject property. This approach compares similar properties that have recently sold or are in escrow to the subject parcels. In determining the value for the property, a unit of comparison needs to be addressed. For detached sing�le-family lots, the lots are typically sold on a finished lot basis while for attached product, the lands are typically sold on a per unit basis with the condition of the land taken into consideration. That is, the sales price is determined by a finished lot value or a per unit value in a superpad condition, then the remaining costs to develop the property to a finished lot or superpad condition are taken into account in the sales price. Therefore, in determining a current market value for the lands, the current condition of the lots will be considered. The same approach will be used for the commercial properties which are typically sold in a superpad condition based on a per square foot price. In the case of the existing home valuations, a single new-home sale is the unit of' comparison. Our search will include all new home projects within Otay Ranch and the surrounding area to find comparable new homes for sale. In determining the value for each house, a base value will be concluded for each plan which will be considered a minimum market value as most buyers typically purchase some premiums, upgrades or options which increase the price of the home. In the case of the completed (over 95 percent complete) builder-owned models and production units,1 the homes will be valued using the Sales Comparison Approach to conclude on a retail value for each plan, followed by a Discounted Cash Flow ("DCF"') Analysis due to the single ownership for each neighborhood. The D,CF will take into account the fair market value of the completed homes (utilizing the Sales Comparison Approach), remaining development costs (if any), the marketing and carrying costs associated with selling off the homes, a profit due to the developer of the homes, and a discount rate reflecting both the risk associated with selling off the homes along with the time value of money during the estimated absorption period. In the case of the individually owned homes, a concluded base value will be used for each plan and a mass appraisal technique will be used. In determining the concluded base value, new home sales in the Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 65 A 0 J1 1 0 i 202 f_03-t 6 Pligica-tua I at-INIC;L JL a8u.'-tv IL %if L ,-Area will be reviewed and compared with sales of �the sub ect completed homes using a i standard methodology and statistical testing. All of the value conclusions will assume that the improvements funded by the CFD No. 16-1 IA 2, Special Tax Bonds are completed and in place and that the property is subject to the Special Tax Lien. The valuation will be presented as follows: First, a discussion of the comparable residential market data will be g�iven. Each of the transactions will be detailed along with a comparison discussion of their relationship to the subject property based on a per lot or per unit price. A value conclusion for the residential lands will �then be concluded. Next a discussion of �the comparable commercial market data will be given. Again, each transaction will be detailed along with a comparison discussion of their relationship to the subiect r)roperty. A value conclusion for commercial land will be concluded. Following �the land value conclusions, a valuation for each home plan will be conducted. Finally, a value conclusion for each ownership will be given along with a minimum market value concluded for the individually owned homes. A summary of the final value conclusions will be reported at the end of'this valuation section. Market, Data Discussion and Valuation Analysis of Residential Land The area surrounding �the subject has been searched and residential land sales were located and compared to�the subject. Eight of the sales were considered to be comparable and are detailed in the Addenda. Four of the sales are located within the Otay Ranch, two are in Otay Mesa, one in Chula Vista proper, one in Santee and one in the Spring Valley area of San Diego. All are within 15 miles of�the subject. Each transaction is discussed in relationship to the subject property below followed by a summarization of �the land transactions. Land Data No. 1 refers to the sale of' a 4.92-acre site located in the City of Chula Vista about five miles northwest of the subject site. This is an infill parcel which has excellent access to �the 8015 Freeway and easy access �to downtown Chula Vista. Silvergate Development, a San Diieg�o based developer specializing in multi-f'amily and mixed-use projects,,, purchased the site for development of 170 apartments suggesting a density of 34.55 dwelling units per acre. Nine of the 170, units, will need to be affordable rate units. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 66 A Q 11 i P a 11 6 P18ullua T a%7r%,C;L a8c;-tv/-. UT 7 The site is surrounded by apartments and commercial land use along with single-family residential uses. In addition to�the $6,10100,01010 purchase, �they purchased a 01.3-acre piece from the City of' Chula Vista which was previously an entry cul-de-sac into the site. They paid $,225,0�O�O for the additional site. On their website they are referring to the property as a total of 170 units which equates �to $,36,618 per unit based on �the total paid for the �two parcels and a density of 36.17 dwelling units per acre. In comparison to �the subject property this site is considered to be inferior as it does not have the master plan association and is in an unimproved state. Land Sale No. 2 is located about�three miles south of�the subject property within one mile of�the National border with Mexico. The 12.98-acre site is in �the area known as Otay Mesa with Brown Field (private airport) to the north and within a few blocks of Ocean View Hills Corporate Center and Otay Corporate Center South. The site was originally zoned for industrial use however the buyer re-entitled the site for 450 apartments which suggests a density of 34.66 dwelling units per acre. The site had previously been mass-graded and appears to be ready for development. The purchase price was $14,1400,,000 which equates to $32,000 per unit. There are industrial buildings in the immediate area along with �truck transfer stations and �truck stops. The buyer,, Co[Rich, is planning on building �three- and four-story wood frame apartments. In comparison to the subject propertyAhis site has a significantly inferior location when compared to Otay Ranch due to surroundings and amenities. Land Sale Nos. 3, 4 and 5 are in regards to land sales within the subject Millenia Village of Otay Ranch including purchases of �two of �the subject properties. Land Sale No. 3 is the most recent transaction which closed in February 2020. Ryan Companies purchased the 12-08-acre site that has entitlements for 480 apartments. There are several apartment complexes located in Millenia and all have been successful in leasing. The land purchase was for $15,50101,,000 or $,32,1292 per unit for�the land with a density of 39.7 dwelling units, per acre. Land Sale Nos. 4 and 5 refer to two of the subject properties which were both purchased by Lennar for Cleo and Vibe respectively. Land Sale No. 4 refers the 4.35- acre site with mapping for 117 units, (equates �to 26.9 du/ac) which closed December 5,1 2019. The site sold for$4,815,010101 or$41,1155 per unit. Land Sale No. 5 refers �to the 4.47 Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 67 QAIIIJ A3-t6* 1 11 11 1 P 4AQ _Q /�V/�I_V gUHUCt I a%.,rSC;L _L a8c;-tvi I //�4— acres mapped for 92 units (equates�to 20�.6 du/acre)which was purchased June 24, 2019. C1 This site was sold for $4,10,010,0010, or $,43,478 per unit. Land Sale No. 4 and 5 included in the sale the buyer to build and deliver a 4,500 square foot commercial shell building deeded back to the master developer. Land Sale No. 6 pertains �to �the purchase of a multi-family zoned parcel located on Caribbean Way,1 in Santee, about 15 miles north of the subject property. The site is 2.89 acres and has a map allowing for 42 units on the site suggesting a density of 14.53 dwelling units per acre. The property is generally an in-fill location however this property was sold in an unimproved or raw land condition with unpaved access. City Ventures purchased the property in April 2019 for$2,535,101010 and $60,357 per unit. They are selling two story townhomes on the site known as Ariana with sizes from 1,419 to 1,879 square feet. In comparison to the subject site this parcel is considered to be inferior in condition (unimproved) Land Sale No. 7 is located 1.5 miles south of the subject in Otay Mesa near Data No. 2. The property consists of a 5.58-acre property that has entitlements for 143 total units which relates to an overall density of 25.63 dwelling units per acre. The site is in a raw land condition, has view potential however has unpaved access. The property was purchased by an investor in November 20,18 for about 15 percent below the asking price at $4,,650,000 which equates to $32,517 per unit with an overall density of 25.63 dwelling units per acre. The site is within an industrial neighborhood however just across a ravine from existing housing. The property has two, parcels between it and an existing industrial building, with one of the empty parcels entitled for commercial use and �the other entitled for light industrial use. In comparison to the subject property this site is considered to be inferior in surroundings/location and in condition (unimproved). Lane Sale No. 8 pertains �to the October 2018 purchase of an 18-acre site by KB Home located in Spring Valley,, about eight miles north of the subject in the Spring Valley area of San Diego. The site wraps around the northeast corner of Sweetwater Springs Boulevard and Jamacha Boulevard in a more industrial area however there are homes to �the west. KB Home is marketing "Sweetwater Place"'consisting of 2-story homes on 3,,0001 square foot lots, ranging in size from 1,,854 to 2,095 square feet. The prices range from Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 68 QA1114 A3-t6* 1 11 11 1 /�V/�I_V gU11UCt I Ct%.,rSUL _L a8c;-tv-t I Z, $587,10,010 to $615,00101. The reported finished lot price at�time of purchase was $2701,0001. The site was purchased in a raw land condition with approved mapping. The site sold for $18,700,000 or$153,1279 per unit with the homes having an overall density of 6.8 dwelling units per acre. In comparison to the subject site the condition of this property is considered �to be inferior. That is, the risk of grading is gone on the subject property while on �this site, �there was still risk at�time of purchase. The density of�this transaction at 6.8 dwelling units per acre is significantly lower than the subject sites. The market data and comparisons to the subject are summarized below: Data Acres/Units Date of No. Location Density Sale Price/Unit Comparison to Su 1 Chula Vista 4.92/170 3/20/20 $36,617* Inferior Condiition 34.55 2 Otay Mesa 12.98/450 3/16/20 Inferior Location & 34.66 $32,000, Condition 3 Millenia Otay 12.08/�480 2/27/20 Inferior—Density Ranch 39.0 $32,292 4 Millenia Otay �4.35/117 12/5/19 Subject Ranch /26-9 $41,155 Millenia Otay 4.47/92 5 Ranch 20.6 6/24/19 $43,478 Subject 6 Ssantee 2.,89/42 4/10/19 Inferior—Condition 24.53 $60,357 7 Otay Mesa 5.58/143 11/18 Inferior — Location & 25-63 $32,517 Condition 17.93/122 Lower Density 8 Spring Valley, 6.8 10/4/18 $153,279 Slightly Superior Location San Diego Inferior Condition *Based on bo�th parcels�p,urchase Two of�the land sales summarized include subject parcels. These sales reflect prices per acre that are consistent with other Millenia sales as well as other market data researched. Without making adjustments the marker data has an overall per unit range from $,32,292 �to $153,,279. The wide range is mainly influenced by density as �the various project densities range from 6.8 to 39.7 dwelling units per acre. Lower density product land typically sells at hig�her prices per unit and higher density product generally sells at lower per unit prices with other factors being equal. This is depicted with �the highest density Appraisal Report City of Chula Vista CIFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 69 A 0 J1 1 0 a 1;i r, '-—Q 202 f-03-t 6 Pligica-tua I at-INIC;L JL a8lF.,-tv..� vi sales generally having the lowest per unit price and �the lowest density sale having �the highest per unit price. The subject properties have densities in the 20�.6 to 26.9 dwelling units per acre range. Land Sale Nos. 4, 5, 6 and 7 have a density range from 14.53 to 26.9 dwelling units per acre with sales prices on a per unit basis ranging from $32,,517 to $,60,357. The lowest end of the range is for an unimproved property that was purchased to hold as an investment and is considered significantly inferior to the subject in condition and location. The remaining market data has a per unit range from $41,1155 �to $,60,357. As a secondary review we have looked at the market data on a density basis by inserting 4 the eleven comparables into a graph and extracting a trend line to suggest the subject properties value ranges. The chart is shown on the following page. Pric,e/Unit 200,000 150�000 'E 1001000 U CL 50)000 0 0 5 10 15 20 25 30 35 40 45 Density Using the above graph suggests the range of value for the subject properties in a raw land condition between $45,0001 and $601,0001 per unit. The sale of'the individual subject parcels is a very good indication of market value, in our opinion, with the comparable market data backing up the value conclusions. Data Nos 4 and 5 represents �the acquisition by Lennar of both Vibe and Cleo within the past 18 months. We have concluded that �the subject residential lands have the following superpad values �— Meridian $,55,0�O�O�; Vibe $60,000 and Cleo $,42,50�O based on density. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 70 A Q 11 i P 4A/- 11 6" P18ulaua T a%7r%.C;L a8c;400 T 7 All of the subject residential parcels all have had land development occur. We have reviewed historical costs of' development on three existing projects within Millenia which include Shea's Z & Element communities, Boulevard by Lennar (formerly CalAtlantic), and KB Homes Skylar project all which were built and sold out in 20,17 through 2019. The finishing costs ranged from $,81,683 per unit �to $92,,815 per unit �to bring �the lands to a true finished condition. In addition, we have reviewed Lennar's current cost estimates for Vibe and Cleo. The costs to bring these two projects to true finished lots is estimated at $94,669 per unit and $116,851 per unit. The current costs are 10 to 20 percent higher �than the historical costs from 20,16/17 when land development occurred on �the previous communities. This is typical due to increases material costs, labor and fees. Using an average finishing cost of $95,000 to $110,000 per unit suggests the finished lots would have a value in the $1401,10,00 to $165,10,00 per unit range. Pinnacle at Millenia has an overall density of 21.18 dwelling units per acre. There are 36 completed, individually owned homes, six models owned by the builder, 42 units under construction and 42 remaining building pads. We will value �the homes under construction (under 95 percent complete) on �the basis of a finished pad rather than attribute value to a partially complete improvement. Therefore, we will value 84 building pads in our analysis. Based on the market data and finishing costs, we have estimated the lands to have a finished pad value of$155,,000. The site has been developed to generally finished pads with an estimated $501,1283 in remaining costs per unit as discussed under the property description section earlier within this report. The valuation for the builder-owned lands within Pinnacle is calculated as follows: 84 building pads x $155,1000 $13)020)000 Less: �Remaining Costs ($,501,1283 x 84) (41,2 2 317 7 2) "As Is" value of builder owned lands $ 8)796)228 $ 8,800,000 (rounded) Vibe at Millenia has an overall density of' 20�.6 dwelling units per acre. There are five completed, individually owned homes, three models and eleven homes owned by the builder (over 95 percent complete), 25 units under construction and 48 remaining building Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 71 A 0 J1 0 4 I;j— p— 202 f_03-t 6 PligV'i-tua 1 UCISI& -1 agC"tv U1 / pads. We will value �the homes under construction (under 95 percent complete) on �the basis of a finished pad rather �than attribute value to a partially complete improvement. Therefore, we will value 73 building pads in our analysis. Based on the market data and finishing costs, we have estimated the lands to have a finished pad value of $165,1000. The site has been partially developed �to with an estimated $44,,867 remaining costs per unit as discussed under �the property description section earlier within this report. The valuation for the builder-owned lands within Vibe is calculated as follows: 73 building pads x $165)101010 $1270,457000, Less: Remaining Costs ($44,867 x 73) (3,2751291) "As Is" value of builder owned lands $ 877697709 $ 8,770,000 (rounded) Cleo at Millenia has an overall density of 26.9 dwelling units per acre. No homes are over 95 percent complete at this time. While there are 32 units under construction,y we will value a unit under construction on the basis of a finished pad,1 rather �than attribute value �to a partially complete improvement. Therefore,, we will value all 117 building pads in our analysis. Based on the market data and finishing costs, we have estimated the lands to have a finished pad value of $140,000. The site has been partially developed to with an estimated $55,1930 remaining costs per unit as discussed under the property description section earlier within �this report. The valuation for the builder-owned lands within Cleo is calculated as follows: 117 building pads x $1401,10,00 $167380,7000, ^X Less: Remaining Costs ($55,930 x 117) (63,543,81 U) "As Is" value of builder owned lands $ 978367190, $ 9,835,000 (rounded) Commercial Land Valuation In addition to revenues generated from residential land uses, there is one commercial site located within �the subject area of the Millenia master planned community. This property has been described earlier in �this report. Our search for commercial land sales resulted in ten land transactions consisting of nine sales and one current listing which have been summarized in the Addenda and are Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 72 A A 0 11 0 4AQ 202 f_03-t 6 P-18CIL-tua T aCTIZ& -1 a8c;"tV0 U1 discussed below. Due to the limited amount of commercial/office land sales in the area,1 we expanded our search to include industrial and retail sales along with reviewing office land sales in northern San Diiego County. Land Sale No. 1 pertains to the current listing of a 17.6-acre parcel located at the southeast corner of La Media Road and Otay Mesa Road in the City of San Diego in the area known as Otay Mesa about three miles south of' the subject property. The site is near Brown Field Municipal Airport and is essentially at the end of SR125 which terminates at Otay Mesa Road. The asking price on the site is $7.15 per square foot. The site was carved out due to the construction of the 9015 freeway which bisected an original approximate 70�-acre parcel. The two parcels are being sold separately or together. The current zoning of'this parcel is IL-3-1.0 which allows for a wide range of manufacturing or distribution activities. In comparison to the subject property, 'this site is considered inferior in condition (not finished site) and zoning. Land Sale No. 2 refers to the sale of a 2.75-acre parcel located in the Diistrict at Eastlake, about three miles north of the subject property. Eastlake Hospitality Ventures purchased the site for a hotel. The property was in escrow for six months prior to closing. The buyer paid $3,850,000 for the site or $,32.37 per square foot. In 2019 Hilton opened a dual- branded Hampton and Homewood Suites across the street from this site. They paid $19.53 per square foot for their site in 2015. These sites are located in the Eastlake Business area which is generally built out and surrounded by existing development. Land Sale No. 3 refers to the sale of an industrial zoned parcel located at the end of Harvest Road at Otay Center Drive in San Diego about three miles south of the subject. The property was unimproved at time of sale. Transportes Diiaz USA Inc. purchased the 1.97 acres for $1,000,000 per public record on October 22, 2020�. The site is unimproved with existing streets to the site. The property has excellent access to the Mexican border and is surrounded by trucking areas and logistic opportunities. The property is zoned for industrial use under the IBT (the international business and trade zone). Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 73 A 0 J1 1 0 j a 202 f-03-t 6 Plvgvatua I at-INIC;L I Ct8IF.,-tV-7 %JJL Land Sale No. 4 is also located in �the Otay Mesa area of San Diiego. The 7.81-acre site is surrounded by Airway Road on the south, Centurion Street on �the east,, Gigantic Street on the north and Excellante Street on the west. The site is a finished lot with the Otay Mesa Chamber of'Commerce and Southwestern Community College located on the north side of Gigantic Street which fronts �the 9015 Freeway. West of the site are existing distribution buildings. The site is zoned IP-1-1 which allows for research and development with some possible light manufacturing. The buyer, OM Gigantic Property, purchased the site for $5,,215,500 which equates to $,15.0�6 per square foot from RG Gigantic Otay LLC on February 201,1 20201. Land Sale No. 5 pertains to the January 16,1 2020 purchase of'a 2.47-acre parcel located at the northeast corner of'Otay Mesa Road and Ocean View Hills Parkway in San Diego. The site is slated for a retail development and is surrounded by existing apartments and new residences �to �the north and west. The buyer, Greenfield Square Otay Mesa LLC, purchased for the site for $2,700,000 which equates to $25-09 per square foot. The site is generally a finished lot with surrounding streets in place. Land Sale No. 6 refers�to another industrial zoned parcel located at the southern �terminus of Gateway Park Drive,y west of Heritage Road in Pacific Gateway Park. The site is zoned I-P-1-1 which allows for business park, research and development and light manufactu ring. There are several trucking yards in �the near vicinity. Heritage Gateway Park LLC purchased the 3.43 net acre site on February 6,1 2020, for $1,1742,5010 which equates to$11-68 per square foot. The site was raw at time of sale with streets completed to the site. Land Sale Nos. T 8 and 9 refer �to sales of commercial lands within Millenia which occurred in 20�16 and 20�17. Land Sale No. 7 is in regards to Sudberry (MCV23LLC) purchasing 12-58 acres which has been developed with retail known as Millenia Commons. Sudberry purchased the lands in April 20,17 for $5,1459,1725 or for $101.013 per square foot. They have constructed 135,000, square feet of retail space on the site and have successfully leased the space. The seller was SLF IV - Millenia LLC,,, the master Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 74 F Q All"I_A3_t 6 1 a8u.'-t I v ul /�V/�I V 8U11Ua I a%.,rSC;L developer of Millenia. Land Sale No. 8 pertains to the Ayers Millenia LP purchase in April 2016 of the 2.5-acre parcel adjacent to Land Sale No. 7 for $1,40101,000 or $12.83 per square feet. The land has been developed into an Ayers boutique hotel. Land Sale No. 9 closed in February 2016 and referred to a 7-062-acre parcel which is zoned for commercial. LIVIC Millenia Investment Co. LP (Chesnut) purchased the site for $2,568,,663 or$8.35 per square foot. At time of purchase Chesnut entered escrow on the two additional commercial parcels, including the subject commercial site. Proposed plans for all three sites were for"Think", "Invent" and "Discover" a commercial project with over 1.4 million square feet of office, medicali life science and high-tech space. Land Sale No. 9 referred to the "Think"' complex which is proposed for 424,100 square feet of medical office along with some service retail in an amenity building. The escrows in 20�17 were at $8.24 per square foot for the site on the west side of' Millenia and for $12.72 per square foot for the subject site. The subject site has an allowed residential component of possibly up to 225 units and has freeway visibility from the 125 Freeway. Per the seller the escrows were cancelled by the seller in January 20�18 due to a buyer default. The sales are summarized below Commercial Land Sale Summ Data Sale Size Price/ No. Location Date Acres Price S Land Use 1 San Diego/Otay Mesa Listing 17-6 $5,480,000 $7.15 Industrial 2 Eastlake, Chula Vista 9/20 2.75 $3,850,000 $32.37 Hotel Site 3 San Diego/Otay Mesa 10/20 1.97 $1,000,000 $11.65 Industrial 4 San Diego/Otay Mesa 2/20 7.81 $5,215,500 $15.06 Industrial 5 O�cean Hills/Otay Mesa 1/20 2.47 $2,700,000 $25-09 Retail 6 San Diego/Otay Mesa 2/20 3.43 $1,742,500 $11.68 Industrial '7 SE & SWC Birch Rd. & 4/17 12-58 $5,4591725 $10-03 Retail site Millenia Ave., Millenia MPC 8 W/S Millenia Ave. @ 4/16 2.505 $1,400,000 $12-83 Ayres Hotel Stylus St., Millenia MPC 9 E/S Millenia Ave., S/O 2/16 7.062 $2,568,663 $8.35 "'Think" project Stylus St., Millenia MPC The market data has a wide range from $,7.15 to $,32.37 per square foot. Data No. 2Ahe highest price, refers to a sale in the Eastlake Business area which is reaching build-out and was purchased to construct a hotel. We have additional information on the purchase of another site within the same area in 20,15 which Hilton purchased for$19.53 per square Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 75 4 4 A A Q 41 , P a 4 J -I U P-1 a U I at_�rSC;L g1c,-t a a8c;-t T f T 7 foot and has developed a hotel. This area is considered superior�to�the subject. Land Sale Nos. 3,1 4 and 6 are all designated for industrial use and located near Brown Field, an inferior location. Other office land sales were reviewed that are located in northern portions of San Dieg�o County in the Carlsbad area. These sales range in unit prices from just under $15.010, to $20.001 per square foot. In our opinion these locations are superior �to �the subject but are good indications of commercial land values for office locations. The subject commercial site is located on the west side of Millenia Avenue, one of' the main arterial streets �through �the community and has prominent visibility within �the development as well as from State �Route 125. While the site is designated for commercial use, there is the possibility of a residential component of possibly up to 225 units for mixed use. The 225 potential residential units are a total for both Lot 1 and Lot 19 (subject parcel). At�this time,1 it is unknown if, when or where they will be built. Based on the comparable data and summarized considerations we have estimated the retail value of the commercial site at $,15.00 per square foot. SLF-1V Millenia Ownership Valuation SLF-IV Millenia owns Lot 19 of'Tract 16081. Lot 19 consists of an 8-34-acre commercial parcel with the possibility of a residential component of' up to 225 units. We have concluded market value of $15.00 per square foot. Using �the Meyers �Research absorption tables for office, and assuming Lot 7 is developed as proposed, it will be leased up in four to five years. This suggests that Lot 19 will not be developed for at minimum four or five years with a prospective buyer becoming interested possibly in three or four years. Using the concluded current market value of $15.001 per square foot and discounting it for a �three to four-year period at 101 percent per year suggests �the parcel's current market value is about $,10.25 to $11.25 per square foot range. We have concluded that the subject Lot 19 has a current market value of $10.50 per square foot. In addition, 'the subject parcel will be subject �to the CFD1 20,16-1 IA 2 special taxes which are estimated at $45,10,00 per year on �the undeveloped parcel. This amount will need to Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 76 Q A1114-A3-t 6* I r", I i -L /�V/�I V 8U11UCt I Ct%.,r%,C;L be paid over�the four-year hold resulting in a deduction from the current value. The value is calculated as follows: Lot 19 (8-34 Acres) x $10-50/sf = $35814,5,549 Less CFD 2016-1 IA2 Special Taxes ($,45,01010 x 4,) (180,01010) Current Market Value Lot 19 $35634,5,549 (rounded) $�3,635)10100 Meridian Ownership Valuation Meridian owns six model homes, 42 lots under construction and 42 generally finished building pads. The units under construction were valued on the basis of a building pad, rather than attribute value to a partially complete improvement. The 84 lots 66 as is)7 value conclusion was $8,8010,10,0101. The six model homes will be valued below followed by the final calculation of�the builder-owned lands and �the individual owned unit's valuation. Retail House Valuation Due to �the single ownership of multiple houses by Meridian, a Discounted Cash Flow ("DCF"') analysis is needed in order to arrive at a bulk value for the homes. First, a retail value for each plan will be concluded followed by a D,CF for the builder which will take into account the absorption time to sell offthe builder owned houses, the costs associated with selling off the homes and any remaining costs owed by �the builder within the neighborhood. The resulting revenue will be discounted using an appropriate rate to determine the builder-owned bulk value. Pinnacle by Meridian consists of 126 proposed single family attached condominiums,1 some attached two, story and some penthouse units with living quarters on the third and fourth floors. Thirty-six of the homes are completed and have closed to individual homebuyers. There are six completed model homes, 42 units under construction and an additional 42 homesites in a generally finished condition. In this analysis we will value each plan within Pinnacle and �then use a discounted cash flow analysis to conclude at a bulk value for the builder owned homes. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 77 202 f_03-t 6 P-18CIL-tua T aCTIZ& "t-1 U I Below is a summary of the floor plans within Pinnacle. A listing of�the improved residential comparable properties is located in �the Addenda of �this report. This listing is utilized in the valuation for each plan using the Sales Comparison Approach to value. Completed 95%Complete Plan Room Floorsl Sq. Ind. Bldr. Count Parking Ft. Owned Owned City'Towns at Pinnacle I I 1 3/3 2/2 11362 6 1* 2 3/2 2/2 11433 6 1* 3 4/3 2/2 11989 1 6 1* Elevator Penthouses at Pinnacle I 4 3/2 4/2 21185 6 1* 5 3+,/2 4/2 21380 6 1* 6 3+,/2 4/2 1 2,522 6 1* Total 1 36 6 *One of each plan is a model ho�me. In addition to the above shown houses, there are 42 homes under construction and 42 finished pad�s. The most appropriate new home comparable data for Pinnacle Plan 1 are shown below. Data Plan Rm. Ct. Firs/ S,q. Ft. Price/SIF I Subj. 1 3 / 3 2 / 1 1,362 1 2 3 /2 2 /2 1,)1433 $,336.29 3 2 2 / 2.5 2 /2 1)1215 $�311.013 3 3 2 / 2-5 3 /2 11)1265 $,291-62 4 2 2 / 2.5 2 /2 11,357 $�298.38 7 ^r-1 _E1 2 / 2-5 L 3 /2 1,),340 $,335-oo All new home comparables are located within Otay Ranch or Playa Del Sol. All are of'similar quality,1 design and appeal. Adjustments were considered (when applicable) for location, master plan amenities,1 lot size, stories, sales concessions, CFD1 taxes, common area benefits, total square footage,,, room count,,, garage space and other amenities. The new home comparables have a base price range from $,291.62 to $,336-29 per square foot. Pinnacle Plan 1 has a current asking base price of $336-20- There have been six closings of Plan 1 with actual sales prices ranging from $,322.98 to $343.101 per square foot. There are currently six escrows, of Plan 1 with sales prices ranging from $,323.72 to $,3401.60 per square foot. It should be noted that most homebuyers purchase some upgrades, premiums and options and builders typically offer some concessions. Our concluded price is based on �the base price of�the home with no upgrades, premiums or options. The homes appear Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 78 ',J A F 44 a t�-Q V/-.I-V3-t 6*gUltd Ct flat.31SC;IL -L a8c;-t-1-t kil //�4— �to be in excellent condition with no depreciation visible. It has been concluded that Plan 1 has a base current market value of$315.00, per square foot. This calculates as follows: 1,362 sf x $315.0101 = $429,,030 The most appropriate new home comparable data for Pinnacle Plan 2 are shown below. Data Plan Rm. Ct. Firs/ Sq. Ft. Price/SF Subj. 2 3 /2 2 /2 1)1433 1 1 3 / 3 2 /2 1,5,362 $,336.zu 1 3 4 / 3 2 /2 1)1989 $�275.47 3 4 3 / 2-5 3 /2 1,5,504 $,278-52 4 2 2 / 2.5 2 /2 1)1215 $�311.013 4 3 3 / 3 2 /2 1),652 $�266.28 5 2 2 / 2-5 2 / 1 1,5,583 $,290-52 5 3 2 / 2.5 2 /2 1),587 $�308.69 7 1 2 / 2-5 3 /2 1,5,340 $,335.65 7 2 %J%j _L3 / 2.5 3 /2 1),583 $�304.99 All new home comparables are located within Otay Ranch or Playa Del Sol. All are of similar quality,1 design and appeal. Adjustments were considered (when applicable) for location, master plan amenities, lot size, stories, sales concessions, CFD1 taxes, common area benefits, total square footage,,, room count,,, garage space and other amenities. The new home comparables have a base price range from $,266.28 to $336.201 per square foot. Pinnacle Plan 2 has a current asking base price of$,336.29. There have been six closings of' Plan 2 with actual sales prices ranging from $,330.49 to $,352-51 per square foot. There are currently seven escrows of Plan 2 with sales prices ranging from $,323.0�3 to $340�-47 per square foot. It should be noted that most homebuyers purchase some upgrades,1 premiums and options and builders �typically offer some concessions. Our concluded price is based on the base price of the home with no upgrades, premiums or options. The homes appear to be in excellent condition with no depreciation visible. It has been concluded that Plan 2 has a base current market value of $3101.00 per square foot. This calculates as follows: 1 433 sf x $,310.010, = $444)1230 Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 79 4 4 A A Q 41 1, p 4 4 ?- p_Q -I U P-1 ;]L U I at_�rSC;L g1c,-t a a8c;477 OT 72.4" The most appropriate new home comparable data for Pinnacle Plan 3 are shown below. Data Plan Rm. Ct. Firs/ S,q. Ft. Price/SIF Su 3 4 / 3 2 /2 1,5,989 1 2 /2 2 /2 1)1433 $�226.z�j 1 4 3 /2 4 /2 2)1185 $�255.79 2 2 4 / 3-5 3 /2 115,819 $,279.77 3 6 4 / 3.5 3 /2 1),675 $�276.36 4 5 3 / 3-5 3 /2 2,5,0�25 $,246.86 6 1 3 / 3.5 3 /2 1)1938 $�280.13 7_� 3 3 / 2-5 3 /2 2,5,0�05 $,273.8 All new home comparables are located within Otay Ranch or Playa Del Sol. All are of'similar quality,1 design and appeal. Adjustments were considered (when applicable) for location, master plan amenities,1 lot size, stories,, sales concessions, CFD1 taxes,, common area benefits,1 total square footage,1 room count garage space and other amenities. The new home comparables have a base price range from $,226.29 to $,280-13 per square foot. Pinnacle Plan 3 has a current asking base price of'$,275.47. There have been six closings of Plan 3 with actual sales prices ranging from $,267.16 to $,282.38 per square foot. There are currently seven escrows of Plan 3 with sales prices ranging from $,265.41 �to $279.99 per square foot. It should be noted that most homebuyers purchase some upgrades,1 premiums and options and builders typically offer some concessions. Our concluded price is based on �the base price of�the home with no upgrades, premiums or options. The homes appear�to be in excellent condition with no depreciation visible. It has been concluded that Plan 3 has a base current market value of $255.00 per square foot. This calculates as follows: 1,989 sf x $255.0101 = $50T195 The most appropriate new home comparable data for Pinnacle Plan 4 are shown below. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 80 A 0 ji 0 202 f-03-t 6 PligV'i-tua 1 UCISI& agC "t-tv Data Plan Rm. Ct. Firs/ Sq. Ft. Price/SF Subj. 4 3 /2 4 /2 2)118 5 �� - 1 3 4 / 3 2 /2 115,989 $,275.47 1 5 3 /2 4 /2 2,5,380 $,249-96 2 3 4 / 3.5 3 /2 2)10137 $�262.1 0 4 5 3 / 3-5 3 /2 2,5,0�25 $,246-86 4 6 4 / 3.5 4 /2 2)1439 $212.1A 6 2 4 / 3-5 3 /2 2,51256 $,255.27 7 J 3 3 / 2.5 3 /2 2)10105 $�273.89 All new home comparables are located within Otay Ranch or Playa Del Sol. All are of similar quality,,, design and appeal. Adjustments were considered (when applicable) for location, master plan amenities,,l lot size, stories,,, sales concessions, CFD1 taxes,,, common area benefits,1 total square footage,1 room count garage space and other amenities. The new home comparables, have a base price range from $,212.34 to $,275.47 per square foot. Pinnacle Plan 4 has a current asking base price of$,255.79. There have been six closings of' Plan 4 with actual sales prices ranging from $,252.0�6 to $273-90 per square foot. There are currently seven escrows of Plan 4 with sales prices ranging from $,253.50 to $262-20 per square foot. It should be noted that most homebuyers purchase some upgrades,1 premiums and options and builders typically offer some concessions. Our concluded price is based on the base price of the home with no upgrades, premiums or options. The homes appear to be in excellent condition with no depreciation visible. It has been concluded that Plan 4 has a base current market value of $245.00 per square foot. This calculates as follows: 2,185 sf'x $245.00 = $535,5,325 The most appropriate new home comparable data for Pinnacle Plan 5 are shown below. Data � Plan Rm. Ct. Firs/Pkg. S,q. Ft. Price/SIF Subj. 5 3 /2 4 /2 2),380 1 4 3 /2 4 /2 2,51185 $,255.f�j 1 6 3 /2 4 /2 2),522 $�244.61 2 3 4 / 3.5 3 /2 2,5,0�37 $,262.10 4 5 3 / 3.5 3 /2 2)10125 $�246.86 4 6 4 / 3-5 4 /2 2,51439 $,212-34 6 2 4 / 3-5 3 /2 2,51256 $,255.27 6 3 4 / 3.5 L 3 /2 2),505 $�251.46 Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 81 A 0 J1 0 4 4— p— 202 f_03-t 6 PligV'i-tua 1 UCISIV't -1 agC"t-1 U1 / All new home comparables are located within Otay Ranch or Playa Del Sol. All are of similar quality,1 design and appeal. Adjustments were considered (when applicable) for location, master plan amenities, lot size, stories, sales concessions, CFD1 taxes, common area benefits, total square footage,,, room count,,, garage space and other amenities. The new home comparables, have a base price range from $,212.34 to $262.101 per square foot. Pinnacle Plan 5 has a current asking base price of$,249.96. There have been six closings of' Plan 5 with actual sales prices ranging from $,253.93 to $,286-28 per square foot. There are currently seven escrows of Plan 5 with sales prices ranging from $,242.82 to $258-36 per square foot. It should be noted that most homebuyers purchase some upgrades,1 premiums and options and builders typically offer some concessions. Our concluded price is based on the base price of the home with no upgrades, premiums or options. The homes appear to be in excellent condition with no depreciation visible. It has been concluded that Plan 5 has a base current market value of $235.00 per square foot. This calculates as follows: 2,380 sf'x $235.00 = $559,300 The most appropriate new home comparable data for Pinnacle Plan 6 are shown below. Data Plan Rm. Ct. Firs/P Sq. Ft. Price/SF Subj. 6 3 /2 4 /2 2,5,522 1 5 3 /2 4 /2 2),380 $�249.96 2 3 4 / 3-0 3 /2 2,5,0�37 $,262.10 4 5 3 3.5 3 /2 2)10125 $�246.86_ 4 6 4 3.5 4 /2 21 A ICI $,212.34 0-%"7 6 2 4 3.5 3 /2 2)1256 $255.2"t 3 L 4 3.5 3 /2 2,5,505 $,251.46 All new home comparables are located within Otay Ranch or Playa Del Sol. All are of'similar quality,1 design and appeal. Adjustments were considered (when applicable) for location, master plan amenities,1 lot size, stories,, sales concessions, CFD1 taxes, common area benefits, total square footage,,, room count,,, garage space and other amenities. The new home comparables have a base price range from $,212.34 to $,255-27 per square foot. Pinnacle Plan 6 has a current asking base price of$,244.61. There have been six closings of Plan 6 with actual sales prices ranging from $,257.26 to $273.501 per square foot. There Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 82 A Q 11 j P a j Q 11 6" 018ujaua T a%7rSC;L a8c;-t T N T 7 2�4-1 are currently seven escrows of Plan 6 with sales prices ranging from $,237.87 �to $253.73 per square foot. It should be noted that most homebuyers purchase some upgrades,1 premiums and options and builders typically offer some concessions. Our concluded price is based on the base price of the home with no upgrades, premiums or options. The homes appear�to be in excellent condition with no depreciation visible. It has been concluded that Plan 6 has a base current market value of $2301.00 per square foot. This calculates as follows: 2,522 sf'x $230.00 = $580�,5,060 Builder Owned Retail Value Within Pinnacle,,, all six builder-owned homes are model homes. Per interviews with builders,,, upgrades and landscape/hardscape of up to $100,000 are installed in the model homes,1 however, 'the builders generally consider this a marketing cost and do not anticipate recovering this investment on a dollar for dollar basis. Based on historical information, home sizes and fixtures, actual model home sales within the subject area and the current real estate market, a consideration of a $40,000 premium has been included with each of�the model homes. The retail base value conclusions for the builder- owned homes are calculated as follows: Plan 1 (1 x $429,030) $ 4295030 Plan 2 (1 x $444,1230) 4447230, Plan 3 (1 x $507,1195) 50�75195 Plan 4 (1 x $535,,325) 5357325 Plan 5 (1 x $559,300) 5595300 Plan 6 (1 x $5 8 01)1016 0) 580,7060, Model Upgrades (6 x $,40,00�O�) 240, 00 Total Pinnacle Retail Value 31295,140, Absorption Period In order to arrive at an absorption period for the builder owned homes within Pinnacle, the absorption rates for the subject and comparable projects have been reviewed. The sales rates within the three subject projects range from 8.6 sales per month to 16.9 sales per month. The comparables, outside of Millenia range from 4.8 �to 5.5 sales per month. In addition to reviewing actual sales rates,y we have reviewed Meyers Research Market Absorption Study on Pinnacle which projects a sales rate in the 3 units per month range. We have concluded that �the six model homes will be absorbed over a two-month time period. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 83 A 0 J1 0 f-()3-t 6 PligV'i-tua 1 UCISI& agC "t-1-7 Remaining Costs, As discussed earlier within this report �the Meridian owned property has some remaining costs associated with the land development. There are an additional $4,525,443 in land development costs and development fees. These costs should be spread across all builder owned property which includes �the six builder-owned model homes,1 the 42 units, under construction and �the 42 remaining pads. Dividing �the $,4,525,1443 by the 90, total builder owned units suggests a per lot remaining cost of $50,1283 per lot. This valuation is for the six model homes which suggests there are $301,698 ($50,,,283 x 6) in remaining land development costs associated with �the builder owned completed homes. For purposes of this analysis we are estimating �the remaining land development costs will be spread evenly over the absorption period. Expenses, In determining an expense rate, several builders in the subject area have been interviewed as to their expenses on selling existing inventory. Expenses include marketing and general administrative costs. These costs typically range from six to ten percent depending on varying factors such as absorption period, intensity of marketing, etc. Six percent has been estimated for marketing expenses and two percent for general and administrative costs for a total of'eig�ht percent in expenses for the subject neighborhood's analysis. Profit Several interviews with merchant builders in the area were conducted in order to determine an appropriate profit percentage for the subject properties. In the early 20�00s, developers typically attempted to achieve a 10 to 12 percent profit based on gross sales proceeds. During �the Great Recession) this, range was lowered considerably �to six �to eight percent with some builders drastically lowering their profit marg�ins in order to maintain their work force. As the market improved, so did the profits. This appears to be occurring once again as prices have increased in �the past year. A �ten percent profit is considered appropriate in the analysis for�these neighborhoods. Discount Rate In selecting a discount rate,1 the following was completed: Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 84 202 f-03-t 601gMada Pal..31S,& I agC a 11 A "t/�V'U1 1. Interviews with merchant builders in the South San D�iego market area 2. Review of' current market conditions including current market rates as well as yields reflected in other markets (i.e.,i municipal bonds, corporate bonds, etc.) 3. The quality, construction, historical sales and product on the subject properties 4. Discussed the project with equity investors and master plan community developers The homes within Millenia have been well received in the marketplace with excellent absorption rates. Due to the good sales rates, a ten percent discount rate is considered appropriate for the subject neig�hborhoods. Discounted Cash Flow Summ The discounted revenue (see D,CF Analyses in Addenda) for the builder owned homes resulted in the value of$,2,370�,543 (rounded) $,2,370�,000�. Meridian Ownership Final Valuation Meridian owns six model homes, 42 units under construction and 42 remaining pads within Pinnacle at Millenia. In the valuation of' the residential lands above, the land improvements to date were considered. The final value conclusion for the Meridian owned property is shown below. 84 generally finished pads $ 8780,070010, Six model homes $ 213701000 Total Meridian Ownership Valuation 1$1191709000 Pinnacle Individual Owners Value Conclusion. In determining the value for the individually owned homes,1 we have considered the concluded base price value for the homes which is considered a minimum market value. This is due to homebuyers typically purchasing some upg�rades and options or paying premiums for the lot. Within Pinnacle there are 36 individually owned homes. The concluded values are shown below: Plan 1 (6 x $429,10,30) $ 2),5747180, Plan 2 (6 x $444,1230) 2,56655380 Plan 3 (6 x $507,1195) 3)101437170, Plan 4 (6 x $535,325) 3,1211 5950 Plan 5 (6 x $559,,300) 3),35578010, Plan 6 (6 x $580,060) 3,1480,36u� ni Total Pinnacle Ind. Owned 181330184w Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 85 A 0 J1 0 t�— 202 f_03-t 6 PligVnua 1 UCISI& agC "t/�I In an additional analysis, we have reviewed the actual builder sales prices for the homes within Pinnacle. Sales occurred between February 20�20 and November 15, 20�2O�. The builder reported closing prices for the individually owned homes totals $18,,807,,426 about 2.5 percent higher than the concluded value. The actual sales prices include any upgrades, premiums or options purchased by the homeowner while our concluded value is for the base value of the homes. While this difference would typically be greater, there have been price appreciation with base pricing rising across all plans which has offset the increase paid due to upgrades, premiums and options. It is our opinion that the actual sales prices further substantiate the concluded minimum market values for the Pinnacle individually owned homes Vibe - Lennar Ownership Valuation Within Vibe, Lennar owns three model homes, 11 homes over 95 percent complete,1 25 units which are under construction and 48 remaining building pads. The units under construction were valued on the basis of a building pad rather than attribute value to a partially complete improvement. The 73 lots 96 as is))I value conclusion was $8,1770,000. The builder-owned units over 95 percent complete (14 units including three model homes) will be valued followed by the final calculation of the builder-owned lands. Finally) the individual owned units within Vibe will be valued. Retail House Valuation Due to the sing�le ownership of multiple houses by Lennar, a Discounted Cash Flow CDCF") analysis is needed in order to arrive at a bulk value for the homes. First, a retail value for each plan will be concluded followed by a D,CF for the builder which will take into account the absorption time to sell offthe builder owned houses, the costs associated with selling off' the homes and any remaining costs owed by the builder within the neighborhood. The resulting revenue will be discounted using an appropriate rate to determine the builder owned bulk value. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 86 QA1114 A3-t6* 1 11 11 1 /�V/�I_V gU11UCt I Ct%.,rSC;L -tzz. I Vibe by Lennar consists of 92 proposed single family attached condominiums which are all three story. Five of�the homes are complete and have closed �to individual homebuyers. There are three completed model homes, 14 units that are over 95 percent complete, 25 units under construction and an additional 48 building pads in a generally finished condition. In this analysis we will value each plan within Vibe and then use a discounted cash flow analysis to conclude at a bulk value for the builder-owned homes over 95 percent complete. Below is a summary of �the floor plans within Vibe. A listing of the improved residential comparable properties is located in �the Addenda of this, report. Completed 95%Complete Plan Room Floors/ Sq. Ind. Bldr. I Count Parking I Ft. I Owned I Owned i VIBE at Millenia I 1 4/3 3/2 11681 2 5* 2 4/3.5 3/2 11819 0 5* 3 1 4/3.5 3/2 21037 1 3 4* Total 1 1 5 14 *One of each plan is a model ho�me. In addition to the abo�ve shown houses, there are 25 hornes under construction and 48 finished pad�s. The most appropriate new home comparable data for Vibe Plan 1 are shown below. Data � Plan Rm. Ct. Firs/ S,q. Ft. Price/S,F I Subj. 1 4 / 3 3 / 11,681 1 3 4 / 3 2 /2 1,5,989 $,275.47 2 2 4 / 3.5 3 /2 11,819 $�279.77 3 6 4 / 3-5 3 /2 1,5,675 $,276-36 4 3 3 / 3 2 /2 11,652 $�266.28 5_ 3 2 / 2-5 2 /2 115,587 $,308-69 7 2 / 2.5 3 /2 11,583 $�304.65 All new home comparables are located within Otay Ranch or Playa Del Sol. All are of similar quality,,, design and appeal. Adjustments were considered (when applicable) for location, master plan amenities,,l lot size, stories,,, sales concessions, CFD1 taxes,,, common area benefits,1 total square footage,1 room count garage space and other amenities. The new home comparables have a base price range from $266.28 �to $3018.69 per square foot. Vibe Plan 1 has a current asking base price of'$287.86. There have been two closings of Plan 1 Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 87 A 0 J1 1 0 202 f_03-t 6 Pligica-tua I aCr%.C;L I(281F6, 214, with actual sales prices ranging from$,275.48 to$,288.43 per square foot. There are currently ten escrows of Plan 1 with sales prices ranging from $277.22 to $,299.48 per square foot. It should be noted that most homebuyers purchase some upgrades, premiums and options and builders typically offer some concessions. Our concluded price is based on the base price of the home with no upgrades, premiums or options. The homes appear to be in excellent condition with no depreciation visible. It has been concluded that Plan 1 has a base current market value of$270.00 per square foot. This calculates as follows: 1,,681 sf x $2701.00 = $4537870, The most appropriate new home comparable data for Vibe Plan 2 are shown below. Data Plan Rm. Ct. Firs/P Sq. Ft. Price/SF Subj. 2 4 / 3.5 3 /2 1,5,819 1 3 4 / 3 2 /2 1)1989 $�275.47 1 4 3 /2 4 /2 2,)1185 $,255.79 1 ON 2 1 4 / 3 3 / Z 1)1681 $�287.86 2 3 A / 3.5 3 /2 2,5,0�37 $,262.10 4 5 3 / 3.5 3 /2 2)10125 $�246.86 6 1 3 / 3.5 3 /2 1)1938 $�280.13 7 3_ 3 / 2-5 3 /2 2,5,0�05 $273-89 All new home comparables are located within Otay Ranch or Playa Del Sol. All are of similar quality,,, design and appeal. Adjustments were considered (when applicable) for location, master plan amenities,,l lot size, stories,,, sales concessions, CFD1 taxes,,, common area benefits,1 total square footage,1 room count garage space and other amenities. The new home comparables have a base price range from $246.86 to $287.86 per square foot. Vibe Plan 2 has a current asking base price of'$279.77. There have been no closings of Plan 2 however there are 11 escrows with sales prices ranging from $,268.77 to$283-56 per square foot. It should be noted that most homebuyers, purchase some upgrades,, premiums and options and builders typically offer some concessions. Our concluded price is based on the base price of the home with no upgrades,, premiums or options. The homes appear to be in excellent condition with no depreciation visible. It has been concluded that Plan 2 has a base current market value of$258.0101 per square foot. This calculates as follows: Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 88 -4 4 A A Q I I I P all a 1 U P-1gullua T a%7rSC;L a8c;-M-t T 7 1,819 sf x $258.00 = $469,,302 The most appropriate new home comparable data for Vibe Plan 3 are shown below. Data Plan Rm. Ct. Firs/ S,q. Ft. Price/SIF Subj. 3 4 / 3.o 3 /2 25,0 3 7 1 3 4 / 3 2 /2 1)1989 $�275.47 1 4 3 /2 4 /2 2)1185 $�255.79 2 2 4 / 3-5 3 /2 115,819 $,279.77 4 5 3 / 3.5 3 /2 2)10125 $�246.86 4 6 4 / 3-5 4 /2 2,)1439 $,212.34 6 2 4 / 3.5 3 /2 2)1256 $�255.27 7 3 .5 3 /2 UU L 3 / 2 2,5,0�05 $,273.On All new home comparables are located within Otay Ranch or Playa Del Sol. All are of'similar quality,,, design and appeal. Adjustments were considered (when applicable) for location, master plan amenities,1 lot size, stories,, sales concessions, CFD1 taxes,, common area benefits,1 total square footage,1 room count garage space and other amenities. The new home comparables have a base price range from $212.34 to $279-77 per square foot. Vibe Plan 3 has a current asking base price of$262.10. There have been three closings of Plan 3 with actual sales prices ranging from $251.31 �to $,264.72 per square foot. There are currently 13 escrows of Plan 3 with sales prices ranging from $,253.85 to$271.35 per square foot. It should be noted that most homebuyers purchase some upgrades,, premiums and options and builders typically offer some concessions. Our concluded price is based on the base price of�the home with no upgrades,, premiums or options. The homes appear �to be in excellent condition with no depreciation visible. It has been concluded that Plan 3 has a base current market value of$248.00 per square foot. This calculates as followsi: 2,037 sf x $248.0101 = $505,,176 Builder Owned Retail Value Within Vibe there are three models and 11 production homes over 95 percent complete. Per interviews with builders,,, upgrades and landscape/hardscape of up to $100,000 are installed in the model homes, however, the builders generally consider this a marketing cost and do not anticipate recovering this investment on a dollar for dollar basis. Based Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) J Kitty Siino&Associates, Inc. Page 89 QA1114 H-M* 1 11 11 1 /�V/-.I-V gU11UCt I Ct%.,r%.C;L -tz,-) I Z, on historical information, home sizes and fixtures, actual model home sales within the subject area and the current real estate market, a consideration of a $40,0010, premium has been included with each of'the model homes. The retail base value conclusions for the builder-owned homes are calculated as follows: Plan 1 (5 x $453,,870) $ 272697350, Plan 2 (5 x $469,302) 2,346)510 Plan 3 (4 x $505,1176) 270,20,7704 Model Upgrades (3 x $,40,00�O�) 1201000 Total Vibe Retail Value 61756,564 Absorption Period In order to arrive at an absorption period for the builder owned homes within Vibe, the absorption rates for the subject and comparable projects have been reviewed. The sales rates within the three subject projects range from 8.6 sales per month to 16.9 sales per month with Vibe selling an average of 8.7 homes per month. The comparables outside of Millenia range from 4.8 to 5.5 sales per month. In addition to reviewing actual sales rates, we have reviewed Meyers Research Market Absorption Study on Vibe which projects a sales rate in the 3 units per month range. We have concluded that the 14 builder-owned homes over 95 percent complete will be absorbed over a three-month time period. Remaining Costs As discussed earlier within this report the Meridian owned property has some remaining costs associated with the land development. There are an additional $3,90�3,461 in land development costs and development fees. These costs should be spread across all builder owned property which includes the builder-owned homes over 95 percent completel the 25 units under construction and the 48 remaining pads. Dividing the $3)903,1461 by the 87 total builder owned units suggests a per lot remaining cost average of$44,867 per unit. This valuation is for 14 builder-owned units which suggests there are $628)1138 ($,44,867 x 14) in remaining land development costs associated with the builder owned completed homes. For purposes of this analysis we are estimating the remaining land development costs will be spread evenly over the absorption period. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 90 A 0 J1 1 0 a g%g7 Q 41 -()3-t 6 Pligica-tua I aCr%.C;L JL a8lF.,-t/�v%JIL /�-t ,�Expenses In determining an expense rate, several builders in the subject area have been interviewed as to their expenses on selling existing inventory. Expenses include marketing and general administrative costs. These costs typically range from six to ten percent depending on varying factors such as absorption period, intensity of marketing, etc. Six percent has been estimated for marketing expenses and two percent for general and administrative costs for a total of'eig�ht percent in expenses for the subject neighborhood analyses. Profit Several interviews with merchant builders in the area were conducted in order to determine an appropriate profit percentage for the subject properties. In the early 20�00s, developers typically attempted to achieve a 10 to 12 percent profit based on gross sales proceeds. During the Great Recessionl this range was lowered considerably to six to eight percent with some builders drastically lowering their profit marg�ins in order to maintain their work force. As the market improved, so did the profits. This appears to be occurring once again as prices have increased in the past year. A ten percent profit is considered appropriate in the analysis for these neighborhoods. Discount Rate In selecting a discount rate,1 the following was completed: 1. Interviews with merchant builders in the South San Diiego market area 2. Review of current market conditions including current market rates as well as yields reflected in other markets (i.e., municipal bonds, corporate bonds,,, etc.) 3. The quality, construction, historical sales and product on the subject properties 4. Discussed the project with equity investors and master plan community developers The homes within Millenia have been well received in the marketplace with excellent absorption rates. Due to the good sales rates and minimal supply, a ten percent discount rate is considered appropriate for the subject neighborhoods. Discounted Cash Flow Summ The discounted revenue (see D,CF Analyses in Addenda) for the builder owned homes resulted in the value of$,4,831,497 (rounded) $4,830,000. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 91 All"I_A3_t 6* I r,% I i _L I V 8U11UCt I Ct%.,r%.UL Lennar Vibe Ownership Final Valuation Lennar owns three models and 11 production homes over 95 percent complete,y 25 units under construction and 48 remaining pads within Vibe at Millenia. In the valuation of the residential lands above,1 the land improvements to date were considered. The final value conclusion for the Lennar Vibe owned property is shown below. 73 generally finished pads $ 8)770)000 14 model & production units 1$ 41830,0010, Total Lennar Vibe Ownership Valuation $13160 Vibe Individual O�wners Value Conclusion, In determining the value for the individually owned homes, we have considered the concluded base price value for the homes which is considered a minimum market value. This is due to homebuyers typically purchasing some upgrades and options or paying premiums for the lot. Within Vibe there are five individually owned homes. The concluded values are shown below: Plan 1 (2 x $453,,870) $ 90,77740, Plan 2 (0 x $469,302) 0 Plan 3 (3 x $505,1176) 11515,528 Total Vibe Ind. Owned 21423,268 In an additional analysis, we have reviewed the actual builder sales prices for the homes within Vibe. Sales occurred between July 2020, and November 15, 2020. The builder reported closing prices for the individually owned homes totals $2,525,204 about four percent hig�her than the concluded values. The actual sales prices include any upgrades, premiums or options purchased by the homeowner while our concluded value is for the base value of the homes. It is our opinion that the actual sales prices further substantiate the concluded minimum market values for the Vibe individually owned homes Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Page 92 202 f-03-t 6 P-18CIL-tua T aCTIZ& &-r/�O U1 Cleo - Lennar Ownership Valuation Within Cleo, Lennar owns six models and 26 production units that are under construction along with 85 remaining building pads in a generally finished condition resulting in 117 building pads being valued. As there are no completed homes, the following is the final Lennar ownership valuation for Cleo. 117 generally finished pads 918 3 51 0 0 0 Total Lennar Cleo Ownership Valuation 998359000 Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 93 QAIIIJ H-M* 1 11 11 1 -L a8c; /�V/�I-V gU11UCt I Ct%.,r%.C;L APPRAISAL REPORT SUMMARY The appraisal assignment was to value �the subject property within the City of Chula Vista CFD1 No. 16-1 Improvement Area No. 2 which includes 335 proposed residential units and one commercial parcel being developed within the master planned community known as Millenia in Otay Ranch,,, Chula Vista. There are currently two builders selling new homes within three projects within CFD1 2016-1 IA 2. Meridian is selling �their Pinnacle neighborhood and Lennar is selling �their Vibe and Cleo neighborhoods. The parcels have all been mass graded,, are currently selling and have improvements ranging from completed, individually owned homes to builder owned homes,,l to homes under construction and finally �to partially finished building pads. Closings began in May 2020, with 41 homes closed �to individuals as of November 15, 2020 and an additional 96 homes in escrow. The currently selling projects are experiencing excellent sales rates with most homes sold as soon as they are released. All structures appear to be in excellent condition with no visible depreciation. We have reviewed builder sales and reviewed the MLS for re-sales. The subject property was valued utilizing the Sales Comparison Approach �to value to ascertain the retail values of�the lands,1 then using a Discounted Cash Flow for�the homes owned by the builders that are over 95 percent complete and a mass appraisal technique for the individually owned homes. A minimum value was determined by concluding at a base value for�the homes. The valuation �took into account�the i m prove ments/be nefits �to be funded by �the CFD1 16-1 IA 2 Special Tax Bond proceeds along with �the CFD1 16-1 IA 2 Special Tax Lien. The concluded aggregate value for the subject properties, subject to their respective special tax lien, is: Pinnacle by Meridian Meridian Ownership 111)117 0)0 0 0 Individual Owners 181,330,840, Subtotal Pinnacle $ 29,)500)840 Vibe by Lennar Lennar Ownership 13,6 0 0)0 0 0 Individual Owners 21,423,268 Subtotal Vibe $ 16,023)268 Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) J Kitty Siino&Associates, Inc. Page 94 QAIIIJ H-M* 1 11 11 1 a8u.'-t-)v%J1 /�V/�I-V gUHUCt I aLr�,C;L Cleo by Lennar Lennar Ownership 9158355000 SLIF IV Millenia,l LLC Ownershi 3563510010 10% Aggregate Value for CFD No. 16-1 IA 2 58391914,1 Ots The above values are stated as of' said date of' value and subject to the attached Assumptions and Limiting Conditions and Extraordinary Assumptions herein, and the attached Appraiser's Certification. Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 95 A 0 1 1 P qa,l P1V8UJJUCt I Ct%.,rSC;L a8c;-t-)I I /Z, APPRAISERS' CERTIFICATION 'The app�raiser certifies that to the best of his knowledge and belief: 1. 'The statements of fact contained in this report are true and correct. 2. 'The reported analyses, opinions and conclusions,are limited only by the reported assumptions and limiting conditions, and are my personal, unbiased, professional analyses, opinions and conclusions. 3. 'The appraisers have no present or prospective interest in the property that is the subject of this report, and no personal interest or bias with respect to the parties involved. 4. The appraisers' compensation is not contingent u�pon the reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value estimate, the attainment of a stipulated result or the occurrence of a subsequent event. 5. This appraisal was not based on a requested minimum valuation, a specific valuation or the approval of a loan. 6. The analyses, opinions and conclusions were developed, and this report was prepared, in conformity with the Uniform Standards of Professional Appraisal Practice. 7. Kitty Siino has made a personal inspection of the property that is the subject of this report. 8. Kitty Siino has not performed appraisal services on the,subject property in the past three years. 9. �No other appraisers have provided significant professional assistance to the persons signing this report. 10. The reported analyses, opinions and conclusions were developed, and this report was prepared, in conformity with the requirements of the Appraisal Institute's Code of Professional Ethics and Standards of Professional Appraisal Practice,which include the Uniform Standards of Professional Appraisal Practice,. 11. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. 12. As of the date of this report, both Larry Heglar and Kitty Siino have completed the requirements of the continuing education program of the Appraisal Institute., Kitty S. Siino, MAI State Certified General Real Estate Appraiser (AGO047913), Appraisal Report City of Chula Vista CFD 16-1, Improvement Area No.2(Millenia) Kitty Siino&Associates, Inc. Pag�e 96 J 4QQ QA1114 -t-)/� /�V/�I-V gUHUCt I aLrSC;L ADDENDA 2()2 f-()3-t 6*�;1cJL-tLAIR I UCIMt TP a 8 1-,"It-9)ja u 12 4—' CFD NO. 16=1 IMPROVEMENT AREA 2 BOUNDARY MAP Pligica-tual at-,r%.vt -1 agC"t-)"t ul PROPOSED AMENDED BOUNDARY MAP OF" SHEST 1 OF I SHEE7 COMMUNITY FACILITIES, DISTRICT NO. 16-1 1 HIEREW CERTIFY THAT THE WITHIN MAP SHOWIN6 PROPOSED (WILLEN11,A) THIS BOUNDARY MAP AMENDS,SHEET'2 OF 2 Of PKOPOVE) SOUNIVARtES, Of COMMUNM, ' FA41,071E$ DISTRiCt NO, 16.1 0Q,U!NW-0E5 Of COMMUNiTY FAVILITIES VISTRICT Nfj,�16-1 IMKLIWA�,, CITY OF, CHULA VISTA6 COUNTY OF' CITY OF CHULAVISTA, NILLFMA)CITYlOr Cl-fU'LA VISTA,,COUNTY'Of SAN,DlEGGi,STATE SAN W600 STATIF Of CAUFOR"MIA. WAS APPROVE0, 01 ttil COUNTY OF SAN DIEGO,STATEOF CALIFORNIA OF CALIFIC)ANIA f 1411)ON AUGUST 2016 M Wok 46 Of 07Y COIVNCIL OF THE CRY'OF CHULA ViVA AT A AEGMAR MAPS O�ASSESSMENT ANO COMMUNITY"FACWTiES MSTRIVS WE'll NGTHIEREGF.HELD ON DAYOK�m"20-u,-" ATPAGE 3��A5 DOCIUNIEN7�NO.20164CW326. BY RESOLUTION NO._�%Q0pa- IRWRENCE I,$HEREGY1 WDE TO"THE,CtrV OF C"WLA V'574 T$(At T MIAP NO,109'-03 RKORDED�',N V41!0FRVIAL,RE OF 7'Hc' 00()NTV OF SAN DirGO, STAtt 'OF -7DDQ cil ERX CALIFORNIA, AS D(XWENI NIO� 2019 481 FOR A CITY OF CHULA VtS,7A P(SCRIPTION' OF THE UMES AND DIMEN'STONS OF '34tSt PARCELS. FILED IN T�+E Off IZE OF'THE'Ciry CLERK,01YOF CHULAVISTA,, ,Of dm&4 DAY 20 THl$ C17Y C K CITY Of CHULA VISTA DAY of AT IX RECORDED THIS A I ItL. "0� 3 -CtOC'K 7'HE ftft/,,A,�of�OLA,, , 0 PAGt,.k±-Of MAR5 OF ASSESSMEN'TAND COMMUNITY LEG MCK171ES D157RICTS IN 'THE OFFICE ()V THL COUNtY �ND RECOADEK, IN THE COUNTY 011F SAN D14601 STA7E, or, CALIFORNIA,, �fev 11-1 1 WV*E oo/ PAACEL k.pit ASSESSOR, RKORDER,,� Z020 121�11004 - Ft .......... NO- ER 1, 11DRON ENO:VAG), JR�.� S% COVVYCLERK rl-7-71 L sy� %S uEplul Axx,XXX-XX-KX A133-C sem PAFtreL Ntmm,66 R C�FD 164 MAP REF,ERENCENO. ASSE.SSOR PARCEL NO, LOT N,0JF WAL N,V 6434"9 LOT19�OF F KAL MIAP No�toolal fo 643AW'(PORTON), WT I Of FINAL,MAP NO 16380 643-065-06(PORTK)N) L�OT 4 OF,FINAL MAP NO.16V 643460-62 LOT"120F FKAL MAP NO,16061 -mlo-ol LOT 13(�F FINAL,MAPNO,16061 TIHIS W)UNDARY MAP COARECTLY SHOWS 111V,901MOARIES N UF ME COMMUNIFtY,rACKITIES VISTRICt, FOR DETAILS CONCERNINa Pit ONE$AND DIMENSON$OF �UT'S 00 W, f�; :i q-c � T"4G, I 21ARCEL ReFER TO T'K,'(�,OQNTY AM,%URS MAPS FOR O� 3,75 750 11,100,F*ei + 0 U,A FIWAI.WEAR 2,019.210. IN A A 0 ji 1 202 t-03-t 6 P-18ujauct I at.,r%.c;t 1 214, MAPS 16081 , 163779 16408 & 16409 0 ji fC AQ4 =e%A .1 A. /I-r-7 v I T--ff- P,gicJL-t 'a at-, Ct ag u Z MAP' N'O* �,�Tlk�90501 ............... SHEET 4 Of 8 'SHEETS C H U LA VI S TA T`RA,C-`,"r NO., 09-03 Ilf............ Or A.Y RA NCH 'MILLENIA RHIASE 2 (EASTERN uRBAN' CENTE" 91' ' Mjfe*,rT� OUT' ra ; CQ%fF0,W,AWQXAF T\"K lalkl sup*.ll"23'47,it A,I lAP SCALS" , rm), 4 .................. "A.M Aw, 11 W.PUT 2 LOT 5 U41 v,(,*Il ............... �9 21 r:f�L DO T B Loll 11.11, 0� ell m"rk.ij ff, or 41,14is';PA �01 7 12' 'Ilia LOT `*M11' I&,; S19 A, 9W., .-........... �4 Of?,2,.1 r,1F 22 Oil 15 (to v,pi or Z),LOT 0,01r'm CF awl, IX. I 14 ADr,Als"W", .......... "LOT '"A \14c vocs) 17 arm, I RAO 95 gy, dI 6 LOT" *J, 21 51 76 A VAN ML M*ft"Sim me PROJECT'DES ION CONS U ILTANTS, $,70 LOT PROXP�T NO, 336 M'S M 1804-6,34' Pj:S1y-M, "-DJp wo,�INA,CR-8,51X 164-17,81 .0 202 t-03-t 6 P-18ujauct JL a%.,r%.& I Ct8c;"t-) V1 MAP (o 3 7 7 5-91 11; S T 0 LS I CE A 7F; t fFj w ?J097'01 IV 7j�-,x),� srciu-FA wmc�,;T m tuea-.) y z";4 J4 34 LQ v! v- �5.49 A Cfi RS Lu L.J 11 rz Z�7 L Ln ro 77 W),",56'l/ 73,0,9 7'�W e VYX ly 7K A ORIVAT A VEATI)T, 4 W -3Gj.YY 'co,w wyj2 S'TA'7-'Dq -00'2- CONVEKENCE ANGLE ----------- 5 C) 2 F. fl 12"1 loo 130 �n6i r i _09-93 Cf-3 H.e..W'nlQ--634j It\l5QD\l6B5-10-MERIDIAN DEVELOF-WENT MILLUqIA LOT 19-22-F-iNAL EMr.1,NEET�ING,\MAPS\FINAL�15r;�a.IQ 5HFET 4.,'D%G t-03-t 6 PlvgL�Jaua I aCrSlvt MAP NO . CHULA VISTA TRACT NO. 09-03 SHEET 3 OF 3 SHEET$ OTAY RANCH MILLEINIA CLEO FOR CONDOMINIUM PURPOSES ?_1 9 Y0 no w ORION AVE DEDICATED PER MAP 16061 ............................................. W4.WP ............................. rNW'oZWw 73MM ............... 34' 4z 0 T 2 V 4.351 ACRES AW245-rW m" 39, zJ 3'r 70" 2_f)71 A ME'TR'OL A VE ehlerozoy w 5J_9�TVIA ------ ------ T240M A4jff w 0_r�L.,5.351 I OILY a Va 04 0 FRIARS ROAD J�jr 115 (FAN)6.1 9MI 1-1 f fi 5 ------ NO. EY0804 CC-,83 1802-6339 FW.0. IS."uw!�. F-md.-br-�g.-S........L. S,-Lm Ump. 0—m, GRAPHIC S-CALE V=50' T.M. NO. 09-03 L�C, 16Z-1779 V/-.IL_XJ3 t 6*gUltd Ct l'la%.,lrlSC;IL I a8c;-t-)7 kil //Nt ........... MAP NO . I&40cl CHULA VISTA TRACT NO. 09-03 SHEET 4 OF 4 SHEETS OTAY RANCH MILLENIA VIBE CURVE TABLE NAME DELTA RADIu& ARC -7 FOR CONDOMINIUM PURPOSES cl 4.38,32 66-00 5.357 C2 5'4q'47" v.oc) 9.36, LINE'TABLE NAME DIRECTION LLNGIH Ll 5 71,58.1 0.01,w lo.00, 1�5 L2 5 16-23'33"E 56.3z, L3 N 113:02�00' W 57-00' L4 5 18 02 on E 17-14' A LS 5 l7q40:54, 56-42' ,--A L ro 5 71*56 00 Vi 24-310' Lul L7 S 76'36'32' CL :Vi �54.05' 5 19'44'3-3,,W 5.41. L9 N 3,8'40'2-7 W 12.Gfil LJO N.38'40' W -5 2.53 METRO A VE Lll N 49&44 33 1 37-53, 4UZ.56' 77 '�9 54' 34' WIDTH VARIES ----------- ar w-qPY5,16mw-R)rpm Z�b L5 LOT I ko 4.472 A CRJES L9 -3V C 81 L-3 NXrOffW W T-V.Z4' Tim, % .......... MONTAGEAVE DEDICATED PER OAF ISFIX4 FIL, ��MK Q-10 V N5, 60 30 0 50 20 too GRAP41C SCALL 1'' 60' ��4'll fi,LA 9211 u T.1654num 619,291-17n7 Q. MO. EYQ:B02 =CCS 83 t802-633,9 R�mmr=-Or;iiW,.-5.Nwmvrm li�m him(lhm�-P�nmrx-ww-�,llvtw T.M. NO. 09-03 L.C. t62-1779 A 4A t� P-18ullua 1 at.,r%.c;t I a8c;-t-tv kil BUI�LDER=OWNED HO�MES� DISCOUNTED CASH FLOW ANALYSES e%fN e% fN .0- A 11 1 A A t�—f%All /�V/� -V-Y- u .. I agi,-, -t]L kil //�-t Pinnacle Discounted Cash Flow Anal MONTH Months MONTH 1 MONTH 2 TOTAL 2 INCOME: Retail Sales =3,295,1 $1,647,570 $1,647,570 $3,295,140 'TOTAL INCOME $1,647,570 EXPENSES: Remaining Costs ($150,849) ($150,849) ($301,698) Marketing &Carrying Expenses 8% ($131,806) ($131,806) ($263,611) Prof it 10% ($164 �75 7)� ($164,757) ($329,514) TOTAL EXPENSES ($4471412) ($447A 12) ($894;823) NET CASH FLOW $1 2200;158 $112001,158 $2,400,31�7 Discount Factor 10% 0.9917 0.9835 DISCOUNTED CASH FLOW $12190;240 $11,1801,403 $213701643 CUMULATIVE DISCOUNTED $1,9190,240, 1$2,3709643 1$2,3709643 CASH FLOW 202t _03 t 6 Pligica-tua 1 acrNIV, I agc"t"t/_. Ul 214, Vibe Discounted Cash Flow Analysis MONTH Months MONTH 1 MONTH 2 MONTH 3 TOTAL F- 3 INCOME-� Retail Sales 6,756,5 $22252;188 $22252;188 $22252;188 $6,756,564 TOTAL INCOME $2,252,188, $2325211188� $25252,188, $6,7561564 EXPENSES: Remaining Costs ($2091379) ($2091379) ($209,380) ($628J 38) Marketing & Carrying Expenses 8% ($180,175) ($180,175) ($180,175) ($540,525) P rof it 10% �($225,219) ($225,219) ($225,219) ($675,656) TOTAL EXPENSES ($614,773) ($614,773) ($614,774) ($1,844,320) NET CASH FLOW $1,637,415 $1,637,415 $1,637,414 $4,912,244 Discount Factor 10% 0.9917 0.9835 0.9754 DISCOUNTED CASH FLOW $1,623,883 $1,610,462 $1,597,152 $4,831,497 CUMULATIVE DISCOUNTED $196239883 $392349345 $498319497 1$4,831.497 CASH FLOW A 0 1 0 a 202 f-03-f 6 P-18ujauct JL JL a8u,-t-tj %JJL FINISHED LOT �LAND SA�LES MAP & SUM�MARY CHART 202 f-03-t 6 Pligica-tua 1 at-ISICt Data NO.I slla'allll . 0 R i'vervi elw,, Farms R Iii II, II, Ail Sa'ntel Johnstown �7i,Z inter i I'i�len ew rdens Til I I Filed R Fi, orrtgaNlery phi R idgmnitio%l Llo%nd o%I in on E 1,Caj "�j ............ n 10' monit 9 Rancho San Die go Cal,avoGardens .8 M ...... �C) lj� ey pri Girme '.-TJ Data Noll h 4 a t 6 v B J�y' San I! ............ a I La Pre is`� Sweetwatelp., 5,4 12:5 v N tibnal,q�y SU I I llyside Lincloin Acres Daltal No'. I 11"Bonitia JII Lynwood Hil[lis Av Diego, 117, 111, ,,I"I", 1111, 1, bhdl,a"[ViE�ta jj� r subject&Data Nols,31,4&51 12:5 lj� k....... Al, 7 5, Castl,d Par "Al 0,tayl jjllll� Data NO.7' Imperial Beik Pal�m CRY Data NO.2 OW eld M un i OTAY Nil E SA RD MffSA RD, jmperial Bieaic4' LE- ,"II, llimpedal Beach.rlaval Air Stat n 202 It-03-t 6 wRESIDENTIAL SALES SUMMARY CHART Sales Acres Use/ Sales Price/ Location/Seller Buyer �Date Units Density Price-Unit Comments North of"Y"'of Bonita Glen Drive and Sold in mass graded superpad condition with surrounding streets 1 Vista Drive,Chula Vista/Nita Ferreira Bonita Glen 3/20/20 4.7/ 170/ $6,225,00�O in place.Buyer also known as Silvergate Development,purchased �Living Trust Investors 4.92 34.55 $36,617 4.7 acres from Ferreira($6,0001,0100)and additional 01.3 acres from City of Chula Vista(former street)for$225,01001. Plan to build 170, total units including 9 affordable rate units. NEC Continental Street and Airway $14,400,000 This site has good access in O�tay Mesa however inferior 2 Road, Otay Mesa, Chula Vista CR Airway 3/16/20 12-98 450/ $32,0010 surroundings of industrial buildings, truck transfer stations and Airway Gardens Corporation Gardens 34.6 truck stops. ColRich is planning a 450 unit 3, and 4-story (ColRich) apartments. SWC Stylus Street & Orion Avenue, Ryan $15,5010,0010 Anticipated to be developed into an 8-buildling apartment 3 Millenia, Otay Ranch, Chula Vista Companies US 2/27/20 12.08 �480 $32,292 community with one to three-bedroom apartments. Sold in a SLF IV Millenia,LLC 39.7 finished superpad condition. 4 NWC Orion Avenue and Strata Street, Subject Property—Lennar building out Cleo with home sizes from Millenia, Otay Ranch, Chula Vista �Lennar 12/5/19 �4.35 117/ $4,815,0010 1,125—2,552 square feet. SLF IV Millenia LLC 26.9 $411155 NEC Montage Avenue and Strata Subject Property—�Lennar building out Vibe with home sizes from 5 Street, Millenia, Otay Ranch, Chula �Lennar 6/24/19 4.47 92/ $4,000,0010 1,681 to 2,552 square feet. Vista/SLF IV Millenia LLC 20.6 $43,478 8655&8707 Carribean Way, Santee �42/ $2,535,0010 Raw land with existing houses on two lots at time of purchase. 6 Meade Trust City Ventures 4/10/19 2.89 14-53 $60,357 Street to property needs paving.City Ventures is nearing sell-out f-+ of their Ariana,two,-story townhomes project. N/0 Exposition Way and Innovative Wang 2018 143 $4650,000/ Originally offered for$5.6 million.Investor purchased for hold.S,ite 7 Drive,Otay Mesa/N/A Trust 11/2018 5.58 25-63 $32,517 has approval for 1016 stacked flats, 24 townhomes and 13 detached condos.Access currently through industrial area. NEC Sweetwater Springs Blvd & 122/6.8 $18,700,0010 Single family detached lots(3,0010 sf). KB Home currently selling 8 Jamacha Blvd, Spring Valley, San KB Home 10/4/18 17-93 $153,279 Sweetwater with home sizes from 1,850 to 2,100 square feet in D�ieg�o Sam-Sweetwater the $650,000, range. Purchased unimproved at time of sale. Reported finished lot estimate at time of closing was$270,0010. 0 a 44 '�_ 1 202 f_03-t 6 P-18ulauct JL aL'r'�'& I(281F6,"t"tv VIL /214, CO�MMERCIAL LAND SALES �MAP AND SUMMARY CHART e%fl, fx 1% A .0- A A A— f^All "t"t/ /�V/�l V-y iutxgv,.t-t a at-,&vt -F ag I I I� �, ,�,,-----........... 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I III I� I )� I"I"tt if% I �I' - ,1 I,)J,,,�I� ,����, ,11 "'li I[�,t,l 1,,,��"', hil 11111-11., �/11 I, CZA", /, ,"t""', //////////////,) ittilt ////////, - ,/,/////////////////////////////,/////// , - , ��r L,ZA RA G (( / I �, , , 1111� 111111111/��', III '!,/ / ����l l, ,-.", "�� �:zt���� � 1�" " )/,///////////, ,, � "I'l""I'l-111/11-�",,/",�,/�, I, � ,----, /lihilhir'\ M��� 'I I� 11 � Z", �� �)' :17 � I'll j , ,,���],, ,L�,I � I I 1 7 i'll,I I �) � � I !� 11, ;I . 2 i I I -4 4 A A Q 11 j a a Q t�-Q 1 202 it-03 1 U P-1gullua I a%7r%.IL;L fla8c;-F-Fo UT 7 Z 4- Commercial Land Sale Summ Data Sale Size Price/ No. Location/APN/Seller Buyer Date Acres Price Comments(expand) SEC La Media Road &Otay The site is raw, unimproved land located at the southwest 1 Mesa Road, Chula Vista N/A C u�rr. 17.6 $5,480,000 $7.15 corner of La Media Road and O�tay Mesa Road. Originally 646-121-34/Las Vegas Listing the site had over 50 acres, however the 905 Freeway Sunset Properties construction bisected the site. Both pieces are currently listed with an asking price of$7.15 per square foot.The site is zoned Light Industrial and allows retail, office and industrial use. Northwest corner of Fenton Within Eastlake Business Center. Finished lot ready for 2 Street at Showroom Place, SunCoast Properties 9/16/20 2.75 $3,850,000 $32-37 development. Zoned for industrial use with additional allows Eastlake, Chula Vista/595- uses including hospitality.Purchased for hotel construction. 710-21-00/Eastlake Design District 11 LLC East side of Harvest Road, Transportes Diaz Unimproved site in Otay Mesa near the Mexican border 3 south of Otay Center Drive, USA Inc, Francisco 10/22/20 1�.97 $1,000,000 $11.65 surrounded by logistics, trucking areas.Zoned for Chula Vista/646-141-08-00 Santiago industrial use. Yu Family Trust N/S Airway Raod,West of La Finished, mass graded site with surrounding streets in 4 Media Road, Otay Mesa/ RG Gigantic Otay 2/20/20 7.81 $5,215,500 $15.06 place,. Double escrow with seller purchasing the property 646-111-17-00/OM Gigantic LLC for$4,000,000. Property NEC Otay Mesa Road and Adjacent to Greenfield Village Apartments near Ocean 5 Ocean View Hills Parkway, Greenfield Square 1/16/20 2.47 $2,700,000 $25.09 View Hills and Playa Del Sol, new residential Otay Mesa/645-390-03-00 Otay Mesa LLC ne,ighborhoods.Zoned for retail use. Greenfield Square LLC Southern terminus of Raw site which was previously mass graded with cul-de- 6 Gateway Park Drive,W/O James Wright 2/06/20 3.43 $1,742,500 $11.68 sac in place. Gross acreage is 5.26 however net is Heritage, Otay Mesa/646- (Heritage Gateway reported at 143 acres. Near trucking area,in Otay Mesa 170-14-00/Peto'Trust Park LLC) industrial area. South side of Birch Rd. 7 between Orion and Millenia MCV23 LLC 4/17 12.58 $5,459,725 $10.03 Retail site now open with 135,000 square feet of retail, Avenues, Millenia, Chula services and restaurants. Within Millenia to provide Vista/643-060-54. 55 amd commercial fo�r surrounding residences. 56/SLF IV—Millenia LLC West side of Millenia Ave. at In Millenia with frontage on SR 125. Ayres purchased for 8 Stylus St., Millenia, Chula Ayers Millenia LP 4/16 2.505 $1,400,000 $12.83 to build a boutique 135-room hotel. Currently under Vista/643-060-70-00/SLF construction. IV—Millenia LLC East side of Millenia Ave., 9 south of Stylus St., Millenia, LMC-Millenia Inv. 2/16 7.062 $2,568,663 $8.35 "'Think" project. Building plans in to city for 424,100 Chula Vista/643-060-57-009 Co. LP (Chesnut) are feet of medical office and amenity building. SLF IV—Millenia LLC A 0 J1 a Pligica-tual UCISI& agC&-rl-r 7 U.1 IMPROVED RESIDENTIAL SALES MAP & SUMMARY CHART 202 f-03-t 6 Pligica-tua 1 at-,r%.vt -1 agl,-"t-)V'ul 7-Z-ff— t t If,", III- 1"I'll �#o Jz % If 'R� t t u n n t el 'it tj I P,f V14 jjj OF tl ........................ 00 1. 01A, It 1� op,t FF,FF�1-71 11 , ,I I t ............. 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If, Data Nol 7' "JI, lc� t ..................................... ................IDATS u N S-I own,Field 1A uni It ................/"�l 25 !��RD ................................................ ......OTAYNE % OTAY.M ESA R'DJ W,if Ih f,................................ t ................. t t t .............. ........... t ............ ........... -------- YS t t t t �g A 0 it 0 a r"J t� At f-03-t 6 P-18ujauct JL at.,r%.ce I a8 C;-t-)I ki JL -tl IMPROVED RESIDENTIAL SALES SUMMARY CHART �D�ata Project Name Room Floors/ Det/Att Base PrIce/SF No. Location/Developer Plan Count Size (SF) Parking Absorp. Sales Price Pinnacle, Millenia, Orion 1 3/3 11362 2/2 $45'7;900 $336.20 1 Avenue and Optima 2 3/2 11433 2/2 Att. $481,900 $336.29 Streert, Otay Ranch, 3 4/3 11989 2/2 8.6 $547,900 $2,75.47 Chula Vista/ Merid�ian 4 3/2 2,1 Il 85 4/2 $558,900 $2,55.79 5 3/2 2,1380 4/2 $599,900 $2,49.96 1 6 3/2 21522 4/2 $616,900 $244.61 Vibe, Millenia, Montage 1 4/3 11681 3/2 $483,900 $287.86 2 Avenue and Strata 2 4/3.5 11819 3/2 Att. $508,900 $279.77 Street, O�tay Ranch, 3 4/3.5 21037 3/2 8.7 $533,900 $262.10 Chula Vista/ �Lennar I Cleo, Millenia, Orion 1 2/2-5 11182 3/2 $381;900 $323-10 3 Avenue and Strata, 2 2/2-5 11215 3/2 Att $377;900 $311-03 O�tay Ranch, Chula 3 2/2.5 11265 3/2 16.9 $368,900 $291.62 Vista/ Lennar 4 3/2.5 11504 3/2 $418;900 $278.52 5 3/2.�5 1161�6 3/2 $445,900 $2,75.93 6 4/3.5 1,675 3/2 $462,900 $276.36 Suwerte , Town Center 1 2/2.5 11192 2/2 $372,900 $312.84 4 Drive & Promenade, 2 2/2.5 11357 2/2 Att. $404,900 $298.38 Otay Ranch Town 3 3/3 11652 2,/2 5.3 $439,900 $2,66.28 Center, Chula Vista 4X 4/3.�5 2,1 Il 39 4/2 $471,900 $2,20.61 Heritage 5 3/3.�5 2,1025 3/2 $499,900 $2,46.86 6 4/3-5 21439 4/2 $51'7;900 $212-34 Parc Place, Village Two, 1 2/2 1 11�16 2/ Il $412;900 $369-98 5 O�tay Ranch, Chula 2 2/2-5 11583 2/ Il Att. $459;900 $290-52 Vista/ 3 2/2.5 11587 2/2 4.8 $489,900 $308.69 Heritage Alay at Suwerte, 'Town 1 3/3-5 11938 3/2 $542;900 $280-13 6 Center Drive & 2 4/3-5 21256 3/2 Att. $5'75;900 $255.27 Promenade, Otay 3 4/3.5 21505 3/2 4.8 $629,900 $251.46 Ranch 'Town Center Heritage Veraz, Ocean Hills 1 2/2.5 11340 3/2 $449,776 $335.65 7 Parkway and Del So�l 2 3/2.5 11583 3/2 Att. $482,266 $304.65 oulevard, Playa Del 3 3/2.�5 2,1005 3/2 5.5 $549,145 $2,73.89 Sol, San Diego/ Pardee 202 f-03-f 6 PlIgIca-tua 1 acrNICt -1 agc"t U I /2 14, APPRAISER'S QUALIFICATIONS Q=?%A T- Pigicalual at-,r%.vt -1 ap,"t-)j Ul Z-ff— QUALIFICATIONS OF KITTY S, SHNO, MAI Education Bachelor of Arts in Business Administration Financial Investments, California State University, Long Beach, California (19,80) Post-Graduate Study, Real Estate Development, University of California, Irvine, California Appraisal Institute Classes: Uniform, Standards of Professional Appraisal Practice, A & B�; Appraisal Principles; Appraisal Procedures; Basic Income, Capitalization; Advanced Income Capitalization; Narrative Report Writing; Advanced Applications, Case Studies. Successfully completed all classes in addition to successfully completing the writing of a Demonstration Report and taking the Comprehensive Exam. Became a Member of the Appraisal Institute in December 1996. Have completed over 100 hours of continuing education through the Appraisal Institute every five years. lEmp,loyment 1988 - Present: S,elf-Employed Real Estate Appraiser. Duties include the appraisal of various types of properties such as commercial, retail, industrial and vacant land. More complex assignments include easements, right-�of-ways and special assessment districts. From 1996 to present, specialized in special assessment districts and community facilities districts appraisals for public entities, including Jurupa Community Services District, Corona Norco Unified School District,, City of Corona, City of Chula Vista, City of San Marcos and City of Moreno Valley. 1986-1988: Project Manager of Development for Ferguson Partners, Irv"Ine, Cal"Iforn"la. Duties included land acquisitions; review of fee appraisals and valuations; analysis of proposed development; planning and design; and management of development, construction and lease-up. The types of properties developed were commercial and industrial. Duties ranged from raw, vacant site development through property management of recently developed projects. 1981 - 1986 Manager of Finance, Construction for Community Development Division, The Irvine Company, Irvine, California. Duties included originating and managing a newly formed division of finance to bridge between the accounting functions and project management functions. Worked with analysis and budgets for Community Development Division. Coordinated with cities in forming new Assessment Districts, and Community Facilities Districts to finance major infrastructure improvements. Types of properties were apartments and single-family residential lots on a for sale basis to apartment and homebuilders. 1980 - 1981 Investment Counselor, Newport Equity Fu�nds, Newport Beach, California. Duties in�cl�uded obtaining private financing for residential properties, working with appraisals of properties and analyzing the investments. A 0 J1 0 1 -03 t 6 PligV'Jaun 1 acrNIV, I agc "t-)"t Licenses Real Estate Sales Person, State of California, 1980 Certified General Appraiser, State of California (#AGO04793) Organizations MAI #11145 - The Appraisal Institute Public Flinanci CASTOFF Meetings, 2006, 200T; 20083 20095 20,101) 20117 20137 20,147 20157 2016, 2018 and 2019 Speaker, �Mello-Roos & Special Assessment Financing, UCLA Extension Public Pollicy Program, February 20,09 and March 2011 A 0 ji 0 A 202 f-03-t 6 Pligica-tua 1 at-110z't I agC SUPPLEMENT TO APPRAISAL REPORT COMMUNITY FACILITIES DISTRICT NO, 164 IMPROVEMENT AREA NO. 2 (partion of) MILLENIA IN OTAY RANCH City of Chul�a Vista, California (Appraisers' File Noi. 20i20-1167S) PROPOSED AMENDE"0 aOUNDARY MAP OF SKEEI 5 0'1 1145-1 COMMIUNITY FACILITIES DISTRICT NO.,144, 0 041REP CURTTY W i'WITAN MAP 5"WING MO,POSED 1,jr14,5,60"UNtmifly'MAP 4m(,N05 54LET 2 101;2 f;F:rpi C, 60040AX110 Of commij;x1gy khQvillis bKfANCIT mKI 16,4l (MILLENIA) W�Uliwj'AWFS 04 C()hmmjJNAY*ACPjljt$,(19STVC I'Nit),�4�� m MARAIWAL Cr," W CHULA, WISIA. COAAWY (7F CITY OF,C"UILA VISTA, MINXINA)CTINOVOILKA W57A,,U.XJN FY D,F%Aim()RIGU.SW IL SAN 04100,STATE OF CA10,00001A.W0 APPOOVIC0 SY 1�it COUNTY OF SANDIEGO,,$TATE OF CALIFORNIA Of CAUMANA FW16 ON 1 3,1016,N 600K 46 OF" tffr QJ�VNCJL�,QKF,TKk(�m ap�: �JSYA A't'A A1f(j,4AAR LAAF5 ANO CMAMVN�TY'FACjjbTjjjj�(0)11,STR�"',I" Cl S MUCTONO UICREGF,W1111 0 ON DAY i0FQ", 20�20�, AT PA4111*5 DOCLPWCNTNO�201641M,12tv UY fltwltul�ON W11 —mL KJIIFIIREINU�*KAMP WAVC To T*41(Me LVI 01110(A V15711A "Ji L 711011A00 KtV FOO i 100AWD flN THE AKICIRr'... 00T, of 1101w W—UNTY 01(7430�� STWE OF Of SAN w �,L MIFORNA, Al DOCUMINI NO,, 2i:W70M11,FOR A, C"Irf Of CHULA Y15TA Dt$CA1jiPTnftk Q9 THI LINkS, AND WAONSIONIS 40 P k[P 11N T4 E OfflICI Of T1 I EWYC LEM.101 V U$CH UIA V15 W TH6±—W,DAY DV�km'4..zo,"A VIIX % d 1, 'Iry el�, if d �y 0 FY Or C WILAVISTA %�Al Rf 1010RDIVO H IS JW Of 1,A= THt HOUR,Of,if,12.WaIxic Lm. *mau P"I jj_W MAP$OF&ZESSM114T AND CONUMN)Ngrly t ViQg N FACIVIR4 DOSTKICTS*THE OfTICO' or ra couwry t THik, RECCAIDLA,Ilk d,rRJNrV Ot 5AN P06,0�,STATE(11, RU DI",ENOV41115", )R,,,, A$$Lsjolm, REXIORKA. ie�,i"', �rdo drie ove? 00, Lt m ee Iiis 00,i Ile 0,, ,e iX N., 19 St W, Eft I AS 7�5509 PAR CU,W) LOT WX11PRAi�MAP (......... R LG1`19 OFFNAL MAP NO,KAI iOT I CF FKAL hW NO 110k, WAU'?tF(MTM`,j, W�066-06�PIX—TK)Nj LOT4 CUF1 4AL MAP NO,1,16,3W L 01'12'OF F N�k MAP N Q,I(Oo M, 6434,W-6 LCT 61'OF'F'04 4,MAF N I t OF D*commukilly FACkYTEA 04TKCT� Prm,C&TOWLS CC)WIROwnG TW-140S ANJU LWAMEWWOONS IN:!'LUI�OR w ROM TC1 THA CIXOM ASSWAAWWS MAPS FOR V 1,501 F061 FIISCAL VIA0 2*o*40 Prepared For City of Chula Vista 276 Fourth Avenue 0-%, Chula Vista, Ualifornia 9191 U^ Prepared Kitty Siino & Associates, Inc. dm% 115 East Siecond Streety z�iuite 100 0-%, Tustin, ualifornia 92780% 202 f-03-t 6 PlvgL�Jaua I at-,r%.vt -1 agI17"t-)"U1 KITTY SHNO & ASSOCIATES, �INC, REAL �ESTATE APPRAISERS &CONSULTANTS February 25, 20�21 Kim Elliotti Facilities Finance Manager City of Chula Vista 276 Fourth Avenue Chula Vista, California 91910 Reference: Supplement to Appraisal Report Community Facilities District No. 16-1 Improvement Area 2 (Portion of) Millenia, Otay Ranch Northwest Corner of Hunte and Eastlake Parkways Chula Vista, California Dear Ms. Elliott: At the request and authorization of the City of Chula Vista, we have completed a Supplement to the Appraisal Report ("Supplement") for City of Chula Vista Community Facilities Diistrict No. 16-1 Improvement Area 2 ("CFD, No. 16-1 IA 2"). This Supplement is to be used in conjunction with the Original Appraisal Report for the above referenced property dated January 11, 20�21 with a date of value of November 15, 2020 which encompasses a portion of the mixed-use community known as Millenia in Otay Ranch ("Orig�inal Appraisal"'). In lieu of' updating the entire appraisal, the purpose of' this Supplement is to bring forward the date of value to February 15, 2021 and conclude if the property has a value not less than the value concluded in the Original Appraisal. It should be noted that this report may not be understood properly on its own, but rather should be used only in conjunction with the Original Appraisal. The purpose of this Supplement is to ascertain and discuss changes in the subject property along with any changes that have occurred in the real estate market between November 15,1 2020, (date of value of Original Appraisal) and February 15, 20,21. 'the INTENDED USE OF APPRAISAL - It is the appraiser's understanding that the client, City of'Chula Vista, will utilize this Supplement in disclosure documents related to the sale of the Special Tax Bonds of CFD1 No. 16-1 IA 2. This Supplement may be included in the Official Statement or similar document to be distributed in connection with the marketing and offering of the bonds. It is the appraiser's understanding that there are no other intended uses of'this report. Supplement to Appraisal Report City of Chula Vista CFD 16-1 Improvement Area 2 (portion of Millenia) Kitty Siino &Associates, Inc. 1 f%A 202 f_03-t 6 P-1gV'i-tua 1 at-110ZIt -1 agC"t U I /�"t SUBJECT PROPERTY - The subject property consists of 335 proposed single-family homes and a commercial parcel within the community known as Millenia in the area known as Otay Ranch in �the City of Chula Vista. The subject property consists of �three residential neighborhoods in varying degrees of development and a commercial parcel. Please refer �to �the Addenda of this, Supplement �to view a table showing �the ownership and condition by parcel or unit as of' November 15, 20�20 (date of' value in Original Appraisal) and as of February 15, 20,21 (date of value of this Supplement). Please refer to the Original Appraisal Report for a legal description of the subject property. O�WNER OF RECORD AS OF February 15, 2021 — Lot 19 of Tract Map 160,81 is owned by SLF IV Millenia LLC, a Delaware limited liability company. Within Pinnacle at Millenia by Meridian - Units 37-126 of' Map 16377 are owned by Pinnacle New Homes,1 LLC. Individuals own Units 1-36 of Map 16377 Within Vibe at Millenia by Lennar— Units, 1-5,1 17-257 32-34 and 42-92 of Map 16409 are owned by Lennar Homes of California, Inc. Individuals own Units 6-16, 26-31 and 35-41 of Map 164019. Within Cleo at Millenia by Lennar �— Units, 1-117 of Map 164018 are owned by Lennar Homes of'California. PROPERTY RIGHTS APPRAISED - The property rights being appraised are of a fee simple estate interest, subject �to easements of record and subject �to �the lien of�the CFD1 No. 16-1 IA 2 special tax. The definition of fee simple estate is included in the Original Appraisal. DEFINITIONS - The term "Market Value"' as used in this report is defined as: "Th�e most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently, knowledgeably and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation r 9- of a sale as of a specified date and the passing oT ritle from seller to buyer under conditions whereby.- 1. buyer and seller are typically motivated; 2. both parties are well informed or well advised, and each acting in, what he or she considers his or her own best interest; 3. a reasonable time is allowed for exposure in the open market; 4. payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto,- and Supplement to Appraisal Report City of Chula Vista CFD 16-1 Improvement Area 2 (portion of Millenia) Kitty Siino &Associates, Inc. 2 A 0 J1 0 t� f%A 202 f-03-t 6 Pligica-tua 1 at-INICt agC "t 0 ki I /�"t 5. the price represents the normal consideration for the property sold unaffected by special or creative financinci or sales concessions granted by anyone associated wiffi the sale. For all other definitions please refer to Original Appraisal. DATE OF VALUE — February 15,12021 DATE OF SUPPLEMENT — February 25,120,21 SCOPE OF WORK 1— The following items were completed in the scope of work for this assignment. 0 Identify additional builder home sales and closings within the subject property and ascertain if the sales prices have increased,, stayed the same or decreased. 0 Identify additional construction on the subject property and report additional expenditures resulting in less remaining costs to complete. 0 �Review and report on the subject real estate market conditions and identify any changes since the Original Appraisal. 0 Determine if the value is not less than the value conclusion in Original Appraisal. DISCUSSION — On February 20,1 2021 an inspection of' the subject property and surrounding lands was made by the appraiser. In addition, sales offices were contacted and reviews of' current information was conducted. This information included additional sales and/or closings within the subject property. We observed the following changes in the subject property between November 15, 20�20 (date of value of Original Appraisal) and February 15,1 2021 (date of value of Supplement). 1. An additional 19 homes have closed escrow to individual homebuyers within the three residential neighborhoods. As of the Original Appraisal there were 41 homes closed to individual homebuyers and as of February 15,, 2021 there were 60, homes closed to individual homebuyers. 2. An additional 62 homes were constructed to over 95 percent complete within the three neighborhoods and an additional 78 homes began construction. Within the three neighborhoods as of the Original Appraisal,, there were 99 homes under construction (under 95 percent complete) and 175 remaining finished lots. As of February 15,1 2021,,, there were 115 homes under construction (under 95 percent complete) and 97 remaining finished lots. 3. An additional 93 homes were sold within the three neighborhoods. As of the Original Appraisal there were 178 homes sold (including closed homes) and as of February 15, 20,21 there were 271 homes sold (including closed homes). Note that sold homes can include closed homes and homes over 95 percent complete and builder-owned,,l homes under construction and finished lots that are in escrow. 1 The Appraisal of Real Estate, 13 thEdition Supplement to Appraisal Report City of Chula Vista CFD 16-1 Improvement Area 2 (portion of Millenia) Kitty Siino &Associates, Inc. 3 A 0 J1 0 202 f-03-t 6 Pligica-tua 1 UCISI& -1 agC"t-)-7 4. An additional 25 homes were sold within the neighborhood of' Pinnacle by Meridian. As of the Original Appraisal there were 77 homes sold (including 36 closed) and as of February 15, 2021,,, there were 10�2 homes sold (including 36 closed). Also,,, an additional 24 homes began construction within Pinnacle. 5. An additional 35 homes were sold within Vibe at Millenia by Lennar. As of the Original Appraisal there were 26 homes sold (including five closed) and as of February 15,1 2021 there were 61 homes sold (including 24 closed). Also, an additional 26 homes began construction within Vibe. 6. An additional 24 homes were sold within the neighborhood of Cleo at Millenia by Lennar. As of the Original Appraisal there were 24 homes sold (none closed) and as of February 115,1 2021 there were 48 homes sold (none closed). Also,,, an additional 28 homes began construction within Cleo. 7. Within each neighborhood additional costs and fees were expended. Per Meridian,1 an additional $109,990 was spent on remaining costs and fees. As of the Orig�inal Report they reported there were $,4,,525,,443 in remaining costs while as of February 15, 2021 they reported $4,415,453 in remaining costs. Lennar spent an additional $4601,10,23 in land development costs and development fees. As of the Original Report there were $3,903,4611 in remaining costs for both Vibe and Cleo,,, while as of February 15, 2021,, there were $3,443,1408 in remaining costs. In total, as reported above, an additional $570,013 has been spent on land development and development fees on the subject property between November 15,1 2020, and February 15, 20,21. While we were not able to review these expenditures in detail, the amounts appear reasonable per our visual inspection of changes that have occurred on the sites. 8. Within each of the three neighborhoods base prices have increased between 3.8 and 8.1 percent. Within Pinnacle, all except one plan had base price increases of$35,000 while the largest plan had an increase of $38,10,010. These equated to an increase of 5.8 to 7.6 percent on the base prices. Within Vibe prices increased from $23,1000 to $39,01010,which equated to an increase range of 4.7 percent to 7.6 percent. Within Cleo prices increased from a low of $115,000 to a high of $30,000 which equated to an increase range of 3.8 percent to 8.1 percent. The fact that each plan within each neighborhood has had a price increase suggests that prices are not declining within the subject area. 9. Our physical inspection of the entire Millenia Project (includes the subject property and additional lands) showed signs of progress with the following changes noted between November 15, 2020, and February 15, 20,21. Lot 21 of Map 16081 (not a part of the subject) began construction of a new apartment project. The parcel was purchased by Ryan Companies US in February 2020. As of November 15,1 2020) it was a finished lot as they were getting approvals and permits for construction. As of February 15,1 2021,, construction has begun with slabs poured for the apartments. Supplement to Appraisal Report City of Chula Vista CFD 16-1 Improvement Area 2 (portion of Millenia) Kitty Siino &Associates, Inc. 4 A 0 J1 0 t� f%A 202 f-03-t 6 Pligica-tua 1 at-INICt agC "t V V, IL"t Aft 0 Aft 0 0 so Ift Ift 0 Aft Ift 6 of off Aft Ift Aft 0 0 Ift 0 0 0 Ift Ift Ift Aft 0 Aft Aft Aft Aft Aft Aft Aft 0 Aft Aft 0 Aft Aft Aft Aft 0 0 0 9 Aft 0 A A A Aft 0 Aft 9 Aft Aft Aft Aft Aft Aft 0 Aft 6 1 JAG 0 Aft 0 Ab 0 9 0 Aft 0 0 Aft 6 Ift Aft Aft 6 Ift so off 4 Aft 0 6 Aft Aft Aft 6 Ift Aft Aft Aft Aft Ift Ift Aa 0 6 0 Aft Aft 0 0 w w I w 0 1 w Ift Ift Ift Aft Aft Ift 6 Ift Ift Ift Ift Aft AMM Amb AMM Aft AM Aft Aft Aft M M 111111 w w 'o 0 Ift 0 0 0 Ift Aft *so* Aft Aft 0 9 0 0 Aft 0 Aft 0 Aft Aft Aft 0 0 0 0 Ah 0 0 Aft Aft Aft Ift 0 Aft Aft 0 4400 Ift Ift Ift 6 Aft 0 Ift Ift Ift 0 Aft Aft Aft Aft 0 0 0 Aft Aft Aft Aft Aft Aft 0 Aft Aft - v v a Aft AM 0 Ah 4 0 AM 0 0 Ift Aft Aft 0 9 0 Am Aft 0 0 v 0 .0 w 0 0 9 Aft Aft 0 0 0 w Aft Aft Aft Aft w Ift 0 Aft 0 Aft Aft Ift Ift 0 0 AM Aft Aft Aft Aft 0 Aft 9 0 Aft Aft Ift JIM 0 Aft Ift 0 A& 0 0 0 Aft Ift Aft 6 6 Aft Aft 6 m so 0 ft 0 ft 0 Aft Aft Aft Aft Aft Aft Aft 0 0 Amh Aft 0 0 0 0 Oak Ift Ift Ift Ah of Aft WIWAM a ILIAMI-2491 N rg 01 subject property 9 s lands. Also, additional homes have closed, additional homes have been constructed and additional homes are in escrow, all suggesting the subject)s value has not decreased. In addition, it has been determined �that the subject new home real estate market has not experienced any negative changes since November 15, 20�20. Based upon our investigation, we have determined that �the current market value is not less than the concluded value as of November 15, 2020�. This Supplement is to be used in conjunction with the Original Appraisal and subject to �the attached Assumptions and Limiting Conditions and the Appraiser's Certification. Respectfully submitted, KITTY SHNO & ASSOCIATES, �INC. Kitty S. Siino, MAI California State Certified General Real Estate Appraiser(AGO04793) Supplement to Appraisal Report City of Chula Vista CFD 16-1 Improvement Area 2 (portion of Millenia) Kitty Siino &Associates, Inc. 6 4 0;; A A 0 J1 t� e%A 202 f-03-1"P-1gV'i-tua 1 at-INICt Pap,"tV/-. U1 /�"t ASSUMPTIONS AND LIMITING CONDITIONS 1 This report might not include full discussions of'the data, reasoning and analyses that were used in the appraisal process to develop the appraiser's opinion of value. Some supporting documentation concerning the data, reasoning and analyses may be retained in the appraiser's files. The information contained in this report is specific to the needs of the client and for the intended use stated in this report. The appraiser is not responsible for unauthorized use of this report. 2. No responsibility is assumed for legal or title considerations. Title to the property is assumed to be good and marketable unless otherwise stated in this report. 3. It is assumed that the subject property is subject to the special tax lien of CFD No. 16-1 IA 2. 4. Responsible ownership and competent property management are assumed unless otherwise stated in this report. 5. The information furnished by others is believed to be reliable; however, no warranty is g�iven for its accuracy. 6. All engineering is assumed to be correct. Any plot plans and illustrative material used in this report are included only to assist the reader in visualizing the property and may not be to scale. 7. It is assumed that there are no hidden or unapparent conditions of either property, subsoil or structures that would render them more or less valuable. No responsibility is assumed for such conditions or for arrang�ing for engineering studies that may be required to discover them. 8. It is assumed that there is full compliance with all applicable federal, state and local environmental reg�ulations and laws unless otherwise stated in this report. 9. It is assumed that all applicable zoning and use regulations and restrictions have been complied with, unless nonconformity has been stated,, defined and considered in this appraisal report. 10. It is assumed that all required licenses, certificates of'occupancy or other leg�islative or administrative authority from any local,, state or national governmental or private entity or organization have been or can be obtained or renewed for any use on which the value estimates contained in this report are based. 11. Any sketch or photograph included in this report may show approximate dimensions and is included only to assist the reader in visualizing the properties. Maps, photographs and exhibits found in this report are provided for reader reference Supplement to Appraisal Report City of Chula Vista CFD 16-1 Improvement Area 2 (portion of Millenia) Kitty Siino &Associates, Inc. 7 J1 0 t�—f%A a 4n 1 202 f-03-t 6 Pligica-tua 1 acrNICt I agc"tvi VIL /IL"t purposes only. No guarantee regarding accuracy is expressed or implied unless otherwise stated in this report. No survey has been made for the purpose of this report. 12. It is assumed that the utilization of the land and improvements (if any) are within the boundaries or property lines of the property described and that there is no encroachment or trespass unless otherwise stated in this report. 13. The appraiser is not qualified to detect hazardous waste and/or toxic materials. Any comment by the appraiser that might suggest the possibility of the presence of such substances should not be taken as confirmation of the presence of hazardous waste and/or toxic materials. Such determination would require investigation by a qualified expert relating to asbestos, urea-formaldehyde foam insulation or other potentially hazardous materials that may affect the value of the property. The appraiser)s value estimate is predicated on the assumption that there is no such material on or in the property that would cause a loss in value unless otherwise stated in this report. No responsibility is assumed for any environmental conditions or for any expertise or engineering knowledge required to discover them. The appraiser's descriptions and resulting comments are the result of the routine observations made during the appraisal process. 14. Proposed improvements, if any, are assumed to be completed in a good workmanlike manner in accordance with the submitted plans and specifications. 15. The distribution,1 if any, of the total valuation in this report between land and improvements applies only under the stated program of utilization. The separate allocations for land and buildings, if any,1 must not be used in conjunction with any other appraisal and are invalid if so used. 16. The Americans with Disabilities Act ("ADA"') became effective on January 26, 1992 and has been updated several times since then. The appraiser has made no specific compliance survey and analysis of the property to determine whether they conform to the various detailed requirements of the ADA,1 nor is the appraiser a qualified expert regarding the requirements of' the ADA. It is possible that a compliance survey of the property,1 together with a detailed analysis of the requirements of the ADA,,, could reveal that the property is not in compliance with one or more of the requirements of the ADA. If so,1 this fact could have a negative effect upon the value of'the property. Since the appraiser has no direct evidence relating to this issue, a possible noncompliance with requirements of the ADA in estimating the value has not been considered. 17. It is assumed there are no environmental concerns that would slow or thwart development of the subject properties and that the soils are adequate to support the highest and best use conclusions. Supplement to Appraisal Report City of Chula Vista CFD 16-1 Improvement Area 2 (portion of Millenia) Kitty Siino &Associates, Inc. 8 A 0 J1 0 t� f%A 202 f-03-t 6 Pligica-tua 1 at-INICt agC "t ki I /�"t 18. It is assumed that�the sales information provided by the builders is�true and accurate. We have reviewed and analyzed the sales along with checking samples on various public record documents and �the information appears to be correct. 19. Possession of this, report, or a copy thereof, does not carry with it �the right of publication. It may not be used for any purpose by any person other than the party to whom it is addressed without the written consent of the appraiser, and in any event, only with proper qualification and only in its entirety. Permission is g�iven for this appraisal �to be published as a part of�the Official Statement or similar document for the San Diego, County CIFID No. 16-1 IA 2 Special Tax Bonds. Supplement to Appraisal Report City of Chula Vista CFD 16-1 Improvement Area 2 (portion of Millenia) Kitty Siino &Associates, Inc. 9 A 0 ji 0 _f%A 202 f-03-t 6 Pligica-tua 1 UCINIV't I agC APPRAISER'S CERTIFICATION The appraiser certifies that to the best of his knowledge and belief: 1. The statements of fact contained in this report are true and correct. 2. The reported analyses, opinions and conclusions are limited only by the reported assumptions and limiting conditions, and are my personal, unbiased, professional analyses, opinions and conclusions. 3. The appraiser has no present or prospective interest in the property that is the subject of this report, and no personal interest or bias with respect to the parties involved. 4. The appraiser's compensation is not contingent upon the reporting of a predetermined value or direction in value that favors, the cause of the client, the amount of the value estimate, the attainment of a stipulated result or the occurrence of a subsequent event. 5. This appraisal was not based on a requested minimum valuation, a specific valuation or the approval of a loan. 6. The analyses, opinions and conclus,ions,were developed, and this report was prepared, in conformity with the Uniform Standards of Professional Appraisal Practice. 7. Kitty Siino has made a personal inspection of the property,that isthe subject of this report. 8. Kitty Siino has performed appraisal services,on the subject property in the past three years as described with�in this Supplement. An Orig�in�al Appraisal of the property with a November 15, 2020 date of val�ue was completed. 9. No other appraisers have provided significant professional assistance to the persons signing this report. 10. The reported analyses, opinions and conclusions were developed, and this report was prepared, in conformity with the requirements of the Appraisal Institute's Code of Professional Ethics and Standards of Professional Appraisal Practice, which include the Uniform Standards of Professional Appraisal Practice. 11. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. 12. As of the date of this report, Kitty Siino has completed the req�uirem�en�ts of the continuing educati�on program of the Appraisal Institute. Kitty S. Siino, MAI State Certified General Real Estate Appraiser (AGO047913) Supplement to Appraisal Report City of Chula Vista CFD 16-1 Improvement Area 2 (portion of Millenia) Kitty Siino &Associates, Inc. 10, 2 _03 02 f -1 P-1gV'Jaua 1 UCISIV, Pap,"t""U1 ADDENDA 202 f-03-t 6 Pligica-tua 1 at-,r%.vt -1 agC-tv I UI 7-Z-ff— Sub'"ect Property as of November 15, 2020 (from Orig inall Report) Description �No�. Ownershi Conditio�n/Status Lots p, Pinnacle by Meridian (Units 1-126 of Lot 1 of Map No. 16377) Units 1-�36 of Map 16377 36 Individuals Completed Houses / Closed Units 121-126 of Map 16377 6 Meridian Model Homes None 0 Meridian Homes over 95% Complete Unit 3,7-78 42 Meridian Homes U/C (41 In escrow) Units 79-120 42 Meridian Finished Lots (0 in escrow) Subtotal Pinnacle 126 Vibe b Lennar Homes (Units 1-92 of Lot 1 of Map 16409�) Units 7, 8, 29-31 of Map 16409 5 Individuals Com leted Houses / Closed Units 3,-�5 of Map 16409 3 Lennar Model Homes Homes Units 1-2, 6 and 9-16 of Map 16409, 11 Lennar Homes over 95% Complete (9 In escrow) Units 26-28 and 32-53, of Map 16409 25 Lennar Homes U/C (22 In escrow) Units 17-25 and 54-92 of Map 16409 48 Lennar Finished Lots (0 in escrow Subtotal Vibe 912 1 Cleo by Lennar Homes (Units 93-209 of Lot 1 of Map 16408) Units 93-97, 104-1097 '114-�125 and 32 Lennar Homes and Models U/C (24 201-209 in escrow) Units 98-103, 110-113, 126-200 85 Lennar Finished Building pads Su�btotal Cleo 117 Commercial Parcel Lot �19 of Tract Map 16081 N/A SLFIV- 8.34-acre Finished Lot Millenia LLC 'To�tal �Residential Units 1335 A A 0 11 0 a 202 f-03-t 6 P-18U]Ltua T aCrIZ& -1 a8c;"tVO SuWect Property as of Februaa 15, 2021 Description �No�. Ownershi Conditio�n/Status Lots p, Pinnacle by Meridian (Units 1-126 of Lot 1 of Map No. 16377) Units 1-�36 of Map 16377 36 Individuals Completed Houses / Closed Units 121-126, of Map 16377 6 Meridian Model Homes Units 27-48 of Map 16377 12 Meridian Homes over 95% Complete (12 in esc.) Unit 49-102 pf<a[ 16377 54 Meridian Homes U/C (54 In escrow) Units 103,-�120 of Map 16377 42 Meridian Finished Lots (0 in escrow) Subtotal Pinnacle 126 Vibe by Lennar Homes (Units 1-92 of Lot 1 of Map 16409�) Units 6-�16, 26-31 and 35-41 of Map 24 Individuals Completed Houses / Closed 16409 Units 3-5 of Map 16409 3 Lennar Model Homes Homes Units 1-�2, 32-�34 and 42-46 of Map 10 Lennar Homes over 95% Complete 16409 (8 1 n escrow�—two not released) Units 47-72 and 76-82 of Map 16409 33 Lennar Homes U/C (29 In escrow) Units 17-25, 73-�75 and 83,-�92 of Map 22 Lennar Finished Lots (0 in escrow) 16409 Subtotal Vibe 912 Cleo by Lennar Homes (Units 93-209 of Lot 1 of Map 16408) Units 120-�125 6 Lennar Model Homes Complete Units 93-97, 104-109, 114-119and 201- 26 Lennar Homes over 95% Complete 209 (26 in esc.) Units 126-1297 135-13�87 144-1493 156- 161 and �1913-�200 28 Lennar Homes U�/C (22 in escrow Units 98-103, 110-113, 130-134, 139- 143, 150-155 and 162-192 57 Lennar Finished Building pads Su�btotal Cleo 117 Commercial Parcel Lot �19 of Tract Map 16081 N/A SLFIV- 8.34-acre Finished Lot Millenia LLC 'To�tal �Residential Units 3 30%r%F A 0 ji 0 202 f-03-t 6 Pligica-tua 1 at-ISICt agC "tV-7 U1 C, 3 f tradling Yocca Carlson &Rauth Drqft dated 315121 CONTINUING DISCLOSURE AGREEMENT This Continuing Disclosure Agreement dated as of April 1, 2021 (the "Disclosure Agreement") is executed and delivered by Community Facilities District No. 16-1 (Millenia) (the '"District") and Spicer Consulting Group, LLC (the "'Dissemination Agent") in connection with the execution and delivery of$ City of Chula Vista Community Facilities District No�. 16-1 (Millenia) Improvement Area No. 2 2021 Special Tax Bonds, (the "Bonds"). The Bonds are being issued pursuant to a Bond Indenture dated as of April 1, 2021 (the "Indenture"), by and between the District and Wilmington Trust, National Association, as fiscal agent (the "Fiscal Agent"). The District covenants as follows: SECTION 1. Purpose of the Disclosure Aareement. This Disclosure Agreement is being executed and delivered by the District for the benefit of the Owners and Beneficial Owners of the Bonds and in order to assist the Participating Underwriter in complying with the Rule (defined below). SECTION 2. Definitions. In addition to the definitions set forth in the Indenture,, which apply to any capitalized term used in this Disclosure Agreement unless otherwise defined. in this Section, the following capitalized terms shall have the following meanings: "Annual Report" shall mean any Annual Report provided by the District pursuant to, and as described in,, Sections 3 and�4 of this Disclosure Agreement. "Beneficial Owner" shall mean any person which has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds through nominees, depositories or other intermediaries). "City"means the City of Chula Vista, County of San Diego, California. "Disclosure Representative" shall mean the City Manager, Assistant City Manager, Deputy City Manager, Chief Financial Officer, Director of Finance/Treasurer of the City or the designee of any one of such officers, or such other officer or employee as the City Manager shall designate in writing from time to time. "Dissemination Agent" shall mean Spicer Consulting Group, LLC, or any successor dissemination agent designated in writing by the City Manager or the Director of Finance/Treasurer of the District and which has filed with the District a written acceptance of such designation. "EMMA" shall mean the Electronic Municipal Market Access system of the MSRB. "Financial Obligation" means a (i) debt obligation; (ii) derivative instrument entered into in connection with. or, an existing or planned debt I or pledged as security or a source of payment f obligation; or (iii) guarantee of(i) or (ii). The term Financial Obligation shall not include municipal securities as to which a final o�fficial statement has, been provided to the MSRB consistent with the Rule. "Improvement Area No. 2" shall mean Improvement Area No. 2 of the District. 483 3-30�65-800�5v5/02403 6-0089 2021-03-16 Agenda Packet Page 470 of 724, "Listed Events" shall mean any of the events listed in Sections 5(a) and 5(b) of this Disclosure Agreement. "MSRB" shall mean the Municipal Securities Rulemaking Board and any successor entity designated under the Rule as the repository for filings made pursuant to the Rule. "Official Statement" shall mean the Official Statement relating to the Bonds dated March 2021. "Participating Underwriter"' shall mean Stifel,Nicolaus &Company, Incorporated. "Repository" shall mean the MSRB or any other entity designated or authorized by the Securities and Exchange Commission to receive reports pursuant to the Rule. Unless otherwise designated by the MSRB or the Securities and Exchange Commission, filings with the MSRB are to be made through the EMMA website of the MSRB, currently located at http://emma.msrb.org. "Rule" shall mean Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time. "State" shall mean the State of California. SECTION 3. Provision of Annual Reports. (a) The District shall, or, upon delivery of the Annual Report to the Dissemination Agent shall cause the Dissemination Agent to, not later than March 31 of each year, commencing March 3 1, 2022, provide to the Repository an Annual Report which is consistent with the requirements of Section 4 of this Disclosure Agreement. The Annual Report may be submitted as a single document or as separate documents comprising a package, and may cross-reference other infori-nation as provided in Section 4 of this Disclosure Agreement; provided that the audited financial statements of the District, if any are prepared, may be submitted separately from the balance of the Annual Report and later than the date required above for the filing of the Annual Report if they are not available by that date. If the District's fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 5(d). The District shall provide a written certification with each Annual Report furnished to the Dissemination Agent to the effect that such Annual Report constitutes the Annual Report required to be furnished by it hereunder. The Dissemination Agent may conclusively rely upon such certification of the District and shall have no duty or obligation to review such Annual Report. (b) Not later than five (5) days prior to the date for the filing of an Annual Report, the District shall provide the Annual Report to the Dissemination Agent (if other than the District)�. If by five (5) days prior to such date, the Dissemination Agent has 'not received a copy of the Annual Report, the Dissemination Agent shall contact the District to inquire if the District is in compliance with subsection(a). (c) If the District is unable to provide to the Repository an Annual Report by the date required in subsection (a), the Dissemination Agent, in a timely manner, shall send a notice to the Repository in the form required by the Repository stating that the Annual Report has not been filed and, if provided by the District, the date the District anticipates the filing to be made. 2 483 3-30�65-800�5v5/02403 6-0089 2021-03-16 Agenda Packet Page 471 of 724, (d) The Dissemination Agent shall: (i) determine each year prior to date for providing the Annual Report the name and address of the Repository if other than the MSRB; and (ii) file a report with the District certifying that the Annual Report has been provided to the Repository pursuant to this Disclosure Agreement and stating the date it was provided to the Repository. SECTION 4. Content of Annual Reports. The District's Annual Report shall contain or include by reference the following: (a) Financial Statements. The audited financial statements of the District for the prior fiscal year, if any have been prepared and which, if prepared, shall be prepared in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board; provided, however, that the District may, fro�m time to time, if required by federal or state legal requirements, modify the basis upon which its financial statements are prepared.. In the event that the District shall modify the basis upon which its financial statements are prepared, the District shall provide the information referenced in Section 8(b) below regarding such modification. If the District is preparing audited financial statements and such audited financial statements are not available by the time the Annual Report is required. to be filed pursuant to Section 3(a), the Annual Report shall contain unaudited financial statements, and. the audited financial statements shall be filed in the same manner as the Annual Report when they become available (b) Financial and O-peratina Data. The Annual Report shall contain or incorporate by reference the following: (i) the principal amount of the Bonds outstanding as of the September 2 preceding the filing of the Annual Report; (1i) the balance in each fund under the Indenture and the Reserve Requirement as of the September 2 preceding the filing of the Annual Report; (Iii) any changes to the Improvement Area No. 2 Special Tax RMA approved or submitted to the qualified electors for approval prior to the filing of the Annual Report; (iv) an update of the estimated assessed value-to-lien ratio for Improvement Area No. 2 substantially in the form of Table 6 in the Official Statement based upon the most recent Special Tax levy preceding the date of the Annual Report and on the assessed values of property for the current fiscal year; (v) a statement regarding the amount of Special Tax prepayments, if any, in, the Fiscal Year for which the Annual Report is prepared.; (vi) the status of any foreclosure actions being pursued by the District in Improvement Area No. 2 with respect to delinquent Special Taxes; 3 483 3-30�65-800�5v5/02403 6-0089 2021-03-16 Agenda Packet Page 472 of 724, (vii) a statement as to whether the District participates in the Teeter Plan (as defined in the Official Statement) and whether the City or the District has entered into an agreement to sell delinquent installments of Special Taxes to a third arty; p I (viii) a table showing the total Special Taxes levied and the total Special Taxes collected for the prior fiscal year and the total Special Taxes that, as of December 3 1, remain unpaid for each prior fiscal year in which Special Taxes were levied and the number of delinquent parcels in Improvement Area No. 2; (ix) a list of the property owners within Improvement Area No. 2 responsible for 5% or more of the Special Tax levy for the current Fiscal Year, if any, the percentage of the Special Tax levy for which each such ro ertv owner is responsible, and whether any of such p p , owners, as of December 31 preceding the Annual Report, was delinquent in the payment of Special Taxes; and (x) any information not already included under (i) through (ix) above that the District is required to file in its annual report pursuant to the provisions of the Mello-Roos Community Facilities Act of 1982, as amended, with the California Debt and Investment Advisory Commission. Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues of the District or related,public entities, which have been submitted to each of the Repository or the Securities and Exchange Commission. If the document included by reference is a final official statement.) it must be available from the MSRB. The District shall clearly identify each such other document so included by reference. In the event that the District shall modify the basis upon which its financial statements are prepared, the Dissemination Agent shall provide a notice of such modification to the Repository, including the information set forth in Section 8(b)below. SECTION 5. Reporting of Significant Events. (a) Pursuant to the provisions of this Section 5, the District shall give, or cause the Dissemination Agent to give, notice to the Repository of the occurrence of any of the following events with respect to the Bonds in a timely manner not more than ten (10) business days after the occurrence of the event: I. principal and interest payment delinquencies; 2. unscheduled draws on debt service reserves reflecting financial difficulties; 3. unscheduled draws on credit enhancements reflecting financial difficulties; 4. substitution of credit or liquidity providers, or their failure to perform; 5. adverse tax opinions or the issuance by the Internal Revenue Service of proposed or final determinations of taxability or of a Notice of Proposed Issue (IRS Form 5 701-TEB); 6. tender offers; 4 483 3-30�65-800�5v5/02403 6-0089 2021-03-16 Agenda Packet Page 473 of 724, 7. defeas,ances; 8. ratings changes; 9. bankruptcy, insolvency, receivership or similar proceedings; and 10. default, event of acceleration, termination event, modification of terms, or other similar events under the terms of a Financial Obligation of the obligated person, any of which reflect financial difficulties. Note: for the purposes of the event identified in subparagraph (9)�, the event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent or similar officer for an obligated person in a proceeding under the U.S. Bankru tcv Code or in any other proceedina under state or federal law in which a p , 4-� court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the obligated person, or if such jurisdiction has been assumed by leaving the existing governmental body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the obligated person. (b) Pursuant to the provisions of this Section 5, the District shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Bonds, if material, in a timely manner not more than ten (10)business days after the occurrence of such event: I unless described in paragraph 5(a)(5) above, notices or determ.inations by the Internal Revenue Service with respect to the tax status of the Bonds or other material events affecting the tax status of the Bonds; 2. the consummation of a merger, consolidation or acquisition involving an obligated person or the sale of all or substantially all of the assets, of the obligated person, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms; 3. appointment of a successor or additional trustee or the change of the name of a trustee; 4. nonpayment related defaults; 5. 'modifications to the rights of Owners of the Bonds; 6. Bond calls; 7. release, substitution or sale of property securing repayment of the Bonds; and 8. incurrence of a Financial Obligation of the obligated person, or agreement to covenants, events of default, remedies, priority rights, or other similar terms 5 483 3-30�65-800�5v5/02403 6-0089 2021-03-16 Agenda Packet Page 474 of 724, of a Financial Obligation of the obligated person, any of which affect security holders. (c) Whenever the District obtains knowledge of the occurrence of a Listed Event under 5(b) above, the District shall as soon as possible determine if such event would be material under applicable federal securities laws. (d) If a Listed Event under Section 5(a) has occurred, or if the District determines that knowledge of the occurrence of a Listed Event under 5(b) above would be material under applicable federal securities laws, the District shall file a notice of such Listed Event with the Repository in a timely manner not more than 10 business days after the event. Notwithstanding the foregoing, notice of the Listed Event described in subsection (b)(6) need not be given under this section any earlier than the notice (if any) of the underlying event is given to Owners of affected Bonds pursuant to the Indenture. (e) The District hereby agrees that the undertaking set forth in this Disclosure Agreement is the responsibility of the District and. that the Dissemination Agent shall not be responsible for determining whether the District's instructions to the Dissemination Agent under this Section 5 comply with the requirements of the Rule. SECTION 6. Tennination of Reporting Obligation. The District's obligations under this Disclosure Agreement shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. SECTION 7. Dissemination Nc4ent. The District may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Agreement,., and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The Dissemination Agent may resign by providing thirty days written notice to the District and the Fiscal Agent. The Dissemination Agent shall not be responsible for the content of any report or notice prepared by the District and, shall have no duty to review any information provided, to it by the District. The Dissemination Agent shall have no duty to prepare any information report nor shall the Dissemination Agent be responsible for filing any report not provided to it by the District in a timely manner and in a form suitable for filing. SECTION 8. Amendment; Waiver. (a) Notwithstanding any other provision of this Disclosure Agreement, the District may amend this Disclosure Agreement, and any provision of this Disclosure Agreement may be waived, provided that the following conditions are satisfied: (1) If the amendment or waiver related to the provisions of Sections 3(a), 4, or 5, it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature or status of an obligated person with respect to the Bonds, or the type of business conducted; (2) The undertaking hereunder, as amended or taking into account such waiver, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the original execution. and delivery of the Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and 6 483 3-30�65-800�5v5/02403 6-0089 2021-03-16 Agenda Packet Page 475 of 724, (3) The amendment or waiver either (i) is, approved by the Owners, of the Bonds in the same manner as,provided in the Indenture for amendments to the Indenture with the consent of Owners, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the Owners or Beneficial Owners of the Bonds. (b) In the event of any amendment or waiver of a provision of this Disclosure Agreement, the District shall describe such amendment in the next Annual Report, and shall include, as applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the type (or, in the case of a change of accounting principles, on the presentation) of financial information or operating data being presented by the District. In addition, if the amendment is related to the accounting principles to be followed in preparing financial statements, (i) notice of such change shall be given in the same manner as for a Listed Event under Section 5(a), and (ii) the Annual Report for the year in which the change is made should present a comparison (in narrative fon-n and also, if feasible, in quantitative form) between the financial statements as prepared on the basis of the new accounting principles and. those prepared on the basis of the former accounting principles. SECTION 9. Format of Filings with RepositoEy. Any report or filing with the Repository pursuant to this Disclosure Agreement must be submitted in electronic format, accompanied by such identifying information as is prescribed by the Repository. SECTION 10. Additional information. Nothing in this Disclosure Agreement shall be deemed to prevent the District from disseminating any other information, using the means of dissemination set forth in this Disclosure Agreement or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Agreement. If the District chooses to include any information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Agreement, the District shall have no obligation hereunder to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event. SECTION 11. Default. In the event of a failure of the District to co�molv with any provision of this Disclosure Agreement, any Owner or Beneficial Owner of the Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the District to comply with its obligations under this Disclosure Agreement. A default under this Disclosure Agreement shall not be deemed an Event of Default under the Indenture, and the sole remedy under this Disclosure Agreement in the event of any failure of the District to comply with this Disclosure Agreement shall be an action to compel performance and the District shall have no monetary liability to any person as a result of any failure to comply with the terms of this Disclosure Agreement. SECTION 12. Duties, Immunities and Liabilities of Dissemination The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure! Agreement, and the District agrees,, to the extent permitted by law, to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorney's fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent's negligence or willful misconduct. The Dissemination Agent shall be paid compensation by the 7 483 3-30�65-800�5v5/02403 6-0089 2021-03-16 Agenda Packet Page 476 of 724, District for its services provided hereunder in accordance with its schedule of fees as amended from time to time and all expenses, legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder. In performing its duties hereunder, the Dissemination Agent shall not be deemed to be acting in any fiduciary capacity for the District, the Owners, or any other party. The obligations of the District under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds. SECTION 13. Notices. Any notices or communications to or among any of the parties to this Disclosure Agreement may be given as follows: To the District: Community Facilities District No. 16-1 (Millenia) City of Chula Vista 276 Fourth Avenue Chula Vista, CA 91910 Attention: Director of Finance/Treasurer To the Dissemination Agent.- Spicer Consulting Group,LLC 41619 Margarita Road, Suite 10 1 Temecula, CA 92591 SECTION 14. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the District, the Dissemination Agent, the Participating Underwriter and Owners and, Beneficial Owners fro�m time to time of the Bonds, and shall create no rights in any other person or entity. SECTION 15. CounteEparts. This Disclosure Agreement may be executed in several counterparts, all or any of which shall be regarded.for all purposes as one original and shall constitute and be but one and the same instrument. [REMAINDER OF PA GE INTENTIONALL Y LEFT BLANK] 8 483 3-30�65-800�5v5/02403 6-0089 2021-03-16 Agenda Packet Page 477 of 724, SECTION 16. Sianatures. This Disclosure Agreement has been executed by the undersigned on the date hereo�f, and such signature by the District binds the District to the undertaking herein provided and such signature by the Dissemination Agent binds, the Dissemination Agent to the terms hereof applicable to it. COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA) By: Director of Finance/Treasurer SPICER CONSULTING GROUP,, LLC, as Dissemination Agent By: Authorized Officer 9 483 3-30�65-800�5v5/02403 6-0089 2021-03-16 Agenda Packet Page 478 of 724, C, 3 tradling Yocca Carlson &Rauth Drqft dated 318121 4`1 "_0 cz- PRELIMINARY OFFICIAL STA.I'EMENT D�ATED�MARCH .2021 NEW ISSUE—BOOK-ENTRY-ONLY NO RATING In the opinion(Y'Best Best&Krieger,LLP San Diego,Cal�fbrnia("Bond Counsel'),subject to certain qual�flcations described in this fficial Statement under existing statutes, regulations, rulings andjudicial decisions, and assuming certain representations and compliance with certain covenants and requirements described herein,the interest on the Bonds is excludedfirom gross incomeforfiederal income tax purposes and is,not an item g-, 0 qf*tax pre�?rence A)r purposes of'the ftderal alternative minimum tax. In thef�rther opinion of'Bond Counsel, interest on the Bonds is exempt.fi-om Cal�fbrnia personal income tax. See "TAX.MA TTERS"herein. C-d $11,2551000* 4-0 CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO.16-1(MILLENIA) IMPROVEMENT AREA NO.2 2021 SPECIAL TAX BONDS Dated: Delivery Date Due: September 1,as shown on the inside cover page This Official Statement describes bonds that are being issued by Community Facilities District No. .164(Millenia)(the"District")with respect to Improvement Area No.2 therein("'Improvement Area No.2"). The City of Chula Vista Community Facilities District No. 16-1(Millenia)Improvement Area No. 2 2021 Special Tax Bonds(the"Bonds")are being issued by the District to(a)pay the cost and expense of acquisition of certain public facilities required in connection with the development of the District; (b)fund,capitalized interest on the Bonds through September 1,2021; (c) fund a Reserve Fund,securing the Bonds;and(d)pay costs of issuance of the Bonds. The Bonds are authorized,to be issued pursuant to the Mello-Roos Community Facilities Act of 1982, as amended(Sections 53311, et seq. of the Government Code of the State of California),and pursuant to Resolution No.2021-_adopted by the City Council of the City of Chula Vista(the"City"),acting as the legislative body of the District and a Bond Indenture,dated as of April 1,2021 (the"Indenture"),by and between the District and Wilmin to,n Trust,National 9 Association,as Fiscal Agent(the"Fiscal Agent"). The Bonds are limited obligations of the District and are payable solely from revenues derived from certain annual Special Taxes(as defined C01 herein)to be levied on and collected from the owners of parcels within Improvement Area No.2 subject to the Special Taxes and from certain other funds c, pledged under the Indenture,all as further described herein (see"SOURCES OF PAYMENT FOR THE BONDS—Assignment of Assessor Parcel +L C13 Numbers and Delayed Special Tax Revenues"herein for a description of certain delays in receipt of Special Tax revenues during the development and +.; V� home sales period within Improvement Area No.2). The Special Taxes are to be levied according to the rate and method of apportionment approved by the City Council of the City and the qualified electors within Improvement Area No.2. See"SOURCES OF PAYMENT FOR THE BONDS—Special 7� J Taxes." The City Council of the City is the legislative body of the District. C) The Bonds are issuable in fully registered forrn and when issued will be registered in the name of Cede&Co.,as nominee of The Depository Trust Company,New York,New York("DTC"). Individual purchases of the Bonds may be made in principal amounts of$5,000 and integral multiples thereofand will be in book-entry form only. Purchasers of Bonds will not receive certificates representing their beneficial ownership of the Bonds but will receive credit balances on the books of their respective nominees. Interest on the Bonds will be payable semiannually on each March I and September 1,commencing September 1,2021. The Bonds will not be transferable or exchangeable except for transfer to another nominee of DTC or as otherwise described herein. Principal of and interest on FE,910 �3 the Bonds will be paid by the Fiscal Agent to DTC for subsequent disbursement to DTC Participants who will remit such payments to the beneficial owners ofthe Bonds. See"THE BONDS—General Provisions"and APPENDIX H—"BOOK-ENTRY ONLY SYSTEM"herein. NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE DISTRICT,, THE CITY OF CHULA VISTA THE STATE OF 4� CALIFORNIA,OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE BONDS. EXCEPT FOR THE NET TAXES �E (AS DEFINED HEREIN),NO OTHER REVENUES OR TAXES ARE PLEDGED TO THE PAYMENT OF THE BONDS. THE BONDS ARE NOT GENERAL 0 += OR SPECIAL OBLIGATIONS OF THE CITY OR GENERAL OBLIGATIONS OF THE DISTRICT BUT ARE LIMITED OBLIGATIONS OF THE DISTRICT PAYABLE SOLELY FROM SPECIAL TAXES TO BE LEVIED IN IMPROVEMENT AREA NO.2 OF THE DISTRICT AND CERTAIN OTHER AMOUNTS E, HELD UNDER THE INDENTURE AS MORE FULLY DESCRIBED HEREIN. 'C', �= � U ;_14 -y redemption from prepaid Special Taxes,and mandatory sinking fund redemption prior to The Bonds are subject to optional redemption,extraordinal maturity as set forth herein. See"THE BONDS—Redemption"herein. 7:� THE BONDS ARE NOT RATED BY ANY RATING AGENCY,AND INVESTMENT IN THE BONDS INVOLVES SIGNIFICANT RISKS THAT ARE NOT APPROPRIATE FOR CERTAIN INVESTORS. CERTAIN EVENTS COULD AFFECT THE ABILITY OF THE DISTRICT TO 4-4 �Z PAY THE PRINCIPAL OF AND INTEREST ON THE BONDS WHEN DUE. SEE THE SECTION OF THIS OFFICIAL STATEMENT ENTITLED "SPECIAL RISK FACTORS"FOR A DISCUSSION OF CERTAIN RISK FACTORS THAT SHOULD BE CONSIDERED,IN ADDITION TO THE OTHER MATTERS SET FORTH HEREIN,IN EVALUATING THE INVESTMENT QUALITY OF THE BONDS. >> This cover page contains certain information for general reference only. It is not intended to be a summary of the security or terms of this issue. i Investors are advised to read the entire Official Statement to obtain information essential to the making of an infortned.investment decision. MATURITY SCHEDULE (See Inside Cover Page) The Bonds are offered when,as and if issued and accepted by the Underwriter,subject to approval as to their legality by Best Best&Krieger LLP, �cql San Diego,California,Bond Counsel,and subject to certain other conditions. S,tradling Yocca Carlson&Rauth,a Professional Corporation,Newport Beach, California is serving as Disclosure Counsel to the District with respect to the Bonds. Certain legal matters will be passed on for the City and the District by the Office of the City Attorney,for the Underwriter by Jones Hall,A Professional Law Corporation,San Francisco,California,as counsel to the Underwriter and for +_o *r� rA the Fiscal Agent by its counsel. It is anticipated that the Bonds in book-entry form will be available for delivery through the facilities of DTC on or about April 20�2 1. 4Z 4-J ct C'n Preliminary, su�ject to change. Page 479 of 724, ISTIFEL LOGO] Dated: March—,,2021 lwt!W460,k,q&(m(NCm9 Page 480 of 724, $11,2551000* CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 16-1(MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS MATURITY SCHEDULE B as e CUSIP No. Serial Bonds Maturity Date Principal (September 1) Amount Interest Rate Yield Price CUSIP No. Term Bonds $ — %Term Bonds due September 1,20 ,Yield: %Price: CUSIP No. $ %Term Bonds due September 1,20 ,Yield: %Price: CUSIP No. Preliminary,sub ject to change. CUSIP0 is a registered trademark of the American Bankers Association. CUSIP data,herein is provided by CUSIP Global Services, managed kv S&P Global Market Intelligence on beha�f of The American Bankers Association. This iqformation is not intended to create a database and does not serve in any way as a substitute,tbr the CUSIP Services Bureau. CUSIP numbers have been assigned by an independent compan�v not qf ,�iliated with the Ci�v, the District, the Municipal Advisor or the Underwriter and are included sole�vfbr the convenience ofthe registered owners qf the applicable Bonds. None of'the City, the District, the Municipal Advisor or the Underwriter is responsiblefior the selection or uses qf*these CUSIP numbers, and no reprc,�sentation is made as to their correctness on the applicable Bonds or as included herein. The CUSIP number.for a *f spec!ic maturity is subject to being changed qfter the issuance qf the Bonds as a result of various subsequent actions including, but not limited to�, a rqfunding in whole or in part or as a re�sult qf the procurement of secondary market poqfolio insurance or other similar enhancement 4y investors that is applicable to all or a portion of certain maturities qf the Bonds. 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 481 of 724, CITY OF CHULA VISTA STATE OF CALIFORNIA CITY COUNCIL Serving as the Legislative Body of Community Facilities District No. 16-1(Millenia) Mary Casillas Salas,Mayor John McCann(First District) Jill Galvez(Second District) Stephen Padilla(Third District) Andrea Cardenas(Fourth District) CITY OFFICIALS, Maria Kachado,orian,City Manager Kelley Bacon,Deputy City Manager Kelly Broughton,Deputy City Manager Glen Goo�gins,City Attorney Kerry K.Bigelow,MMC,City Clerk David Bilby,Director of Finance/Treasurer Tiffany Allen,Director of Development Services BOND COUNSEL Best Best&Krieger LLP San Diego,California DISCLOSURE COUNSEL Stradling Yocca Carlson&Rauth, a Professional Corporation, Newport Beach,California MUNICIPAL ADVISOR Harrell&Company Advisors,LLC Orange,California SPECIAL TAX CONSULTANT Spicer Consulting Group,LLC Temecula,California REAL ESTATE APPRAISER Kitty Siino&Associates,Inc. Tustin,California MARKET ABSORPTION ANALYST Meyers Research, LLC Solana Beach,California FISCAL AGENT Wilmington Trust,National Association Costa Mesa,California 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 482 of 724, Except where otherwise indicated,all information contained in this Official Statement has been provided by the City and the District. No dealer,broker, salesperson or other person has been authorized by the City,the District, the Fiscal Agent,the Municipal Advisor or the Underwriter to give any information or to make any representations in connection with the offer or sale of the Bonds other than those contained in this Official Statement and, if given or made, such other information or representations must not be relied upon as having been authorized by the City, the District, the Fiscal Agent, the Municipal Advisor or the Underwriter. This O�fficial Statement does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the Bonds by a person in anyjurisdiction in which it is unlawful for such person to make such an offer, solicitation or sale. This Official Statement is not to be construed as a contract with the purchasers or owners of the Bonds. Statements contained in this Official Statement which involve estimates, forecasts or matters of opinion, whether or not expressly so described in this Official Statement, are intended solely as such and are not to be construed as representations of fact. This Official Statement, including any supplement or amendment to this Official Statement, is intended to be dep�o�sited with the Electronic Municipal Market Access System of the Municipal Securities Rulernaking Board,which can be found at www.emma.msrb,.org. The information set forth in this Official Statement which has been obtained from third party sources is believed to be reliable, but such information is not guaranteed as to accuracy or completeness by the City or the District. The information and expressions of opinion in this Official Statement are subject to change without notice, and neither the delivery of this Official Statement nor any sale made hereunder shall,under any circumstances,create any implication that there has been no change in the affairs of the City or the District or any other parties described in this Official Statement since the date of this Official Statement. All summaries of the Indenture or other documents are made subject to the provisions of such documents respectively and do not purport to be complete statements of any or all of such provisions. Reference is made by this Official Statement to such documents on file with the City for further information. While the City maintains an internet website for various purposes, none of the information on that website is incorporated by reference herein or intended to assist investors in making any investment decision or to provide any continuing information with respect to the Bonds or any other bonds or ob�ligations of the City. Any such information that is inconsistent with the information set forth in this Official Statement should be disregarded. The Underwriter has provided the following sentence for inclusion in this Official Statement: The Underwriter has reviewed the information in this Official Statement in accordance with, and as a part of, its responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction,,but the Underwriter does not guarantee the accuracy or completeness of such information. Certain statements included or incorporated by reference in this Official Statement constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 21 E of the United States Securities Exchange Act of 1,934,as amended,and Section 27A of the United States Securities Act of 1933., as amended. Such statements are generally identifiable by the terminology used such as 4�plan,""expect,""estimate,11��project,","budget"or other similar words. Such forward-looking statements include, but are not limited to, certain statements contained in the information under the caption "IMPROVEMENT AREA NO. 25'and"PROPERTY OWNERSHIP AND THE DEVELOPMENT." THE,ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN SUCH FORWARD-LOOKING,STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS,UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS DESCRIBED TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. THE DISTRICT DOES NOT PLAN TO ISSUE ANY UPDATES OR REVISIONS TO THE FORWARD-LOOKING STATEMENTS SET FORTH IN THIS OFFICIAL STATEMENT. IN CONNECTION WITH THE OFFERING OF THE BONDS, THE UNDERWRITER MAY O�VERALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF SUCH BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING,IF COMMENCED,MAY BE DISCONTINUED AT ANY TIME. THE BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933� AS AMENDED,IN RELIANCE UPON AN EXEMPTION CONTAINED IN SUCH ACT. THE BONDS HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES LAWS OF ANY STATE. 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 483 of 724, WAfLE OF CONTENTS Page INTRODUCTION-----------__________----------------------_____| The District and Improvement Area No. 2.....................................................................................................| Property Ownership and Development Status ...............................................................................................3 Forward Looking Statements----------------------------------------.4 Sources of Payment for the Bonds.................................................................................................................5 Appraisal Report and Supplement to Appraisal Report.................................................................................6 Descriptionof the Bonds................................................................................................................................7 Tax Exemption-----------__________----------------------_____7 Professionals Involved tnthe Offering-----------------------------------.7 Continuing Disclosure.-------------------------------------------..8 BondOwners' Risks......................................................................................................................................8 OtherInformation..........................................................................................................................................8 ESTIMATED SOURCES AND USES 8F FUNDS ............................................................................................9 lN|EBONDS........................................................................................................................................................9 GeneralProvisions.........................................................................................................................................9 DebtService Schedule.................................................................................................................................lU Redemption------------------------------------------------..11 Transfer and Exchange--------------------------------____l4 SOURCES OF PAYMENT FOR THE BONDS--------------------------------l5 Limited Obligations--------------------------------------------.l5 SpecialTaxes...............................................................................................................................................l5 ReserveFund...............................................................................................................................................24 Assignment ofAssessor Parcel Numbers and Delayed Special Tax Revenues...........................................25 Issuance of Parity Bonds for Refunding Only.............................................................................................%8 IMPROVEMENTAREA NO. 2.........................................................................................................................%9 General Description o[Millenia,the District and Improvement Area No. 2...............................................29 Description of Authorized Facilities............................................................................................................29 Direct and Overlapping Indebtedness-----------------------------------.3O Expected Tax Burden;Potential Special Tax Prepayment-------------------------3K MarketAbsorption Study.............................................................................................................................35 Appraisal Report and Supplement to Appraisal Report...............................................................................37 Appraised Value-To-Lien Ratios.................................................................................................................39 Largest Taxpayers ---------------------------------------------.4K Delinquency History --------------------------------------------42 PROPERTY OWNERSHIP AND THE DEVELOPMENT--------------------------.42 General Description of the Development---------------------------------..42 SLFand the Contracted Project Manager---------------------------------.44 History of Property TaxPayments; Loan Defaults; ---------------..44 The Development---------------------------------------------..45 Builders in Improvement Area No. 2...........................................................................................................48 Lemmarl8ocoes Development and Financing Plan........................................................................................5O Pinnacle Homes Development and Financing Plan.....................................................................................54 SPECIALRISK FACTORS...............................................................................................................................58 Risks of Real Estate Secured Investments ---------------------------.58 Concentration of Ownership_____________________-------------------57 LimitedObligations.....................................................................................................................................57 Insufficiencyof Special Taxes.....................................................................................................................57 Failure to Develop Properties _____________________------------------.59 NaturalDisasters..........................................................................................................................................6O Endangered/Threatened`Species.................................................................................................................._ 4852-7256-1 107v12/024036-0089 WABLE OF CONTENTS (continued) Page HazardousSubstances..................................................................................................................................61 Payment of the Special Tax is not a Personal Obligation of the Property Owners......................................61 PropertyValues............................................................................................................................................61 Parity Taxes and Special Assessments.........................................................................................................62 Disclosures to Future Purchasers.................................................................................................................63 SpecialTax Delinquencies...........................................................................................................................63 FDIC/Federal Government Interests in Properties.......................................................................................64 Bankruptcy and Foreclosure........................................................................................................................65 NoAcceleration Provision...........................................................................................................................66 Lossof Tax Exemption................................................................................................................................66 LimitedSecondary Market...........................................................................................................................66 Proposition218............................................................................................................................................67 Litigation with Respect to Community Facilities Districts..........................................................................67 BallotInitiatives...........................................................................................................................................69 Limitationson Remedies .............................................................................................................................69 Potential Early Redemption of Bonds from Special Tax Prepayments........................................................69 Cybersecurity...............................................................................................................................................69 COVID-19(Coronavirus)Pandernic............................................................................................................70 CONTINUINGDISCLOSURE..........................................................................................................................70 District Continuing Disclosure.....................................................................................................................70 Developer Continuing Disclosure................................................................................................................71 TAXMATTERS.................................................................................................................................................72 LEGALMATTERS............................................................................................................................................73 ABSENCEOF LITIGATION............................................................................................................................73 NORATING......................................................................................................................................................73 UNDERWRITING.............................................................................................................................................73 FINANCIALINTERESTS.................................................................................................................................73 PENDING LEGISLATION................................................................................................................................74, ADDITIONAL INFORMATION.......................................................................................................................74, APPENDIX A RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX.......................A-1 APPENDIX B-I APPRAISAL REPORT..............................................................................................B-1-1 APPENDIX B-,2 SUPPLEMENT TO APPRAISAL REPORT.............................................................B-2-1 APPENDIX C FORM OF OPINION OF BOND COUNSEL..............................................................C-1 APPENDIX D GENERAL INFORMATION CONCERNING THE REGION...................................D-I APPENDIX E SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE..............E-1 APPENDIX F FORM OF DISTRICT CONTINUING DISCLOSURE AGREEMENT......................F-1 APPENDIX G FORMS OF DEVELOPERS CONTINUING DISCLOSURE CERTIFICATES ........G-1 APPENDIX H BOOK-ENTRY ONLY SYSTEM................................................................................H-I APPENDIX I MARKET ABSORPTION STUDY..............................................................................I-1 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 485 of 724, [INSERT AERIAL PHOTO HERE] 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 486 of 724, $11,2551000* CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 16-1(MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS INTRODUCTION The purpose of this Official Statement, which includes the cover page, the table of contents and the appendices (collectively, the "Official Statement"'), is to provide certain information concerning the issuance by Community Facilities District No. 164 (Millenia) (the "District") of its City of Chula Vista Community Facilities District No. 16-1 (Millenia) Improvement Area No. 2 2021 Special Tax Bonds (the "Bonds") in the aggregate principal amount of$11,255,000*. The proceeds of the Bonds will be used to (a) pay the cost and, expense of acquisition of certain public facilities required in connection with the development of the District; (b) fund capitalized interest on the Bonds through September 1,2021- (c) fund a Reserve Fund securing the Bonds; and(d) pay costs of issuance of the Bonds. See"ESTIMATED SOURCES AND USES OF'FUNDS." The Bonds are authorized to be issued pursuant to the Mello-Roos Community Facilities Act of 1982, as amended(Sections 53311 et seq. of the Government Code of the State of California) (the "Act"), Resolution No. 2021�- adopted by the City Council of the City of Chula Vista(the"City Council"),acting as the legislative body of the District,on March 202 1,and a Bond Indenture dated as of April 1,2021 (the"Indenture"),by and between the District and Wilmington Trust,National Association,as Fiscal Agent(the"Fiscal Agent"). The Bonds are secured under the Indenture by a pledge of and lien upon Net Taxes (as defined herein) levied on parcels within Improvement Area No. 2 (as defined and further described below) of the District and all moneys in the funds and accounts (other than the Project Fund, the Rebate Fund and the Administrative Expense Fund) established under and as described in the Indenture. Special taxes levied in Improvement Area No. I (as defined below)of the District are not pledged to pay debt service on the Bonds. See"SOURCES OF PAYMENT FOR THE BONDS.11 The Bonds are being issued and delivered pursuant to the provisions of the Act, Ordinance No. 2730 adopted by the City Council(the"CFD Ordinance")and the Indenture. The Bonds are being sold to the Underwriter pursuant to a bond purchase agreement between the Underwriter and the District. See"THE BONDS—General Provisions"and"UNDERWRITING"herein. This introduction is not a summary of this Official.Statement. It is only a brief description of and guide to, and is qualified by, more complete and detailed information contained in the entire Official Statement and the documents summarized or described herein. A full review should be made of the entire Official, Statement. The sale and delivery of Bonds to potential investors is made only by means of the entire Official, Statement. All capitalized terms used in this Official Statement and not defined shall have the meaning set forth in APPENDIX E "SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE—DEFINITIONS"herein. The District and Improvement Area No.2 GeneraL The District is located in the eastern.portion of the City of Chula Vista(the"City"),approximately 8 miles southeast of the City of San Diego, within the master planned community known as "Otay Ranch." The District consists of approximately 66 gross acres of which 42 acres are within Improvement Area No. 1, ("Improvement Area No. I")therein and 24 acres are within Improvement Area No�.2("Improvement Area No�.2"') therein. The District is a portion of a larger development within Otay Ranch known as "Millenia."' The Millenia project is located south of Birch Road,east of State Route 125,and west of Eastlake Parkway. The Millenia project Preliminary, subject to change. 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 487 of 724, covers approximately 206 acres and is a mixed-use development consisting of both rental and for-s,ale residential units and a maximum of 3.3 million square feet of commercial uses, including a hotel, retail space and a business, district of up to two million square feet of office space. The Millenia project is expected to be served by a number of parks and a civic core including library facilities, an elementary school and a City fire station. Completed developments within Millenia include single family homes',apartments,attached and detached condominiums,retail centers and an Ayres hotel. See"IMPROVEMENT AREA NO. 2—General Description of Millenia,the District and Improvement Area No. 2" for a description of the completed and active developments within the Millenia community as a whole. The development within Improvement Area No. 2 is part of the second phase of Millenia. Improvement Area No. 2 of the District is made up of four separate project areas. Residential development is underway in three of the project areas which are planned to include 335 for-sale market-rate homes at buildout. The fourth project area is located within the portion of Millenia designated primarily for commercial use, however, residential uses are also permitted, as further described herein. SLF (as defined below)has not made a decision as to whether any residential projects will be located in the fourth project area. SLF IV-Millenia., LLC, a Delaware limited liability company("SLF"), is the master developer within the District. SLF has contracted with Meridian Communities', LLC ("Meridian"), a land development and homebuilding company, to manage the development of the property within Millenia, including the District. SLF and Meridian are not affiliated entities. SLF and Meridian have formed a joint venture entity,Pinnacle New Homes LLC ("Pinnacle Homes"), to develop one of the residential projects within Improvement Area No. 2. See "'PROPERTY OWNERSHIP AND THE DEVELOPMENT."' Formation Proceedings. The District was formed and Improvement Area No. I and Improvement Area No. 2 were designated therein, by the City pursuant to the Act and the CFD Ordinance. The District constitutes a governmental entity separate and apart from the City. The Act was enacted by the California legislature to provide an alternative method of financing certain public capital facilities and services, especially in developing areas of the State. Any local agency(as defined in the Act)may establish a community facilities district to provide for and finance the cost of eligible public facilities and services. Generally, the legislative body of the local agency which forms a community facilities district acts on behalf of such district as its legislative body. Subject to approval by two-thirds of the votes cast at an election and compliance with the other provisions of the Act, a legislative body of a local agency may issue bonds for a community facilities district and may levy and collect a special tax within such district or any improvement area designated therein to repay such indebtedness. The City Council adopted the CFD Ordinance to establish certain provisions applicable to the formation of a community facilities district in addition to those set forth.in.the Act. Pursuant to the Act and the CFD Ordinance, on August 2, 2016, the City Council adopted Resolution No. 2016-154(the"Resolution of Intention"),stating its intention to form the District,designate Improvement Area No. I and Improvement Area No. 2 therein,and to authorize the levy of a special tax on the taxable property within each of Improvement Area No�. I and Improvement Area No.2. On August 2,2016,the City Council also adopted Resolution No. 2016-155, stating its intention to incur bonded indebtedness in an aggregate principal amount,with respect to Improvement Area No. 2, not to exceed $21,000,000, for the purpose of financing the acquisition, construction, expansion, improvement, or rehabilitation of certain public facilities to serve the area within the District and its neighboring areas. See"IMPROVEMENT AREA NO.2—Description of Authorized Facilities." Subsequent to a noticed public hearing,the City Council adopted Resolution Nos. 2016-184 and 20 16-185 on September 13, 2016 (the "Resolution of Formation" and the "Resolution to Incur Debt," respectively) which established the District, designated Improvement Area No. I and Improvement Area No. 2 therein, authorized the levy of a special tax within each of Improvement Area No�. I and Improvement Area No.2,determined the necessity to incur bonded indebtedness within the District with respect to each of Improvement Area No. I and Improvement Area No�. 2, and called an election within each of Improvement Area N"o. I and Improvement Area No. 2 on. the 2 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 488 of 724, propositions of incurring bonded indebtedness, levying a special tax and setting an appropriations limit within the District. On September 13, 2016, an election was held within Improvement Area No. 2 at which the landowners within Improvement Area No. 2 eligible to vote approved the issuance of bonds for the District with respect to Improvement Area No. 2 in an amount not to exceed$21,000,000. A Notice of Special Tax Lien for Improvement Area No. 2 was recorded in the office of the County Recorder of the County of San Diego (the "Co�unty") on September 23,2016,as Document No. 2016-0506597. Pursuant to a petition received from the Developer,the City Council adopted Resolution No. 2020-001 on January 7,2020,declaring its intention to consider changes to the rate and method of apportionment of special taxes for Improvement Area No. 2 and to amend the boundary map of the District to remove certain property from Improvement Area No. 2. Subsequent to a noticed public hearing,the City Council adopted Resolution No.2020�- 029 on February 18,20�2O�,which called a special election on the proposition of levying a special tax in accordance with the Amended and Restated Rate and Method of Apportionment of Special Tax for Improvement Area No. 2 (as amended and restated,the"'Rate and Method"), a copy of which is attached hereto as APPENDIX A. On February 18,2020,an election was held within Improvement Area No.2 at which the landowners within Improvement Area No. 2 eligible to vote approved the levy of a special tax within Improvement Area No. 2 in accordance with the Rate and Method. On February 18, 2020,the City Council adopted Resolution No. 2020-30, which declared the results of the election approving the Rate and Method. An Amendment to Notice of Special Tax Lien for Improvement Area No.2 was recorded in the office of the County on February 28,2020,as Document No. 2020-0105261. On July 28, 2020, the City Council, acting as the legislative body of the District, adopted Ordinance No. 3492(the"Special Tax Ordinance"')which authorizes the levy within Improvement Area No.2 of a special tax pursuant to the Rate and Method. For a summary of the Rate and Method,including certain circumstances under which the Special Tax may be prepaid,in whole or in part for a parcel, see"SOURCES OF PAYMENT FOR THE BONDS—Special Taxes." If Special Taxes are prepaid, such prepayments would be applied to the redemption of Bonds in accordance with the Indenture. See"THE BONDS—Redemption—Extraordinary Redemptionftom Special Tax Prepaymentv." Property Ownership and Development Status The District and Improvement Area No. 2 therein encompasses a portion of the Millenia project within the Otay Ranch master planned community of the City. The area within the Millenia project has been divided into separate project areas,four of which are included in Improvement Area No. 2. Three of the project areas are planned for 335 for-sale market-rate homes,two of which are being developed by Lennar Homes of Califomia, Inc. ("Lennar Homes") and one of which is being developed by Pinnacle Homes. Pinnacle Homes is ajoint venture entity formed by Meridian(the contracted project manager for Millenia)and SLF. The fourth project area is currently owned by SLF. Lennar Homes is developing two residential. communities within Improvement Area No. 2 totaling 209 homes being marketed as "Cleo"' and"Vibe." As of March 1,202 1, Lennar Homes had completed and conveyed 35 homes to individual homeowners. As of such date, Lennar Homes owned a five-unit building containing three model homes available for touring and a six-unit building containing six models homes available for touring, 119 homes under construction(6,6 of which were in escrow)and finished lots planned for 44 homes. Lennar Homes has, recorded condominium plans and obtained building permits for all 209 homes that it plans to build within Improvement Area No. 2 and currently expects to complete and convey the remaining homes, to individual homeowners by the end of 202 1. 3 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 489 of 724, Pinnacle Homes is developing a residential community with 126 homes being marketed as "Pinnacle at Millenia"within Improvement Area No. 2. As of March 1,202 1,Pinnacle Homes had,completed and conveyed 36 homes to individual homeowners. As of such date,Pinnacle Homes owned six completed model homes, 66 homes under construction (all of which were in escrow) and finished lots planned for 18 homes. Pinnacle Homes has recorded condominium plans for the first three phases of its project within Improvement Area No.2,which includes 48 of the 126 planned homes. Pinnacle Homes currently expects to complete and convey the remaining homes that it plans to construct in Improvement Area No. 2 to individual homeowners by the end of 202 1. SLF owns the remaining project area within Improvement Area No. 2,which consists of an approximately eight-acre finished lot ("Lo�t 19�"). Lot 19 and an adjacent I I-acre lot ("Lot I") together comprise the "business district"within Millenia. Lot I is not located within Improvement Area No. 2. The business district is entitled for commercial development with a minimum building square footage of 800,000 and a maximum of 1,900,000. The business district is also entitled for up to 225 residential units, which may be for-rent or for-s,ale products. If a residential project is included in the business district, it may be located within either Lot 19 or Lot 1. SLF has not yet developed plans for the ultimate use of the business district,including Lot 19 in Improvement Area No. 2. SLF has and expects to continue to have discussions with potential developers and analyze proposed development plans by such developers for the business district. See"PROPERTY OWNERSHIP AND THE DEVELOPMENT.11 The major infrastructure(sewer,water, storm drains,utilities,and arterial roads)to be installed to serve the property within Improvement Area No.2 is substantially complete,with minor street improvements and a pedestrian crossing remaining. Millenia is accessed via Birch Road and Eastlake Parkway, the arterial roads which border Millenia. The property within Improvement Area No. 2 varies from finished lots to completed homes owned by individuals., as described above. The remaining in-tract improvements are expected to be constructed by the homebuilders as development within their respective projects continue to progress. SLF is responsible for constructing six parks within the Millenia project pursuant to the Park Agreement (as defined herein) with the City. The Park Agreement gives the City the right to withhold building permits for units or properties within Millenia should master plan approval,commencement of construction or park completion not occur as provided for in the Park Agreement. Three of the six parks have been completed, two are under construction and the final park is in the design phase. To date there have been no violations of any of the park thresholds identified in the Park Agreement. See "PROPERTY OWNERSHIP AND THE DEVELOPMENT The Development—Inftastructure Requirements and SLF Financing Plan." Forward Looking Statements Certain statements included or incorporated by reference in this Official Statement constitute "forward- looking statements" within the meaning of the United States Private Securities Litigation Reforrn Act of 1995, Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933,as amended. Such statements are generally identifiable by the terminology used such as a(.4plan,""expect," "estimate,""project,"'"budget"or similar words. Such forward-looking statements include, but are not limited to certain statements contained in.the information.under the captions"IMPROVEMENT AREA NO. 2," "'PROPERTY OWNERSHIP AND THE DEVELOPMENT and APPENDIX B-I — "APPRAISAL REPORT"'and APPENDIX B-2—*'SUPPLEMENT TO APPRAISAL REPORT." THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN SUCH FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS DESCRIBED TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FO�RWARD�-LO�O�KING STATEMENTS. THE DISTRICT DOES NOT PLAN TO ISSUE ANY UPDATES OR REVISIONS TO THE FORWARD-LOOKING STATEMENTS SET FORTH, IN THIS OFFICIAL STATEMENT. 4 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 490 of 724, Sources of Payment for the Bonds Limited Obligations. The Bonds and any Parity Bonds (as defined herein) are not general or special obligations of the City nor general obligations of the District, but are special obligations of the District payable solely from Net Taxes (as defined herein) and certain amounts held under the Indenture as more fully described herein. The interest on and principal of and redemption premiums, if any, on the Bonds and any Parity Bonds are payable solely from the Net Taxes(as defined herein),and amounts on deposit in certain funds and accounts under the Indenture, including, to the extent necessary, from the moneys on deposit in the Reserve Fund. As described herein, the Special Taxes are collected along with ad valorem property taxes on the tax bills mailed, to property owners by the Office of the Treasurer-Tax Collector of the County (the "Tax Collector"'). Although the Special Taxes will constitute a lien on the property subject to taxation in Improvement Area No. 2,they will not constitute a personal indebtedness of the owners of such property. There is no assurance that such owners will be financially able to pay the annual Special Taxes or that they will pay such taxes even if they are financially able to do so. Except for the Special Taxes,no other taxes are pledged to the payment of the Bonds and any Parity Bonds. See "SOURCES OF PAYMENT FOR THE BONDS — Assignment of Assessor Parcel Numbers and Delayed Special Tax Revenues"herein for a description of certain delays in receipt of Special Tax revenues during the development and home sales period within Improvement Area No. 2. Special Tax. As used in this Official Statement, the terms "Special Tax" and "Special Taxes" is the "Improvement Area No. 2 Special Tax,"'which term is defined in the Indenture as the Special Tax authorized to be levied in Improvement Area No. 2 pursuant to the Act and the Rate and Method. Under the Indenture,the D�istrict will pledge to repay the Bonds from the "Net Improvement Area No. 2 Special Tax Revenues" (referred to in this Official Statement as the"Net Taxes""),which term is defined in the Indenture to mean the Improvement Area No. 2 Special Tax Revenues minus amounts applied annually to fund the Administrative Expense Requirement. The term"Improvement Area No.2 Special Tax Revenues"is defined in the Indenture as: (a)the proceeds of the Special Tax levied by the District within Improvement Area No. 2 of the District pursuant to the Rate and Method and received by the District,minus the Delayed Special Tax Revenues(as defined herein),(b)the Delinquency Proceeds and (c) amounts transferred from the Deposit Fund to the Fiscal Agent pursuant to the Deposit Agreement (as defined herein). "Delinquency Proceeds" is defined in the Indenture as amounts collected from the redemption of delinquent Special Taxes including the penalties and interest thereon and from the sale of property sold as a result of the foreclosure of the hen of the Special Tax resulting from the delinquency. See"SOURCES OF PAYMENT FOR THE BONDS — Special Taxes" and APPENDIX A — "RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX.51 The Special Taxes are the primary security for the repayment of the Bonds and any Parity Bonds. In the event that the Special Taxes are not paid when due, the only sources of funds available to pay the debt service on the Bonds and any Parity Bonds are amounts held by the Fiscal.Agent in.the funds and accounts under the Indenture (other than the Project Fund, the Rebate Fund and the Administrative Expense Fund). See "SOURCES OF PAYMENT FOR THE BONDS—Reserve Fund."') Assignment of Assessor Parcel Numbers and Dela e'd Special Tax Revenues. As further described y herein,the timing of the County's assignment of assessor parcel numbers to the parcels for the individual.residential units within Improvement Area No. 2 could result in delays in receipt by the District of portions of the Special Taxes levied within Improvement Area No.2 for a limited period. In order to provide an amount which the District may apply to pay the portion of debt service attributable to the Special Taxes that are delayed by this process, SLF has funded the Deposit Fund established under a certain Deposit Agreement by and among the City, the District and SLF (the "Deposit Agreement"). See "SOURCES OF PAYMENT FOR THE BONDS — Assignment of Assessor Parcel Numbers and Delayed Special Tax Revenues." Foreclosure Proceeds. The District will covenant in the Indenture for the benefit of the owners of the Bonds that it will commence and diligently pursue to completion, judicial foreclosure proceedings against (i) properties under common ownership with delinquent Special Taxes in the aggregate of$5,000 or more by October 5 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 491 of 724, I following the close of the Fiscal Year in which the Special Taxes were due, and (ii) against all properties with delinquent Special Taxes in the aggregate of$5,000 or more by October I following the close of any Fiscal Year if the amount of the Reserve Fund is less than the Reserve Requirement. The District is not be obligated to advance funds from any source of legally available funds in order to maintain the Reserve Fund at the Reserve Requirement or to avoid a default in payment on the Bonds. See "SOURCES OF PAYMENT FOR THE BONDS—Special Taxes"herein and APPENDIX E—"SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE—MISCELLANEOUS CONDITIONS—Covenants." There is no assurance that the property within Improvement Area No.2 can be sold,at foreclosure for the appraised value described herein, or for a price sufficient to pay the principal of and interest on the Bonds in the event of a default in payment of Special Taxes by the current landowners or future landowners within Improvement Area No. 2. See"SPECIAL RISK FACTORS—Property Values"' and APPENDIX B-1 —"APPRAISAL REPORT" and APPENDIX B-2—"SUPPLEMENT TO APPRAISAL REPO�RT.11 Special Taxes Are Not Within TeeterPlan. Section 4701 et seq. of the California Revenue and Taxation Code allows a county to adopt a tax distribution procedure which distributes taxes to taxing agencies on the basis of the amount of the tax levy, rather than on the basis of actual tax collections. This mechanism is known as a "Teeter Plan." The Special Taxes are not subject to the County's Teeter Plan. The amount of Special Taxes available to pay debt service on the Bonds will depend on actual tax collections. Parity Bonds and Liens. Under the terms of the Indenture,the District may issue additional bonds secured by the Net Taxes on a parity with the Bonds (the "Parity Bonds") for the purpose of refunding a portion of the Bonds. Parity Bonds may be issued so long as the issuance of such Parity Bonds results in a reduction in each Bond Year on the Annual Debt Service on the Bonds when combined with the Debt Service on Parity Bonds following the issuance of such Parity Bonds. See "SOURCES OF PAYMENT FOR THE BONDS — Issuance of Parity Bonds for Refunding Only." Parity Bonds may be issued without any requirement for the consent of any Bondowners. See APPENDIX E—"SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE —MISCELLANEOUS CONDITIONS—Covenants."' Other taxes and/or special assessments with liens equal in priority to the continuing lien of the Special Taxes have been. levied and may also be levied in the future on the property within Improvement Area No. 2 which could adversely affect the willingness of the property owners to pay the Special Taxes when due. See "SPECIAL RISK FACTORS — Parity Taxes and Special Assessments" herein. Appraisal Report and Supplement to Appraisal Report An appraisal of the land and existing improvements within Improvement Area No.2 was prepared by Kitty Si,ino & Associates, Inc., Tustin, California (the "'Appraiser"). The appraisal is entitled "Appraisal Report Community Facilities District No. 164 Improvement Area No. 2 (Millenia) Otay Ranch, Chula Vista" (the "Appraisal Report"). See APPENDIX B—"APPRAISAL REPORT." The Appraisal Report provides an estimate of the approximate minimum market value of the property in Improvement Area No.2 subject to the levy of Special. Taxes, assuming that development of the property as currently planned will consist of 335 residential units and the potential non-residential projects described therein. Based on the assumptions and limiting conditions in the Appraisal Report,the Appraiser concluded that the minimum market value of all of the parcels within Improvement Area No. 2 subject to the Special Tax was$58,994,108 as of November 15,2020(the"Date of Value"). The Appraiser has prepared a Supplement to Appraisal Report(the"Appraisal Supplement")in which the Appraiser concludes that the estimated market value of the property within Improvement Area No. I subject to the levy of Special Taxes as of February 15, 202 1, was not less than the concluded value as of the Date of Value set forth in the Appraisal Report. See APPENDIX B-2—"SUPPLEMENT TO APPRAISAL REPORT.il� The Appraisal Report and the Appraisal Supplement are based upon a variety of assumptions and limiting conditions that are described in APPENDIX13-1 and APPENDIXB-2. The District makes,no representation as to the accuracy of the Appraisal Report or the Appraisal Supplement. The District makes no representation as to the 6 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 492 of 724, accuracy of the Appraisal Report. See "IMPROVEMENT AREA NO. 2 —Appraisal Report and Supplement to Appraisal Report" and "— Appraised Value-to-Lien Ratios." There is no assurance that property within Improvement Area No. 2 can be sold for the prices set forth in the Appraisal Report or that any parcel can be sold for a price sufficient to pay the Special Tax for that parcel in the event of a default in payment of Special Taxes by a property owner. See "IMPROVEMENT AREA NO�. 2," "SPECIAL RISK FACTORS—Property Values," and APPENDIX B-I — "APPRAISAL REPORT" and APPENDIX B-2 — "SUPPLEMENT TO APPRAISAL REPORT"herein. Description of the Bonds The Bonds will be issued and delivered as fully registered Bonds,registered in the name of Cede&Co. as nominee of The Depository Trust Company, New York, New York ("DTC"), and will be available to actual purchasers of the Bonds(the"Beneficial Owners"')in the denominations of$5,000 or any integral multiple thereof, under the book-entry system maintained by DTC, only through brokers and dealers who are or act through DTC Participants as described herein. Beneficial Owners will not be entitled to receive physical delivery of the Bonds. In the event that the book-entry-only system described herein is no longer used with respect to the Bonds,the Bonds will be registered and transferred in accordance with the Indenture. See APPENDIX H—"BOOK-ENTRY ONLY SYSTEM.11 Principal of, premium, if any, and interest on the Bonds is payable by the Fiscal Agent to DTC. Disbursement of such payments to DTC Participants is the responsibility of DTC and disbursement of such payments to the Beneficial Owners is the responsibility of DTC Participants. In the event that the book-entry only system is no longer used with respect to the Bonds,the Beneficial Owners will become the registered owners of the Bonds and will be paid principal and interest by the Fiscal Agent,all as described in the Indenture. The Bonds are subject to optional redemption, extraordinary redemption from prepaid Special Taxes, and mandatory sinking fund redemption as described herein. See"THE BONDS—Redemption." For a more complete descriptions of the Bonds and the basic documentation pursuant to which they are being sold and delivered, see "THE BONDS" and APPENDIX E SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE"herein. Tax Exemption In the opinion of Bond Counsel,subject to certain qualifications described in this O�fficial Statement,under existing statutes, regulations,rulings and judicial decisions, and assuming certain representations and compliance with certain covenants and requirements described herein,the interest on,the Bonds is excluded from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax. In the further opinion of Bond Counsel, interest on the Bonds is exempt from California personal income tax. Set forth in APPENDIX C is the form of opinion of Bond Counsel.expected to be delivered in connection with the issuance of the Bonds. For a more complete discussion of such opinion and certain other tax consequences incident to the ownership of the Bonds,including certain exceptions to the tax treatment of interest,see"TAX MATTERS." Professionals Involved in the Offering Wilmington Trust, National Association, Costa Mesa, California, will act as Fiscal Agent under the Indenture. Stifel,Nicolaus&Company,Incorporated is the Underwriter(the"Underwriter")of the Bonds. Certain proceedings in connection with the issuance and delivery of the Bonds are subject to the approval of Best Best& Krieger LLP', San Diego,California,Bond Counsel. Stradling Yocca Carlson&Rauth,a Professional Corporation, Newport Beach, California, is serving as Disclosure Counsel to the District in connection with the issuance of the Bonds. Certain legal matters will be passed on for the District and the City by the Office of the City Attorney, for the Underwriter, by Jones Hall, A Professional Law Corporation, San Francisco, California, as counsel to the Underwriter and for the Fiscal Agent by its counsel. Other professional services have been performed by Kitty Si.ino& Associates, Inc.,, Tustin, California, as the Appraiser, Meyers Research,LLC, Solana"Beach, California as 7 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 493 of 724, Market Absorption Analyst, Harrell & Company Advisors, LLC, Orange, California as municipal advisor to the City and Spicer Consulting Group,LLC,Temecula, California,as Special Tax Consultant. For information concerning respects in which certain of the above-mentioned professionals, advisors, counsel and consultants may have a financial or other interest in the offering of the Bonds, see "FINANCIAL INTERESTS,"herein. Continuing Disclosure The District has agreed to provide,or cause to be provided,pursuant to Rule 15c2-12(the"Rule") adopted by the Securities and Exchange Commission (the "SEC"') certain financial information and operating data on an annual basis (the "District Reports"). The District has further agreed to provide, in a timely manner, notice of certain events with respect to the Bonds (the"Listed Events"). These covenants have been made in order to assist the Underwriter in complying with the Rule. The District Reports will be filed,with the Electronic Municipal Market Access System("EMMA")of the Municipal Securities Rulemaking Board(the"MSRB")available on the Internet at http://emma.msrb.org. Notices of Listed Events will also be filed with the MSRB. The City will assist the District in preparing the District Reports. Within the last five years, the City and certain related entities have failed to comply in certain respects with prior continuing disclosure undertakings as described under the caption "CONTINUING DISCLOSURE.11, The Underwriter does not consider Lennar Homes or Pinnacle Homes to be an "obligated person" with respect to the Bonds for purposes of the Rule. However,to assist in the marketing of the Bonds,Lennar Homes and Pinnacle Homes have agreed to provide, or cause to be provided on EMMA, updated information with respect to their respective development within Improvement Area No.2(the"Developer Reports"),on a semiannual basis and notices of certain Listed Events until certain development milestones have been reached. The termination of such reporting requirements varies among each continuing disclosure undertaking. See "CONTINUING DISCLOSURE"herein and APPENDIX F and APPENDIX G hereto for a description of the specific nature of the reports to be filed by the District, Lennar Homes and Pinnacle Homes and notices of Listed Events and a copy of the continuing disclosure undertakings pursuant to which such reports are to be made. Bond Owners' Risks Certain events could affect the ability of the District to pay the principal of and interest on the Bonds when due. See the section of this Official Statement entitled "SPECIAL RISK FACTORS" for a discussion of certain factors which should be considered, in addition to other matters set forth herein., in.evaluating an investment in the Bonds. The Bonds are not rated by any nationally recognized rating agency. The purchase of the Bonds involves significant risks, and the Bonds are not appropriate investments for certain investors. See "SPECIAL RISK FACTORS"herein. Other Information This Official Statement speaks only as of its date,and the information contained herein is subject to change. Brief descriptions of the Bonds and the indenture are included in this Official Statement. Such descriptions and information do not purport to be comprehensive or definitive. All references herein to the indenture,the Bonds, and the constitution and laws of the State as well as, the proceedings of the City Council, acting as the legislative body of the District,are qualified in their entirety by references to such documents,laws and proceedings, and with respect to the Bonds, by reference to the indenture. Capitalized terms not otherwise defined herein s,ball have the meanings set forth in the Indenture. Copies of the Indenture, the Appraisal Report, the Appraisal Supplement and other documents and information are available for inspection and (upon request and payment to the District of a charge for copying, mailing and handling)for delivery from the City Clerk at 276 Fourth Avenue, Chula Vista, California 919 10. 8 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 494 of 724, ESTIMATED, SOURCES AND USES OF FUNDS The following table sets forth the expected sources and uses of Bond proceeds. Sources of Funds-, Principal Amount of Bonds Plus Net Original Issue Premium Total Sources Uses of Funds: Project Fund Capitalized Interest Sub-Account(O Costs of Issuance(2) Reserve Fund Underwriter's Discount Total Uses Amounts deposited to pay the interest on the Bonds through September 1,2021. Includes Bond Counsel fees,Disclosure Counsel fees,Appraiser fees,Market Absorption Consultant fees,Special Tax Consultant fees,Municipal Advisor fees,Fiscal Agent fees,printing costs and other issuance costs. Source: The Underwriter. THE BONDS General Provisions The Bonds will be dated as of their date of delivery and will bear interest at the rates per annum set forth on the inside cover page hereof, payable semiannually on each March I and September I., commencing on September 1,2021 (each,an"Interest Payment Date"),and will mature in the amounts and on the dates set forth on the inside cover page of this Official Statement. Interest on the Bonds through September 1,2021 will be paid from a portion of the proceeds of the Bonds. Interest will be calculated on the basis of a 360-day year comprised of twelve 30-day months. Interest on any Bond will be payable from the Interest Payment Date next preceding the date of authentication of that Bond, unless(i) such date of authentication is an Interest Payment Date,in which event interest will be payable from such date of authentication; (ii)the date of authentication is after a Record Date but prior to the immediately succeeding Interest Payment Date, in which event interest will be payable from the Interest Payment Date immediately succeeding the date of authentication; or(iii)the date of authentication is prior to the close of business on the first Record Date, in,which event interest will be payable from the date of the Bonds;provided, however, that if at the time of authentication of a Bond, interest is in default.1 interest on that Bond will be payable from the last Interest Payment Date to which the interest has been paid or made available for payment. As used herein, Record Date means the fifteenth calendar day of the month immediately preceding an Interest Payment Date,regardless of whether such day is a Business Day. Interest on any Bond will be paid to the person.whose name appears in the Registration Books as the Owner of such Bond as of the close of business on the Record Date. Principal of the Bonds due at maturity or upon prior redemption,and any premium due upon redemption,is payable upon presentation and surrender of the Bonds at the principal corporate trust office of the Fiscal Agent in Los Angeles, California. The Bonds will. be issued as fully registered bonds and will be registered in the name of Cede & Co., as nominee of DTC. DTC will act as securities depository of the Bonds. Ownership interests in the Bonds may be purchased in book-entry form only in denominations of$5,000 and any integral multiple thereof. So long as DTC is the securities depository all. payments of principal. and interest on the Bonds will be made to DTC and will be 9 4852-7256-1 10�7vl2/024036-00�89 2021-03-16 Agenda Packet Page 495 of 724, paid to the Beneficial Owners in accordance with DTC's procedures and the procedures of DTC's,Participants. See APPENDIX H—"BOOK-ENTRY-ONLY SYSTEM.1� In the event the Bonds are not held in book-entry form, interest on the Bonds will be paid by check of the Fiscal Agent mailed by first class mail,postage prepaid,to the Bondowner at its address on the Registration Books. In addition', with respect to any Bonds owned by the District and upon a request in writing received by the Fiscal Agent on or before the applicable Record Date from an Owner of$1,000,000 or more in principal amount of the Bonds, payment will be made by wire transfer in immediately available funds to an account in the United States designated by such Owner. Debt Service Schedule The following table presents the annual debt service on the Bonds (including mandatory sinking fund redemption), assuming there are no optional or extraordinary redemptions. See"SOURCES OF PAYMENT FOR THE BONDS"and"THE BONDS—Redemption." [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 10 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 496 of 724, Date (September 1) Principal Interest Total Total Source: The Underwriter. Redemptiod Optional Redemption. The Bonds may be redeemed at the option of the District prior to maturity as a whole,or in part on any Interest Payment Date on and after September I�2028,from such.maturities as are selected by the District,and by lot within a maturity,from any source of funds,at the following redemption prices,(expressed as percentages of the principal amount of the Bonds to be redeemed),together with accrued interest thereon to the date of redemption: Preliminary, subject to change. 1,1, 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 497 of 724, Redemption Dates Redemption Price September 1,2028 and March 1,2029 103% September 1, 2029 and March 1,2030 102 September 1,2030 and March 1,2031 101 September 1,2031 and any Interest Payment Date thereafter 100 Extraordinary Redemption from Special Tax Prepayments. The Bonds are subject to extraordinary mandatory redemption on any Interest Payment Date, prior to maturity, as a whole or in part on as nearly as practicable a pro rata basis among maturities of authorized denominations from amounts deposited to the Redemption Fund in connection with a prepayment of Special Taxes pursuant to the Rate and Method, (see "'IMPROVEMENT AREA NO. 2 — Expected Tax Burden; Potential Special Tax Prepayment"). Such extraordinary mandatory redemption of the Bonds shall be at the following redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed),together with accrued interest thereon to the date of redemption: Redemption Dates Redemption Price Any Interest Payment Date from September 1, 2021 through March 1,2029 103% September 1, 2029 and March 1,2030 102 September 1,2030 and March 1,2031 101 September 1,2031 and any Interest Payment Date thereafter 100 See the caption "SPECIAL RISK FACTOR S—Potenti al Early Redemption of Bonds from Prepayments" for a discussion of the potential for a lower than expected yield on the Bonds as a result of a special mandatory redemption from prepayment of Special Taxes. Mandatory Sinking Fund Redemption. The Term Bonds maturing on September 1, 20 are subject to mandatory sinking fund redemption,in part by lot,on September I in each year commencing September 1,20�_at a redemption price equal to the principal amount of the Term Bonds to be redeemed, plus accrued and unpaid interest thereon to the date fixed for redemption, without premium, in. the aggregate principal amount and in the years shown on the following redemption schedule: Sinking Fund Redemption Date (September 1) Sin king Fu n d Payin en ts (maturity) The Tenn Bonds maturing on September 1,20 are subject to mandatory sinking fund redemption,in part by lot, on September I in each year commencing September 1, 20 at a redemption price equal to the principal amount of the Term Bonds to be redeemed,plus accrued and unpaid interest thereon to the date fixed for redemption, without premium,in the aggregate principal amount and in the years shown on the following redemption schedule: 1,2 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 498 of 724, Sinking Fund Redemption Date (September 1) Sin king Fu n d Paym en ts (maturity) In the event of a partial optional redemption or extraordinary redemption from Special Tax prepayments of the Term Bonds maturing on September 1, 20_or September 1, 20�_, each of the remaining mandatory sinking fund payments for the applicable maturity of the Term Bonds so redeemed will be reduced,as nearly as practicable, on a pro rata basis in integral multiples of$5,,000. Notice ofRedemption. So long as the Bonds are held,in book-entry form by the Depository,or its Nominee, notice of redemption will be given to the Depository in such manner as is set forth in the procedures of the Depository, at least thirty (30�) days but not more than forty-five (45) days prior to the redemption date. It is the responsibility of DTC Participants to provide such notice. See APPENDIX H — "BOOK-ENTRY ONLY SYSTEM.1� If the Bonds are no longer registered to the Depository,or its Nominee,the Fiscal Agent is required to mail, at least thirty(30)days but not more than forty-five(45)days prior to the date of redemption,notice of redemption, by first-class mail,postage prepaid,to the original purchaser of the Bonds and the respective registered Owners of the Bonds at the addresses appearing on the Registration Books. The notice of redemption shall state: (a) the redemption date;(b)the redemption price; (c)the bond registration numbers,dates of maturity and CUSIP numbers of the Bonds to be redeemed., and in the case of Bonds to be redeemed in part, the respective principal portions to be redeemed;provided,however,that whenever any call includes all Bonds of a maturity,the numbers of the Bonds of such maturity need not be stated; (d)that such Bonds must be surrendered at the principal corporate trust office of the Fiscal Agent;(e)that further interest on such Bonds will not accrue from and after the designated redemption date; (f) the date of the issue of the Bonds as originally issued; (g) the rate of interest borne by each Bond being redeemed; and(h)that any other descriptive information,needed to identify accurately the Bonds being redeemed as the District shall direct. Each notice of redemption shall be sent at the same time that the notice of redemption is mailed to the Bondowners by registered or certified mail or overnight delivery service to the Securities Depository and to at least one of the Information Services that disseminate notice of redemption of obligations similar to the Bonds or, in accordance with the then-current guidelines of the SEC, such other services providing information on called bonds, or no such other services, as District may determine in its sole discretion. Conditional Notice of Redemption. Any notice of optional redemption of the Bonds delivered in accordance with the Indenture may be conditional and if any condition stated in the notice of redemption shall not have been satisfied on or prior to the redemption date, said notice shall be of no force and effect and the District shall not be required to redeem such Bonds. In such event, the redemption shall not be made and the Fiscal Agent shall within a reasonable time thereafter give notice, to the persons and in the manner in which the notice of redemption was given,that such condition or conditions were not met and that the redemption was canceled. The District may rescind any optional.redemption and notice thereof for any reason on any date prior to the date fixed for redemption by causing written notice of the rescission to be given to the Owners of the Bonds so called for redemption. Any optional redemption and notice thereof shall be rescinded if for any reason on the date fixed for redemption moneys are not available in the Debt Service Fund or otherwise held in trust for such.purpose in an amount sufficient to pay in fall on said date the principal o�f, interest, and any premium due on. the Bonds called for redemption. Notice of rescission of redemption shall be given in the same manner in which notice of redemption was originally given. The actual receipt by the Owner of any Bond of notice of such rescission shall 1,3 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 499 of 724, not be a condition precedent to rescission, and failure to receive such notice or any defect in such notice shall not affect the validity of the rescission. So long as notice has been provided as set forth in the Indenture, the actual receipt by the Owner of any Bond of notice of such redemption shall not be a condition precedent to redemption, and failure to receive such notice shall not affect the validity of the proceedings, for redemption of such Bonds or the cessation of interest on the date fixed for redemption. Ef .feet qf Redemption. When notice of redemption has been given substantially as provided for in the Indenture, and when the amount necessary for the redemption of the Bonds called for redemption is set aside for that purpose in the Debt Service Fund, the Redemption Fund or an escrow fund, as provided for in the Indenture, the Bonds designated for redemption shall become due and payable on the date fixed for redemption thereof, and upon presentation and surrender of said Bonds at the place specified in the notice of redemption, said Bonds shall be redeemed and paid at the redemption price out of the Debt Service Fund or the Redemption Fund and no interest will accrue on such Bonds or portions of Bonds called for redemption from and after the redemption date specified in said notice,and the Owners of such Bonds so called for redemption after such redemption date shall look for the payment of principal and premium,if any,of such Bonds or portions of Bonds only to the Debt Service Fund or the Redemption Fund, as applicable. All Bonds redeemed shall be canceled forthwith by the Fiscal Agent and shall not be reissued. Upon surrender of Bonds redeemed in part, a new Bond or Bonds of the same maturity shall be registered, authenticated and delivered to the registered Owner at the expense of the District, in the aggregate principal amount of the unredeemed portion. All unpaid interest payable at or prior to the date fixed for redemption shall continue to be payable to the respective Owners of such Bonds or their order,but without interest thereon. Selection of Bonds fir Redemption. If less than all of the Bonds Outstanding are to be redeemed, the portion of any Bond of a denomination of more than $5,000 to be redeemed shall be in the principal amount of $51000 or a multiple thereof, and, in selecting portions of such Bonds for redemption, the District shall treat each such Bond as representing that number of Bonds of$5,000 denomination which is obtained by dividing the principal amount of such Bond to be redeemed in part by$5,000. Purchase in lieu of Redemption. In lieu of such an optional, extraordinary mandatory or mandatory sinking fund redemption, the District may elect to purchase such Bonds at public or private sale at such prices as the District may in its discretion determine; provided, that, unless otherwise authorized by law, the purchase price (including brokerage and other charges) thereof shall not exceed the principal amount thereof,plus the applicable premium,if any, stated above,plus accrued interest to the purchase date. Registration,Transfer and Exchange Registration. The Fiscal Agent will keep sufficient books for the registration and transfer of the Bonds. The ownership of the Bonds will be established by the Bond registration books held by the Fiscal Agent. Upon initial issuance, the ownership of the Bonds will be registered in the name of the nominee of DTC. Transfer or Exchange. Whenever any Bond or Bonds shall be surrendered for registration of transfer or exchange, the Fiscal Agent shall authenticate and deliver a new Bond or Bonds of the same maturity, for a like aggregate principal amount of authorized denominations; provided that the Fiscal Agent shall not be required to register transfers or make exchanges of(i) Bonds for a period of 15 days next preceding the date of any selection of the Bonds to be redeemed, or(ii)any Bonds chosen for redemption. 14 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 500 of 724, SOURCES OF PAYMENT FOR THE BONDS Limited Obligations The Bonds are special, limited obligations of the District payable only from amounts pledged under the Indenture and from no other sources. In the event that the Special Taxes are not paid,when due, the only sources, of funds available to pay the debt service on the Bonds are amounts held by the Fiscal Agent in the funds and accounts established in the Indenture(including the investment earnings thereon)with the exception of the Project Fund,the Rebate Fund and the Administrative Expense Fund. See"SOURCES OF PAYMENT FOR THE BONDS—Assignment of Assessor Parcel Numbers and Delayed Special Tax Revenues" for a description of certain delays in receipt of Special Tax revenues during the development and,home sales period,within Improvement Area No. 2. NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE DISTRICT, THE CITY, THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE BONDS. EXCEPT FOR THE NET TAXES, NO OTHER REVENUES OR TAXES ARE PLEDGED TO THE PAYMENT OF THE BONDS. THE BONDS ARE NOT GENERAL OR SPECIAL OBLIGATIONS OF THE CITY OR GENERAL OBLIGATIONS OF THE DISTRICT BUT ARE LIMITED OBLIGATIONS OF THE DISTRICT PAYABLE SOLELY FROM SPECIAL TAXES TO BE LEVIED IN IMPROVEMENT AREA NO. 2 AND CERTAIN OTHER AMOUNTS HELD UNDER THE INDENTURE AS MORE FULLY DESCRIBED HEREIN. Special taxes levied in Improvement Area No. 1. of the District are not pledged to pay debt service on the Bonds. Special Taxes Authorization and Pledge. In accordance with the provisions of the Act and the CFD Ordinance,the City established the District and designated Improvement Area No.2 therein on.September 13,2016, for the purpose of financing various public improvements required in connection with the proposed development within the District. On September 13, 20�16, an election was held within Improvement Area No. 2 at which the landowner eligible to vote approved the issuance of bonds for Improvement Area No. 2 in an amount not to exceed$2 1,000,000, and the levy of the Special Taxes on property within Improvement Area No. 2 to repay such bonds and to finance the Facilities (as defined below)�. In connection with change proceedings undertaken for Improvement Area No. 2 in 2020, the landowners within Improvement Area No. 2 voted to approve the levy of the Special Tax in accordance with the Rate and Method. The District will covenant in the Indenture that it will comply with all requirements of the Act so as to assure the timely collection of the Special, Taxes in, an amount sufficient to pay the Annual Debt Service on the Bonds when due, Administrative Expenses, and any amounts to replenish the Reserve Fund to the Reserve Requirement. The Special Taxes are collected in the manner and at the same time as ad valorem property taxes are collected and are subject to the same penalties and the same procedure,sale,and lien priority in case of delinquency as is provided for ad valorem property taxes. See APPENDIX A — "RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX.11 The"Net Taxes"pledged by the District to secure the repayment of the Bonds(and any Parity Bonds) are the Special Tax Revenues minus amounts applied annually to fund the Administrative Expense Requirement. As used in this Official Statement, the term"Special Tax Revenues"refers to the"Improvement Area No. 2 Special Tax Revenues," which is defined in the Indenture as: (a) the proceeds of the Special Tax levied by the 1,5 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 501 of 724, District within Improvement Area No.2 of the District pursuant to the Rate and Method and,received by the District, minus the Delayed Special Tax Revenues (as defined herein), (b) the Delinquency Proceeds and (c) amounts transferred from the Deposit Fund to the Fiscal Agent pursuant to the Deposit Agreement (as defined herein). "Delinquency Proceeds"is defined in the Indenture as amounts collected from the redemption of delinquent Special Taxes including the penalties and interest thereon and from the sale of property sold as a result of the foreclosure of the lien of the Special Tax resulting from the delinquency. Commencing Fiscal Year 2021-22, the District will,no later than February 15th and August 15th of each year, transfer such Special Tax Revenues to the Fiscal Agent. Except for Prepayments which shall be deposited to the Redemption Fund and the Administrative Expense Fund, as set forth in written instructions from the District in accordance with the Indenture,the Fiscal Agent will deposit the Special Tax Revenues received in the Special Tax Fund. The Special Tax Revenues deposited in the Special Tax Fund shall be held in trust and deposited in the following accounts of the Special Tax Fund or transferred to the following other funds and, accounts on the dates and in the amounts set forth in the following paragraphs and in the following order of priority: (1) The Fiscal Agent will each Fiscal Year transfer to the Administrative Expense Fund from the Special Tax Revenues received by the Fiscal Agent during such Fiscal Year an amount equal to the Administrative Expense Requirement; (2) The Fiscal Agent will transfer to the Interest Account of the Debt Service Fund, on each Interest Payment Date and date for redemption of the Bonds, an amount required to cause the aggregate amount on deposit in the Interest Account to equal the amount of interest due or becoming due and payable on such Interest Payment Date on all Outstanding Bonds or to be paid on the Bonds being redeemed on such date; (3) The Fiscal Agent will transfer to the Principal Account of the Debt Service Fund, on each September 1, an amount required to cause the aggregate amount on deposit in the Principal Account to equal the principal amount of, and premium (if any) on, the Bonds coming due and payable on such September 1, whether at maturity or by mandatory sinking fund payments on Term Bonds; (4) On or after September 2 of each year after making the deposits and transfers to the Administrative Expense Fund and the Debt Service fund described above, the Fiscal Agent shall transfer the amount,if any,necessary to replenish the amount then.on deposit in the Reserve Fund to an amount equal to the Reserve Requirement; (5) On or after September 2 of each year after making the deposits and transfers required to the Administrative Expense Fund,the Debt Service Fund and the Reserve Fund described above,upon receipt of written instructions from the District,the Fiscal Agent will transfer from the Special,Tax Fund to the Rebate Fund the amount specified in such request; (6) On or after September 2 of each year after making the deposits and transfers required to the Administrative Expense Fund, the Debt Service Fund, the Reserve Fund and the Rebate Fund described above, upon receipt of a written request of the District, the Fiscal Agent will transfer from the Special Tax Fund to the Administrative Expense Fund the amounts specified in such request to pay those Administrative Expenses which the District reasonably expects will become due and payable during such Fiscal Year or the cost of which Administrative Expenses have previously been incurred and paid by the District from funds other than the Administrative Expense Fund in excess of the Administrative Expense Requirement for such Fiscal Year; and (7) If, on or after September 2 of each year, after making the deposits and transfers required to the Administrative Expense Fund, the Debt Service Fund, the Reserve Fund and the Rebate Fund 16 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 502 of 724, described above, monies remain in the Special Tax Fund, such monies shall be transferred to the Project Fund until the Project Fund is closed. The Fiscal Agent will, upon receipt of Special Tax Revenues representing Prepayments, immediately transfer Prepayments to the Redemption Fund and utilize such funds to redeem Bonds pursuant to the Indenture (see "Redemption — Extraordinary Redemption ftom. Special Tax Prepayments" above) as set forth in written instructions to be delivered to the Fiscal Agent by the District;provided,however,that any portion of a Prepayment constituting Administrative Expenses shall be deposited into the Administrative Expense Fund as set forth in such written instructions. See APPENDIX E—"SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE.11 The Special Taxes levied in any fiscal year may not exceed the maximum rates authorized pursuant to the Rate and Method. See APPENDIX A—"RATE AND METHOD OF'APPORT'IONMENT OF SPECIAL TAX�l hereto. There is no assurance that the Special Tax proceeds will, in all circumstances, be adequate to pay the principal of and interest on the Bonds when due. See the caption"—Estimated Debt Service Coverage"below and "'SPECIAL RISK FACTORS—Insufficiency of Special Taxes"herein. Rate and Method ofApportionment of Special Tax. The District is legally authorized and will covenant in the Indenture to cause the levy of the Special Taxes in an amount determined according to the Rate and Method. The Rate and Method apportions the total amount of Special Taxes to be collected among the taxable parcels in Improvement Area No. 2 as more particularly described below. The following is a synopsis of the provisions of the Rate and Method for Improvement Area No. 2,which should be read in conjunction with the complete text of the Rate and Method which is attached as APPENDIX A —"RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX." The meaning of the defined terms used in this section are as set forth in APPENDIX A. This section provides only a summary of the Rate and Method, and is qualified by more complete and detailed information contained in the entire Rate and Method attached as APPENDIX A. Assignment to Land Use Categories. Under the Rate and Method, Improvement Area No. 2 is classified into two tax zone areas (each a "Zone"). Each Fiscal Year, all Taxable Property within Zone A and B of Improvement Area No. 2 shall be classified as Taxable Property or Exempt Property. In addition, all Taxable Property shall further be classified as Developed Property, Undeveloped Property or Provisional Property, and all such Taxable Property shall be subject to the levy of Special Taxes determined pursuant to Sections 3 and 4 of the Rate and Method. The Assigned Special Tax for an Assessor's Parcel of Residential Property in Zone A sball be based on the Building Square Footage of the dwelling units located on the Assessor's Parcel. The Assigned Special Tax for an Assessor's Parcel of Non-Residential Property in Zone A is $6,624.49 per Acre for Fiscal Year 2021- 22. The Assigned Special,Tax for an Assessor's Parcel in Zone B is $6,624.49 per Acre for both Residential and Non-,Residential Property. The Assigned Special Tax rates escalate by 2.00%on each July 1. For Assessor's Parcels of Non.-Residential Property developed with Condominiums (e.g., office or industrial condos),the Acreage applicable to each such Condominium for purposes of levying Special Taxes shall be computed from the Acreage of the legal lot created by the Final Map upon which such Condominiums are entitled to be developed,with the Acreage of such lot allocated to each Condominium on a pro-rata basis using the Building Square Footage of such Condominium.relative to the total Building Square Footage of all Condominiums entitled to be developed on such lot. The determination of Building Square Footage for each non-residential Condominium shall be made by reference to the applicable Building Permit,and to the extent a Building Permit has not been issued for all Condominiums to be located on.the applicable legal lot,the building square footage attributable to any such Condominiums shall be determined from the recorded condominium plan,or applicable site plan,plot plan,or other appropriate records kept by the City as reasonably determined by the City. In the event the City takes, ownership of a Condominium within. Improvement Area No. 2 and such property in all other respects meets the definition of 17 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 503 of 724, Public Property as set forth in Section I of the Rate and Method, such property shall be exempt from Special Taxes pursuant to Section 5 of the Rate and Method. In the event a Building Permit is issued for one or more residential Condominiums prior to March I of the previous Fiscal Year and an Assessor's Parcel Number has not yet been assigned to each such Condominium for the current Fiscal Year, the applicable Assessor's Parcel may be classified as both Developed, Property and Undeveloped Property. In such an instance,the Special Taxes levied on such Assessor's Parcel shall be the sum of the amount derived from the following(i)applying the Assigned Special Tax applicable to each Condominium for which a Building Permit was issued prior to March I of the previous, Fiscal Year and (ii) levying the acreage allocable to such actual or planned Condominiums for which a Building Permit has not been issued prior to March I of the previous Fiscal Year as Undeveloped Property;the allocable acreage shall be computed on a pro-rata basis based on the relative number of remaining Condominiums to the total number of Condominiums entitled to be developed on such Assessor's Parcel.The total number of Condominiums entitled to be developed on the applicable Assessor's Parcel shall be determined from the recorded condominium map, condominium plan, applicable site plan,plot plan,or other appropriate records kept by the City as reasonably determined by the CFD Administrator. Lennar Homes has recorded condominium plans for all phases of its projects in Improvement Area No. 2. Pinnacle Homes has recorded condominium plans for the first three phases of its project,which includes 48 of the 126 planned homes of its project within Improvement Area No. 2. The County has not yet assigned individual Assessor's Parcel Numbers to all of the planned individual units. Until the County assigns individual Assessor's Parcel Numbers to all of the planned units set forth in the condominium plans recorded and to be recorded, the District will apply the methodology described in the preceding paragraph to allocate the Special Tax levy between Developed Property and Undeveloped Property on the applicable Assessor's Parcel Numbers. See"SOURCES OF PAYMENT FOR THE BONDS—Assignment of Assessor Parcel Numbers and Delayed Special Tax Revenues" for a description of certain delays in receipt of Special Tax revenues during the development and home sales period within Improvement Area No. 2. Exemptions. No Special Tax shall be levied on Assessor's Parcels of Public Property, Property Owner Association Property, Assessor's Parcels which are used as places of worship, and are exempt from ad valorem property taxes because they are owned by a religious organization, and Assessor's Parcels with public or utility easements making impractical their utilization for other than the purposes set forth in the easement. Notwilb standing the foregoing, no property within,Improvement Area No. 2 will be classified as Exempt Property if such classification, would reduce the sum of all, Taxable Property in, Improvement Area No. 2 to less than 13.29 Acres for Zone A and 7.51 Acres for Zone B. Assessor's Parcels which cannot be classified as Exempt Property because such classification would reduce the sum of all Taxable Property in.Improvement Area No. 2 to less than the foregoing acreages for each Zone shall be classified as Provisional Property and will continue to be subject to the Improvement Area No. 2 Special Taxes. Under the Rate and Method, classification of Exempt Property will be assigned by the City in the chronological order in which property becomes eligible for classification. as Exempt Property. Maximum Special Tax,Assigned Annual Special Tax and Backup Special Tax. Maximum Special Tax. The Maximum Special Tax for each Assessor's Parcel classified as Developed Property within a particular Zone shall be the greater of(i) the amount derived by application of the Assigned Special Tax for such Zone or(ii)the amount derived by application of the Backup Special Tax for such Zone. For Fiscal Year 2021-22,the Maximum Special Tax for an Assessor's Parcel of Provisional Property and Undeveloped Property within each Zone will be$43,851 per Acre for Zone A and$7,361, per Acre for Zone B. Section 3F of the Rate and Method provides for the process by which the District may,upon the receipt of a request from SLF and the City's Special Tax Consultant prior to the issuance of the Bonds,reduce the Assigned Special Tax, the Backup Special. Tax and the Maximum Special Tax (as such terms are defined in the Rate and Method) rates to a level which. will provide not less than the sum of estimated the Administrative Expense 18 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 504 of 724, Requirement and one hundred ten percent(I 10%)of the estimated debt service with respect to the amount of Bonds, requested to be issued in such written request. No request has been made or is expected to be made prior to the issuance of the Bonds to reduce the Assigned Special Tax rates, the Backup Special Tax rates or the Maximum Special Tax rates pursuant to Section 3�F of the Rate and,Method, Assigned Special Tax. The Assigned Special Tax for each Land Use Class within each Zone is shown in Tables I and 2 of the Rate and Method attached as APPENDIX A,,which rates increase by two percent on each July I, commencing July 1, 2020. Assigned Special Tax rates have been established for Residential Property and Non- Residential Property in the two Zones. The number of units/acres in each Zone, the Fiscal Year 2021-22 Assigned Special Tax rates and the estimated Fiscal Year 2021�-22 Special Tax levy(based on development status as of March I'l 2021)are set forth in Table I below. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 19 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 505 of 724, TABLE I COMMUNITY FACILITIES DISTRICT NO. 16-1(MILLENIA) IMPROVEMENT AREA NO.2 ASSIGNED SPECIAL TAX RATES FOR FISCAL YEAR 2021-22 Fiscal Year Aggregate 2021-22 Estimated Estimated Assigned/ Fiscal Year Percent o Fiscal Year f maximum 2021-22 Maximuml 2021-22 Taxable Residential Floor Special Tax Special Tax Assigned No.of' Special Tax Percent Land Use Type Unit Area(sq.ft.) Rates 0) Levy Rates Rate* Units(2) Acreage Levy(3)(4)* of Total ,Sq, Zone A Residential Property RU Less than 1,450 $19501.55 $1�501.55 100.0% 59 N/A $ 881591.45 15.1% Residential Property RU Greater than 1,450 11797.45 1 i797.45 100.0 258 N/A 4631742.10 79.2 UndevelopedResidential Property(5) RU N/A Varies Varies 33.8 0 0.82 12,140.11 2.1 Zone A Subtotal 317 0.82 $ 5641,473.66 96.5% Zone B Residential Property Acre N/A $6fi24.49 $6�624.49 100.0% 0 N/A $ 0.00 0.0% Non-Residential Property Acre N/A 61624.49 6�624.49 100.0 0 0.00 0.00 0.0 Undeveloped Non-Residential Property Acre N/A 7136,0.83 21484.58 33.8 0 8.34 201 26.34 3.5 Zone B Subtotal 0 8.34 $ 205726.34 3.5% Grand Total 317 9.16 $ 585,200.00 100.0% Preliminary,subject to change. (1) Reflects the Assigned Special Tax rate on Developed Property for Residential Property in Zone A and Zone B and the Maximum Special Tax rate on Undeveloped Property in Zone B. With respect to Zone B,the Assigned Special Tax rate is the same for Residential Property and Non-Residential Property which is Developed Property. (1) Reflects development status as of March 1,202 1. (1) Based,on estimated Special Tax levy and includes estimated Administrative Expenses of$75,00�O�. (4) May not total due to independent rounding. (5) Reflects estimated Fiscal Year 2021-22 Special Tax levy on acreage associated with the 18 planned units within the Pinnacle at Millenia project for which building permits have not been issued as of March 1.,2021. See"-Assignnient to Land Use Categories"above for a discussion on the method of allocating the Special Tax levy on Developed and Undeveloped Property prior to the time that the County has assigned Assessor Parcel Numbers to individual units. Source: Spicer Consulting Group,LLC. 20 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 506 of 724, In Zone A, the Assigned Special Tax levied against Developed Property that is Residential Property will generally correlate with the residential square footage of the unit in question (i.e. equal to or greater than 1,,450 square feet). In Zone B,the Assigned Special Tax levied against Developed Property that is Residential Property or Non-Residential Property will be at the same rate on a per-Acre basis. For a detailed description of Assigned Special Taxes for Residential Property and Non-Residential Property in the Zones,see the Rate and Method attached, as APPENDIX A. Multiple Land Use Classes. If an Assessor's Parcel of Developed Property contains more than one Land Use Class'. the Maximum Special Tax that may be levied, on such Assessor's Parcel shall only be levied on the Residential Property Land Use Class located on such Assessor's Parcel. All Assessor's Parcels of taxable property within Zone A are expected to be classified as Residential Property. As noted above, in Zone B, the Assigned Special Tax levied against Developed Property that is Residential Property or Non-Residential Property will be at the same rate on a per-Acre basis. Backup Special Tax. With respect to Zone A, each Assessor's Parcel of Residential Property or for each Assessor's Parcel of Undeveloped Property to be classified as Residential Property upon its development within the Final Map area, the Backup Special Tax is calculated based on a fon-nula that is a function of a per acre rate,, multiplied by the number of acres within such Assessor's Parcel,divided by the number of lots which are classified or to be classified as Residential Property. With respect to Zone B,for each Assessor's Parcel of Developed Property or Undeveloped Property within the Final Map area,the Backup Special Tax shall be deten-nined by multiplying the per acre rate by the total Acreage of any such Assessor's Parcel. In Fiscal Year 2021-221 the per acre rates for Zones A and B will be$43,851 and$7,361,respectively. Annual Increases. On each July 1, the Assigned Special Tax and the Backup Special Tax for each Assessor's Parcel of Taxable Property within Improvement Area No.2 will be increased by an amount equal to two percent(2%) of the amount in effect for the previous Fiscal Year. On each July 1, the Maximum Special Tax for Provisional Property and Undeveloped Property will be increased by an amount equal to two percent (2%) of the amount in effect for the previous Fiscal Year. Method ofApportionment ofSpeci*al Tax. For each Fiscal Year,the District shall levy the Special Tax on all Taxable Property in order to satisfy the Special Tax Requirement in accordance with steps 1 through 4 below. The Rate and Method defines the Special Tax Requirement as that amount required in.any Fiscal Year to: (i)pay regularly scheduled Debt Service on, al.l. Outstanding Bonds; (ii)pay periodic costs on the Outstanding Bonds, including but not limited to, credit enhancement and rebate payments on the Outstanding Bonds; (iii)pay Administrative Expenses-, (iv)pay any amounts required to establish or replenish any reserve funds for all Outstanding Bonds; (v) accumulate funds to pay directly for acquisition or construction of facilities provided that the inclusion of such amount does not cause an increase in the Special Tax to be levied on Undeveloped Property; and (vi)pay for reasonably anticipated delinquent Special Taxes based on (a)the average delinquency rate for special taxes levied in the previous Fiscal. Year in all community facilities districts within,the portion of the City commonly known as Otay Ranch for the first Fiscal Year in which Special Taxes are levied and(b)the delinquency rate for Special Taxes levied in the previous Fiscal Year within Improvement Area No. 2 for all subsequent Fiscal Years in which Special Taxes are levied; less (vii) a credit for funds available to reduce the Annual Special Tax levy,as determined by the CFD Administrator pursuant to the Fiscal Agent Agreement: Step 1: The Special Tax shall be levied Proportionately on each Assessor's Parcel of Developed Property at up to 100%of the applicable Assigned Special Tax to satisfy the Special Tax Requirement; Step 2-, If additional monies are needed to satisfy the Special Tax Requirement after Step I has been completed, the Special Tax shall be levied Proportionately on each Assessor's Parcel of Undeveloped Property up to 100%of the Maximum Special Tax for Undeveloped Property-, 21 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 507 of 724, Step 3: If additional monies are needed to satisfy the Special Tax Requirement after the first two steps have been completed, then the Special Tax amount determined,in Step I shall be increased Proportionately on each Assessor's Parcel of Developed Property up to 100% of the Maximum Special Tax for Developed Property. Step 4: 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 each Assessor's Parcel of Provisional Property up to 100%of the Maximum Special Tax for Provisional Property. Notwithstanding the above,under no circumstances will the Special Tax levied in a Fiscal Year against any Assessor's Parcel of Residential Property for which an occupancy permit for private residential use has been issued be increased by more than ten percent(10%) above the amount that would have been levied in that Fiscal Year as a consequence of delinquency or default by the owner of any other Assessor's Parcel within Improvement Area No. 2. To the extent that the levy of the Special Tax on Residential Property is limited by the provision in the previous sentence, the levy of the Special Tax on all other Assessor's Parcels shall continue in equal percentages at up to 100%of the Maximum Special Tax. Prepayment ofAnnual Special Taxes. The Annual Special Tax obligation for an Assessor's Parcel may be prepaid in full, or in part, provided that the terms set forth under the Rate and Method are satisfied. The Prepayment Amount is calculated based on the sum of the Bond Redemption Amount, the Redemption Premium, the Future Facilities Prepayment Amount, the Defeasance Amount', the Prepayment Administrative Fees and Expenses and less a credit for the resulting reduction in the Reserve Requirement for the Bonds (if any) and less capitalized interest (if any), all as specified in Section 8 of the Rate and Method attached as APPENDIX A. Pursuant to the Rate and Method and the Indenture, prepayments of Special Taxes will be applied to effect an extraordinary redemption of Bonds and Parity Bonds. Where the total tax burden exceeds 2.0%of the actual sales price of a home when first sold by a homebuilder,the Special Tax,or special taxes and assessments of overlapping taxing districts, must be partially prepaid to the extent described herein. See "THE BONDS — Redemption — Extraordinary Redemptionftom Special Tax Prepayments"and"IMPROVEMENT AREA NO. 2—Expected Tax Burden;Potential Special Tax Prepayment." Estimated Debt Service Coverage. In order to size the Bonds, the D�istrict evaluated the maximurn Assigned Special Taxes that could be levied based on projected build out of Improvement Area No. 2. Assuming an Administrative Expense Requirement of$,75,000 and build out within Improvement Area No.2 as planned,Net Taxes would not be less than I 10%of debt service on the Bonds in each Bond Year which begins in a Fiscal Year. While the maximum Special Tax rates, if levied in accordance with the Rate and Method,would produce coverage levels of Net Taxes which,are higher than, I 10% of debt service in certain circumstances,because of the limitations imposed by Section 53321(d) of the Government Code, investors should assume that the maximum amount that could be levied in any Fiscal Year is the amount that would produce Net Taxes equal to I 10%of debt service due on the Bonds in the corresponding Bond Year. Government Code Section 53321(d)provides that the special tax levied against any Assessor's parcel for which an occupancy pennit for private residential use has been issued shall not be increased as a consequence of delinquency or default by the owner of any other Assessor's parcel by more than 10%above the amount that would have been levied in that fiscal year had there never been any such delinquencies or defaults. Collection of Special Taxes. The Special Taxes are levied and collected by the Treasurer Tax-Collector of the County in the same manner and at the same time as ad valorem property taxes,. The District may,however, collect the Special Taxes at a different time or in a different manner if necessary to meet its financial obligations. The District will make certain covenants in the Indenture for the purpose of ensuring that the current maximum Special Tax rates, and method of collection of the Special Taxes are not altered in a manner that would impair the District's ability to collect sufficient Special Taxes to pay debt service on the Bonds and Administrative 22 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 508 of 724, Expenses when due. First, the District will covenant that, to the maximum extent that the law permits it to do so, the District will not initiate proceedings to reduce the Maximum Special Tax rates (as set forth in the Rate and Method), unless, in connection therewith, (i) the District receives a certificate from one or more Special Tax Consultants which,when taken together, certify that, on the basis of the parcels of land and improvements existing in Improvement Area No.2 as of the July I preceding the reduction,the Maximum Special Tax which may be levied on all Assessor's Parcels(as such term is defined in the Rate and Method)of taxable property on which a completed structure is located in each Fiscal Year will equal at least 110% of the largest sum of the Annual Debt Service on the Bonds to remain Outstanding and the Debt Service on any Parity Bonds outstanding("Maximum Debt Service") after the reduction is approved and will not reduce the Maximum Special Tax payable from parcels on which a completed structure is located or to be located at buildout of Improvement Area No.2 as proposed to less than I 10% of the Maximum Debt Service,,and(ii)the City Council,acting as the legislative body of the District,finds pursuant to the Indenture that any reduction made under such conditions will not adversely affect the interests of the Owners of the Bonds. The District will also covenant that, in the event that any initiative is adopted by the qualified electors which purports to reduce the Maximum Special Tax below the levels authorized pursuant to the Rate and Method or to limit the power or authority of the District to levy the Special Taxes pursuant to the Rate and Method, the District shall, from funds available under the Indenture, commence and pursue legal action in order to preserve the authority and power of the District to levy the Special Taxes pursuant to the Rate and Method. The District will further covenant that it will not adopt any policy pursuant to Section 5334 1.1 of the Act permitting tender of Bonds in full payment or partial payment of any Special Taxes unless it first receives a certificate of a Special Tax Consultant that accepting such tender will not result in the District having insufficient Net Taxes to pay the principal of and interest on the Bonds when due. See APPENDIX E— "SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE.11 Although the Special Taxes constitute liens on taxed parcels within Improvement Area No. 2,they do not constitute a personal indebtedness of the owners of property within Improvement Area No. 2. In addition to the obligation to pay Special Taxes,properties in.Improvement Area No.2 are sub ect to other assessments and special taxes as set forth in Table 3 herein. These other special taxes and assessments are co-equal to the lien for the Special Taxes. Moreover,other liens for taxes and assessments could come into existence in the future in certain situations without the consent or knowledge of the City or the landowners in Improvement Area No.2. See"SPECIAL RISK FACTORS—Parity Taxes and Special Assessments"'herein. There is no assurance that property owners will.be financially able to pay the annual Special Taxes or that they will pay such taxes even if financially able to do so,all as more fully described in the section of this Official Statement entitled"SPECIAL RISK FACTORS.11 Special Taxes Are Not Within Teeter Plan. Section 4701 et seq. of the California Revenue and Taxation Code allows a county to adopt a tax distribution procedure which distributes taxes to taxing agencies on the basis of the amount of the tax levy, rather than on the basis of actual, tax collections. This mechanism is known. as a "Teeter Plan." The Special. Taxes are not subject to the County's Teeter Plan. The amount of Special Taxes available to pay debt service on the Bonds will depend on actual tax collections. Proceeds of Foreclosure Sales. The amounts collected from the redemption of delinquent Special Taxes including the penalties and interest thereon and from the sale of property sold as a result of the foreclosure of the lien of the Special Tax resulting from the delinquency in the payment of Special Taxes due and payable on such property, are included within the Special Tax Revenues from which principal and interest on the Bonds is payable under the Indenture. Pursuant to Section 53356.1 of the Act, in the event of any delinquency in the payment of any Special Tax or receipt by the District of Special Taxes in an amount which is less than the Special Tax levied,the City Council of the City, as the legislative body of the District, may order that Special Taxes be collected by a superior court action to foreclose the lien within specified time limits. In such an action, the real property subject to the unpaid amount may be sold at a judicial foreclosure sale. Under the Act, the commencement of judicial foreclosure 23 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 509 of 724, following the nonpayment of a Special Tax is not mandatory. However, the District will covenant for the benefit of the Owners of the Bonds that it will commence and diligently pursue to completion, judicial foreclosure proceedings against (i) properties under common ownership with delinquent Special Taxes in the aggregate of $5,000 or more by October I following the close of the Fiscal Year in which the Special Taxes were due, and(ii) against all properties with delinquent Special Taxes in the aggregate of$5,000 or more by October I following the close of any Fiscal Year if the amount of the Reserve Fund is less than the Reserve Requirement. See APPENDIX E — "SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE MISCELLANEOUS CONDITIONS — Covenants" herein. Also see "SOURCES OF PAYMENT FOR THE BONDS—Assignment of Assessor Parcel Numbers and Delayed Special Tax Revenues"herein for a description of certain delays in receipt of Special Tax revenues during the development and home sales period within Improvement Area No. 2. If judicial foreclosure is necessary and other funds held under the Indenture (including amounts in the Reserve Fund) have been exhausted, debt service payments on the Bonds could be delayed until the foreclosure proceedings have ended with the receipt of any foreclosure sale proceeds. Judicial foreclosure actions are subject to the normal delays associated with court cases and may be further slowed by bankruptcy actions, involvement by agencies of the federal government and other factors beyond the control of the City and the District. See"SPECIAL RISK FACTORS — Bankruptcy and Foreclosure"' herein. Moreover, no assurances can be given that the real property subject to foreclosure and sale at a judicial foreclosure sale will be sold or, if sold, that the proceeds of such sale will be sufficient to pay any delinquent Special Tax installment. See "SPECIAL RISK FACTORS Property Values" herein. Although the Act authorizes the District to cause such an action to be commenced and diligently pursued to completion,the Act does not impose on the District or the City any obligation to purchase or acquire any lot or parcel of property sold at a foreclosure sale if there is no other purchaser at such sale. The Act provides that, in the case of a delinquency, the Special Tax will have the same lien priority as is provided for ad valo�rem taxes. COVID-19(Coron�avirus)Pandemic. In response to the coronavirus pandemic,on May 6,2020,Governor Newsom issued Executive Order N-61-20 (the "'Executive Order"), waiving penalties and interest on taxes on property on the secured or unsecured roll through May 6,2021 under certain conditions,including: (i)the property is a residential property occupied by the taxpayer or the property is used for a small business, (ii)the taxes owed were not delinquent as of March 4,,2020, (iii)the taxpayer files for relief in a form prescribed by the tax collector, and(iv)the taxpayer demonstrates economic hardship to the satisfaction.of the tax collector. Fiscal Year 2020-21 was the first year of the Special Tax levy within Improvement Area No.2. The D�istrict cannot predict whether the Executive Order will be extended beyond May 6,202 1. If the Executive Order is extended or modified,it may have an effect on the collection of penalties and interest on delinquent Special Taxes and may otherwise affect a property ownerls willingness to pay Special Taxes when due. The District can provide no assurance that additional actions will not be taken by the County,the State,or individual property taxpayers that may have a material adverse impact on the timing of Special Tax collection,and the District's ability to pay scheduled debt service on the Bonds when due. See"IMPROVEMENT AREA NO�.2—Delinquency History"and"SPECIAL RISK FACTORS—CO�VID- 19(Coronavirus)Pandernic." Reserve Fund In order to secure further the payment of principal of and interest on the Bonds, the District is required, upon delivery of the Bonds, to deposit in the Reserve Fund an amount equal to the Reserve Requirement and thereafter to levy Special Taxes to maintain in the Reserve Fund an amount equal to the Reserve Requirement. The Indenture provides that the amount to be maintained in the Reserve Fund as the Reserve Requirement shall, as of any date of calculation, equal the lesser of: (i) Maximum Annual Debt Service for the Bonds, (ii) one hundred twenty-five percent(125%)of Average Annual Debt Service for the Bonds; (i.i.i.) ten percent(1,0%,) of the original issue price of the Bonds calculated in accordance with Treasury Regulations Section 1.148-2(f)(I); or (iv) $ the initial Reserve Requirement. 24 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 5 10 of 724, Subject to the limits on the maximum annual Special Tax which may be levied within Improvement Area No. 2 in accordance with the Rate and Method, the District will covenant to levy Special Taxes in an amount that is anticipated to be sufficient,in light of the other intended uses of the Special Tax proceeds,to maintain the balance in the Reserve Fund at the Reserve Requirement. Amounts in the Reserve Fund are to be applied to (i)pay debt service on the Bonds,to the extent other moneys in the Interest Account and the Principal Account are insufficient therefor; and (ii) redeem and/or defease the Bonds in whole or in part. See APPENDIX E— "SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE—FUNDS AND ACCOUNTS—Reserve Fund"herein. Assignment of Assessor Parcel Numbers and Delayed Special Tax Revenues Assessor Parcel Segregation Process. All of the residential developments within Improvement Area No. 2 are planned for condominiums. With respect to condominium projects, the final tract map for each project area creates one assessor parcel for such project area(referred to herein as a"Parent Parcel"). In order for the County to create individual assessor parcels for the condominium units (referred to herein as the "Children Parcels"'), the builder is first required to record a condominium plan for each phase of development within a project(the process for segregating the Parent Parcel into separate Children Parcels is referred to herein as the "Parcel Segregation process"). If a condominium plan is recorded for a particular phase and there is a home closing within such phase prior to January I of a given year, the County is obligated to undertake the Parcel Segregation process such that assessor parcel numbers for the individual units within such phase will be assigned by the time the secured property tax bills are sent to property owners the following October. The property owners of the individual units within such phase (including any unsold unit owned a builder) will receive a secured tax bill with their correct share of the Special Tax levy for such Fiscal Year. Such property tax bill will become due and be subject to delinquencies as is provided for advalorem property taxes under State law. If a condominium plan for a phase has been recorded prior to January I in a given year but the first home within such phase does not close until after January I and before December 10 of such calendar year,a builder may submit a request to the County to begin the Parcel Segregation process in such phase. In such scenario, in the following October,the County will send a secured tax bill reflecting a tax levy(including the Special Tax levy)on the entirety of the Parent Parcel,to the record owner of such Parent Parcel as of the prior January I (i.e.the builder). Although the secured property tax bill is sent to the record owner of the Parent Parcel,if the owner requests that the Tax Collector perform a Parcel Segregation process with respect to such Parent Parcel, the County's practice has been to issue a letter instructing the owner to not pay such secured property tax bill (and penalties and interest will. not be assessed for noripayment). Such letter also informs the owner that the County is undertaking the Parcel Segregation process for the portion of the Parent Parcel subject to the segregation request and will issue new secured tax bills to the Parent Parcel and the new Children Parcels reflecting their appropriate share of taxes(the"Delayed Tax Bills"),. The Delayed Tax Bills are to be paid within 30 days,with respect to the first installment, and 45 days, with respect to the second installment, of the bills being mailed. The County estimates that the Parcel Segregation process takes approximately 6 to 12 months to complete from the time of the request (i.e. a segregation. request submitted in July 2021 could result in Delayed Tax Bills not being sent to the record owners until July 2022, at which time such owners will have 30 days, with respect to the first installment, and 45 days, with respect to the second installment, to pay)�. If the builder does not request segregation of the Parent Parcel and a home is closed after January 1,the units within the related phase will be assigned an,assessor parcel number and receive its property tax bills based on the timing described in the preceding paragraph (e.g. if a home is closed after January 1, 2021 and no Parcel Segregation process is requested, the parcel related to such home will have its own assessor parcel number and will. receive a regular property tax bill beginning with the Fiscal Year 2022-23 levy). As a result of the foregoing process, the County does not consider the unpaid property taxes (including the Special Tax) due until 30 or 45 days,as applicable,after the Delayed Tax Bills are mailed. As a result,with respect to the Special Tax, there can be no assurance that the District will be able to enforce the foreclosure covenant set forth in the indenture with respect to unpaid Special Taxes levied on property with respect to which the Parcel Segregation process has not been completed. By way of example, in Fiscal Year 2020-21,the District levied$74,012.40 on the"Parent"Parcel owned by Pinnacle Homes as of January 1, 2020. Pinnacle Homes submitted a request for segregation as to the first three of 25 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 511 of 724, eight phases of its project(48 units) in Improvement Area No. 2 in June 2020 and received a letter by the County instructing Pinnacle Homes to not pay its Fiscal Year 2020-21 secured property tax bill, as described above. In reliance on such letter, Pinnacle Homes did not pay such bill. The Delayed Tax Bills related to this segregation request is expected to be received,before the end of Fiscal Year 2020-21. Based on the currently expected timing of home closings within each of Pinnacle Homes and Lennar Homes' projects within Improvement Area No. 2, assignment of individual assessor parcel numbers and the County's ability to issue separate secured property tax bills to all 335 planned residential units within Improvement Area No. 2 is not expected to occur until Fiscal Year 2022-23. In order to cover the insufficiency of Special Tax revenues when needed as a result of the Delayed Tax Bills during the interim period, SLF has deposited funds with the District to be applied to the payment of administrative expenses and debt service on the Bonds and to be periodically released to SLF or reimbursed from collected Delayed Special Taxes,as described below. Deposit Agreement. The City,the District and SLF have entered into the Deposit Agreement pursuant to which SLF has deposited$1,003,113.34 into a Deposit Fund established thereunder and held by the District. Such amount was determined based on the projected Fiscal Year 2021-22 and Fiscal Year 2022-23 Special Tax levy on the units within Improvement Area No. 2 for which the Parcel Segregation process has not been completed, plus the$74,0 12.40 Fiscal Year 2020-21 Special Tax levy on the Parent Parcel for which Pinnacle Homes was the record owner as of January 1, 2020. Such amount is to be applied in accordance with the Deposit Agreement, as further described below. Pursuant to the Deposit Agreement,so long as the Bonds are outstanding and the Parcel Segregation process has not been completed with respect to all 335 planned residential units within Improvement Area No. 2, not later than August I of each year, the District will review its records and the public records of the Tax Collector to determine the amount of Special Taxes collected in the preceding Fiscal Year and then calculate the amount that relates to parcels for which Parcel Segregation process has not been completed and which Special Taxes have not been collected for the preceding Fiscal Year as of each such date (the "Unpaid Special Taxes"). The District's determination of the Unpaid Special Taxes as of any August I pursuant shall be conclusive absent manifest error. On the date of issuance of the Bonds,the District shall transfer$74,012.40 to the Administrative Expense Fund established pursuant to the Indenture (being the amount of the Fiscal Year 2020-21 Special Tax levy on the Parent Parcel that was owned by Pinnacle Homes as of January 1, 2020). The District shall,no later than,February 15th and August 15th of each year, transfer monies in the Deposit Fund to the Fiscal Agent for deposit in: (a) the Administrative Expense Fund established under the Indenture in an amount equal to a proportionate share of the Administrative Expense Requirement and(b)the Special. Tax Fund established under the Indenture in the amount equal to the least of(x) the Unpaid Special Taxes as of the immediately preceding August I or (y) the amount necessary to pay debt service on the Bonds due on the next Interest Payment Date. Following a draw on monies in the Deposit Fund and transfer thereof to the Fiscal Agent for deposit in the Administrative Expense Fund or the Special Tax Fund,immediately upon receipt,the D�istrict shall deposit proceeds of Special Taxes from the payment of Delayed Tax Bills (the "Delayed Special Tax Revenues") into the Deposit Fund to the extent necessary to replenish the Deposit Fund up to the amount attributable to such the parcels relating to such Delayed Tax Bills deposited into the Administrative Expense Fund and the Special Tax Fund as described in the immediately preceding paragraph. Under no circumstance shall the District or the City be obligated to deposit any monies into the Deposit Fund except the Delayed Special Tax Revenues(other than the initial deposit described above), including without limitation proceeds of the Bonds. No later than September 1 of each year, the District will review the public records of the Tax Collector to determine if segregation occurred within a phase for which at least one home was conveyed to a homeowner in the prior calendar year and for which there is expected to be no further Delayed Tax Bills within such phase. The District shall release from the Deposit Fund to SLF the amount allocable to a phase within a Parent Parcel for which full segregation has occurred and for which the Special.Taxes have been.levied on the related Children Parcels or may be levied in a subsequent tax year. 26 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 512 of 724, On each August 1, the District shall also calculate the difference between the Unpaid Special Taxes and the portion of the Deposit attributable to the corresponding installment payments received(an "Excess Deposit"). No later than September I of each year, the District shall release from the Deposit Fund to the Owner the amount equal to the Excess Deposit. For the avoidance of doubt, the Owner shall, in total, receive no more than $1,1003,1113�.34. In the Indenture, the District will covenant to comply with the Deposit Agreement and will not amend the Deposit Agreement in such a way that is materially adverse to the interests of Bondowners. However, amounts on the Deposit Fund are not pledged to the payment of debt service on the Bonds. See"SPECIAL RISK FACTORS—Bankruptcy and Foreclosure"herein for a description of the ability of a bankruptcy trustee to reverse certain transfer of funds(e.g. SLF"s deposit of funds under the Deposit Agreement). Projected Home Closing Schedule by Phase. As described above, the Parcel Segregation process is related to the time at which condominium plans are recorded for the phases within a project and the time at which a first home closing has occurred within a particular phase. Lennar Homes has recorded condominium plans for all phases within its projects in Improvement Area No. 2. Pinnacle Homes has recorded condominium plans for the first three phases of its project,which includes 48 of the 126 planned homes of its project within Improvement Area No. 2. Based on the actual calendar year 2020 closings within Pinnacle Homes' project in Improvement Area No. 2, the expectation is that new assessor parcel numbers will be assigned to the Children Parcels for the first three phases(48 units)and a new assessor parcel number to the remaining property constituting the Parent Parcel for the Fiscal Year 2021-22 Special Tax levy. With respect to Lennar Homes' Vibe project,based on actual calendar year 2020 closings,the expectation is that new assessor parcel numbers will be assigned to the Children Parcels for the first three phases (24 units) and a new assessor parcel to the remaining property constituting the Parent Parcel for the Fiscal Year 2021-22 Special Tax levy. Based on the foregoing, in the aggregate,the current expectation is that 72 individual units will receive secured tax bills with their correct share of the Special Tax levy for in October 202 1. Table 2 below shows the phases within Pinnacle Homes and Lennar Homes' projects which have closed homes and the projected closing schedule by phase within their respective project(s). As shown in Table 2, there is currently expected to be a home closing within each phase of the residential developments in Improvement Area No. 2 by the end of December 20�2 1. As a result,the current expectation is that the Parcel Segregation process will be complete such that the County will have assigned assessor parcels numbers to, and be able to, issue separate secured property tax bills(including the Special Tax levy)to the 335 planned homes within.Improvement Area No. 2 beginning with Fiscal Year 2022-23. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 27 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 513 of 724, TABLE2 CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 16-1(MIL�L�ENIA) IMPROVEMENT AREA NO. 2 BUILDERS' ACTUAL AND PROJECTED HOME CLOSING SCHEDULE BY PHASE Number of Actual and Projected Units within First Unit Close Project and Owner(l) Phase Phase Within Phase Pinnacle at Millenia by Pinnacle Homes 1 18 Second Quarter 2020 2 18 Third,Quarter 2020 3 12 First Quarter 2021 4 18 Second Quarter 2021 5 12 Second Quarter 2021 6 24 Third Quarter 2021 7 18 Fourth Quarter 202 1 Models 6 Fourth Quarter 202 1 Total 126 Vibe by Lennar Homes 1 6 October 2020 2 8 November 2020 3 10 December 2020 4 8 March 202 1 5 7 April 2021 6 7 May 2021 7 8 May 2021 8 9 July 2021 9 7 August 2021 10 8 September 2021 11 9 October 2021 Models 5 August 2021 Total 92 Cleo by Lennar Homes 1 11 February 2021 2 9 April 2021 3 10 May 2021 4 8 June 2021 5 10 June 2021 6 11 July 2021 7 14 August 2021 8 11 October 2021 9 6 October 202 1, 10 11 November 2,02,1 11 10 December 2021 Models 6 December 2021 Total 117 Source: Pinnacle Homes and Lennar Homes,respectively. Based on estimates as of March 15,202 1. Issuance of Parity Bonds for Refunding Only The District will not issue any other obligations payable from the Special Taxes which have, or purport to have,any lien upon the Special Taxes superior to or.)except for Parity Bonds,on a parity with the lien of the Bo�nds. 28 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 514 of 724, Nothing in the Indenture prevents the District from issuing and,selling,pursuant to law,Parity Bonds payable from and having a first lien upon the Special Taxes on a parity with the Outstanding Bonds to refund, a portion of the Outstanding Bonds so long as the issuance of such Parity Bonds results in a reduction in each Bond Year on the Annual Debt Service on the Bonds when combined with the Debt Service on the Parity Bonds following the issuance of such Parity Bonds. IMPROVEMENT AREA NO.2 General Description of Millenia,the District and Improvement Area No. 2 The District is located in eastern portion of the City, approximately 8 miles southeast of the City of San Diego,within the master planned community known as"Otay Ranch." The District is located within a development of Otay Ranch known as"'Millenia." For a description of the Millenia project and the ongoing development activity surrounding the District, see"PROPERTY OWNERSHIP AND THE DEVELOPMENT—General Description of the Development." The District consists of separate project areas within the Millenia development totaling approximately 66 gross acres. Improvement Area No. 2 of the District consists of approximately 24 gross acres and includes four of the project areas within the Millennia development. Residential development is underway in three of the project areas',which are planned to include 335 for-sale market-rate attached sin le-family homes at buildout. The fourth 9 project area is located within the portion of Millenia designated primarily for commercial use,however,residential uses are also permitted, as further described herein. The fourth project area is in a finished lot condition and SLF has not yet decided whether the development therein will be only commercial or whether there will be a residential component. The District was formed and Improvement Area No. 2 was designated therein in 2016 by the City Council under the Act and the CFD Ordinance to provide for the financing of public improvements to meet the needs of new development within the District. SLF, as the qualified elector of Improvement Area No. 2, authorized the District to incur bonded indebtedness for Improvement Area No. 2 to finance certain public facilities to meet the needs of new development within the District and approved the Rate and Method for Improvement Area No.2 and authorized the levy of the Special Tax. The major infrastructure (sewer, water, storm drains, utilities, and arterial roads) to serve the property within Improvement Area No. 2 is substantially complete. Millenia is accessed via Birch Road and Eastlake Parkway,the arterial roads which border Millenia. The roads within Millenia from which the property included in, Improvement Area No�. 2 can be accessed are complete. The property within Improvement Area No. 2 varies from finished lots to completed homes owned by individuals. The remaining in-tract improvements are expected to be constructed by the homebuilders and the non-residential property developer as development within their respective projects is completed. See"PROPERTY OWNERSHIP AND THE DEVELOPMENT." A detailed description of the status of the construction and ownership as of the date of the Appraisal Report is included in APPENDIX B "APPRAISAL REPORT." Water and sewer service to the property within the District is provided by the Otay Water District and the City,respectively. Electricity and natural gas is supplied by San Diego Gas and Electric,and police and fire services are provided by the City. Description of Authorized Facilities The expected total cost of the facilities eligible to be financed with the proceeds of the bonds to be issued by the District (the "Facilities"), which includes the Bonds and bonds, that have been issued by the District for Improvement Area No. 1,based on the current estimated cost of the Facilities, is approximately$90�,O�O�O�,O�O�O�. The Facilities consist of street and bridge improvements, curbs and gutters, sidewalks, trails, medians, traffic signalization and signage, street lights, utilities, storm water drainage, on and off-site detention and treatment 29 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 515 of 724, facilities,, and landscaping and irrigation related thereto, sewer collection and conveyance facilities, land and facilities for parks and recreational uses, fire facilities and equipment, library facilities, and equipment, transit facilities,fiber optic telecommunication facilities,general government office,administrative and meeting facilities, bus and rapid transit facilities and,land,rights of way and easements necessary for any of such facilities. The estimated cost of the Facilities necessary to serve the property within Improvement Area No. 2,based on current estimates, will exceed the amount of proceeds of the Bonds and bonds that have been issued by the District for Improvement Area No. I available to finance such Facilities. The costs of the Facilities in excess of available proceeds from the sale of the Bonds and bonds that have been issued by the District for Improvement Area No. I have been and are expected to continue to be paid for by SLF. See"PROPERTY O"ANERSHIP AND THE DEVELOPMENT—The Development—Infrastructure Requirements and SLF Financing Plan"below. Direct and Overlapping Indebtedness The ability of an owner of land within Improvement Area No. 2 to pay the Special Taxes could be affected by the existence of other taxes and assessments imposed upon the property. These other taxes and assessments which secure direct and overlapping debt outstanding as of November 15,2020,in Improvement Area No.2 are set forth in Table 3 below(the "Debt Report"). The Debt Report sets forth those entities which have issued debt and does not include entities which only levy or assess fees,charges,ad valorem taxes or special taxes. See"—Expected Tax Burden; Potential Special Tax Prepayment" below for information regarding other entities levying taxes, assessments or other charges on property in Improvement Area No. 2. The Debt Report includes the principal amount of the Bonds. The Debt Report has been derived from data assembled and reported to the District by the County as of November 15,2020. None of the District,the City,or the Underwriter has independently verified the information in the Debt Report and do not guarantee its completeness or accuracy. As discussed under"SPECIAL RISK FACTORS—Parity Taxes and Special Assessments,"the property within Improvement Area No. 3 may be subject to additional taxes and assessments imposed by other public agencies in the future. Table 3 below does not include any authorized and unissued debt of other agencies. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 30 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 516 of 724, TABLE3 CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 16-1(MIL�L�ENIA) IMPROVEMENT AREA NO.2 DIRECT AND OVERLAPPING,DEBT 1. Appraisal Value(l) $58�9941 108 11. Land Secured Bond Indebtedness % Amount Outstanding Direct and Overlapping Bonded Debt Type Issued Outstandin Applicable A pplicable CITY OF CHULA VISTA CFD NO. 16-1 IA 2,Series 2021(') CFD $1 L25500 $1112551000 100.000% $11,255,000* TOTAL LAND SECURED BONDED DEBT $11�2559000* 111. General Obligation Bond Indebtedness % Amount Outstanding Direct and Overlapping Bonded Debt Type Issued Outstandin Applicable(3) Applicable METROPOLITAN WATER DEBT'SERVICE GO $13416451000 $37,300,000 0.0�O�2% $ 712 OTAY WATER DISTRICT,I.D.NO.27 GO 191280,000 2J,051000 O�.415 8�713 SOUTHWESTERN COMMUNITY COLLEGE DISTRICT GO 495,923,676 4151123,676 0.1 O�2 422,557 SWEETWATER UNION HIGH SCHOOL DISTRICT GO 4920000 3951759,333 0.127 50�2�095 CHULA VISTA ELEMENTARY SCHOOL DISTRICT GO 1141),12000 851460,000 O�.166 14291,00 CHULA VISTA ELEMENTARY SCHOOL DISTRICT SFID NO. I GO 90100000 79,580,000 0.384 30�5,50�4 TOTAL OUTSTANDING GENERAL OBLIGATION BONDED DEBT' $ 1,1381,681 % Amount Authorized but Unissued Direct and Overlapping Indebtedness Type Authorized Unissued Applicable(3) Applicable METROPOLITAN WATER DEBT SERVICE GO $85000"P000 $715�3555000 O�.00�2% $ 13�647 OTAY WATER DISTRICT,I.D.NO.27 GO 100,000,000 801720,000 O�.414 33491,31 SOUTHWESTERN COMMUNITY COLLEGE DISTRICT GO 789,000,000 2931076,324 0.1 O�2 298,324 SWEETWATER UNION HIGH SCHOOL DISTRICT GO 831,000,000 339,000,000 O�.127 4309085 CHULA VISTA ELEMENTARY SCHOOL DISTRICT GO 3641),12000 250,000,000 O�.166 4159693 CHULA VISTA ELEMENTARY SCHOOL DISTRICT SFID NO. I GO 90100000 0 0.384 0 CHULA VISTA ELEMENTARY SCHOOL DISTRICT CFD NO. 18(4) CFD 401000,000 401000,000 9.057 31,6221774 SWEETWATER UNION HIGH SCHOOL DISTRICT CFD NO. 18 CFD I OOMKOOO 100100000 5.967 52966192211 TOTAL UNISSUED GENERAL OBLIGATION INDEBTEDNESS $141081�574 TOTAL OUTSTANDING AND UNISSUED GENERAL OBLIGATION INDEBTEDNESS $12,463,255* TOTAL OF ALL OUTSTANDING DIRECT AND OVERLAPPING BONDED DEBT $12,636,681* TOTAL OF ALL OUTSTANDING DIRECT AND UNISSUED DIRECT OVERLAPPING INDEBTEDNES'S $23,71,81255* IV. Ratios to Appraisal Value Outstanding Land Secured Bonded Debt 5.24.-1 Total Outstanding Bonded Debt 4.67-1* Preliminaty,suNect to change. (1) Based on the Appraisal Report as of the Date of Value. (2) Ren.ects the Bonds to be issued. (3) Calculated by dividing the appraised value by the total assessed value for Fiscal Year 2020-2 1. (4) Historically,the community facilities districts fori-ned by the Chula Vista Elementary School District have not issued bonds but apply the special tax levy amounts toward obligations of the school district incurred to finance facilities. Source: San Diego County Assessor's Office,Spicer Consulting Group,LLC. Expected Tax Burden; Potential Special Tax Prepayment Table 4 below sets forth the estimated total effective tax rates for the average residential unit each floor plan for Pinnacle Homes' project and Lennar Homes' Vibe project, based on appraised values, set forth in the Appraisal Report. As there were no completed homes within Lennar Homes' Cleo project at the time the Appraisal Report was prepared, the Appraisal Report did not report appraised values for the proposed floor plans for Lennar Homes' Cleo project. However,based on base sales prices as set forth in the Market Absorption Study for the Cleo project, Fiscal. Year 2020-21 overlapping tax rates and the estimated Fiscal Year 2021-22 Special Tax levy, the effective tax rates for the Cleo project range from approximately 1.81%to 1.90%. 31 4852-7256-1 10�7vl2/024036-00�89 2021-03-16 Agenda Packet Page 517 of 724, The expected tax burden of the Special Taxes and other taxes and, assessments on individual parcels located within Improvement Area No. 2 will vary among parcels. Actual amounts charged and the effective tax rates may vary and may increase or decrease in future years. Table 4 below does not include Lot 19 owned by SLF within Improvement Area No. 2 which may be developed for residential or commercial/retail use. See Table 5 below for the estimated Fiscal Year 2021-22 Special Tax levy on the property currently owned by SLF and"PROPERTY OWNERSHIP AND THE DEVELOPMENT." In accordance with City policies, each homebuilder within Improvement Area No. 2 is required to prepay a portion of the Special Tax,or special taxes and assessments,of overlapping taxing districts,at the time a completed home is sold, if, based on the actual sales price of such home, the projected total effective tax rate on such parcel would exceed 2.0�0% of the actual sales price. If the 2.00% threshold is exceeded, the homebuilder is required to prepay that amount of the Special Tax obligation, or special taxes and assessments of overlapping taxing districts, necessary to reduce the effective tax rate to 2.00%, or less of the actual sales price. In determining the overall effective tax rate, special taxes levied by the City for maintenance and services are excluded, but all other special taxes., assessments and advalorem property taxes are included. The effective tax rate at the time of sale could increase due to a reduction in sales prices or other factors including,but not limited to,escalation of the Special Tax rates at 2.00% per Fiscal Year pursuant to the Rate and Method, additional overlapping special taxes and assessments and increases in the amount of general obligation bonds issued by overlapping taxing entities. As of March 1,2021 1 no prepayments were required for the 71 homes which have closed escrow and,based on sales prices provided by Lennar Homes and Pinnacle Homes,no prepayments are expected to be required for the 132 homes that were in escrow as of such date. Based on the projected Fiscal Year 2021-22 Special Tax levy and the Fiscal Year 2020�-21 levy for overlapping special taxes (excluding those levied for maintenance and services), assessments and ad valorem property taxes (assuming no changes or additions to such overlapping taxes), the following approximate percentage decreases in the average base sales prices of homes within each residential project, as set forth in Table 4 below, would result in effective tax rates greater than 2.00% for such products: (i) 21%for each of Lennar Homes' Vibe project; (ii) 17%for Lennar Homes' Cleo project; and(iii)26% for Pinnacle Homes' Pinnacle at Millenia project. Based on the base sales prices of the homes to be constructed by the current homebuilders as described herein, the District does not expect that any prepayments of Special Taxes or overlapping special taxes and assessments will be required; however, if actual sale prices were to be reduced in. the future or any of the other factors that could affect the effective tax rate described above were to occur, it is possible that some prepayments could occur. Such prepayments of the Special Taxes, if any, would be applied to the redemption of Bonds in accordance with the Indenture. See"THE BONDS—Redemption—Extraordinary Redemptionfrom Special Tax Prepayments." Neither the District nor the Underwriter can make any assurance that prepayments of the Special Taxes will not be required in connection with the initial sale of a home within Improvement Area No. 2 to reduce the effective tax rate thereof to 2.00%or less of the actual sales price. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 32 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 518 of 724, TABLE4 COMMUNITY FACILITIES DISTRICT NO. 16-1(MILLENIA) IMPROVEMENT AREA NO.2 OF THE CITY OF CHULA VISTA ESTIMATED FISCAL YEAR 2021-22TAX OBLIGATION FOR A SAMPLE DEVELOPED PROPERTY Map No.16377 Map No.16409 Prqject Pinnacle at Millenia Vibe Developer Pinnacle Homes Lennar Homes Plan Type 1 2 3 4 5 6 1 2 3 Less than Less than Greater than Greater than Greater than Greater than Greater than Greater than Greater than CFD Tax Category 11450 S.F. I i450 S.F. I i450 S.F. I i450 S.F. 1�450 S.F. 11450 S.F. 1�450 S.F. 15450 S.F'. 1�450 S.F. Home Size 11362 1 i433 I i989 21185 2,380 21522 101 15819 2�037 Appraisal Value(]) $429M30 $4441230 $5071195 $5351325 $559�300 $580iO6O $453�870 $469i3O2 $505J,76 Ad Valorem Property Taxes: General Purpose $ 41290 $ 4�442 $ 5M72 $ 5�353 $ 5i593 $ 501 $ 4i539 $ 4M3 $ 51,052 Metropolitan Water West(0.00350%) 15 16 18 19 20 20 16 16 18 Otay Water District,I.D.No.27(O.O�0350%) 15 16 18 19 20 20 16 16 18 Southwestern Community College District (0.027920%) 120 124 142 149 156 162 127 131 141 Sweetwater Union High School District(0.04880%) 209 217 248 261 273 283 221 229 247 Chula Vista Elementary School District(0�.O�4305%) 185 191 218 230 241, 250 195 202 217 Chula Vista Elementary School District SFID No. 1 (0.02150%) 92 96 109 115 120 125 98 101 109 Total General Property Taxes $ 45926 $ 5JOI $ 5X4 $ 6J47 $ 61422 $ 601 $ 51212 51�389 $501 Assessment,Special Taxes&Parcel Charges(2: Mosquito Surveillance $ 3 $ 3 $ 3 $ 3 $ 3 $ 3 $ 3 3 $ 3 Vector Disease Control 8 8 8 8 8 8 8 8 8 CWA Water Availability 10 10 10 10 10 10 to 10 to Otay Water Availability 10 11 11 11 11 11 11 11 11 MWD Water Standby Charge 12 12 12 12 12 12 12 12 12 Sweetwater Union High School District CFD No. 18(3) 921 969 1�345 1�478 11610 1�706 11137 1 1�230 1�378 Chula Vista Elementary School CFD No. 18(4) 525 553 767 843 918 973 648 702 786 City of Chula Vista CF'D 97-2,Zone C(5) 30 32 44 49 53 56 37 41 45 City of Chula Vista CFD 14M 298 298, 298, 298 298 298 298 298 298 City of Chula Vista CFD 16-IA No.2(') 15502 1�502 1�798, 1�798 11798 1�798 11798 1 1�798 1�798 Sweetwater Union High School District General Obligation Bonds Credit(') (215) (222) (254) (268) (280) (290) (227) (235) (253) Chula Vista Elementary School General Obligation Bonds Credit(7) (69), (71) (81) ('86) (89) ('93) (73) (75) (81) Total Assessments&Special Taxes $ 3M36 $ 3.�104 $ 1�962 $ 4J56 $ 4�351 $ 41)492 $ 303 $ 302 $41M 15 Projected Total Property Tax $ 7,963 $ 89205 $ 99786 $ 10,303 $ 110,774 $ 111152 $ 8,875 $ 91191 $9,816 Projected Effective Tax Rate 1.8,6% 1.85% 1.93% 1.92% 1.93% 1.92% 1.96% 1.96% 1.94% (fbotnotes onfbllowing page) 33 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 519 of 724, (1) Based on the Appraisal Report as of the Date of Value. (2) Reflects estimated Fiscal Year 2021-22 tax rates. (3) Based on the Fiscal Year 2020-21 estimated maximum rate of$0.6764 per building square foot. (4) Based on the Fiscal Year 2020-21 estimated maximum rate of$0.3857 per building square foot.Historically,the community facilities districts fonned by the Chula Vista Elementary School District have not issued bonds but apply the special tax levy amounts toward obligations of the school district incurred to finance facilities. (5) Based on the Fiscal Year 2020-21 estimated maximum rate of$0.0223 per building square foot. (6) Reflects estimated Fiscal Year 2021-22 Special Tax levy based on development status as of March 1,2021 and includes Administrative Expenses of$75,000. (7) Credit for school districts'ad valorem general obligation levy per mitigation agreements between the applicable school district and the developer. Pursuant to the mitigation agreements,such credits are to be provided until the final maturity of the general obligation bonds which are payable from such ad valorem general obligation levy. Source: San Diego County Assessor's Office;Spicer Consulting Group,LLC. 34 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 520 of 724, Market Absorption Study General. In order to determine the projected absorption of the planned residential and non-residential property within Improvement Area No. 2, the City engaged Meyers Research, LLC (the "Market Absorption Analyst")to perform a comprehensive analysis of the product mix characteristics as well as the macroeconomic and microeconomic factors that are expected to influence the absorption of the planned products within Improvement Area No. 2. The Market Absorption Analyst delivered its Market Absorption Study titled "Market Absorption Analysis Chula Vista CFD 16-1 (Millenia IA No. 2) (the "Market Absorption Study") in November 2020. As of the time the Market Absorption Study was prepared,there were 41 homes within Improvement Area No. 2 owned, by individuals and 96 homes in escrow. The Market Absorption Study includes an estimated absorption schedule for the 335 for-sale homes in the three project areas currently being developed by Lennar Homes and Pinnacle Homes. For purposes of the Market Absorption Study,the Market Absorption Consultant used a hypothetical scenario in which the development within Lot 19 will include 400,000 square feet of commercial space and a 150-unit for-rent apartment complex. As described herein, SLF has not yet made a decision as to whether there will be any residential development or the building square footage of the commercial development within Lot 19. The commercial development within Lot 19 could also be greater or less than 400,000 square feet. The Market Absorption Analyst notes that actual absorption rates will differ from projections in the Market Absorption Study. Such differences could be material. Factors which may influence the pace of absorption of the residential and non-residential products within Improvement Area No. 2 include economic downturn, a sudden spike in mortgage rates, tax reform policies relating to housing, and competition from developments within the vicinity of Improvement Area No.2. See"SPECIAL RISK FACTORS—Risks of Real Estate Secured Investments Generally." The Market Absorption Study is attached hereto as APPENDIX 1. For-Sale Residential Products. The Market Absorption Study states that the number of active new home projects has been decreasing throughout the County–over 130 active projects in 2019 and fewer than 80 at the time the Market Absorption Study was prepared in November 20�2O�. The Market Absorption Study states that there is growing housing demand in the south County area as affordability becomes a greater issue in the San Diego County marketplace as a whole. In addition, the low interest rate environment, heightened focus on living space and a growing retiree population is increasing interest in the south County market. The Market Absorption Analyst observes that there is good demand potential in the south County area and the neighborhoods in,Improvement Area No.2,which have homes offered in the$,400,000 to$600,000 range are largely unavailable elsewhere in.the region. While there was a brief decrease in housing demand in early 2020 as a result of the COVID-19 pandemic, demand for housing has accelerated since March 2020. The Market Absorption Consultant estimates that new home communities have a historical. average absorption rate of approximately 3.6 units per month,which has increased to approximately 5.2 units per month in the latter part of 2020. The residential, communities within Millennia have experienced absorption rates of approximately 8,.0 units per month. The Market Absorption Study projects housing demand in the south County area to be approximately 740 units per year between 2021 and 2025. Pinnacle Homes' project opened for sale in February 2020 and Lennar Homes' Vibe and Cleo and projects opened for sale in July 2020 and October 2020, respectively. Based on the assumptions and limiting conditions set forth in the Market Absorption Study, the Market Absorption Analyst has estimated the calendar year sales for the residential units under active development within Improvement Area No. 2 as set forth in the table below. The table below represents sales and not closings. The Market Absorption Study states that if current market conditions hold, the absorption rate will be much faster. Lennar Homes and Pinnacle Homes currently expect to complete and close all homes within their respective projects by the end of 202 1. 35 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 521 of 724, PROJECTED ABSORPTION Project 2020 2021 2022 2023 Pinnacle 82 36 8 Cleo 28 42 42 5 Vibe 41 36 15 To�tal 151 114 65 5 Source: The Market Absorption Analyst. Lot 19 Hypothetical Commercial Development. For purposes of the Market Absorption Study,the Market Absorption Consultant used the hypothetical scenario that the commercial development on Lot 19 will include a 400,000 square feet office building. The Market Absorption Study states that, for 2020, the office vacancy rate in the County was approximately I I%and that the San Diego-Chula Vista-Carlsbad Metropolitan Statistical Area(the "'San Diego MSA") experienced negative absorption. The Market Absorption Consultant attributes the negative absorption rate to the COVID19 pandemic as absorption has outpaced deliveries in the last 10 years. The Market Absorption Study states that the south b�ay/County area is performing relatively well as compared with the County as a whole., with a vacancy rate of approximately 5.0%. A 5.0% or lower vacancy rate represents an underserved office market that can support additional growth. Based on the foregoing and estimated job demand, the Market Absorption Study estimates that demand for office space within the Millenia project will be approximately 64,000 square feet per year through 2042. The Market Absorption Study assumes that development of the two office campuses located to the north of Lot 19 will proceed first,with the first phase anticipated to include approximately 337,0�O�O square feet of office space and the second phase anticipated to include approximately 68 1,000 square feet of office space. Based on the foregoing assumptions, the Market Absorption Consultant estimates that a 400,000 square foot office building Zn located on Lot 19 would be built and absorbed over a seven year period between 2036 and 2042. The Market Absorption Consultant notes that timing of construction of the office campuses located to the north of Lot 19 could change(i.e.development of Lot 19 could proceed first). If development of office space on.Lot 19 commences first, the absorption period would be different from what is currently estimated in the Market Absorption Study. See" Appraisal Report"below for the Appraiser's assumptions as to the absorption rate of the commercial.development on Lot 19. Lot 19 Hypothetical Residential Development. For purposes of the Market Absorption Study,the Market Absorption Consultant used the hypothetical scenario that a 150-unit for-rent apartment complex will be included within the development in Lot 19. The Market Absorption Study states that apartment occupancy rates within the Chula Vista/Imperial Beach submarket have averaged approximately 97%over the last two years,which is slightly higher than the 96% average in the overall San Diego MSA. In addition, the Market Absorption Study notes that while there was moderation in overall rent growth in mid-2020, rental prices increased in Chula Vista/Imperial Beach in the third quarter of 2020. Based on the assumption that any apartment complex on Lot 19 will, have a market-entry in 2022, an assumed lease-up rate of 15 units per month (which the Market Absorption Consultant notes is a conservative estimate), the Market Absorption Consultant estimates that a 150-unit apartment complex would be fully leased in the first half of 2023. As previously described, SLF has, not made a final decision as to whether Lot 19 will include both residential and commercial developments. Neither the District nor the Underwriter can provide any assurance that any development will. occur on. Lot 19, including the hypothetical scenarios described in the Market Absorption study. 36 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 522 of 724, Appraisal Report and Supplement to Appraisal Report The estimated assessed value of the property within Improvement Area No. 2, as shown on the County's, assessment roll for Fiscal Year 2020-21 , is approximately $14,858,620. However, as a result of the requirements of Article XIIIA of the California Constitution,a property's assessed value is not necessarily indicative of its market value. In order to provide information with respect to the minimum market value of the property within Improvement Area No. 2, the City engaged Kitty Siino &Associates, Inc.,the Appraiser,to prepare the Appraisal Report. The Appraiser has an"MAI"designation from the Appraisal Institute and has prepared numerous appraisals for the sale of land-secured municipal bonds. The Appraiser was, selected by the City and has, no material relationships with the City, the District, or the owners of the land within Improvement Area No. 2 other than the relationship represented by the engagement to prepare the Appraisal Report. The City instructed the Appraiser to prepare its analysis and report in conformity with City-approved guidelines and the Appraisal Standards for Land Secured Financings published in 1994 and, revised in 2004 by the California Debt and Investment Advisory Commission. A copy of the Appraisal Report is included as APPENDIX B — "APPRAISAL REPORT" to this Official Statement. The purpose of the Appraisal Report was to estimate the minimum market value of the property within Improvement Area No. 2 subject to the lien of the Special Taxes. The estimate of market value takes into consideration and assumes the improvements to be funded with the proceeds of the Bonds have been installed and that the remaining costs to develop each of the projects within Improvement Area No. 2 provided to the Appraiser by SLF and each of the builders are correct. As a result, the value conclusions are based upon a hypothetical condition that the Bonds have been sold with proceeds available for construction of improvements of approximately $10.6 million. In addition.,the Appraisal Report assumes that SLFcompletes construction of Metro Park in a timely manner which does not limit the issuance of building permits and the occupancy of the homes within Improvement Area No. 2. As described under"PROPERTY OWNERSHIP AND THE DEVELOPMENT—The Development —Infrastructure Requirements and SLF Financing Plan," SLF' has commenced construction of Metro Park and expects to complete construction thereof within the timeframe required by the Park Agreement such that building permits are not expected to be withheld for the active residential projects within Improvement Area No. 2. Subject to the assumptions and limiting conditions set forth in the Appraisal Report, the Appraiser concluded that, as of the Date of Value (November 15, 2020), the market value of the Taxable Property within Improvement Area No�.2 was$58,994,108. In valuing the property within Improvement Area No.2,the Appraiser used a sales comparison approach for the property to be developed and, with respect to the builder-owned models and production units more than 95%complete, a discounted cash flow analysis was applied. The discounted cash flow analysis accounts for remaining development costs, marketing and carrying costs, developer profit and a discount rate through the estimated absorption period for such models and production units. To arrive at the absorption schedule for the models and production units,the Appraiser reviewed both the actual sales made to date and the projection set forth in the Market Absorption Study. For the 4,1 individual,homes that had closed escrow as of the Date of Value,the Appraiser used a mass appraisal technique identifying the base prices for each model. As described herein, SLF has not yet decided whether any residential projects will be included on Lot 19. To provide a conservative estimate of the appraised value of Lot 19,the Appraiser has assumed that the development on Lot 19 will.not include a residential component. Using a sales comparison approach,the Appraiser estimated a current market value of$15.00 per square foot. The estimated absorption schedule in the Market Absorption Study for the first phase (approximately 337,000 square feet) of the office campuses located to the north of Lot 19, is approximately four years. See"Market Absorption Study—Lot 19 Hypothetical Commercial Development." To arrive at the estimated appraised value of Lot 19, Appraiser estimated that a prospective buyer for Lot 19 would purchase Lot 19 in four years (i.e. after the first phase of the office campus to the north has been absorbed). Applying an annual discount factor of 10 percent and the estimated Special Taxes to be paid over such four-year holding period, the Appraiser arrived at an estimated market value of$3,6�35,000 for Lot 19. 37 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 523 of 724, Table 5 below shows the appraised value of the various, parcels owned by SLF, the builders and the individual homeowners within Improvement Area No.2 as set forth in the Appraisal Report as of the Date of Value. See"PROPERTY OV�NERSHIP AND THE DEVELOPMENT"below. TABLE5 COMMUNITY FACILITIES DISTRICT NO. 16-1(MILLENIA) (IMPROVEMENT AREA NO. 2) SUMMARY OF APPRAISED VALUES BY OWNERSHIP Projected Number of Units at Build- Owner(l) OUt(l)(2) Appraised Value SLF(3) To be determined $3.1635.1000 Lennar Homes–Vibe 87 13.1600.1000 Lennar Homes–Cleo 117 918351000 Pinnacle Homes 90 11.1170.1000 Individual Homeowners 41 202754,108 Total Appraised Value 335 $581)9941)108 Based on ownership as of the Date of Value set forth in the Appraisal Report. Based,on the total number of residential units expected to be developed at buildout. The parcel owned by SLF may be used for commercial and/or residential developments. See"PROPERTY OWNERSHIP AND THE DEVELOPMENT"below. Source: The Appraiser. Reference is made to APPENDIX B for a complete list of the Appraiser's assumptions and limiting conditions and a full discussion of the appraisal methodology and the basis for the Appraiser's opinions. In the event that any of the assumptions and limiting conditions are not actually realized,the value of the property within Improvement Area No. 2 may be less than the amount reported in,the Appraisal.Report. In any case,there can be no assurance that any portion of the property within Improvement Area No. 2 would actually sell for the amount indicated by the Appraisal Report. The Appraisal Report is a statement of the Appraiser's opinion as to the market value of the taxable property in Improvement Area No. 2 as of the date and under the conditions specified therein. The Appraiser's opinion reflects conditions prevailing in the applicable market as of the Date of Value. The Appraiser's opinion does not predict the future value of the subject property,and there can.be no assurance that market conditions will not change adversely in the future. See"SPECIAL RISK FACTORS—Property Values." The Appraiser has also prepared the Appraisal Supplement, in which the Appraiser concludes that the estimated minimum market value of the property within. Improvement Area No. 2 subject to the levy of Special Taxes as of February 15, 2021, was not less than the concluded value of$58,994,108 set forth in the Appraisal Report. In the Appraisal Supplement,the Appraiser states that subsequent to the Date of Value,within Improvement Area No. 2,there were additional home closings and homes in escrow,additional homes have been constructed and additional amounts have been expended on remaining infrastructure costs. In connection with the preparation of the Appraisal Supplement,the Appraiser inspected the property within Improvement Area No.2 and was provided information with respect to the additional home closings,sales and construction activity by the homebuilders within Improvement Area No. 2. It is a condition precedent to the issuance of the Bonds, that the Appraiser deliver to the District a certification to the effect that, nothing has come to the attention of the Appraiser subsequent to the date of the Appraisal Supplement that would cause the Appraiser to believe that the value of the property in Improvement Area No. 2 is less than the value reported in the Appraisal Report. However, the Appraiser notes that acts and events may have occurred since the date of the Appraisal Supplement which could result in both positive and negative 38 4852-7256-1 10�7vl2/024036-00�89 2021-03-16 Agenda Packet Page 524 of 724, effects on market value within Improvement Area No. 2. The Appraiser has reviewed the homebuilder base prices as of the date of this Official Statement and concluded that those base prices do not cause it to believe that the value of property listed for any owner in Table 5 above would be reduced. Appraised Value-To-Lien Ratio�s Table 6 below incorporates the values assigned to parcels in the Appraisal Report,the estimated principal amount of the Bonds allocable to each category of parcels and the estimated appraised value-to-lien ratios for such categories of parcels based upon property ownership in Improvement Area No. 2 as of Date of Value as set forth in the Appraisal Report. Based on the principal amount of the Bonds, the estimated appraised value-to-lien ratio of the Taxable Property within Improvement Area No. 2 is 5.24-to-I*. This ratio does not include other overlapping debt within Improvement Area No. 2. See "— Direct and Overlapping Indebtedness" above. Taking that overlapping debt into account, the ratio of the aggregate appraised value of the Taxable Property within Improvement Area No. 2 to the total principal amount of the Bonds and such overlapping general obligation debt for Improvement Area No. 2 is approximately 4.67-to-I*. The share of Bonds set forth in Table 6 below is allocated based on each property's share of the estimated Fiscal Year 2021-22 Special Tax levy based on development status and ownership as of March 1, 2021. In the District Re-ports to be provided pursuant to the District Continuing Disclosure Agreement, Table 6 will not be updated based on appraised value,but similar information will be provided based on current assessed value. Based on the Fiscal Year 2020-21 assessed value of$141858,6201 the assessed value-to-lien ratio., taking the Bonds and the overlapping debt in Table 3 into account,is approximately 1.32-to-1.*. Such assessed value does not account for the development and sales activity that has occurred since the January 1, 2020 lien date. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] Preliminary, subject to change. 39 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 525 of 724, TABLE6 CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 161(MILLENIA) IMPROVEMENT AREA NO.2 ESTIMATED VALUE-TO-�LIEN RATIOS ALLOCATED BY PROPERTY OWNER AS OF MARCH 1.2021 Percentage qf Percentage Maximum Maximum Estimated Of Fiscal Year Fiscal Year Fiscal Year Estimated All other Appraised 2021-22 2021-22 2021-22 Fiscal Year CFD 16-IA 2 Overlapping Value-to- No.of Appraised Special Special Tax Special Tax 2021-22 Proposed Debt Lien Property Owner(), UnitslParcels() Value(2), Tax Levy(3), Levy Levy(4) Levy 2021 Bondv()* Issued(6) Ratio* Developed.Property Individually Owned 71 $25,985,136 $ 147,327 20.64% $123,180 21.05% $ 2,369,098 $ 290�834 9.77:1 Lennar Homes 174 1 8�203,972 320,969 44.97 306�838 52.43 5,901,342 724�458 2.75:1 Pinnacle Homes 72 9,284,286 148,004 20.74 122,315 .20.90 2,352,449 288,790 3.52:1 Subtotal Developed 317 $53,473,394 $ 616�299 86.36% $552,334 94.38% $10221888 $ 1530402 4.48:1 Undeveloped Property Pinnacle Homes 18 $ 11885,714 $ 35i966 5.04% $ 12�140 2.07% $ 2331488 $ 2803 7.19:1 SLF 17) 1 3,635,000 61240 8.60 20n726 3.54 398,624 48,936 8.12:1 Subtotal Developer Owned 19 $ 5�520,714 $ 971370 13.64% $ 321866 5.62% $ 6325112 $ 77�599 7.78:1 Total 33�6 $58�9941108 $ 713�1669 100.00% $585,200 100.00% $11,255,000 $1,1381,681 4.67:1, Preliminai)),subject to change. (1) Based on ownership and development status as of March 1,202 1. (2) Based on the appraised value set forth in the Appraisal Report as orNovember 15,2020,the Date orValue. (3) Based on 1,00%of the Backup Special Tax rate for Developed Property and the Maximum Special Tax rate on Undeveloped Property. (4) Estimated Fiscal Year 2021-22 Special Tax Levy based upon development status as of March 1,2021,preliminary debt service on the Bonds provided by the Underwriter,and an Administrative Expense Requirement of$75,000. (5) Allocated based on estimated Fiscal Year 2021-22 Special Tax levy reflecting building permits issued as of March 1,202 1. (6) Includes overlapping debt. See Table 3 above. (7) Parcel.owned by SLF may be used for residential and/or commercial purposes. See"PROPERTY OWNERSHIP AND THE DEVELOPMENT"below. Source: San Diego County Assessor's Office;Spicer Consulting Group,LLC. 40 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 526 of 724, Table 7 below sets forth the estimated appraised value-to-lien ratios for Taxable Property within Improvement Area No. 2 by various ranges based upon the principal amount of the Bonds. Building permits have been issued for all 161 parcels shown in Table 7 as having an appraised value-to-lien ratio below 3.00:1. As a result, such parcels will be classified as Developed Property in Fiscal Year 2021-22. However, while building permits have been issued,for such parcels,such as of the Date of Value,such parcels were either finished lots or had homes less than 95%complete and were appraised as finished lots by the Appraiser in the Appraisal Report. TABLE7 CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 161(MILLENIA) IMPROVEMENT AREA NO. 2 VALUE-TO-LIEN STRATIFICATION* CFD 16 1 Percent JA No.2 Share qf Estimated Estimated Percent Fiscal Year Fiscal Year CFD 16 1 1A Share,of 2021-22 2021-22 No.2 Proposed All Other Aggregate No.qf Appraised Special Tax Special Proposed 2021 Overlapping Value-to- Value-to-Lien Category UhitslParcel ValueM Levy Tax Levy 2021 Bonds(-'� Bonds Debt(-) Lien Less,than 3,.00:1(4) 16,1 $14�4441524 $282�584 48.29% $ 5i434�860 48.29% $ 66711,92 2.37:1, Between 3.0 1:1 to 6.00:1 95 11 M741762 164�248 28.07 3i I 58�938 28.07 3871796 3.12:1 Between 6.01:1 to 9.00:1 33 10,350,714 58M31 9.92 111161)090 9.92 137M3 8.26:1 Between 9.0 1:1 to 12.00:1 6 2�487,740 1 V85 1.84 207,419 1.84 25463 10.68:1, Greater than 12.01:1(4) 41 20,636,368 69,553 11.89 1,337,692 11.89 164217 13.74:1, Totals 336 $589,99411,08 $5859200 100.00% $11,12551,000 100.00% $1,1381,681 4.67:1 Preliminaty,subject to change. (1) Based on the appraised value set forth in the Appraisal Report as of November 15,2020,the Date of Value. (2) Allocated based on estimated Fiscal Year 2021-22 Special Tax levy reflecting building permits issued as of March 1,202 1. (3) Includes overlapping debt. See Table 3 above. (4) The minimum value to lien in the less than 3.00:1 category is 2.17:1*. The maximum value to lien in the greater than 12.01:1 category is 14.94:1*. Source: San Diego,County Assessor's Office;Spicer Consulting Group,LLC. Largest Taxpayers Table 8 below lists the taxpayers within Improvement Area No.2 based on ownership and development status as of March 1. 2021, measured by the percentage of the projected Fiscal.Year 2021-22 Special,Tax levy. As shown in Table 8 below, based on the ownership status and the number of building permits issued as of March 1, 202 1, assuming no additional conveyance of property by SLF or any transfer of property by homebuilders to individual homeowners,for Fiscal Year 2021-22,the largest taxpayer within Improvement Area No. 2 will be Lennar Homes. See"SPECIAL RISK FACTORS—Concentration of Ownership." 41 4852-7256-1 10�7vl2/024036-00�89 2021-03-16 Agenda Packet Page 527 of 724, TABLE8 COMMUNITY FACILITIES DISTRICT NO. 16-1(MILLENIA) (IMPROVEMENT AREA NO. 2) ESTIMATED FISCAL YEAR 2021-22 LARGEST TAXPAYERS Percent of Total Estimated Estimated Estimated Fiscal Year Fiscal Year Fiscal Year 2020-21 2021-22 2021-22 Number qf Special Tax Special Tax Zone0) Owner(2) Units Levy"' Lev y A Lennar Homes 174 $ 3061838 52.43% A Pinnacle HoMeS(4) 90 1341455 22.97 A Individual Owners 71 123j80 21.05 B SLF(5) 1 20,726 3.54 Total 336 $ 585,200 100.00% 0) Reflects the Zone designations set forth in the Rate and Method. (1) Based,on ownership status as of March 1,20�2 1. (3) Based,on development status as of March 1,2021. Total may not sum due to rounding. (4) Pinnacle Homes is a joint venture formed by SL.F and Meridian. See "PROPERTY OWNERSHIP AND THE DEVELOPMENT"below. (5) Parcel owned by SLF may be used for residential and/or commercial purposes. See"PROPERTY OWNERSHIP AND THE DEVELOPMENT"'below. Source: The Appraiser and Spicer ConSUIting Group,LLC. Delinquency History In Fiscal Year 2020-21, which was the first fiscal year in which Special Taxes were levied within Improvement Area No. 2, District levied Special Taxes in the amount of$74,012.40. Such levy was on the assessor parcel number for the Parent Parcel which was entirely owned by Pinnacle Homes as of the January 1, 2020 lien date. As described under"SOURCES OF PAYMENT FOR THE BONDS—Assignment of Assessor Parcel Numbers and Delayed Special Tax Revenues,"'based on instructions by the County,Pinnacle Homes did not pay the first installment of such levy. SLF has deposited the full amount of the Fiscal Year 2021-22 Special Tax levy with the District. See "SOURCES OF PAYMENT FOR THE BONDS —Delay in Assignment of Assessor Parcel Numbers and Deposit Agreement"'above. PROPERTY OWNERSHIP AND THE DEVELOPMENT The following iqfbrmation about SLF, Lennar Homes, and Pinnacle Homes and their respective developments within Improvement Area No. 2 has been provided by,such entities. No assurance can be given that the proposed developments will occur as described in this Official Statement or that they will be completed in a timely manner, �fat all, or that the current property owners will continue to own the property. Neither the Bonds nor the Special Taxes are personal obligations Qf the property owners or any qffiliate thereof and, in the event that a property owner defaults in the payment of its Special Taxes, the District may proceed with judicial f6reclosure but has no direct recourse to the assets qf'such property owner or any qf ,jiliate thereqf.' Neither the Underwriter nor the District has independently coqfirmed or verified the iqfbrmation in this section Qf'the Official Statement nor does any such party make any representation as to accuracy or adequacy of this i0brmation. Further, there may be material adverse changes in this iqfbrmation qfter the date(?f'this Qf ,ficial Statement. General Description of the Development The District is located in the eastern portion of the City,approximately 8 miles southeast of the City of San Diego, within the master planned community known as "Otay Ranch." The District is located within a 42 4852-7256-1 10�7vl2/024036-00�89 2021-03-16 Agenda Packet Page 528 of 724, development of Otay Ranch known as"Millenia." The Millenia project is located south of Birch Road, east of State Route 125, and west of Eastlake Parkway. The Millenia project is a mixed-use development encompassing approximately 206 acres. Pursuant to the EUC Sectional Planning Area(as defined and described below under"The Development—Entitlementsfor the Overall Millenia Planned Community") the area within the Millenia project is organized into districts with different predominant uses such as residential, civic, office/commercial and retail. As a whole, the Millenia project is entitled for up to 2,983 multi-family residential units and a maximum of 3.3 million square feet of commercial uses including a hotel,retail space and,a business district of up to two million square feet of office space. The Millenia project,including the property within Improvement Area No�.2,is expected to be served by a number of parks and a civic core including library facilities, an elementary school and a City fire station. Certain of such facilities have been completed, as, described herein. Millenia is accessed via entries along the arterial roads which bound the development, and access to the individual districts (i.e. the residential neighborhoods and commercial and civic centers)is via interior streets. The major infrastructure(sewer,water, storm drains,utilities,and arterial roads)to be installed to serve the property within Improvement Area No. 2 is substantially complete. In addition to the active developments within Improvement Area No.2,there are several completed and residential developments within Millenia. Three residential developments within Improvement Area No. I totaling 333 units have been completed and are sold out. A 217-unit condominium project spanning three neighborhoods developed by Meridian as"Metro,Trio and Evo"is also sold out. Completed apartment projects include 273-unit apartment project called "Pulse Millenia," a 210-unit apartment project called "Duetta and Volta at Millenia," a 309-unit apartment marketed as "Alexan Millenia"' and a 253-unit project marketed as "'Alexan Rivue"by Trammel Crow Residential. Such apartment complexes are either fully occupied or nearly fully occupied. Completed commercial developments within Millenia include the "Millenia Commons and Millenia Placel" which is a 130.,000 square foot retail development by Sudberry Properties. Anchor tenants currently include Home Goods,Ross and Cost Plus World Market. A 135-room hotel.has been,completed and is managed by the Ayres Group. With respect to the public facilities planned within Millenia, three of the six parks have been completed and two parks are currently under construction. A City fire station and a pedestrian bridge crossing Eastlake Parkway to link the Millenia project to the surrounding developments are complete. The foregoing developments are outside of Improvement Area No.2 and are not subject to the Special Tax levy. The area within the Millenia project has been divided into separate project areas, four of which are included in Improvement Area No. 2. Three of the project areas within Improvement Area No. 2 are planned for 335 for-sale market-rate residential units. SLF has conveyed these three project areas within,Improvement Area No.2 to Lennar Homes and Pinnacle Homes(which is a j oint venture entity formed by SLF and Meridian). The fourth project area consists of an approximately eight acre finished lot owned by SLF,which may be used for commercial and/or residential development. See "The Development — SLF-Owned Property in Improvement Area No. 2." Lennar Homes is developing two residential communities within Improvement Area No. 2 totaling 209 homes being marketed as"Cleo"and"Vibe." As of March 1,202 1,Lennar Homes had completed and conveyed 35 homes to individual homeowners. As of such date, Lennar Homes o�wned a five-unit building containing three model homes available for touring and a six-unit building containing six models homes available for touring, 119 homes under construction (66 of which were in escrow) and finished lots planned for 44 homes. Lennar Homes has obtained building permits for all 209 homes that it plans,to build within Improvement Area No. 2 and currently expects to complete and convey the remaining homes to individual homeowners by the end of 2021. Pinnacle Homes is developing a residential community with 126 homes being marketed as"Pinnacle at Millenia"within Improvement Area No.2. As of March 1,202 1,Pinnacle Homes had completed and conveyed 43 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 529 of 724, 36 homes to individual homeowners. As,of such date.,Pinnacle Homes owned six completed model homes, 66 homes under construction (all of which were in escrow) and finished lots planned for 18 homes. Pinnacle Homes currently expects to complete and convey the remaining homes that it plans to construct in Improvement Area No. 2 to individual homeowners by the end of 2021. SLF and the Contracted Project Manager SLF. The master developer of the Millenia project, including the property within Improvement Area No. 2, is SLF IV-Millenia, LLC, a Delaware limited liability company (previously defined herein as SLF), formerly known as SLF IV/McMillin Millenia JV, LLC, a Delaware limited liability company. Membership interests in SLF were formerly held by SLF IV Millenia Investor, LLC, a Texas limited liability company(as successor to Stratford Land Fund IV,,L.P.)and The Corky McMillin Real Estate Group,LLC. In 2014, SLF IV Millenia Investor, LLC purchased The Corky McMillin Real Estate Group, LLC's interest in SLF and became the sole member of SLF. The membership interest in SLF purchased by SLF IV Millenia Investor,LLC included the title,rights and obligations with respect to the property within the Millenia project, including the rights and obligations under the Development Agreement(as defined below). SLF is an entity that was funded by an investment fund of Stratford Land("'Stratford"). The investment fund is currently managed by Ankura Consulting Group as prescribed in the Investment Management Agreement. The fund is focused on high growth corridors in the"Sunbelt"region from North Carolina to Florida and across to Texas.,Arizona and southern California. The investment fund relating to SLF was the fourth out of five investment funds that were set-up by Stratford and they primarily invested in land investments (equity and debt) such as the Millenia project. SLF does not expect that any additional capital contributions will be required in order to complete the backbone infrastructure for which it is responsible and required to complete the Millenia project. The Contracted Project Manager. Pursuant to a contract with SLF,Meridian manages the development of the Millenia projectl including the property within Improvement Area No. 2. Founded in 2014,Meridian is a land development and homebuilding company led by former longstanding senior executives of The Corky McMillin Companies. Since 2015, Meridian has been contracted to manage all aspects of development of the Millenia project for SLF. Meridian and SLF have formed a joint venture entity (Pinnacle Homes) which is developing the Pinnacle at Millenia project within Improvement Area No. 2. History of Property Tax Payments; Loan Defaults; Litigation; Bankruptcy Each of SLF, Lennar Homes and Pinnacle Homes has made certain representations to the District, which., among others, include the following: a) with respect to property that such entity owned within the boundaries of a development project in California,within the last five years, such entity has not been delinquent to any material extent in, the payment of any property taxes, special taxes, or assessments levied or assessed against such property or failed to cure such delinquencies within forty-five days of becoming aware of such delinquencies; b) there are no events of monetary default or events which with the passage of time would constitute a monetary default under any loan or similar credit arrangement to which such entity is a party the result of which could have a material adverse effect on the development and sale of the property that it owns within Improvement Area No.2 as described in this Official Statement or its ability to pay Special Taxes related to such property prior to delinquency; c) such entity has not been adjudicated as bankrupt or discharged from any or all of its debts or obligations or granted an extension of time to pay its debts,(except such extensions that are granted in the ordinary course of business) or a reorganization or readjustment of its debts in the past 10 years; and d) such entity does not have any proceedings pending (with service of process having been. accomplished) or, to the actual knowledge of the individual providing the representations on behalf of such entity, threatened in which such entity may be adjudicated as bankrupt, become the debtor in a bankruptcy proceeding,be discharged from any or all of its debts or obligations, be granted an extension of time to pay its debts or obligations, or be granted a reorganization or readjustment of its debts or obligations. 44 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 530 of 724, The Development Infrastructure Requirements and SLF Financing Plan. As of the Date of Value, the backbone infrastructure improvements to serve the parcels within Improvement Area No. 2 have been substantially completed. The only remaining improvements to be completed by SLF to serve the parcels within Improvement Area No.2 are the final lift of paving on two streets in the second,phase of street improvements,and a mid-b�lock pedestrian crossing on Montage Avenue (which borders Lennar Homes' Vibe project). SLF estimates that the cost to complete this work is approximately $145,000. These improvements are expected to be completed by the end of March 2021 and are not prerequisites to the issuance of building permits or certificates of occupancy in Improvement Area No. 2. Pursuant to the"Agreement Regarding Construction of Parks in a Portion of Otay Ranch Eastern Urban Centerl"dated as of September 15, 2009,by and between the City and SLF(as successor in interest thereunder to McMillin Otay Ranch LLC),as amended(the"Park Agreement"), SLF is required to commence construction of Metro Park prior to the occupancy of any units within Lennar Homes' Vibe and Cleo developments in Improvement Area No. 2. SLF commenced construction of Metro Park in October, 2020, which was prior to any occupancy in the Lennar Homes' Vibe and Cleo projects. The Park Agreement requires the park construction to be completed within one year after the park begins construction. SLF expects to complete construction of Metro Park within the one-year time period. SLF is also in the process of constructing Millenia Park,which is located outside of Improvement Area No. 2, adjacent to Lot 19. The Park Agreement does not identify any thresholds for the design, construction or completion of Millenia Park which affect any of the projects in Improvement Area No.2. The Park Agreement requires Millenia Park construction to be completed in one year after construction begins and includes a provision that allows the City to continue to allow building pen-nits to be issued in Millenia should sufficient evidence or bonding be provided to the City demonstrating the park will be completed in a timely manner. As of March I�2021.1 18 building permits with respect to the active residential developments in Improvement Area No. 2 remain to be issued. SLF estimates that the remaining cost to complete Millenia and Metro Parks is approximately $5 million. SLF has posted improvement bonds for both Millenia and Metro Parks. The Park Agreement gives the City the right to withhold building permits for units or properties within Millenia should master plan approval,commencement of construction or park completion not occur as provided for in the Park Agreement. To date there have been no violations of any of the park thresholds identified in the Park Agreement. As described above, SLF has satisfied the requirements in the Park Agreement such that building pennits are not expected to be withheld for the active residential projects within.Improvement Area No. 2. Sidewalks,, landscape and irrigation improvements (the "Pedestrian Corridor Improvements"') which front the Pinnacle Home and Lennar Home projects remain to be completed. The builders are responsible for completing the Pedestrian Corridor Improvements. The Pedestrian Corridor Improvements fronting Lot 19, which is owned by SLF, are completed. Within the overall Millenia project, as of the Date of Value, mass grading had been completed and approximately 75% of the project infrastructure had been. installed. As of the March 1, 2021, SLF expects to spend approximately $15,000,000 in additional site development costs on improvements within the overall Millenia project, including the third and final phase of street and infrastructure development, construction of three parks (including Metro and Millenia Parks), and an off-site sewer improvement in the Salt Creek sewer basin. Completion of such improvements is not a prerequisite to the issuance of building permits or certificates of occupancy in Improvement Area No. 2. 45 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 531 of 724, Through March 1, 20�21, for the Millenia project, SLF has financed its land acquisition costs, various site development and costs related to home construction participation interests with respect to certain property in Millenia(including the Pinnacle at Millenia project in Improvement Area No.2)through internally generated funds,third-party lo�ans, related party loans and proceeds of bonds issued by the District for Improvement Area No. 1. SLF expects to use land sales revenue, home sales revenue from SLF's homebuilding participation in projects in Millenia (including the Pinnacle at Millema project in Improvement Area No. 2)�, internal funding, revenue from the sale of City development impact fee credits, the Bonds, and various loans to complete its development activities in Millenia. However,land sale revenue from SLF's property in Improvement Area No. 2 and proceeds of the Bonds paid to acquire public facilities from SLF will not be segregated and set aside for the payment of costs required to complete its activities in Improvement Area No. 2. Such funds along with land sales revenue,home sales revenue and fee credit sales revenues,from all projects is accumulated and used to pay costs of operations for SLF and its subsidiaries, to pay debt service on outstanding debt and for other project purposes, and may be diverted to pay costs other than the costs of completing SLF's activities in Improvement Area No.2 at the discretion of SLF's management.Notwithstanding the foregoing,SLF believes that it will have sufficient funds available to complete its development activities within the Millenia project, including the infrastructure for which it is responsible in order to allow for buildout of the property within Improvement Area No. 2,commensurate with the development timing described in this Official Statement. Although SLF expects to have sufficient funds available to complete its development activities in Improvement Area No. 2 in accordance with the development timing described in this Official Statement,there can be no assurance that amounts necessary to finance the remaining development costs will be available from SLF or any other source when needed. SLF has no legal obligation to the Bondowners to expend funds for the development of the property within Improvement Area No.2 or the payment of ad valorem property taxes or the Special Taxes. SLF has posted improvement bonds for the costs of the backbone infrastructure required for Improvement Area No. 2 and for Millenia and Metro Parks. Entitlements for the Overall Millenia Planned Community. The Millenia project is located within the Otay Ranch General Development Plan(the"Otay Ranch GDP")approved by the City Council. The Otay Ranch GDP groups the land within Otay Ranch into villages and established community-wide land use policies which governs the developments within Otay Ranch. The Otay Ranch GDP is implemented through the subdivision of land into"Sectional Planning Areas." Each Sectional Planning Area that is approved by the City implements the policies and objectives of the Otay Ranch GDP by defining land uses,development standards,design criteria and the type and amount of development permitted. The Millenia project comprises the Otay Ranch Eastern Urban Center Sectional Planning Area (the "EUC Sectional Planning Area"),. On,October 6,2009,the City Council.adopted an ordinance which found that the EUC Sectional Planning Area plans were consistent with the City's general plan and the Otay Ranch GDP. Pursuant to the EUC Sectional Planning Area, the Millenia project is entitled for up to 2,983 multi-family residential units',up to 3.3 million square feet of commercial uses, and a civic core with public facilities such as a library, museum and multipurpose venues. In 2009, the City approved and entered into a development agreement with McMillin Otay Ranch LLC(the"Development Agreement"),which provided for the vesting of rights to develop the Millenia Project consistent with the terms of the Development Agreement, the EUC Sectional Planning Area plan, the Park Agreement and the Final EIR (as defined below). Other than the construction completion of Metro Park, SLF has fulfilled the requirements necessary to achieve buildo�ut within Improvement Area No�. 2 consistent with the EUC Sectional. Planning Area plan. See "The Development lnf�astructure Requirements and SLF Financing Plan"above. Environmental Impact Report. In 1993, the City Council and the County Board of Supervisors approved the final environmental impact report for the Otay Ranch development. in. 2009�, a Second-Tier environmental impact report was prepared for the proposed Millenia project within.the EUC Sectional Planning Area(the"Final EIR"). The possible use of pesticides in connection with the prior agricultural use of portions of the land within Improvement Area No. 2 was noted in the original environmental report for the Otay Ranch. development and the Final EIR. Such issues were addressed during the grading of the land and included special 46 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 532 of 724, handling and reuse of soil on-site pursuant to a soil reuse plan. In 2009, the City Council adopted a resolution approving a statement of overriding considerations, adopting a mitigation, monitoring and reporting program and ratifying the Final EIR. SLF-Owned Property in Improvement Area No., 2. SLF owns one project area of approximately eight acres within Improvement Area No. 2 which is designated as Lot 19 of Tract 160 8 1. Lot 19 and an adjacent I I- acre lot ("Lot I") together comprise the "business district" within Millenia. Lot I is not located within Improvement Area No.2. The business district is entitled for commercial development with a minimum building square footage of 80�O�,000 and a maximum of 1,900,000. The business district is also entitled for up to 225 residential units,, which may be for-rent or for-sale products. If a residential project is included in the business district, it may be located within either Lot 19 or Lot 1. The types of developments within the business district allowed, by the EUC Sectional Planning Area plan are varied. Permitted commercial uses include offices, civic uses, private schools,, hospitals or medical offices,retail,research and development facilities,hybrid space(mix of office space,research and development or assembly uses),hotels,assisted or congregate care living facilities or other similar uses. Permitted residential uses include apartments, for sale multi-family units and affordable housing. SLF has not yet developed plans for the ultimate use of the business district, including Lot 19 in Improvement Area No. 2. SLF has and expects to continue to have discussions with potential developers and analyze proposed development plans by such developers for the business district. SLF expects to make a decision as to the ultimate use based on factors including,but not limited to,market demand for the type of development or facilities proposed and the manner in which such use is complimentary to the overall Millenia development. Once a development plan is in place,SLF may sell the property within the business district,including Lot 19,to another developer or undertake development thereof on its own or through joint ventures. Lot 19 has been mass graded and is fully served with utilities(storm drain,potable and reclaimed water, sewer., fire service and dry utilities)which have been stubbed to the property line. Lot 19 has direct, signalized access onto Millenia Avenue,which is a fully improved four-lane public street. Lot 19 may also be accessed via an existing improved private driveway providing a secondary access to Millenia Park and the Rivue apartment community. The EUC Sectional Planning Area plans require the construction of a 0.25 acre public plaza as part of the future development of the business district lots. The Park Agreement requires the plaza designs to be submitted along with the design review permit application for the overall lot development plan and for a bond to be placed and public access easement granted prior to building permit issuance for Lot 19. See "IMPROVEMENT AREA NO. 2 —Market Absorption Study" and "—Appraisal Report" for a discussion of the appraisal methodology with respect to Lot 19. The Special Tax rate within Lot 19 is the same for Residential Property and Non-Residential Property. Based on development status as of March 1,2021,the estimated Fiscal Year 2021-22 Special Tax levy on Lot 19 is$20,726,which is approximately 3.54%of the total Fiscal Year 20�21-22 Special Tax levy. See"SOURCES OF PAYMENT FOR THE BONDS—Special Taxes." [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 47 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 533 of 724, Builders 'in Improvement Area No. 2 The property in Improvement Area No. 2 is planned for three for-sale residential developments which are under construction and one project area for which development plans are still being developed. The following table summarizes the planned developments and the status of the active developments within Improvement Area No. 2,which does not include Lot 19. TABLE 9 COMMUNITY FACILITIES DISTRICT NO�. 16-1(MILLENIA) (IMPROVEMENT AREA NO. 2) SUMMARY OF ACTIVE DEVELOPMENTS Number of Number Building Of* Permits Builder Project Name Product Type() UnitS(2) Issued() Lennar Homes Vibe Residential-Attached 92 92 Lennar Homes Cleo Residential-Attached 117 117 Pinnacle HomeS(4) Pinnacle at Millenia Residential-Attached 126 108 TOTAL 335 317 All active residential developments are planned for attached condominiums. (2) Reflects number of units projected at buildout. (3,) As of March 1.202 1. (4) Pinnacle Homes is a joint venture formed by SLF and Meridian. See"—Pinnacle Homes Development and Financing Plan"' below. Source: LennarHomes and Pinnacle Homes. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 48 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 534 of 724, [INSERT SITE MAP] 49 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 535 of 724, Lennar Homes Development and Fmancing Plan General. Lennar Homes is based in Irvine., California, and has been in the business of developing residential real estate communities in California since 1995. Lennar Homes is wholly-owned by U.S. Home Corporation, a Delaware corporation ("U.S. Home"). U.S. Home is who�lly-owned by Lennar Corporation, a Delaware corporation("Lennar Corporation"). Lennar Corporation, founded in 19�54 and publicly traded under the symbol "LEN" since 1971, is one of the nation's largest home builders, operating under a number of brand names,including Lennar and U.S. Home. The company primarily develops residential communities both within the Lennar Corporation family of builders and through consolidated and,unconsolidated partnerships in which the company maintains an interest. Lennar Corporation is subject to the informational requirements of the Exchange Act and in accordance therewith files reports, proxy statements and other information with the SEC. Such filings, particularly the Annual Report on Form I O-K and its most recent Quarterly Report on Form I O�-Q,,may be inspected and copied at the public reference facilities maintained by the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates. Such files can also be accessed over the internet at the SEC's website at www.sec.gov. This internet address is includedfor rqprence onl andthein rmation on the internet site is not apart(?fthis Official Y 0) Statement and is not incorporated by rtfi�rence into this Qf ficial Statement. No representation is made in this Qf ficial Statement as to the accuracy or adequacy qf the information contained on the internet site. Copies of Lennar Corporation's Annual Report on Form 10-K and related financial statements are available from Lennar Corporation's website at www.lennar.com. This internet address is included.for rqference only and the information on the internet site is not a part qf this Qf ficial Statement and is not incorporated by reference into thi Qf s ficial Statement. No representation is made in this Qf ,ficial Statement as to the accuracy or adequacy qf the information contained on the internet site. Development Plan. As further described below, Lennar Homes is developing two projects being marketed as "Vibe" and "Cleo" within Improvement Area No. 2. In the aggregate, Lennar Homes' Vibe and Cleo projects within Millenia are planned for 209 attached condominiums. As of March 1,202 1,Lennar Homes had completed and conveyed 35 homes to individual homeowners. As of such date, Lennar Homes owned a five-unit building containing three model homes available for touring and a six-unit building containing six models homes available for touring, 119 homes under construction (66 of which were in escrow) and finished lots planned for 44 homes. All approvals and permits required for development of property within Lennar Homes' projects within Improvement Area No.2 have been secured except for approvals required in the normal course of development. Vibe. In 2019, Lennar Homes purchased approximately 4.5 acres within Improvement Area No. 2 from SLF for a purchase price of$4,000,000. Lennar Homes plans to develop this property to include 92 condominiums in a neighborhood being marketed as"Vibe." Lennar Homes' Vibe project consists of attached three and four-story condominiums with individual access to each unit and attached garages. As of March 1, 2021, all wet and dry utilities have been installed and certain interior streets have been. completed. Lennar Homes expects to complete the remaining interior streets and associated landscaping as home construction within the Vibe project progresses. At buildout,amenities within the Vibe project are expected to include a swimming pool and associated facilities and a barbeque area. Lennar Homes' Vibe project opened for sale in July 2020. As of March 1, 2,021, Lennar Homes had completed and conveyed 24 homes within the Vibe project to individual homeowners. As of such date,Lennar Homes owned a five-unit building containing three model homes available for touring, 46 homes under construction(29 of which were in escrow)and finished lots for the remaining 17 condominiums(none of which were in escrow)�. Lennar Homes, currently expects that construction of the final phase of the Vibe project will commence in April 2021 and that all homes will be sold to individual homeowners by the end of 2021. 50 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 536 of 724, The table below summarizes, as of March 1., 2021., the product mix and development status of Lennar Homes' Vibe project within Improvement Area No. 2. TABLE 10 COMMUNITY FACILITIES DISTRICT NO. 16-1(MILLENIA) (IMPROVEMENT AREA NO. 2) LENNAR HOMES VIBE Estimated Additional Total Home Closings as Completed Finished Homes in Base Home Plan Units Square OfMarch 1, Homes/Homes Lots Escrow Prices(3) Planned Footage 2021 Under Construction(2) 1 24 L681 8 13 3 9 $483N0 ix 2 2.X3 0 1 1 0 51700 2 26 L819 6 17 3 10 508N0 2X 4 2.�245 0 2 2 0 53000 3 28 2M37 10 16, 6, 10 539N0 3X -8 21552 -0 2 2 0 54700 Total 92 24 51 17 29 Floor plans designated with.an"X"are the four-story units. All other units are three-stories. (2) Includes a completed five-unit building with.three model homes available for touring. Excludes homes which have closed to individual homeowners. (3,) Base home prices shown exclude lot premiums,options and extras and any incentives or price reductions. Base sales prices, are sub�ject to change. Source: Lennar Homes. Cleo. In 2019, Lennar Homes purchased approximately 4.4 acres within Improvement Area No.2 from SLF for a purchase price of$4,815,000. Lennar Homes plans to develop this property to include 117 condominiums in a neighborhood being marketed as"Cleo." Lenn.ar Homes' Cleo project consists of attached three and four-story condominiums with individual access to each unit and attached garages. As of March 1, 2021, all wet and dry utilities have been installed and certain interior streets have been completed. Lennar Homes expects to complete the remaining interior streets and associated landscaping as home construction within the Cleo project progresses. At buildout, amenities within the Cleo project are expected to include a tot lot and access to the amenities located within the Vibe project. Lennar Homes' Cleo project opened for sale in October 2020. As of March 1,202 1,Lennar Homes had completed and conveyed I I homes within the Cleo project to individual homeowners. As of such date,Lennar Homes owned a six-,unit building containing 6 model homes available for touring,73 homes under construction (37 of which were in escrow) and finished lots planned for 27 homes. Lennar Homes currently expects that construction of the final phase of the Cleo project will,commence in May 2021 and that all homes will be sold to individual homeowners by the end of 202 1. The table below summarizes, as of March 1, 2021, the product mix and development status of Lennar Homes' Cleo project within Improvement Area No. 2. 51 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 537 of 724, TABLE 11 COMMUNITY FACILITIES DISTRICT NO. 16-1(MILLENIA) (IMPROVEMENT AREA NO. 2) LENNAR HOMES CLEO Estimated Additional Total Closings as Completed Home,,-v Home Finished 0 Base Home Plan") Units Square of March 1, HomeslHomes Lots in Prices(3) Planned Footage 2021 Under Escrow Construction(2) 1 8, 11175 1 6 1 3 $3841900 ix 3 21132 0 2 0 0 3801900 2 7 11203 1 6 1 3 3641900 2X 4 21320 0 4 0 0 414i9oo 3 7 L274 1 6, 0 3 445.No 3X 4 2.�507 0 4 0 0 467.No 4 7 L506 1 6, 0 3 51200 5 34 L567 3 21 12 12 53200 6 43 L639 4 24 13 13 55800 Total 117 11 79 27 37 Floor plans designated with.an"X"are the four-story units. All other units are three-stories. (2) Includes six model homes under construction. (3,) Base home prices shown exclude lot premiums,options and extras and any incentives or price reductions. Base sales prices, are sul�ject to change. Source:Lennar Homes. Financing Plan. As of March 11 2021, Lennar Homes has spent approximately $46,081,813 on land acquisition,various site development,direct and indirect home construction,builder fees,marketing,sales costs, design costs related to its property in Improvement Area No. 2. To date, Lennar Homes has financed such through internally generated funds. Lennar Homes estimates that as of March 1, 2021 it remains to incur approximately$3,5,057,755 in site development,direct and indirect home construction,builder fees,marketing, sales costs,design costs to complete its development in Improvement Area No.2. Lennar Homes expects to use home sales revenues and internal funding to complete its development in Improvement Area No. 2. Lennar Homes believes that it will have sufficient funds available to complete its planned development in Improvement Area No. 2 in accordance with the development schedule described in this Official Statement. Although Lennar Homes expects to have sufficient funds available to complete its development in, Improvement Area No. 2 in accordance with the development schedule described in this Official Statement, there can be no assurance that amounts necessary to finance the remaining development costs will be available from Lennar Homes or any other source when needed. Neither Lennar Homes,nor any of its related entities are under any legal obligation of any kind to expend funds for the development of and construction of homes on its property in Improvement Area No.2. Any contributions by Lennar Homes to fund the costs of such development are entirely voluntary. If and to the extent that internal funding,including but not limited to home sales revenues,are inadequate to pay the costs to complete the planned development by Lennar Homes within Improvement Area No�. 2 and other financing by Lennar Homes is not put into place,there could be a shortfall in the funds required to complete the planned development by Lennar Homes in Improvement Area No. 2. COVID-19(Coronavi*rus)Pandemi*c.The development of Lennar Homes'planned development within Improvement Area No. 2 is, subject to disruption due to the COVID-1,9 pandemic, and related public health and governmental authorities' orders and actions. With housing construction considered an essential function, 52 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 538 of 724, Lennar Homes has largely continued, with certain modifications, its home construction and, sales activities in Improvement Area No. 2 to date. That is,Lennar Homes has been able to sell, complete,obtain inspections for and close homes during such period, and intends to continue its operations to the extent permitted. See "'SPECIAL RISK F'ACTORS—COVID-19 (Coronavirus)Pandemic"herein. During the early days of the CO,VID-19 pandemic, Lennar Homes closed its on-site sales office and established a virtual appointment only program for homebuyers. However,Lennar Homes' on-site sales office for its development within Improvement Area No. 2 was reopened and now customers have the option of an in- person tour or a virtual tour. While Lennar Homes is no longer appointment-only in many of its new home galleries, in the event that Lennar Homes believes it is advisable to re-implement such measures in all or some of its markets (including within Improvement Area No. 2) in response to a resurgence of COVID-19 or orders by applicable governmental authorities, Lennar Homes may experience negative impacts on its business and operations. As of the date of this Official Statement,Lennar Homes has not experienced any material increases in costs, delays in home construction resulting from decisions to reduce financing for the project, work stoppages,reduced attendance of workers, lack of or delays in the delivery of building materials or the ability to obtain necessary inspections and approvals attributable to the COVID-19 pandemic. Lennar Homes cannot predict the ultimate effects of the COVID-19 outbreak and related public health and governmental authorities' orders and actions (including, without limitation, the scope of restrictions under the current or any amended shelter in place orders), on their ability to continue to sell and close units within Improvement Area No. 2. Such effects, if and as they arise, could have a material adverse effect on the ability to develop Improvement Area No. 2 as planned, and no assurance can be provided that Lennar Homes will be able to (a) complete in whole or in any part, or within any particular time, their planned development within Improvement Area No. 2; (b) avoid material increases in development costs or delays resulting from work stoppages,reduced attendance of workers,shortages or delays in the delivery of building materials,and/or delays in obtaining necessary inspections and approvals; or(c)close any additional homes or not experience additional purchase contract cancellations,due to in each case public health or governmental restrictions,further spread of COVID-19, an economic downturn driven by the pandemic,or otherwise. Recent Litigation Against Lennar Corporation. A lawsuit was filed in the state court of California against Lennar Corporation relating to Lennar Corporation and LandSource Communities Development, LLC, a Delaware limited liability company ("LandSource"), in which the California Public Employees' Retirement System ("CalPers") invested in 2007 ("Complaint"). LandSource filed for bankruptcy on June 8, 2008 ("LandSource Bankruptcy Matter"), and a plan for reorganization was approved by the bankruptcy court on July 20, 2009. (In re: LandSource Communities Development LLC, et a], Case No. 08-11111, United States Bankruptcy Court,District of Delaware.), The Complaint,which was filed as a qui tam action by a newly created limited liability company, makes a number of claims related to Lennar Corporation's actions regarding LandSource and the related bankruptcy and seeks injunctive relief and damages(including statutory and treble) relating to CalPers' alleged$970 million loss. Lennar Corporation filed a petition to remove the Complaint to federal court (Citizens Against Corporate Crime ("CACC") v. Lennar Corporation (9th Circuit, California Eastern District Court,Case No. 2:2018cvO 1269). Lennar Corporation also filed a Motion to Reopen the Chapter I I Bankruptcy Cases for the Limited Purpose of Enforcing the Injunction and Release in the Debtors' Joint Chapter I I Plan and Confirmation Order. Lennar Corporation contended that in addition to the Complaint being barred by the release and injunction in the LandSource Bankruptcy Matter, the Complaint was meritless and barred by applicable statutes of limitation and other defenses. On July 17, 2018, the Bankruptcy Court granted that motion, allowing Lennar Corporation to proceed with filing its proposed enforcement motion. After a hearing on October 2 5, 20 18,the Bankruptcy Court granted the enforcement motion and found that CACC and its member Nicolas Marsch, III ("Marsch."') filed the Complaint in violation of the injunction and release in the Chapter I I Plan and Confirmation Order and barred CACC, Marsch and their agents from prosecuting the Complaint. Further,the Bankruptcy Court enjoined CACC, Marsch and their agents from continuing to pursue released and enjoined claims and causes of action against Lennar Corporation in further violation of the Chapter I I Plan and Confirmation Order. The California federal,district court dismissed the Complaint by minute order issued November 16, 2018. CACC also filed a Notice of Appeal and Statement of Election with the Delaware 53 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 539 of 724, District Court ("District Court") to appeal the Bankruptcy Court's November 1, 2018 order granting the enforcement motion. In January 2020, the District Court issued its opinion denying CACC's request for oral argument, and rejecting each of CACC's arguments in the appeal. Later in January 2020, CACC filed a notice of appeal to the Third Circuit Court of Appeals. On December 17, 2020 CACC filed a Petition for Rehearing before the original panel and,en banc with the Court of Appeal. On January 7,2021 the Court of Appeal issued an order denying the Petition for en banc and panel rehearing. Lennar Homes was not a party to the Complaint. Lennar Homes believes that even if, in the unlikely event, the appeal and the underlying claims are successful against Lennar Corporation, Lennar Homes will be able to complete the development and sale of its projects within Improvement Area No�. 2 as described in this Official Statement and pay Special Tax and ad valorem tax obligations on the property that it owns within Improvement Area No. 2 prior to delinquency during Lennar Homes' period of ownership. Pinnacle Homes Development and Financing Plan General. Pinnacle New Homes,LLC(previously defined as"Pinnacle Homes")is ajoint venture entity formed by SLF and Meridian. Meridian is also the contracted project manager for the Millenia project as a whole. See "—SLF and the Contracted Project Manager" above. Pinnacle Homes operates pursuant to an Amended and Restated Limited Liability Company Agreement of Pinnacle Homes by and between SLF and Meridian (the "Operating Agreement"). Pursuant to the Operating Agreement, Millenia Real Estate Group, LLC, a Delaware limited liab�ility company("MREG"),which is an affiliate of Meridian, serves as the manager of Pinnacle Homes. MREG is paid a management fee determined in accordance with the Operating Agreement. Development Plan. In October 2018,SLF transferred approximately six acres to Pinnacle Communities pursuant to the Operating Agreement. Pinnacle Homes plans to develop this property to include 126 attached condominiums (with six units per building) in a neighborhood being marketed as "Pinnacle at Millenia." Pinnacle at Millenia includes two product types with three floor plans in each–"City Townhomes"and"Elevator Penthouses." The buildings within the Pinnacle at Millenia project are all four stories with direct garage access. The units in the City Townhomes,product are two stories located on the first and second floors of each building. The units in the Elevator Penthouse product are also two stories and are located on the third and fourth floors with personal elevator access. As of March 1,202 1,all wet and dry utilities have been installed and the interior streets have been completed. At buildout, amenities within the Pinnacle at Millenia project are expected to include a swimming pool and associated facilities,a barbeque area,a dog park and a tot lot. Pinnacle Homes' project opened for sale in February 2020. As of March 1,202 1,Pinnacle Homes had completed and conveyed 36 homes to individual. homeowners. As of such date, Pinnacle Homes owned six completed model homes, 66 homes under construction (all of which were in escrow) and finished lots planned for 18 condominium units. All approvals and permits required for development of property within Pinnacle Homes'project within Improvement Area No. 2 have been secured except for the issuance of building permits for residential construction and other approvals required in the normal course of development. Pinnacle Homes currently expects that construction of the final phase of the Pinnacle at Millenia project will commence in April 2021 and that all homes will be sold to individual homeowners by the end of 2021. The Pinnacle at Millenia project is planned to consist of 126 attached condominiums. The table below summarizes, as of March 1, 20�21, the product mix and development status of the Pinnacle at Millenia project within Improvement Area No. 2. 54 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 540 of 724, TABLE 12 COMMUNITY FACILITIES DISTRICT NO. 16-1(MILLENIA) (IMPROVEMENT AREA NO. 2) PINNACLE HOMES PINNACLE AT MILLENIA Estimated Completed Total Home Closings as Homes/Homes units Square ofMarch 1, Under Finished Homes in Base Home Plan Planned Footage 2021 Construction(]) Lots Escrow Prices(2) 1 21 15362 6 12 3 11 $4671900 2 21 15433 6 12 3 11 4911900 3 21 1�989 6 12 3 11 557.1900 4 21 205 6 12 3 11 568.1900 5 21 2�380 6 12 3 11 604.No 6 21 2�522 6 12 -3 11 626.No Total 126 36 72 18 66 Includes six completed model homes. (2) Base home prices shown exclude lot premiums,options and extras and any incentives or price reductions. Base sales prices are sul�ject to change. Source: Pinnacle Homes. Financing Plan. Through March 1, 2021, Pinnacle Homes had spent approximately $32,938,000 in site development,direct and indirect home construction,builder fees,marketing, sales costs,design costs on its development within Improvement Area No. 2. As of such date, Pinnacle Homes expected that it would spend approximately$28,134,000 in site development,direct and indirect home construction,builder fees,marketing, sales costs, design costs until full build-out of the project proposed to be constructed on its property within Improvement Area No. 2,which is expected to occur by the end of 202 1. Pursuant to the Operating Agreement, SLF and Meridian made initial capital contributions to Pinnacle Homes and SLF transferred the property within the Pinnacle at Millenia project to Pinnacle Homes for an agreed upon value credited to SLF. To date,Pinnacle Homes has financed its site development and home construction. costs related to its property within Improvement Area No. 2 through capital contributions, proceeds of the Construction Loan (defined below) and home sales revenues. Pinnacle Homes expects to use proceeds of the Construction Loan and home sales revenues to complete its development activities within Improvement Area No. 2. Pinnacle Homes does not expect to require any additional. capital contributions by SLF or Meridian in order to complete its development within Improvement Area No. 2. Pinnacle Homes has obtained a construction loan from Torrey Pines Bank (the "Construction.Loan"). The Construction Loan is a revolving loan with the maximum amount of$11,200,000,based on a maximum of 36 units under construction at a given time. The Construction Loan currently matures on October 1, 2021, unless extended. As of March 1, 2021, the Construction Loan was outstanding in the principal amount of$4.2 million. SLF and Meridian have provided repayment guarantees with respect to the Construction Loan. The Construction Loan is not secured by the property that Pinnacle Homes owns within Improvement Area No. 2. Pinnacle Homes repays portions of the Construction Loan in connection with home closings. Pinnacle Homes currently anticipates additional draws on the Construction Loan, however, such draws are expected to be significantly less than the currently authorized maximum amount thereunder. Although Pinnacle Homes expects to have sufficient,f�nds available to complete its development activities in Improvement Area No. 2 in accordance with the, development timing described in this Official Statement, there can be no assurance that amounts necessary tofinance the remaining development and home construction costs will be availableftom Pinnacle Homes or any other source when needed. Pinnacle Homes, its lenders, or any of their related entities are not under any legal obligation oJ'any kind to expendfundsfor the 55 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 541 of 724, development of and construction of homes on Pinnacle Homes'property in Improvement Area No. 2. Any contributions by Pinnacle Homes tofund the costs of'such development and home construction are entirely voluntary. COVID-19 (Coronavt*rus) Pandemic. The development of Pinnacle Homes' planned development within Improvement Area No.2 is subject to disruption due to the CO�VID-19 pandemic and related public health and governmental authorities' orders and actions. With housing construction considered an essential function, Pinnacle Homes has largely continued, with certain modifications, its home construction and sales activities in Improvement Area No. 2 to date. That is, Pinnacle Homes has been able to sell, complete, obtain inspections for and close homes during such period, and intends to continue its operations to the extent permitted. See "'SPECIAL RISK FACTORS—COVID-19 (Coronavirus)Pandemic"herein. Pinnacle Homes' on-site sales office and model homes for its development within Improvement Area No. 2 is open by appointment-only to single groups only. As of the date of this, Official Statement, Pinnacle Homes has not experienced any material increases in costs,delays in home construction resulting from decisions to reduce financing for the project, work stoppages, reduced attendance of workers, lack of or delays in the delivery of building materials or the ability to obtain necessary inspections and approvals attributable to the COVID-19 pandemic. Pinnacle Homes cannot predict the ultimate effects of the COVID-19 outbreak and related public health and governmental authorities' orders and actions (including,without limitation, the scope of restrictions under the current or any amended shelter in place orders), on their ability to continue to sell and close units within Improvement Area No. 2. Such effects, if and as they arise, could have a material adverse effect on the ability to develop Improvement Area No. 2 as planned,and no assurance can be provided that Pinnacle Homes will be able to (a) complete in whole or in any part, or within any particular time, their planned development within Improvement Area No. 2; (b) avoid material increases in development costs or delays resulting from work stoppages,reduced attendance of workers,shortages or delays in the delivery of building materials,and/or delays in obtaining necessary inspections and approvals; or(c)close any additional homes or not experience additional purchase contract cancellations,due to in each case public health or governmental.restrictions,further spread of COVID19, an economic downturn driven by the pandemic,or otherwise. SPECIAL RISK FACTORS The purchase of the Bonds involves significant risks that are not appropriate investments for certain investors. The following is a discussion of certain risk factors which should be considered, in addition to other matters set forth herein, in evaluating the investment quality of the Bonds. The Bonds have not been rated by a rating agency. This discussion,does not purport to be comprehensive or definitive and does not purport to be a complete statement of all factors which may be considered as risks in evaluating the credit quality of the Bonds. The occurrence of one or more of the events discussed herein could adversely affect the ability or willingness of property owners in Improvement Area No�. 2 to pay their Special Taxes when due. Such failures to pay Special Taxes could result in the inability of the District to make full and punctual payments of debt service on the Bonds. In addition,the occurrence of one or more of the events discussed herein could adversely affect the value of the property in Improvement Area No�. 2. See"—Property Values"and"—Limited Secondary Market." RI*sks of Real Estate Secured Investments Generally The Bond owners will be subject to the risks generally incident to an investment secured by real estate, including,without limitation,(i)adverse changes in local market conditions,such as changes in.the market value of real property in the vicinity of Improvement Area No�. 2,the supply of or demand for competitive properties in such area, and the market value of residential property or buildings and/or sites in the event of sale or foreclosure; (i.i.)changes in real. estate tax rates and other operating expenses, governmental rules (including, without limitation, zoning laws and laws, relating to endangered species and hazardous materials) and fiscal 56 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 542 of 724, policies;and(iii)natural disasters(including,without limitation,earthquakes,fires and flood,$),which may result in uninsured losses. No assurance can be given that SLF,the builders or any future homeowners within Improvement Area No. 2 will pay Special Taxes in the future or that they will be able to pay such Special Taxes on a timely basis. See"—Bankruptcy and Foreclosure"below,for a discussion of certain limitations on the City"s ability to pursue judicial proceedings with respect to delinquent parcels. Concentration of Ownership Based on the ownership status of the property within Improvement Area No. 2 and the number of building permits issued as of March 1, 2021, assuming no additional conveyance of property by SLF or any transfer of property by Lennar Homes or Pinnacle Homes to individual homeowners within Improvement Area No.2,approximately 3.54%of the Special Taxes estimated to be levied in Fiscal Year 2021-22 would be payable by SLF, approximately 52.43% would be payable by Lennar Homes., and approximately 22.97% would be payable by Pinnacle Homes. See Table 8 above. Failure of SLF,any of the builders, or any of their successors, to pay the annual Special Taxes when due could result in a draw on the Reserve Fund, and ultimately a default in payments of the principal of, and interest on,the Bonds,when due. No assurance can be given that SLF,the builders or any of their successors, will complete the remaining intended construction and development in Improvement Area No. 2 or to pay their Special Taxes when due. See"—Failure to Develop Properties." Undeveloped Property is defined in the Rate and Method as property not classified as Developed Property or Provisional Property. In the event that SLF, entities affiliated with SLF, or any of the builders fail to complete the remaining intended construction and development in Improvement Area No. 2, Special Taxes will continue to be levied on Undeveloped Property and the risk of concentration of ownership would continue. SLF currently does not have an estimated timeframe as to when the development plan for Lot 19 will be finalized. As a result SLF may continue to be a taxpayer within Improvement Area No. 2 for an extended period. No assurance can be given that SLF,the builders,or any successors,will pay Special Taxes in the future or that they will be able to pay such Special Taxes on a timely basis. See"—Bankruptcy and Foreclosure"for a discussion of certain limitations on the District's ability to pursue judicial proceedings with respect to delinquent parcels. Limited Obligations The Bonds and interest thereon are not payable from the general funds of the City. Except with respect to the Special Taxes, neither the faith and credit nor the taxing power of the District or the City is pledged for the payment of the Bonds or the interest thereon.,and,except as provided in the Indenture,no owner of the Bonds may compel the exercise of any taxing power by the District or the City or force the forfeiture of any City or District property. The principal of, premium, if any, and interest on the Bonds are not a debt of the City or a legal or equitable pledge, charge, hen or encumbrance upon any of the City's or the District's property or upon. any of the City's or the District's income,receipts or revenues,except the Net Taxes and other amounts pledged under the Indenture. Insufficiency of Special Taxes Under the Rate and Method, the annual amount of Special Tax to be levied on each taxable parcel in Improvement Area No. 2 will generally be based on the land use class to which a parcel of Developed Property is assigned. See APPENDIX A,—"RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX7 and "SOURCES OF PAYMENT FOR THE BONDS — Special Taxes —Rate and Method qf Apportionment of' Special Tax." In order to pay debt service on the Bonds, it is necessary that the Special Taxes be paid in. a timely manner. The District will establish and fund upon the issuance of the Bonds a Reserve Fund in an amount equal to the Reserve Requirement to pay debt service on the Bonds to the extent other funds are not available. See 57 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 543 of 724, "'SOURCES OF PAYMENT FOR THE BONDS —Reserve Fund." The District will covenant to maintain in the Reserve Fund an amount equal to the Reserve Requirement subject,however,to the limitation that the District may not levy the Special Tax in Improvement Area No. 2 in any fiscal year at a rate in excess of the maximum amounts permitted under the Rate and Method. As a result, if a significant number of delinquencies occurs,the District may be unable to replenish the Reserve Fund to the Reserve Requirement due to the limitations,on the maximum Special Tax. If such defaults were to continue in successive years,the Reserve Fund could be depleted and a default on the Bonds could occur. The District will covenant in the Indenture thatl under certain conditions., it will institute foreclosure proceedings to sell any property with delinquent Special Taxes in order to obtain funds to pay debt service on the Bonds. If foreclosure proceedings were ever instituted,any mortgage or deed of trust holder could,but would not be required to, advance the amount of the delinquent Special Tax to protect its security interest. See "'SOURCES OF PAYMENT FOR THE BONDS — Special Taxes — Proceeds of Foreclosure Sales" for provisions which apply in the event of such foreclosure and which the District is required to follow in the event of delinquencies in the payment of the Special Tax. In the event that sales or foreclosures of property are necessary, there could be a delay in payments to owners of the Bonds (if the Reserve Fund has been depleted) pending such sales or the prosecution of such foreclosure proceedings and receipt by the District of the proceeds of sale. The District may adjust the future Special Tax levied on taxable parcels in Improvement Area No. 2, subject to the limitation on the maximum Special Tax,to provide an amount required to pay interest on,principal of,and redemption premiums,if any,on the Bonds', and the amount if any, necessary to replenish the Reserve Fund to an amount equal to the Reserve Requirement and to pay all current expenses;provided,however,that the Act and the Rate and Method provide that under no circumstances will the Special Tax levied in a Fiscal Year against any Assessor's Parcel of Residential Property for which an occupancy permit for private residential use has been issued be increased by more than ten percent(10%)above the amount that would have been levied in that Fiscal Year as a consequence of delinquency or default by the owner of any other Assessor's Parcel within Improvement Area No. 2. There is, however, no assurance that the total amount of the Special Tax that could be levied and collected against taxable parcels in Improvement Area No. 2 will be at all times sufficient to pay the amounts required to be paid by the Indenture, even if the Special Tax is levied at the maximum Special Tax rates. See "—Bankruptcy and Foreclosure"for a discussion of potential delays in foreclosure actions. See "SOURCES OF PAYMENT FOR THE BONDS—Assignment of Assessor Parcel Numbers and Delayed Special Tax Revenues" herein for a description of certain delays in receipt of Special Tax revenues during the development and home sales period within Improvement Area No. 2 and certain impacts thereof on the ability to institute foreclosure proceedings. The Rate and Method governing the levy of the Special Tax provides that no Special.Tax shall be levied on public property, property owner association property, property which is used as places of worship and are exempt from ad valorem property taxes because they are owned by a religious organization, and 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 of tax-exempt status shall reduce the sum of all Taxable Property in Improvement Area No.2 to less than 13.29 Acres for Zone A or 7.51 Acres for Zone B. See Section 5 of APPENDIX A—"RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX." If for any reason property within Improvement Area No. 2 becomes exempt from taxation by reason.of ownership by a no�n-taxable entity such as the federal government or another public agency., subject to the limitations of the maximum authorized rates, the Special Tax will be reallocated to the remaining taxable properties within Improvement Area No. 2. This would result in the owners of such.property paying a greater amount of the Special Tax and could have an.adverse impact upon the ability and willingness of the owners of such property to pay the Special Tax when due. 58 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 544 of 724, The Act provides that, if any property within Improvement Area No. 2 not otherwise exempt from the Special Tax is acquired by a public entity through a negotiated transaction,or by gift or devise,the Special Tax will continue to be levied on and enforceable against the public entity that acquired the property. In addition, the Act provides that,if property subject to the Special Tax is acquired by a public entity through eminent domain proceedings, the obligation to pay the Special Tax with respect to that property is to be treated, as if it were a special assessment and be paid from the eminent domain award. The constitutionality and operation of these provisions of the Act have not been tested in the courts. Due to problems of collecting taxes from public agencies, if a substantial portion of land within Improvement Area No. 2 was to become owned, by public agencies,collection of the Special Tax might become more difficult and could result in collections of the Special Tax which might not be sufficient to pay principal of and interest on the Bonds when due and a default could occur with respect to the payment of such principal and interest. Failure to Develop Properties Development of property within Improvement Area No. 2 may be subject to unexpected delays, disruptions and changes which may affect the willingness and ability of SLF',the builders,or any property owner to pay the Special Taxes when due. Land development is subject to comprehensive federal, State and local regulations. Approval is required from various agencies in connection with the layout and design of developments,the nature and extent of improvements,construction activity,land use,zoning, school and health requirements,as well as numerous other matters. There is always the possibility that such approvals will not be obtained or, if obtained, will not be obtained on a timely basis. Failure to obtain any such agency approval or satisfy such governmental requirements would adversely affect planned land development. Development of land in Improvement Area No. 2 is also subject to the availability of water. Finally, development of land is subject to economic considerations. The major infrastructure(sewer,,,water,storm drains,utilities,and arterial roads)to be installed to serve the property within Improvement Area No. 2 is substantially complete, with only minor street improvements remaining. The remaining in-tract improvements are expected to be constructed by Lennar Homes and Pinnacle Homes as development within their respective projects is completed. Lot 19 is currently in a finished lot status. The property owned by Lennar Homes and Pinnacle Homes range from finished lots to completed homes. SLF currently does not have an estimated timeframe as to when the development plan for Lot 19 will be finalized. No assurance can be given that the remaining proposed development will be partially or fully completed; and for purposes of evaluating the investment quality of the Bonds, prospective purchasers should consider the possibility that such parcels will remain unimproved. Undeveloped or partially developed land is inherently less valuable than developed land and provides less security to the Bondowners, should it be necessary for the District to foreclose on the property due to the nonpayment of Special Taxes. The failure to complete development of the required infrastructure for development in Improvement Area No.2 as planned,or substantial delays in the completion of the development or the required infrastructure for the development due to litigation or other causes may reduce the value of the property within Improvement Area No. 2 and increase the length of time during which Special Taxes will be payable from undeveloped property, and may affect the willingness and ability of the owners of property within Improvement Area No. 2 to pay the Special Taxes when due. There can be no assurance that land development operations within Improvement Area No. 2 will not be adversely affected by future deterioration of the real estate market and economic conditions or future local, State and federal governmental. policies relating to real estate development, an increase in mortgage interest rates, the income tax treatment of real property ownership, or the national economy. A slowdown of the development process and the absorption rate could adversely affect land values and reduce the ability or desire of the property owners to pay the annual Special Taxes. In that event,there could be a default in the payment of principal of,and interest on.)the Bonds when due. 59 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 545 of 724, Bondowners should assume that any event that significantly impacts the ability to develop land in Improvement Area No. 2 would cause the property values within Improvement Area No. 2 to decrease substantially from those estimated by the Appraiser and could affect the willingness and ability of the owners of land within Improvement Area No. 2 to pay the Special Taxes when due. The District currently expects to levy Special Taxes on Undeveloped,Property for Fiscal Year 2021-22 and may levy Special Taxes on Undeveloped Property in future fiscal years until the Special Taxes levied on Developed Property are sufficient to fund the Special Tax Requirement. Undeveloped Property is less valuable per unit of area than Developed Property, especially if there are no plans to develop, such land or if there are severe restrictions on the development of such land. The Undeveloped Property also provides less security to the Bo�ndo�wners should it be necessary for the District to foreclose on Undeveloped Property due to the nonpayment of the Special Taxes. Furthermore, an inability to develop the land within Improvement Area No. 2 as currently proposed will make the Bondowners dependent upon timely payment of the Special Taxes levied on Undeveloped Property. A slowdown or stoppage in the continued development of Improvement Area No.2 could reduce the willingness and ability of SLF, the builders, or any successors, to make Special Tax payments on Undeveloped Property and could greatly reduce the value of such property in the event it has to be foreclosed upon. See'�—Pro-Dertv Values." A .1 Natural Disasters Improvement Area No. 2, like all California communities, may be subject to unpredictable seismic activity, fires, floods, or other natural disasters. No known active or potentially active faults, as defined in the Alquist-Priolo Earthquake Fault Zone Act,cross the property within Improvement Area No.2,and Improvement Area No. 2 is not located in an Alquist-Priolo Earthquake Study Zone. However, Southern California is a seismically active area; and active faults exist within the vicinity of Improvement Area No. 2. Seismic activity represents a potential risk for damage to buildings, roads, and property within Improvement Area No. 2. In addition, land susceptible to seismic activity may be subject to liquefaction during the occurrence of such event. Improvement Area No. 2 is not located in a flood plain area. In recent years, wildfires have caused extensive damage throughout the State, including within the County. Certain of these fires have burned thousands of acres and destroyed hundreds and in some cases thousands of homes. In some instances entire neighborhoods have been destroyed. Several fires which occurred in recent years damaged or destroyed property in areas that were not previously considered to be at risk from such events. Some commentators believe that chmate change will lead to even more frequent and damaging wildfires in the future. The Millenia projectl including the property within Improvement Area No. 2, is not located in an area which the Department of Forestry and Fire Protection of the State of California has designated as a very high fire hazard severity zone. However, vacant areas which are adjacent to the Millenia project with brush that is not controlled could pose a fire risk to the development within the Millenia project. In the event of a severe earthquake, wildfire, flood or other natural disaster, there may be significant damage to both property and infrastructure in Improvement Area No. 2. As a result, a substantial portion of the property owners may be unable or unwilling to pay the Special Taxes when due. In addition,the value of land in Improvement Area No.2 could be diminished in the aftermath of such a natural disaster,reducing the resulting proceeds of foreclosure sales in the event of delinquencies in the payment of the Special Taxes. Endangered/Threatened Species During the 1990�s,there was an increase in activity at the State and federal level related to the possible listing of certain plant and animal. species found in the Southern. California area as endangered or threatened species. In response to this activity, several large landowners began an effort to move away from "species by species" entitlement to multiple species entitlement, in order to minimize the risk of future species listings and maximize the certainty of development. The Final EIR found that mitigation measures would reduce all 60 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 546 of 724, potentially direct and indirect impacts of the Millenia project to plant and,wildlife to less than significant. All open space dedications for the property in Improvement Area No. 2 have been completed. Hazardous Substances The presence of hazardous substances on a parcel may result in a reduction in the value of a parcel. In general,the owners and,operators of a parcel may be required by law to remedy conditions,of the parcel relating to releases or threatened releases of hazardous substances. The Federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, sometimes referred to as "CERCLA" or the "Superfund Act,"is the most well-known and widely applicable of these laws,but California laws with regard to hazardous substances are also stringent and similar. Under many of these laws,the owner or operator is obligated to remedy a hazardous substance condition of property whether or not the owner or operator has anything to do with creating or handling the hazardous substance. The effect,therefore, should,any of the taxed parcels be affected by a hazardous substance, is to reduce the marketability and value of the parcel by the costs of remedying the condition,because the purchaser,upon becoming the owner,will become obligated to remedy the condition just as is the seller. Further, it is possible that liabilities may arise in the future with respect to any of the parcels resulting from the existence, currently, on the parcel of a substance presently classified as hazardous but which has not been released or the release of which is not presently threatened, or may arise in the future resulting from the existencel currently, on the parcel of a substance not presently classified as hazardous but which may in the future be so classified. Further,such liabilities may arise not simply from the existence of a hazardous substance but from the method of handling such substance. All of these possibilities could significantly affect the value of a parcel that is realizable upon a delinquency and the willingness or ability of the owner of any parcel to pay the Special Tax installments. The value of the taxable property within Improvement Area No. 2, as set forth in the various tables in this Official Statement, does not reflect the presence of any hazardous substance or the possible liability of the owner(or operator)for the remedy of a hazardous substance condition of the property. SLF,Lennar Homes and Pinnacle Homes have each represented to the District that it is not aware of the presence of any federally or State classified hazardous substances in violation of any environmental laws located on its respective property within Improvement Area No. 2. The District has not independently verified, but is not aware, that any owner (or operator) of any of the parcels within Improvement Area No. 2 has such a current liability with respect to any such parcel. However, it is possible that such. liabilities do currently exist and that the D�istrict is not aware of them. See "PROPERTY O�"ERSHIP AND THE DEVELOPMENT —The Development—Environmental Impact Report"for a discussion of the use of pesticides in.connection with the prior agricultural,use of portions of the land within Improvement Area No. 2. Such issues were addressed during the grading of the land and included special handling and reuse of soil on-site pursuant to a soil reuse plan. Payment of the Special Tax Iis not a Personal Obligation of the Property Owners An owner of a taxable parcel is not personally obligated to pay the Special Tax. Rather,the Special Tax is an obligation which is secured only by a lien against the taxable parcel. If the value of a taxable parcel is not sufficient,taking into account other liens imposed by public agencies,to secure fully the Special Tax,the District has no recourse against the property owner. Property Values The value of the property within Improvement Area No. 2 is a critical factor in determining the investment quality of the Bonds. if a property owner is delinquent in the payment of Special Taxes,the Dis,trict"s only remedy is to commence foreclosure proceedings against the delinquent parcel in an attempt to obtain funds to pay the Special Taxes. Reductions in property values due to a downturn in the economy,physical events such as earthquakes,fires or floods,stricter land use regulations,delays in development or other events will adversely 61, 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 547 of 724, impact the security underlying the Special Taxes. See "IMPROVEMENT AREA NO. 2—Appraised Value- to-Lien Ratios." The Appraiser has estimated,on the basis of certain definitions,contingencies,assumptions and limiting conditions contained in the Appraisal Report that as of November 15, 2020, the market value of the land and improvements within Improvement Area No. 2 was approximately$58,994,108. The Appraisal Report is based on a number of assumptions and limiting conditions as stated in APPENDIX B — "APPRAISAL REPORT." The Appraisal Report does not reflect any possible negative impact which could occur by reason of future slow or no growth voter initiatives, an economic downturn, any potential limitations on development occurring due to time delays,an inability of any landowner to obtain any needed development approval or permit,the presence of hazardous substances or other adverse soil conditions within Improvement Area No. 2, the listing of endangered species or the determination that habitat for endangered or threatened species exists within Improvement Area No. 2,or other similar situations. Prospective purchasers of the Bonds should not assume that the land and improvements within Improvement Area No. 2 could be sold for the amount stated in the Appraisal Report at a foreclosure sale for delinquent Special Taxes. In arriving at the estimate of market value, the Appraiser assumes that any property will be sold in a competitive market after a reasonable exposure time, and assuming that neither the buyer or seller is under duress, which is not always present in a foreclosure sale. See APPENDIX B—"APPRAISAL REPORT" for a description of other assumptions made by the Appraiser and for the definitions and limiting conditions used by the Appraiser. Any event which causes one of the Appraiser's assumptions to be untrue could result in a reduction of the value of the land within Improvement Area No. 2 from that estimated by the Appraiser. The assessed values set forth in this Official Statement do not represent market values arrived at through an appraisal process and generally reflect only the sales price of a parcel when acquired by its current owner, adjusted annually by an amount determined by the County Assessor,generally not to exceed an increase of more than 2%per fiscal year. No assurance can be given that a parcel could actually be sold for its assessed value. No assurance can be given that any bid will be received for a parcel with delinquent Special Taxes offered for sale at foreclosure or,,if a bid is received',that such bid will be sufficient to pay all delinquent Special Taxes. See APPENDIX E—"SUMMARY OF CERTAIN PROVISIONS OF' THE BOND INDENTURE MISCELLANEOUS CONDITIONS—Covenants."' See"IMPROVEMENT AREA NO. 2—Expected Tax Burden;Potential Special Tax Prepayment"for a description of the requirement for a homebuilder to prepay a portion of the Special Tax,or overlapping special taxes and assessments,at the time a completed home is sold,if,based on the actual,sales price of such home,the annual total effective tax rate on such parcel would exceed 2.00%of the actual sales price. Such prepaid Special. Taxes would be applied to redeem Bonds. See "THE BONDS —Redemption—Extraordinary Redemption ftom Special Tax Prepayments." Parity Taxes and Special Assessments Property within Improvement Area No. 2 is subject to taxes and assessments imposed by other public agencies also having jurisdiction over the land within Improvement Area No.2. See"IMPROVEMENT AREA NO. 2 — Direct and Overlapping indebtedness"' for a description of the public agencies that have issued debt secured by taxes and assessments levied on property within Improvement Area No�.2. The Special Taxes and any penalties thereon will constitute a lien against the lots and parcels of land on which they will be annually imposed until.they are paid. Such lien is on a parity with all special taxes and special assessments levied by other agencies and is co-equal to and independent of the lien for general property taxes regardless of when they are imposed upon the same property. The Special Taxes have priority over all existing and future private liens imposed on the property except, possibly, for liens or security interests held by the 62 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 548 of 724, Federal Deposit Insurance Corporation or other federal agencies. See"—F'D�IC/Federal Government Interest in Properties"and"—Bankruptcy and Foreclosure." Neither the District nor the City has control over the ability of other entities and districts to issue indebtedness secured by special taxes, ad valorem taxes or assessments payable from all or a portion of the property within Improvement Area No.2. In addition,the landowners within Improvement Area No. 2 may, without the consent or knowledge of the District, petition other public agencies to issue public indebtedness secured by special taxes and ad valorem taxes or assessments. Any such special taxes or assessments may have a lien on such property on a parity with the Special Taxes and could reduce the estimated value-to-lien ratios for the property within Improvement Area No. 2 described herein. See "SOURCES OF PAYMENT FOR THE BONDS" and "IMPROVEMENT AREA NO. 2— Direct and Overlapping Indebtedness"and"—Appraised Value to Lien Ratios." Disclosures to Future Purchasers The willingness or ability of an owner of a parcel to pay the Special Tax even if the value is sufficient may be affected by whether or not the owner was given due notice of the Special Tax authorization at the time the owner purchased the parcel,was informed of the amount of the Special Tax on the parcel should the Special Tax be levied at the maximum tax rate and the risk of such a levy and, at the time of such a levy,has the ability to pay it as well as pay other expenses and obligations. The City has caused a notice of the Special Tax to be recorded in the Office of the Recorder for the County against each parcel. While title companies normally refer to such notices in title reports, there can be no guarantee that such reference will be made or, if made, that a prospective purchaser or lender will consider such Special Tax obligation in the purchase of a property within Improvement Area No. 2 or lending of money thereon. The Act requires the subdivider(or its agent or representative) of a subdivision to notify a prospective purchaser or long-term lessor of any lot,parcel,or unit subject to a special tax under the Act of the existence and maximum amount of such special tax using a statutorily prescribed form. California Civil Code Section I I 02.6b requires that in the case of transfers other than those covered by the above requirement, the seller inust at least make a good faith effort to notify the prospective purchaser of the special tax lien in a format prescribed by statute. Failure by an owner of the property to comply with the above requirements,or failure by a purchaser or lessor to consider or understand the nature and existence of the Special Tax, could adversely affect the willingness and ability of the purchaser or lessor to pay the Special Tax when due. Special Tax Delinquencies Under provisions of the Act,the Special Taxes,from which funds necessary for the payment of principal of,and interest on,the Bonds are derived,will be billed to the properties within Improvement Area No. 2 on the regular ad valorem property tax bills sent to owners of such properties by the County Tax Collector. The Act currently provides that such Special Tax installments are due and payable, and bear the same penalties and interest for non-payment, as do ad valorem property tax installments. See APPENDIX E—"SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE MISCELLANEOUS CONDITIONS — Covenants" for a discussion of the provisions which apply, and procedures which the District is obligated to follow under the Indenture, in the event of delinquencies in the payment of Special Taxes. See "— Bankruptcy and Foreclosure" for a discussion of the policy of the Federal Deposit Insurance Corporation regarding the payment of special taxes, and assessment and limitations on the District's ability to foreclosure on the lien of the Special Taxes in certain circumstances. See "SOURCES OF PAYMENT FOR THE BONDS — Delay in Assignment of Assessor Parcel Numbers and Deposit Agreement"above. 63 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 549 of 724, FD,IC/Federal Government Interests 'in Properties General. The ability of the District to foreclose the lien of delinquent unpaid Special Tax installments may be limited with regard to properties in which the Federal Deposit Insurance Corporation(the "FDIC"),the Drug Enforcement Agency,the Internal Revenue Service, or other federal agency has or obtains an interest. The supremacy clause of the United States Constitution reads as follows: "This Constitution, and the Laws of the United States which shall be made in Pursuance thereof-, and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby,any Thing in the Constitution or Laws of any State to the contrary notwithstanding." This means that,unless Congress has otherwise provided,if a federal governmental entity owns a parcel that is subject to Special Taxes within Improvement Area No. 2 but does not pay taxes and assessments levied on the parcel(including Special Taxes),the applicable state and local governments cannot foreclose on the parcel to collect the delinquent taxes and assessments. Moreover, unless Congress has otherwise provided, if the federal government has a mortgage interest in the parcel and the District wishes to foreclose on the parcel as a result of delinquent Special Taxes,the property cannot be sold at a foreclosure sale unless it can be sold for an amount sufficient to pay delinquent taxes and assessments on a parity with the Special Taxes and preserve the federal government's mortgage interest. In Rust v. Johnson (9th Circuit; 1979) 597 F.2d 1.74, the United States Court of Appeal, Ninth Circuit held that the Federal National Mortgage Association("FNMA")is a federal instrumentality for purposes of this doctrine,and not a private entity, and that, as a result, an exercise of state power over a mortgage interest held by FNMA constitutes an exercise of state power over property of the United States. The District has not undertaken to determine whether any federal governmental entity currently has,or is likely to acquire,any interest(including a mortgage interest)in any of the parcels subject to the Special Taxes within Improvement Area No. 2, and therefore expresses no view concerning the likelihood that the risks described above will materialize while the Bonds are outstanding. FDIC. In the event that any financial institution making any loan which is secured by real property within Improvement Area No. 2 is taken over by the FDIC, and prior thereto or thereafter the loan.or loans go into default,resulting in ownership of the property by the FDIC,then the ability of the District to collect interest and penalties specified by State law and to foreclose the lien of delinquent unpaid Special Taxes may be limited. The FDIC's policy statement regarding the payment of state and local real property taxes (the "Policy Statement"), provides that property owned by the FDIC is subject to state and local real property taxes only if those taxes are assessed according to the property's value,and that the FDIC is immune from real property taxes assessed on any basis other than property value. According to the Policy Statement, the FDIC will. pay its property tax obligations when they become due and payable and will pay claims for delinquent property taxes as promptly as is consistent with sound business practice and the orderly administration of the institution's affairs,unless abandonment of the FDIC's interest in the property is appropriate. The FDIC will pay claims for interest on delinquent property taxes owed at the rate provided under state law,to the extent the interest payment obligation is secured by a valid lien. The FDIC will not pay any amounts in the nature of fines or penalties and will not pay nor recognize liens for such amounts,. If any property taxes (including interest) on FDIC-owned property are secured by a valid lien. (in effect before the property became owned by the FDIC), the FDIC will pay those claims. The Policy Statement further provides that no property of the FDIC is subject to levy, attachment,garnishment, foreclosure or sale without the FDIC's consent. In addition,the FDIC will not permit a lien or security interest held by the FDIC to be eliminated by foreclosure without the FDIC's,consent. The Policy Statement states that the FDIC generally will not pay non-ad valorem taxes,including special assessments, on property in which it has a fee interest unless the amount of tax is,fixed at the time that the FDIC acquires its fee interest in the property, nor will it recognize the validity of any lien.to the extent it purports to secure the payment of any such amounts. Special taxes imposed under the Act and a special tax formula which 64 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 550 of 724, determines the special tax due each year are specifically identified in the Policy Statement as being imposed each year and therefore covered by the I'DIC's federal immunity. The Ninth Circuit has, issued a ruling on August 28,2001 in which it determined that the FD�IC, as a federal agency, is exempt from special taxes under the Act. The District is unable to predict what effect the application of the Policy Statement would have in the event of a delinquency in the payment of Special Taxes on a parcel within Improvement Area No. 2 in which the FDIC has or obtains an interest, although prohibiting the lien of the Special Taxes to be foreclosed out at a judicial foreclosure sale could reduce or eliminate the number of persons willing to purchase a parcel at a foreclosure sale. Such an outcome could cause a draw on the Reserve Fund and perhaps, ultimately, if enough property were to become owned by the FDIC, a default in payment on the Bonds. Bankruptcy and Foreclosure Bankruptcy, insolvency and other laws generally affecting creditors' rights could adversely impact the interests of owners of the Bonds in at least two ways. First,the payment of property owners'taxes and the ability of the District to foreclose the lien of a delinquent unpaid Special Tax pursuant to its covenant to pursue judicial foreclosure proceedings may be limited by bankruptcy, insolvency or other laws generally affecting creditors' rights or by the laws of the State relating to judicial foreclosure. See "'SOURCES OF PAYMENT FOR THE BONDS—Special Taxes—Proceeds qfForeclosure Sales." In addition,the prosecution of a foreclosure could be delayed due to many reasons, including crowded local court calendars or lengthy procedural delays. Second, the Bankruptcy Code might prevent moneys on deposit in the Acquisition and Construction Fund from being applied to pay interest on the Bonds and/or to redeem Bonds if bankruptcy proceedings were brought by or against a landowner or other party and if the court found that the landowner or other party had an interest in such moneys within the meaning of Section 541(a)(1)of the Bankruptcy Code. Although a bankruptcy proceeding would not cause the Special Taxes to become extinguished, the amount of any Special Tax lien could be modified if the value of the property falls below the value of the lien. If the value of the property is less than the lien, such excess amount could be treated as an unsecured claim by the bankruptcy court. In addition,bankruptcy of a property owner could result in a delay in prosecuting Superior Court foreclosure proceedings. Such delay would increase the likelihood of a delay or default in payment of delinquent Special Tax installments and the possibility of delinquent Special Tax installments not being paid in full. On July 30, 1992, the United States Court of Appeals for the Ninth Circuit issued its opinion, in a bankruptcy case entitled In re Glasply Marine-Industries. In that case, the court held that ad valorem property taxes levied by Snohomish County in the State of Washington after the date that the property owner filed a petition for bankruptcy were not entitled to priority over a secured creditor with a prior lien on, the property. Although the court upheld the priority of unpaid taxes imposed before the bankruptcy petition, unpaid taxes imposed after the filing of the bankruptcy petition, were declared to be "'administrative expenses" of the bankruptcy estate,payable after all secured creditors. As a result, the secured creditor was able to foreclose on the property and retain all the proceeds of the sale except the amount of the pre-petition taxes. The Bankruptcy Reform Act of 1994 (the "Bankruptcy Reform Act") included a provision which excepts from,the Bankruptcy Code's automatic stay provisions,"the creation of a statutory lien.for an ad valore,m property tax imposed by a political subdivision of a state if such tax comes due after the filing of the petition[by a debtor in bankruptcy court]." This amendment effectively makes the Glasply holding inoperative as it relates to ad valorem real property taxes. However, it is possible that the original rationale of the Glasply ruling could still result in the treatment of post-petition special taxes as "administrative expenses," rather than as tax liens secured by real property, at least during the pendency of bankruptcy proceedings. 65 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 551 of 724, According to the court's ruling,as administrative expenses,post-petition taxes would be paid,assuming that the debtor had sufficient assets to do so. In certain circumstances,payment of such administrative expenses may be allowed to be deferred. Once the property is transferred out of the bankruptcy estate(through foreclosure or otherwise),it would at that time become subject to current ad valorem taxes. The Act provides that the Special Taxes are secured by a continuing lien which is subject to the same lien priority in the case of delinquency as ad valorem taxes. No case law exists with respect to how a bankruptcy court would treat the lien for Special Taxes levied after the filing of a petition in bankruptcy court. Glavply is controlling precedent on bankruptcy courts in the State. If the Glasply precedent was applied to the levy of the Special Taxes, the amount of Special Taxes received from parcels whose owners declare bankruptcy could be reduced. The various legal opinions to be delivered concurrently with the delivery of the Bonds(including Bond Counsel's approving legal opinion)will be qualified,as to the enforceability of the various legal instruments,by moratorium, bankruptcy, reorganization, insolvency or other similar laws affecting the rights of creditors generally. As described above under"SOURCES OF PAYMENT FOR THE BONDS—Assignment of Assessor Parcel Numbers and Delayed Special Tax Revenues," SLF has deposited certain funds with the District as a result of certain delays in receipt of Special Tax revenues during the development and home sales period within Improvement Area No. 2. When a debtor files for relief under the United States Bankruptcy Code (the "Bankruptcy Code")�,the bankruptcy trustee could reverse certain transfer of funds made by the debtor to protect creditors. As a result, it is possible that the amounts deposited by SLF under the Deposit Agreement could be subject to reversal by a bankruptcy trustee in the event SLF files for relief under the Bankruptcy Code. No Acceleration Provision The Bonds do not contain a provision allowing for the acceleration of the Bonds in the event of a payment default or other default under the terms of the Bonds or the Indenture or in. the event interest on the Bonds becomes included in gross income for federal income tax purposes. Pursuant to the Indenture, an owner is given the right for the equal benefit and protection of all owners of the Bonds similarly situated to pursue certain remedies described in APPENDIX E—"'SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE—EVENT OF DEFAULT.11 Loss of Tax Exemption As discussed under the caption "'TAX MATTERS" herein, interest on. the Bonds could become includable in gross income for purposes of federal income taxation retroactive to the date the Bonds were issued as a result of future acts or omissions of the District in violation of its covenants in the Indenture with respect to compliance with certain provisions of the Internal. Revenue Code of 1986. Should such an event of taxability occur,the Bonds are not subject to early redemption and will remain outstanding until.maturity or until.redeemed under the redemption provisions contained in the Indenture. Limited Secondary Market There can be no guarantee that there will be a secondary market for the Bonds or,if a secondary market exists, that such Bonds can be sold for any particular price. Although the District has committed to provide certain statutorily required financial and operating information,there can be no assurance that such information will be available to Bondowners on a timely basis. See"CONTINUING DISCLOSURE." Any failure to provide annual financial information,if required,does not give rise to monetary damages but merely an action for specific performance. Occasionally,because of general market conditions, lack of current information,the absence of a credit rating for the Bonds or because of adverse history or economic prospects connected with a particular issue, secondary marketing practices in connection with.a particular issue are suspended or terminated. Additionally, 66 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 552 of 724, prices of issues for which a market is being made will depend upon then prevailing circumstances. Such prices could be substantially different from the original purchase price. Proposition 218 An initiative measure commonly referred to as the "Right to Vote on Taxes Act"(the"Initiative")was approved by the voters of the State at the November 5,, 1996 general election. The Initiative added Article XIIIC and Article XIIID to the California Constitution. According to the "Title and Summary" of the Initiative prepared by the California Attorney General,the Initiative limits"the authority of local governments to impose taxes and property-related assessments,fees and charges."' The provisions of the Initiative as they may relate to community facilities district are subject to interpretation by the courts. The Initiative could potentially impact the Special Taxes available to the District to pay the principal of and interest on the Bonds as described below. Among other things, Section 3 of Article XIIIC states that ". . . the initiative power shall not be prohibited or otherwise limited in matters of reducing or repealing any local tax,assessment,fee or charge." The Act provides for a procedure which includes notice,hearing,protest and voting requirements to alter the rate and method of apportionment of an existing special tax. However,the Act prohibits a legislative body from adopting any resolution to reduce the rate of any special tax or terminate the levy of any special tax pledged to repay any debt incurred pursuant to the Act unless such legislative body determines that the reduction or termination of the special tax would not interfere with the timely retirement of that debt. On July 1, 1997, a bill was signed into law by the Governor of the State enacting Government Code Section 5854,which states that: "Section 3 of Article XIIIC of the California Constitution, as adopted at the November 5, 1996,general election,shall not be construed to mean that any owner or beneficial owner of a municipal security, purchased before or after that date, assumes the risk of, or in any way consents to, any action by initiative measure that constitutes an impairment of contractual rights protected by Section 10 of Article I of the United States Constitution." Accordingly, although the matter is not free from doubt, it is likely that the Initiative has not conferred on the voters the power to repeal or reduce the Special Taxes if such reduction would interfere with the timely retirement of the Bonds. It may be possible,however, for voters or the City Council acting as the legislative body of the District to reduce the Special Taxes in a manner which does not interfere with the timely repayment of the Bonds, but which does reduce the maximum amount of Special Taxes that may be levied in, any year below the existing levels. Furtbermo�re,no assurance can be given,with respect to the future levy of the Special Taxes in amounts greater than the amount necessary for the timely retirement of the Bonds. Therefore,no assurance can be given with respect to the levy of Special, Taxes for Administrative Expenses. Nevertheless, to the maximum extent that the law permits it to do so, the District will covenant that it will not initiate proceedings under the Act to reduce the maximum Special Tax rates on parcels within Improvement Area No.2 other than as authorized under the Indenture. The District will also covenant that, in the event an initiative is adopted which,purports to alter the Rate and Method, it will commence and pursue legal action in order to preserve its ability to comply with the foregoing covenant. However,no assurance can be given as to the enforceability of the foregoing covenants. The interpretation and application of Article XIIIC and Article XIIID will ultimately be determined by the courts with respect to a number of the matters discussed above, and it is not possible at this time to predict with certainty the outcome of such determination or the timeliness of any remedy afforded by the courts. See "SPECIAL RISK FACTORS—Limitations on Remedies." Litigation with Respect to Community Facilities Districts Shapi*ro. The California Court of Appeal, Fourth Appellate District, Division One, issued its opinion in City of'San Diego v. Melvin Shapiro (2014) 228 Cal.AppAth 756 (the "San Diego Decision"). The case 67 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 553 of 724, involved a Convention Center Facilities District (the "CCFD") established by the City of San Diego ("San Diego")�. The CCFD is a financing district much like a community facilities district established under the provisions of the Act. The CCFD is comprised of all of the real property in San Diego. However, the special tax to be levied within the CCFD was to be levied only on hotel properties located within the CCFD. 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 deten-nining who would constitute the qualified electors of the CCFD was modeled after Section 53326(c)of the 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 of the 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. Horizon. The Sacramento County Superior Court issued a tentative ruling in Horizon Capital Investments,LLC v. City qfSacramento et al. (Case No. 34-2017-8000266 1). That ruling subsequently became the court's final order. As described below, this case involved an election to approve the levy of a special tax within a community facilities district("CFD")formed under the Act. In 20171 the City of Sacramento initiated proceedings to form a CFD to finance certain costs to operate and maintain a streetcar line. As permitted by the Act,the proposed district included non-contiguous parcels of non-residential property. Because there were fewer than 12 registered voters residing within the territory of the proposed CFD,the City Council submitted the special tax proposed to be levied within the proposed CFD to the owners of land within the proposed CFD,as required by the Act. The proposed special tax received the requisite two-thirds vote in the landowner election. Petitioners Horizon Capital Investments, LLC et al. filed a writ of mandate and complaint for reverse validation and declaratory relief Petitioners argued, and the superior court agreed in its final ruling,that under section 4(a) of article XIII A of the Califomia Constitution (which provides that "Cities, Counties and special districts, by a two-thirds vote of the qualified electors of such district [sic]�, may impose special taxes on such district...")the phrase "qualified electors"means the registered voters of the entire City of Sacramento and not just the owners of the property within the boundaries of the proposed CFD. Citing the San Diego Decision,the tentative ruling states that the phrase"qualified electors of the district"'refers to the registered voters of the entity imposing the special tax,which in this case was the City of Sacramento. Because the vote within the proposed CFD was by landowners only and not by all registered voters in the City of Sacramento, the final ruling states that the special tax is invalid. The superior court's final rulim4 is not binding upon other courts within the State and does not directly apply to Improvement Area No. 2, the Special Tax, or the Bonds. The City of Sacramento did not appeal, the decision. The Special Tax Election in Improvement Area No. 2. With respect to the San Diego Decision, the facts of such case show that there were thousands of registered voters within the CCFD(viz.,all of the registered voters in San Diego). The elections held in Improvement Area No. 2 had less than 12 registered voters at the time of the elections to authorize the Special Tax. In the San Diego 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 1,2 registered voters. Thus,by its terms,the court"s holding in the San.Diego Decision does not apply to the Special Tax election in Improvement Area No. 2. Moreover, Section 53341 of the Act provides that any"action or proceeding to attack,review,set aside,void or annul the levy of a special tax...shall be commenced within 30 days after the special tax is approved by the voters." Similarly, Section.53359 of the Act provides that any action to determine the validity of bonds issued pursuant to the Act be brought within 30 days of the voters approving the issuance of such bonds. The petitioners in Horizon filed the writ of mandate 68 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 554 of 724, within 3�O days of the landowner election. Landowners in Improvement Area No. 2 approved the levy of Special Tax in accordance with the Rate and Method on February 18,2020. Based,on Sections 53341 and 53359 of the Act and analysis of existing laws,regulations, rulings, and court decisions,the City believes that no successful challenge to the Special Tax being levied in accordance with the Rate and Method may now be brought. In connection with the issuance of the Bonds., Bond, Counsel expects to deliver its opinion in the proposed form attached hereto as Appendix C. Ballot Initiatives Articles XIII X XIII B11 XIII C and XIII D were adopted pursuant to measures qualified,for the ballot pursuant to California's constitutional initiative process and the State Legislature has in the past enacted legislation which has altered the spending limitations or established minimum funding provisions for particular activities. On March 6, 1995, in the case of Ro,ssi v. Brown.,the State Supreme Court held that an initiative can repeal a tax ordinance and prohibit the imposition of further such taxes, and that the exemption from the referendum requirements does not apply to initiatives. From time to time, other initiative measures could be adopted by California voters or legislation enacted by the legislature. The adoption of any such initiative or legislation might place limitations on the ability of the State, the City, or local districts to increase revenues or to increase appropriations or on the ability of SLF or the builders within Improvement Area No. 2 to complete the remaining proposed development within Improvement Area No. 2. Limitations on Remedies Remedies available to the owners of the Bonds may be limited by a variety of factors and may be inadequate to assure the timely payment of principal of and interest on the Bonds or to preserve the tax-exempt status of interest on the Bonds. Bond Counsel has limited its opinion as to the enforceability of the Bonds and of the Indenture to the extent that enforceability may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer,moratorium, or other similar laws affecting generally the enforcement of creditor's rights,by equitable principles and by the exercise of judicial discretion and by limitations on remedies against public agencies in the State of California. The Bonds are not subject to acceleration. The lack of availability of certain remedies or the limitation of remedies may entail risks of delay, limitation or modification of the rights of the owners. Potential Early Redemption of Bonds from Special Tax Prepayments Property owners within Improvement Area No. 2 are permitted to prepay their Special Taxes at any time. Such, payments will. result in a mandatory redemption of Bonds from Special Tax prepayments on, the Interest Payment Date for which timely notice may be given under the Indenture following the receipt of such Special Tax prepayment. The resulting redemption of Bonds purchased at a price greater than,par could reduce the otherwise expected yield on such Bonds. See "THE BONDS — Redemption. —Mandatory Redemption ftom Special Tax Prepaymentv" and "IMPROVEMENT AREA NO. 2 — Expected Tax Burden; Potential Special Tax Prepayment." Cybersecurity The City, like many other public and private entities,, relies on a large and complex technology environment to conduct its operations. As a recipient and provider of personal,private,or sensitive information, the City is subject to multiple cyber threats including, but not limited to, backing, viruses, malware and other attacks on computer and other sensitive digital networks and systems."Entities or individuals may attempt to gain unauthorized access to the City's digital systems for the purposes of misappropriating assets or information or causing operational disruption and damage. To date, the City has not experienced an attack on its computer operating systems which resulted in a breach. of its cybersecurity systems that are in place. However, no 69 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 555 of 724, assurances can be given that the City's efforts to manage cyber threats and,attacks will be successful or that any such attack will not materially impact the operations or finances of the City. COVID-19(Coronavirus)Pandemic The spread of the novel strains of coronavirus that cause a disease commonly referred to as CO�VID-19 ("COVID-19") is having significant negative impacts throughout the world, including in the City. The World Health Organization has declared the COVID-19 outbreak to be a pandemic,and states of emergency have been declared by the County, State and the United States. Confirmed cases of COVID-19 are growing throughout the State and health officials are expecting the number of confirmed cases to continue to grow. The outbreak has resulted in the imposition of restrictions on mass gatherings and widespread temporary closings of businesses, universities and schools. The City initially closed certain no�n-essential functions of the City,while City Hall,community services and public safety functions remained opened to service City residents and businesses. The City's Development Services Department remained opened and continued to issue building permits and inspect unoccupied dwellings for the lots within the City. Other City departments that serve businesses and residents within the District telecommuted and/or continued in-person work schedules to meet the needs of the community. Other public agencies serving the property and residents within the District may have taken similar actions in response to the COVID-19 pandemic, though the District and the City can provide no assurance regarding the actions of any other public agencies. Such actions may affect the SLF,Lennar Homes and Pinnacle Homes' ability to complete their planned developments in the time periods and within cost estimates described in the Official Statement. See"PROPERTY OWNERSHIP AND THE DEVELOPMENT.11 The COVID-1 9 pandemic is ongoing,and the ultimate geographic spread of the virus,the duration and severity of the outbreak, and the economic and other actions that may be taken by governmental authorities to contain the outbreak or to treat its impacts are uncertain. However,the impact of the COVID-19 outbreak could adversely impact development within Improvement Area No.2,including,but not limited to,one or more of the following ways: (i)potential supply chain slowdowns or shutdowns resulting from the unavailability of workers in locations producing construction materials; (ii) slowdowns or shutdowns by local governmental agencies in providing governmental permits, inspections, title and document recordation, and other services and activities associated with real estate development;(iii)delays in construction where one or more members of the workforce becomes infected with COVID-19; (iv) continued extreme fluctuations in financial markets and contraction in available liquidity; (v) extensive job losses and declines in, business activity across important sectors of the economy; (vi) declines in business and consumer confidence that negatively impact economic conditions or cause an economic recession; (vii) the failure of government measures to stabilize the financial sector and introduce fiscal stimulus to counteract the economic impact of the pandemic;(vii,i)delays in sales or fewer sales due to lower traffic at model home complexes and real.estate offices; and(ix) delays in sales, or cancellations, due to mortgage lending issues. The ultimate adverse impact of COVID-19 on the District, and the operations, finances and ability of SLF, Lennar Homes and Pinnacle Homes' to complete their development within Improvement Area No. 2 as planned,homebuyers' willingness and ability to pay Special,Taxes when due, and the real estate market in general is unknown. CONTINUING DISCLOSURE District Continuing Disclosure Pursuant to a Continuing Disclosure Agreement(the"District Continuing Disclosure Agreement"),the District will agree to provide, or cause to be provided, to the Municipal Securities Rulemaking Board through its Electronic Municipal Market Access (EMMA) website, or other repository authorized under Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission, certain. annual. financial information and operating data concerning Improvement Area No. 2. The District Reports are to be filed not later than March 31 of each year,beginning March 31,2022. The District Reports will include the information.as required 70 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 556 of 724, by the District Continuing Disclosure Agreement. The District Reports will include the audited financial statements of the District, if any are prepared. The District does not currently prepare audited financial statements and does not anticipate doing so in the future. The full text of the District Continuing Disclosure Agreement is set forth in APPENDIX F — "FORM OF DISTRICT CONTINUING DISCLOSURE AGREEMENT.ii Notwithstanding any provision of the Indenture, failure of the District to comply with the District Continuing Disclosure Agreement shall not be an event of default under the Indenture. However,any Owner or Beneficial Owner of the Bonds may take such action as is necessary and appropriate,including seeking mandate or a judgment for specific perfon-nance, to cause the District to comply with its obligations with respect to the District Continuing Disclosure Agreement. During the last five years, the City and certain of its related entities, have failed to comply in certain respects described below with continuing disclosure undertakings related to outstanding bonded indebtedness. The City and certain other entities related to the City, including the former Redevelopment Agency of the City of Chula Vista("Former Agency"), various community facilities districts and joint powers authorities (together,the"City Entities"),,have entered into previous undertakings pursuant to the Rule.Within the last five years,the City and certain of the City Entities have failed to comply with their respective prior undertakings in the following respects: (i) notice of certain ratings changes relating to several issues resulting from changes in ratings on municipal bond insurance companies were not promptly filed and one notice of an underlying rating change was filed 37 days after the rating change occurred; (ii) with respect to the annual report due for Fiscal Year 2014,related to certain certificates of participation, the annual report was timely filed but did not include certain Fiscal Year 20 15 budgeted information;and(iii)in certain cases information was timely filed on EMMA under the applicable base CUSIP number for the issuer but not linked to all of the individual CUSIP numbers for a series of bonds. The City has adopted policies and procedures regarding compliance with undertakings made by the City and the City Entities pursuant to the Rule and has retained the services of outside consultants to assist in the reporting process. The City's Finance Department has assigned a specific person to coordinate with the outside consultants and to monitor compliance. Developer Continuing Disclosure To provide updated infonnation with respect to the developments within.Improvement Area No.2,each of Lennar Homes and Pinnacle Homes will execute a Continuing Disclosure Certificate with respect to each project area that it currently owns within Improvement Area No. 2 (each a"Developer Continuing Disclosure Certificate"). In each Developer Continuing Disclosure Certificate,the applicable property owner will.covenant to provide separate annual reports and semiannual reports until satisfaction.of certain conditions set forth therein. Such periodic reports to be provided by such entities at such times and will contain updates regarding their respective development within Improvement Area No. 2 as provided in. Section. 3 and Section, 4 of each Developer Continuing Disclosure Certificate attached as APPENDIX G. In addition.to the periodic reports,each of such entities will agree to provide notices of certain events set forth in its Developer Continuing Disclosure Certificate. The termination of such reporting requirements varies among such continuing disclosure undertakings. See APPENDIX G hereto. Pinnacle Homes has not been subject to any continuing disclosure undertakings within the last five years, in connection with the issuance of municipal obligations. Pinnacle Homes expects to assign appropriate staff to prepare the periodic reports and notices, if any, as required by its Developer Continuing Disclosure Certificate. To the Actual Knowledge of Lennar Homes(as defined in the Letter of Representations to be executed by Lennar Homes),other than as disclosed in this Official Statement,Lennar Homes is not aware of any material failures by it to comply in all material, respects with previous continuing disclosure undertakings in a written 71 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 557 of 724, certificate or agreement executed by it to provide periodic continuing disclosure reports or notices of material events respecting securities offerings in California within the last five years. However, in connection with a continuing disclosure obligation entered into with respect to the $12,850,000 County of El Dorado District No. 2014-1 (Carson Creek)Special Tax Bonds Series 2016,Lennar Homes was late in filing the periodic reports due on April 1, 20 17 and October 1, 2017. The oversight was discovered in late January, 2018, and,Lennar Homes promptly filed a curative report on February 1, 2018. Neither the City nor the Underwriter makes any representation as to compliance by Lennar Homes, Pinnacle Homes or any of their respective affiliates with their prior continuing disclosure undertakings. TAX MATTERS In the opinion of Best Best & Krieger LLP, San Diego, California, Bond Counsel, under existing statutes'. regulations, rulings and judicial decisions, interest on the Bonds is excluded, from gross income for federal income tax purposes. In the further opinion of Bond Counsel,interest on the Bonds is exempt from State of California personal income tax. Bond Counsel notes that interest on the Bonds is not an item of tax preference for purposes of calculating the federal alternative minimum tax. Bond Counsel's opinion as to the exclusion from gross income for federal income tax purposes of interest on the Bonds is based upon certain representations of fact and certifications made by the City,on behalf of the District, the Underwriter and others and is subject to the condition that the City complies with all requirements of the Code and the regulations adopted pursuant to the Code (the "Treasury Regulations") that must be satisfied subsequent to the issuance of the Bonds to assure that interest on the Bonds will not become includable in gross income for federal income tax purposes. Failure to comply with such requirements of the Code and the Treasury Regulations might cause interest on the Bonds to be included in gross income for federal income tax purposes retroactive to the date of issuance of the Bonds. The City will covenant in the Indenture and the Tax Certificate to be delivered in connection with the issuance of the Bonds to comply with all such requirements. Should the interest on the Bonds become includable in gross income for federal income tax purposes, the Bonds are not subject to early redemption as a result of such occurrence and will remain outstanding until maturity or until otherwise redeemed in accordance with the Indenture. Future legislative proposals, if enacted into law,clarification of the Code or court decisions may cause interest on the Bonds to be subject, directly or indirectly, to federal income taxation or to be subject to or exempted from state income taxation, or otherwise prevent Bond Owners from realizing the full current benefit of the tax status of such interest. For example, legislative proposals are announced from time to time which generally would limit the exclusion,from gross income of interest on,obligations like the Bonds to some extent for taxpayers who are individuals and whose income is subject to higher marginal income tax rates. Other proposals have been made that could significantly reduce the benefit of,or otherwise affect,the exclusion from gross income of interest on obligations like the Bonds. The introduction or enactment of any such legislative proposals, clarification of the Code or court decisions may also affect, perhaps significantly, the market price for, or marketability of, the Bonds. Prospective purchasers of the Bonds should consult their own tax advisors regarding any pending or proposed federal or state tax legislation, regulations or litigation, and regarding the impact of future legislation,regulations or litigation, as to which Bond Counsel expresses no opinion. Bond Counsel's opinion may be affected by action taken (or not taken) or events occurring (or not occurring)after the date of issuance of the Bonds. Bond Counsel has not undertaken to determine, or to inform any person, whether any such action or events, are taken or do occur, or whether such actions or events may adversely affect the value or tax treatment of a Bond, and Bond Counsel expresses no opinion with respect thereto. 72 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 558 of 724, Although Bond Counsel will render an opinion that interest on the Bonds is excluded from gross income for federal income tax purposes provided the City continues to comply with certain requirements of the Code, the accrual or receipt of interest on the Bonds may otherwise affect the tax liability of the recipient. The extent of these other tax consequences will depend upon the recipient's particular tax status and other items of income or deductions. Bond Counsel expresses no opinion regarding any such consequences,. Accordingly, all potential purchasers should consult their tax advisors before purchasing any of the Bonds. A copy of the proposed form of Bond Counsel opinion is attached hereto as APPENDIX C. LEGAL MATTERS The legal opinion of Best Best & Krieger LLP, San Diego, California, Bond Counsel, approving the validity of the Bonds in substantially the form set forth as APPENDIX C hereto, will be made available to purchasers at the time of original delivery. Certain legal matters will be passed upon for the District by Stradling Yocca Carlson&Rauth,a Professional Corporation,Newport Beach,California, as Disclosure Counsel and for the Underwriter by Jones Hall, A Professional Law Corporation, San Francisco, California, as counsel to the Underwriter. Bond Counsel expresses no opinion to the Owners of the Bonds as to the accuracy, completeness or fairness of this Official Statement or other offering materials relating to the Bonds and expressly disclaims any duty to do so. ABSENCE OF LITIGATION No litigation is pending or, to the knowledge of the District, threatened concerning the validity of the Bonds and a certificate of the District to that effect will be furnished to the Underwriter at the time of the original delivery of the Bonds. Neither the City nor the District is aware of any litigation pending or threatened which questions the existence of the District or the City or contests the authority of the District to levy and collect the Special Taxes or to issue and retire the Bonds. NO RATING The District has not made and does not contemplate making application to any rating agency for the assignment of a rating to the Bonds. UNDERWRITING The Bonds are being purchased by Stifel,Nicolaus&Company,Incorporated(the"Underwriter"). The Underwriter has agreed to purchase the Bonds at a price of$ (being$ aggregate principal amount thereof, plus net original issue premium of $ and less Underwriter's discount of $ . The purchase contract relating to the Bonds provides that the Underwriter will purchase al.l.of the Bonds if any are purchased. The obligation to make such purchase is subject to certain terms and conditions set forth in the purchase contract,the approval of certain.legal.matters by counsel and certain other conditions. Under certain circumstances,the Underwriter may offer and sell the Bonds to certain dealers and others at prices lower than the offering prices stated on the page immediately following the cover page hereof. The offering prices may be changed from,time to time by the Underwriter. FINANCIAL INTERESTS The fees being paid to the Underwriter, the Municipal Advisor to the City, the Fiscal Agent and Underwriter's Counsel are contingent upon the issuance and delivery of the Bonds. The fees being paid to Bond Counsel,Disclosure Counsel,the Appraiser,the Market Absorption Analyst and the Special Tax Consultant are 73 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 559 of 724, not contingent upon the issuance and delivery of the Bonds. From time to time, Bond Counsel and Disclosure Counsel represent the Underwriter on matters unrelated to the Bonds. PENDING LEGISLATION The District is not aware of any significant pending legislation which would have material adverse consequences on the Bonds or the ability of the District to pay the principal of and interest on the Bonds when due. ADDITIONAL INFORMATION The purpose of this Official Statement is, to supply information to prospective buyers of the Bonds. Quotations and summaries and explanations of the Bonds and documents contained in this Official Statement do not purport to be complete, and reference is made to such documents for full and complete statements and their provisions. Any statements in this Official Statement involving matters of opinion,whether or not expressly so stated,are intended as such and not as representations of fact. The execution and delivery of this Official Statement by the Director of Finance/Treasurer has been duly authorized by the City Council of the City of Chula Vista acting in its capacity as the legislative body of the District. COMMUNITY FACILITIES DISTRICT NO. 16-1 (MILLENIA) By: Director of Finance/Treasurer 74 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 560 of 724, APPENDIX A RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX A Special Tax shall be levied on all Taxable Property within the boundaries of Improvement Area No. 2 of Community Facilities District No. 164(Millenia)("IA2")and collected each Fiscal Year commencing in Fiscal Year 2019-20, in an amount detennined by the CFD Administrator through the application of the procedures described below. All of the real property within IA2,unless exempted,by law or by the provisions hereof, shall be taxed for the purposes,to the extent,and in the manner herein provided. 1. DEFINITIONS The terms hereinafter set forth have the following meanings. "Acre"or"Acreage"means the land area of an Assessor's Parcel as shown on an Assessor's Parcel Map, or if the land area is not shown on an Assessor's Parcel Map,the land area shown on the applicable Final Map. An Acre means 431560 square feet of land. 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 of Part I of Division 2 of Title 5 of the Government Code of the State of California. "Administrative Expense Requirement"means an annual amount equal to $75,000,or such lesser amount as may be designated by written instruction from an authorized representative of the City to the Fiscal Agent,to be allocated as the first priority of Special Taxes received each Fiscal Year for the payment of Administrative Expenses. "Administratlive Expenses" means the following actual or reasonably estimated costs related to the administration of IA2 including, but not limited to: the costs of preparing and computing the Annual Special Tax(whether by the City or designee thereof or both);the costs of collecting the Special Taxes(whether by the City, the County or otherwise); the costs of remitting the Special Taxes to the Fiscal Agent; the costs of the Fiscal Agent (including its legal, counsel) in, the discharge of the duties required of it under the Fiscal. Agent Agreement., the costs to the City, CFD No. 16-1, or any designee thereof complying with arbitrage rebate requirements,including without limitation rebate liability costs and periodic rebate calculations;the costs to the City, CFD No. 16-1, or any designee thereof complying with disclosure or reporting requirements of the City or CFD No. 16-1,associated with applicable federal and State laws;the costs associated with preparing Special Tax disclosure statements and responding to public inquiries regarding the Special Taxes;the costs to the City,CFD No. 16-1, or any designee thereof related to an appeal. of the Special Tax; and the City's annual, administration, fees and third party expenses. Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 16-1 for any other administrative purposes of CFD No. 16-1, including attorney's fees and other costs related to commencing and pursuing any foreclosure of delinquent Special Taxes. "Annual Special Tax"means the Special Tax actually levied in any Fiscal Year on any Assessor's Parcel. "Assessor"means the Assessor of the County of San Diego. "Assessor's Parcel" means a lot or parcel shown on an Assessor's Parcel Map with an assigned Assessor's Parcel Number. "Assessor's Parcel Map" means an official map of the Assessor designating parcels by Assessor's Parcel Number. A-1 4852-7256-1 10�7v I 2/024036-00�89 2021-03-16 Agenda Packet Page 561 of 724, "Assessor's Parcel Number" means the number assigned to an Assessor's Parcel by the County for purposes of identification. "Assigned Special Tax"means the Special Tax of that name described in Section 3.A below. "Backup Special Tax"means the Special Tax of that name described in Section 3.13 below. "Bo�nds" means any bonds or other debt of CFD No. 16-1 issued or incurred, for IA2, whether in one or more series, secured by the levy of Special Taxes. "Building Permit" means a building permit for construction of a Residential Unit or non-residential structure within IA2 issued by the City. "Building Square Footage"means all of the square footage of living area within the perimeter of a residential structure, not including any carport,walkway,garage,overhang,or similar area. The determination of Building Square Footage shall be made by the CFD Administrator by reference to the Building Permit(s) issued for such Assessor's Parcel and/or by reference to appropriate records kept by the City. Building Square Footage for a Residential Unit will be based on the Building Perrnit(s) issued for such Residential Unit prior to it being classified as Occupied Residential Property, and shall not change as a result of additions or modifications made to such Residential Unit after such classification as Occupied Residential Property. "Calendar Year"means the period commencing January I of any year and ending the following December 3 1. "CFD Administrator" means an authorized representative of the City, or designee thereof, responsible for determining the Special Tax Requirement, for preparing the Annual Special Tax roll and/or calculating the Backup Special Tax. 11CFD No. 16-1"means the Community Facilities District No. 16-1(Millenia). "City"means the City of Chula Vista, California. "City Council" means the City Council of the City acting as the legislative body of CFD No. 16-1 under the Act. "Condominium"means a unit,whether attached or detached,,meeting the statutory definition of a condominium contained in the California Civil Code Section 4285. "County"means the County of San Diego,California. "Debt Service" means for each Fiscal Year, the total amount of principal and interest payable on any Outstanding Bonds during the Calendar Year commencing on January I of such Fiscal Year. "Developed Property"means for each Fiscal Year,all.Taxable Property,exclusive of Provisional.Property,for which a Building Permit was issued prior to March I of the previous Fiscal Year. An Assessor's,Parcel classified as Developed Property but for which the Building Permit that caused such Assessor's Parcel to be classified as Developed Property has been cancelled and/or voided prior to the Fiscal Year for which Special Taxes are being levied shall be reclassified as Undeveloped Property,provided that the levy of the Annual Special Tax after such reclassification shall not be less than 1.1 times the annual Debt Service less Administrative Expenses on all Outstanding Bonds. If Bonds have not been issued, an Assessor's Parcel classified as Developed Property for which such a Building Permit has been cancelled and/or voided shall be reclassified as Undeveloped Property. "Development Agreement" means that certain Development Agreement by and between the City of Chula Vista and McMillin Otay Ranch LLC adopted October 6, 2009 and recorded with the County of San D�iego's A-2 4852-7256-1 10�7v I 2/024036-00�89 2021-03-16 Agenda Packet Page 562 of 724, Recorder's office on October 27, 2009 as Document Number 20�O�9-0595116., as may be amended and/or supplemented from time to time. "Exempt Property"means for each Fiscal Year,all Assessor's Parcels designated as being exempt from Special Taxes pursuant to Section 5 below. "Final Map"means a subdivision of property by recordation of a final map,parcel map, or lot line adjustment, pursuant to the Subdivision Map Act (California Government Code Section 66410 et seq.) or recordation of a condominium plan pursuant to California Civil Code 428,5 that creates individual lots for which Building Pennits may be issued without further subdivision. "Fiscal Year"means the period starting on July I and ending the following June 30. "Fiscal Agent"means the fiscal agent,trustee,,or paying agent under the Fiscal Agent Agreement. "Fiscal Agent Agreement"means the fiscal agent agreement,indenture,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 the same. 111A2"means Improvement Area No. 2 of CFD No. 16-1. "Land Use Class"means any of the classes listed in Table I or 2 under Section 3A below. Note: Land Uses Class is not in rqfere,nce to a property's zoning designation. "Lot(s)" means an individual legal lot created by a Final Map for which a building pen-nit for residential construction has been or could be issued. Notwithstanding the foregoing, in the case of an individual legal lot created by such a Final Map upon which Condominiums are entitled to be developed, the number of Lots allocable to such legal lot for purposes of calculating the Backup Special Tax applicable to such Final Map shall equal the number of Condominiums which are permitted to be constructed on such legal lot as shown on such Final Map. "Master Developer"means SLF IV-Millenia,LLC or its successors or assignees as defined in the Development Agreement. "Maximum Special Tax" means for each Assessor's Parcel, the maximum Special Tax, determined in accordance with Sections 3.0 and 3.1) below, which may be levied in a given Fiscal Year on, such Assessor's Parcel of Taxable Property. "Non-Residential Property"means all Assessor's Parcels of Developed Property for which a Building Permit has been issued for the purpose of constructing one or more non-residential.units or structures. "Occupied Residential Property"means all Assessor Parcels of Residential Property for which title is held by an end user(homeowner). "Outstanding Bonds"means all Bonds which are deemed to be outstanding under the Fiscal Agent Agreement. "Prepayment Amount" means the amount required to prepay the Special Tax Obligation in full for an Assessor's Parcel as described in Section 8.A below. "Property Owner Association Property"means any Assessor's Parcel within the boundaries of IA2 owned in fee by a property owner association,including any master or sub-association. A-3 4852-7256-1 10�7v I 2/024036-00�89 2021-03-16 Agenda Packet Page 563 of 724, "Proportionately"or"Prop ortion ate"means for Developed Property, that the ratio of the actual Special Tax levy to the applicable Assigned Special Tax or Backup Special Tax is equal for all Assessor's, Parcels of Developed Property. For Undeveloped Property, "Proportionately" means that the ratio of the actual Special Tax levy per Acre to the Maximum Special Tax per Acre is equal for all Assessor's Parcels of Undeveloped Property. "Proportionately" may similarly be applied to other categories of Taxable Property as listed, in Section 3 below. "Provisional Property"means all Assessor's Parcels of Public Property,Property Owner Association Property or property that would otherwise be classified,as Exempt Property pursuant to the provisions of Section 5,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 5. "Public Property"means any property within the boundaries of IA2,which is owned by,or irrevocably offered for dedication to the federal government,the State of California,the County,the City or any other public agency; provided however that any property owned by a public agency and leased to a private entity and subject to taxation under Section 533,40.1 of the Act shall be taxed and classified in accordance with its use. "Residential Property" means all Assessor's Parcels of Developed Property for which a Building Permit has been issued for the purpose of constructing one or more Residential Units. "Residential Unit"means each separate residential dwelling unit that comprises an independent facility capable of conveyance or rental, separate from adjacent residential dwelling units. "Special Tax"means any special tax levied within IA2 pursuant to the Act and this Amended and Restated Rate and Method of Apportionment of Special Tax. I'Special Tax Obligation" means the total obligation of an Assessor's Parcel of Taxable Property to pay the Special Tax for the remaining life of IA2. "Special Tax Requirement" means that amount required in any Fiscal Year to: (i)pay regularly scheduled Debt Service on all Outstanding Bonds; (ii)pay periodic costs on the Outstanding Bonds, including but not limited to, credit enhancement and rebate payments on the Outstanding Bonds; (iii)pay Administrative Expenses'; (iv)pay any amounts required to establish or replenish any reserve funds for all Outstanding Bonds; (v)accumulate funds to pay directly for acquisition or construction of facilities provided that the inclusion of such amount does not cause an increase in the Special Tax to be levied on Undeveloped Property; and(vi)pay for reasonably anticipated delinquent Special Taxes based on (a)the average delinquency rate for special taxes levied in the previous Fiscal,Year in all community facilities districts within the portion of the City commonly known as Otay Ranch for the first Fiscal Year in which Special Taxes are levied and(b)the delinquency rate for Special Taxes levied in the previous Fiscal Year within IA2 for all subsequent Fiscal Years in which Special Taxes are levied; less(vii)a credit for funds available to reduce the Annual. Special.Tax levy, as detennined by the CFD Administrator pursuant to the Fiscal Agent Agreement. "State"means the State of California. "Taxable Property" means all of the Assessor's Parcels,within.the boundaries of CFD,which are not exempt from the levy of the Special Tax pursuant to law or Section 5 below. "Undeveloped Property" means, for each Fiscal Year, all Taxable Property not classified as Developed Property or Provisional Property. "Zone A" means the specific geographic area designated as such within IA2 and as depicted in Exhibit A attached hereto. A-4 4852-7256-1 10�7v I 2/024036-00�89 2021-03-16 Agenda Packet Page 564 of 724, "Zo�ne B" means the specific geographic area designated as such within IA2 and as depicted in Exhibit A attached hereto. 2. LAND USE CLASSIFICATION Each Fiscal Year,beginning with Fiscal Year 2019-20, each Assessor's Parcel within IA2 shall be classified as Taxable Property or Exempt Property. In addition,all Taxable Property shall further be classified as Developed Property, Undeveloped Property or Provisional Property, and all such Taxable Property shall be subject to the levy of Special Taxes in accordance with this Amended and Restated Rate and Method of Apportionment of Special Tax determined pursuant to Sections 3 and,4 below. Furthermore,each Assessor's Parcel of Developed Property shall be classified according to its applicable Land Use Class based on its Building Square Footage. For Assessor's Parcels of Non-Residential Property developed with Condominiums (e.g., office or industrial condos), the Acreage applicable to each such Condominium for purposes, of levying Special Taxes shall be computed from the Acreage of the legal lot created by the Final Map upon which such Condominiums are entitled to be developed, with the Acreage of such lot allocated to each Condominium on a pro-rata basis using the building square footage of such Condominium relative to the total building square footage of all Condominiums entitled to be developed on such lot. The determination of Building Square Footage for each non-residential Condominium shall be made by reference to the applicable Building Permit,and to the extent a Building Permit has not been issued for all Condominiums to be located on the applicable legal lot,the Building Square Footage attributable to any such Condominiums shall be determined from the recorded condominium plan,or applicable site plan, plot plan, or other appropriate records kept by the City as reasonably determined by the CFD Administrator. In the event the City takes ownership of a Condominium within IA2 and such property in all other respects meets the definition of Public Property as set forth in Section 1, such property shall be exempt from Special Taxes pursuant to Section 5. In the event a Building Pen-nit is issued for one or more residential Condominiums prior to March I of the previous Fiscal Year and an Assessor's Parcel Number has not yet been assigned to each such Condominium for the current Fiscal Year, the applicable Assessor's Parcel may be classified as both Developed Property and Undeveloped Property. In such an instance,the Special Taxes levied on such Assessor's Parcel shall be the sum of the amount derived from the following(i)applying the Assigned Special Tax applicable to each Condominium for which a Building Permit was issued prior to March I of the previous Fiscal Year and(ii)levying the acreage allocable to such actual or planned Condominiums for which a Building Permit has not been issued prior to March I of the previous Fiscal, Year as Undeveloped Property,; the allocable acreage shall be computed on a pro-rata basis based on the relative number of remaining Condominiums to the total number of Condominiums entitled to be developed on such Assessor's Parcel. The total number of Condominiums entitled to be developed on the applicable Assessor's Parcel shall be determined from the recorded condominium map, condominium. plan, applicable site plan, plot plan, or other appropriate records kept by the City as reasonably determined by the CFD Administrator. 3. SPECIAL TAX RATES A. Assigned Special Tax for Developed Property The Assigned Special Tax applicable to an Assessor's Parcel classified as Developed Property commencing Fiscal Year 20 19-20 shall be determined pursuant to Table I or 2 below,as applicable. A-5 4852-7256-1 10�7v I 2/024036-00�89 2021-03-16 Agenda Packet Page 565 of 724, Table I Assigned Special Tax Rates for Developed Property within Zone A Land Use Building Square Assigned Land Use Class Type Footage Special I ax $1 443.24 per I Residential Property < 1 450 Residential Unit 2 Residential Property 1 1450 $1,727.65 per Residential Unit N/A 367.25 per Acre 3 Non-Residential Property $6� Table 2 Assigned Special Tax Rates for Developed Property within Zone B Land Use Land Use Building Square Assigned Class Type Footage Special I ax Residential Property N/A $6 367.25 per Acre 2 Non-Residential Property N/A 367.25 per Acre $61 On each July 1, commencing July 1, 2020, the Assigned Special Tax for Developed Property shall be increased by two percent(2.00%)of the amount in effect in the prior Fiscal Year. B. Backup Special Tax for Developed Property When a Final, Map or a condominium plan is recorded within.Zone A or Zone B the Backup Special Tax for Assessor's Parcels of Developed Property classified as Residential Property shall be determined as follows: Zone A For each Assessor's Parcel of Residential Property or for each Assessor's Parcel of Undeveloped Property to be classified as Residential, Property upon its development within the Final. Map area in Zone A,the Backup Special Tax for Fiscal Year 2019-20 shall be the rate per Lot calculated according to the following formula: Zone A $42,148 x A B— -------- L The terms have the following meanings: B= Backup Special.Tax per Lot A— Acreage classified or to be classified as Residential Property in such Final Map. The land area applicable to a Condominium,shall be computed from the Acreage of the Lot A-6 4852-7256-1 10�7v I 2/024036-00�89 2021-03-16 Agenda Packet Page 566 of 724, on which the Condominium is located,with the Acreage for such Lot allocated equally among all of the Condominiums located or to be located on such Lot. L— For a Final Map, the number of Lots which are classified or to be classified as Residential Property. Zone B For each Assessor's Parcel of Developed Property classified as Non-Residential Property or for each Assessor's Parcel of Undeveloped Property to be classified as Non-Residential Property within the Final Mat)area,the Backup Special Tax for Fiscal Year 2019-20 shall be determined by multiplying$42,148 for Zone A and $7,075 for Zone B by the total Acreage of any such Assessor's Parcel. For each Assessor's Parcel of Developed Property classified as Residential Property or for each Assessor's Parcel of Undeveloped Property to be classified,as Residential Property in Zone B within the Final Map area, the Backup Special Tax for Fiscal Year 2019-20 shall be determined by multiplying$7,075 by the total Acreage of any such Assessor's Parcel. Notwithstanding the foregoing,if Assessor's Parcels 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 Map, then the Backup Special Tax applicable to such Assessor's Parcels shall be recalculated to equal the total amount of Backup Special Tax that would have been generated if such change did not take place. On each July 1,commencing July 1,2020,the Backup Special Tax applicable to each Assessor's Parcel of Taxable Property shall be increased by two percent(2.00%)of the amount in effect in the prior Fiscal Year. C. Maximum Special Tax for Developed Property Each Fiscal Year, the Maximum Special Tax for an Assessor's Parcel of Developed Property shall be the greater of the applicable Assigned Special Tax or Backup Special Tax. D. Maximum Special Tax for Provisional Property and Undeveloped Property The Maximum Special Tax for Provisional Property and Undeveloped Property commencing in Fiscal Year 2019-,20 shall be $,42,148 per Acre for Zone A and$7,075 per Acre for Zone B. On each July 1, commencing July 1, 2020, the Maximum Special Tax for Provisional Property and Undeveloped Property shall, be increased by two percent (2.00%) of the amount in effect in the prior Fiscal Year. E. Multiple Land Use Classes In some instances an.Assessor's, Parcel of Developed Property may contain. more than one Land Use Class. The Maximum,Special Tax that may be levied on such an Assessor's Parcel shall only be levied on the Residential Property Land Use Class located on such Assessor's Parcel. F. Administrative Special Tax Reduction Prior to the issuance of Bonds, the Assigned Special Tax, Backup Special Tax, and Maximum Special Tax(collectively the"Special Tax Rates")on Taxable Property may be reduced in accordance with,and subject to the conditions set forth in this paragraph. Upon the City's receipt of a written request from Master Developer and the CFD Administrator, the Special Tax Rates on Taxable Property may be reduced to a level which will provide not less than the sum of estimated Administrative Expense A-7 4852-7256-1 10�7v I 2/024036-00�89 2021-03-16 Agenda Packet Page 567 of 724, Requirement and one hundred ten percent (I 10%) of the estimated debt service with respect to the amount of Bonds requested to be issued in such written request. If it is reasonably determined by the CFD Administrator that the total effective tax rate on Residential Property,as determined in accordance with the Development Agreement,exceeds the maximum level allowed in the Development Agreement, the Special Tax Rates may be reduced to the amount necessary to satisfy the maximum allowable effective tax rate requirement on Residential Property with the written consent of Master Developer, which consent shall not be unreasonably withheld,and the CFD Administrator. It shall not be required that reductions among each"Building Square Footage" range of Residential Property be proportional. Additionally, the "CFD Public Facilities Costs" amount in Section 8 shall be reduced commensurate with any reductions to the Special Tax Rates pursuant to this paragraph, as reasonably determined by the CFD Administrator. A certificate in substantially the form attached hereto as Exhibit"B" shall be used for purposes of evidencing the required written consent and effectuating the reduction to the Special Tax Rates. The reductions permitted pursuant to this paragraph shall be reflected in an amended Notice of Special Tax Lien which the City shall cause to be recorded. 4. METHOD OF APPORTIONMENT For each Fiscal Year, commencing Fiscal Year 2019-20, the CFD Administrator shall levy the Special Tax on all Taxable Property in accordance with the following steps: Ste : The Special Tax shall be levied Proportionately on each Assessor's Parcel of Developed Property at up to 100%of the applicable Assigned Special Tax to satisfy the Special Tax Requirement; Ste : If additional monies are needed to satisfy the Special Tax Requirement after Step I has been completed,the Special Tax shall be levied Proportionately on each Assessor's Parcel of Undeveloped Property up to 100%of the Maximum Special Tax for Undeveloped Property; Ste : If additional monies are needed to satisfy the Special Tax Requirement after the first two steps have been completed, then the Special Tax amount determined in Step 1 shall be increased Proportionately on each Assessor's Parcel of Developed Property up to I O�O�%of the Maximum Special Tax for Developed Property; Ste : 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 each Assessor's Parcel of Provisional Property up to 100%of the Maximum Special Tax for Provisional Property. Notwitb standing the above, under no circumstances will the Special Tax levied in any Fiscal.Year against any Assessor's Parcel of Residential Property for which an occupancy permit for private residential use has been issued be increased as a result of a delinquency or default in the payment of the Special Tax applicable to any other Assessor's Parcel,within IA2 by more than ten percent(10%) above what would have been, levied in the absence of such delinquencies or defaults. 5. EXEMPTIONS The CFD Administrator shall classify as Exempt Property (i)Assessor's Parcels of Public Property, (ii)Assessor's Parcels of Property Owner Association Property,(iii)Assessor's Parcels which are used as places of worship and are exempt from ad valorem property taxes because they are owned by a religious organization, and (iv)Assessor's Parcels with public or utility easements making impractical their utilization for other than the purposes set forth in the easement,provided that no such clas,s,ification would reduce the sum of all Taxable Property in IA2 to less than 13.29 Acres for Zone A or 7.51 Acres for Zone B. Assessor's Parcels which cannot be classified as Exempt Property because such classification would reduce the sum of all Taxable Property in IA2 to less than 13.29 Acres for Zone A or 7.51 Acres, for Zone B, shall be classified as Provisional Property and will continue to be subject to the IA2 Special Taxes accordingly. Tax exempt status for the purpose of this A-8 4852-7256-1 10�7v I 2/024036-00�89 2021-03-16 Agenda Packet Page 568 of 724, paragraph will be assigned by the CFD Administrator in the chronological order in which property becomes eligible for classification as Exempt 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 the first paragraph of Section 5 above 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. 6. APPEALS Any landowner who pays the Special Tax and claims the amount of the Special Tax levied on his or her Assessor's Parcel is in error shall first consult with the CFD Administrator regarding such error not later than thirty-six(3�6)months after first having paid the first installment of the Special Tax that is disputed. If following such consultation the CFD Administrator determines that an error has occurred, then the CFD Administrator shall take any of the following actions, in order of priority,in order to correct the error: (i) Amend the Special Tax levy on the landowner's Assessor's Parcel(s)for the current Fiscal Year prior to the payment date, (ii) Require the CFD to reimburse the landowner for the amount of the overpayment to the extent of available CFD funds, or (iii) Grant a credit against, eliminate or reduce the future Special Taxes on the landowner's Assessor's Parcel(s)in the amount of the overpayment. If following such consultation and action by the CFD Administrator the landowner believes such error still exists, such person may file a written notice of appeal with the City Council. Upon the receipt of such notice,the City Council or designee may establish such procedures as deemed necessary to undertake the review of any such appeal. If the City Council or designee deten-nines an error still exists,the CFD Administrator shall take any of the actions described as(i), (ii)and(iii)above, in order of priority,in order to correct the error. The City Council or designee thereof shall interpret this Amended and Restated Rate and Method of Apportionment of Special Tax for purposes of clarifying any ambiguities and ma1w determinations relative to the administration of the Special Tax and any landowner appeals. The decision of the City Council or designee shall be final and binding as to all persons. 7. COLLECTION OF SPECIAL TAXES Collection of the Annual, Special Tax shall be made by the County in the same manner as ordinary ad valorem property taxes are collected and the Annual Special Tax shall be subject to the same penalties and the same lien priority in the case of delinquency as ad valorem taxes; provided, however, that the City Council may provide for (i)other means of collecting the Special, Tax, including direct billings thereof to the property owners; and (ii)judicial foreclosure of delinquent Annual Special Taxes. 8. PREPAYMENT OF SPECIAL TAX OBLIGATION A. Prepayment in Full Property owners may prepay and permanently satisfy the Special Tax Obligation by a cash settlement with the City as permitted under Government Code Section 53344. The following definitions,apply to this Section 8: A-9 4852-7256-1 10�7v I 2/024036-00�89 2021-03-16 Agenda Packet Page 569 of 724, "CFD Public Facilities Costs"means$11,,500,000 or such lower number as(i) shall be determined by the CFD Administrator as sufficient to acquire or construct the facilities to be financed under the Act and financing program for IA2, or (ii)shall be determined by the City Council concurrently with a covenant that it will not issue any more Bonds(except refunding bonds). "Construction Fund"means the fund(regardless of its name)established pursuant to the Fiscal Agent Agreement to hold funds, which are currently available for expenditure to acquire or construct the facilities or pay fees authorized to be funded by CFD No. 16-1 for IA2. "Future Facilities Costs"means the CFD Public Facilities,Costs minus (i) costs previously paid from the Construction Fund to acquire or construct the facilities, (ii) monies currently on deposit in the Construction Fund, and(iii)monies currently on deposit in an escrow or other designated fund that are expected to be available to finance CFD Public Facilities Costs. "Outstanding Bonds" means all Previously Issued Bonds, which remain outstanding as of the first interest and/or principal payment date following the current Fiscal Year excluding Bonds to be redeemed at a later date with proceeds of prior Special Tax prepayments. "Previously Issued Bonds"means all Bonds that have been issued prior to the date of prepayment. The Special Tax Obligation applicable to an Assessor's Parcel of Developed Property, or Undeveloped Property for which a Building Permit has been issued may be prepaid and the obligation to pay the Special Tax for such Assessor's Parcel permanently satisfied as described herein, provided that a prepayment may be made with respect to a particular Assessor's Parcel only if there are no delinquent Special Taxes with respect to such Assessor's Parcel at the time of prepayment. An owner of an Assessor's Parcel eligible to prepay the Special Tax Obligation shall provide the CFD Administrator with written notice of intent to prepay, and designate or identify the company or agency that will be acting as the escrow agent, if any. The CFD Administrator shall provide the owner with a statement of the Prepayment Amount for such Assessor's Parcel within thirty (30) days of the request, and may charge a reasonable fee for providing this service. Prepayment must be made at least 60 days prior to any redemption date for the Bonds to be redeemed with the proceeds of such prepaid Special Taxes, unless a shorter period is acceptable to the Fiscal Agent and the City. The Prepayment Amount (defined below) shall be calculated for each applicable Assessor's Parcel or group of Assessor's Parcels as summarized below(capitalized terms as defined below): Bond Redemption Amount plus Redemption Premium plus Future Facilities Prepayment Amount plus Defeasance Amount plus Prepayment Administrative Fees and Expenses less Reserve Fund Credit less Capitalized Interest Credit Total: equals Prepayment Amount As of the proposed date of prepayment, the Prepayment Amount (defined in Step 14 below) shall be calculated as follows: Step No.: I Confirm,that no Special Tax delinquencies apply to such Assessor's Parcel. A-10 4852-7256-1 10�7v I 2/024036-00�89 2021-03-16 Agenda Packet Page 570 of 724, 2. For Assessor's Parcels of Developed Property, determine the Maximum Special Tax. For Assessor's Parcels of Undeveloped Property for which a Building Permit has been issued, compute the Maximum Special Tax for that Assessor's Parcel as though it was already designated as Developed Property, based upon the Building Permit which has already been issued for that Assessor's Parcel. 3. Divide the Maximum Special Tax computed pursuant to paragraph 2 by the total expected Maximum Special Tax revenue for IA2 assuming all Building Permits have been issued(build- out) within IA2, excluding any Assessor's Parcels for which the Special Tax Obligation has, been previously prepaid. 4. Multiply the quotient computed pursuant to paragraph 3 by the Outstanding Bonds and round that number up to the nearest$5,000 increment to compute the amount of Outstanding Bonds to be retired and prepaid for all applicable Assessor's Parcels (the "Bond Redemption Amount")�. 5. Multiply the Bond Redemption Amount computed pursuant to paragraph 4 by the applicable redemption premium (expressed as a percentage), if any, on the Outstanding Bonds to be redeemed at the first available call date(the"Redemption Premium")�. 6. Compute the Future Facilities Costs. 7. Multiply the quotient computed pursuant to paragraph 3 by the amount determined pursuant to paragraph 6 to compute the amount of Future Facilities Costs to be prepaid (the "Future Facilities Prepayment Amount"). 8. Compute the amount needed to pay interest on the Bond Redemption Amount from the first bond interest and/or principal payment date following the current Fiscal Year until the expected redemption date for the Outstanding Bonds which, depending on the Fiscal Agent Agreement, may be as early as the next interest payment date. 9. Compute the amount the CFD Administrator reasonably expects to derive from the reinvestment of the Prepayment Amount less the Future Facilities Prepayment Amount and the Prepayment Administrative Fees from the date of prepayment until the redemption date for the Outstanding Bonds to be redeemed with the prepayment. 10. Subtract the amount computed in paragraph 9 from the amount computed in paragraph 8 (the "Defeasance Amount"). 11. Calculate the administrative fees and expenses of CFD No. 16-1 for IA2, including the costs of computation of the prepayment, the costs to invest the prepayment proceeds, the costs of redeeming the Outstanding Bonds to be redeemed with the prepayment, and the costs of recording any notices to evidence the prepayment and the redemption (the ".Prepayment Administrative Fees"). 12. If reserve funds for the Outstanding Bonds, if any, are at or above 1,00%, of the reserve requirement(as defined in the Fiscal Agent Agreement)on the prepayment calculation date, a reserve fund credit shall be calculated as a reduction in the applicable reserve fund for the Outstanding Bonds to be redeemed pursuant to the prepayment (the "Reserve Fund Credit"). No Reserve Fund Credit shall be granted if,after the Prepayment Amount is calculated,reserve funds are below 100%of the reserve requirement after taking into account such.prepayment. A-I 1 4852-7256-1 10�7v I 2/024036-00�89 2021-03-16 Agenda Packet Page 571 of 724, 13. If any capitalized interest for the Outstanding Bonds will not have been expended at the time of the first interest and/or principal payment following the current Fiscal Year, a capitalized interest credit shall be calculated by multiplying the quotient computed pursuant to paragraph 3 by the expected balance in the capitalized interest fund after such first interest and/or principal payment(the"Capitalized Interest Credit"'). 14. The amount to prepay the Special Tax Obligation is equal to the sum of the amounts computed pursuant to paragraphs 4, 5, 7, 10, and 11, less the amounts computed pursuant to paragraphs 12 and 13 (the"Prepayment Amount"). 15. From the Prepayment Amount,,the sum of the amounts computed pursuant to paragraphs 4, 51 and 10, less the amounts computed pursuant to paragraphs 12 and 13 shall be deposited into the appropriate fund as established under the Fiscal Agent Agreement and be used to retire Outstanding Bonds, or make Debt Service payments. The amount computed pursuant to paragraph 7 shall be deposited into the Construction Fund. The amount computed pursuant to paragraph I I shall be retained by CFD No. 16-1. The Prepayment Amount may be sufficient to redeem an amount 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 Fiscal Agent Agreement to redeem Bonds to be used with the next prepayment of Bonds. The CFD Administrator will confin-n that all previously levied Special Taxes have been paid in full. With respect to any Assessor's Parcel for which the Special Tax Obligation is prepaid in full, once the CFD Administrator has confirmed that all previously levied Special Taxes have been paid, the City Council shall cause a suitable notice to be recorded in compliance with the Act, to indicate the prepayment of the Special Tax Obligation and the release of the Special Tax lien on such Assessor's Parcel, and the obligation of the owner of such Assessor's Parcel to pay the Special Tax shall cease. Notwithstanding the foregoing, no Special Tax prepayment shall be allowed unless the aggregate amount of Maximum Special Taxes less the Administrative Expense Requirement that may be levied on Taxable Property, respectively, after the proposed prepayment is at least 1.1 times the Debt Service on all Outstanding Bonds in each Fiscal Year. B. Partial Prepayment The Special Tax on,an,Assessor's Parcel of Developed Property or Undeveloped Property for which a Building Permit has been issued may be partially prepaid. The amount of the prepayment shall be calculated as in Section 8.A.; except that a partial prepayment shall be calculated according to the following formula: PP—(PE-A)x F+A These terms have the following meaning: PP=the partial prepayment PE—the Prepayment Amount calculated according to Section 8.A F—the percentage by which the owner of the Assessor's Parcel(s)is partially prepaying the Special Tax Obligation A—the Prepayment Administrative Fees and Expenses from Section 8.A The owner of any Asses,s,o�r's, Parcel who desires such partial prepayment shall notify the CFD Administrator of (i),such owner's intent to partially prepay the Special. Tax Obligation, (ii)the A-12 4852-7256-1 10�7v I 2/024036-00�89 2021-03-16 Agenda Packet Page 572 of 724, percentage by which the Special Tax Obligation shall be prepaid, and(iii)the company or agency that will be acting as the escrow agent, if any. The CFD Administrator shall provide the owner with a statement of the amount required for the partial prepayment of the Special Tax Obligation for an Assessor's Parcel within sixty (60) 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 Section 8.A., and (ii)indicate in the records of CFD No. 16-1 for IA2 that there has been a partial prepayment of the Special Tax Obligation and that a portion of the Special Tax with respect to such Assessor's Parcel, equal to the outstanding percentage (1.00 -F) of the Maximum Special Tax, shall continue to be levied,on such Assessor's Parcel. Notwithstanding the foregoing,no partial prepayment shall be allowed unless the aggregate amount of Maximum Special Taxes less the Administrative Expense Requirement that may be levied on Taxable Property,respectively,after the proposed partial prepayment is at least 1.1 times the Debt Service on all Outstanding Bonds in each Fiscal Year. 9. TERM OF SPECIAL TAX The Special Tax shall be levied as long as necessary to meet the Special Tax Requirement,but in any event not after Fiscal Year 20�59-60. 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I 2021-03-16 Agenda Packet Page 574 of 724, EXHIBIT B CITY OF CHULA VISTA AND CFD NO. 16-1 CERTIFICATE I Pursuant to Section 3F of the Amended and Restated Rate and Method of Apportionment of Special Tax (the "RMA"), the City of Chula Vista (the "City") and Community Facilities District No. 16-1 of the City of Chula Vista("CFD No. 16-1")hereby agree to a reduction in the Special Tax for Developed Property,Undeveloped Property, and/o�r Provisional Property: (a) The information in the RMA relating to the Special Tax for Developed Property,Undeveloped Property, and Provisional Property shall be modified as follows: [insert Table I andlor 2 showing revised Assigned Special Tax ratesfbr Developed Property, insert revised Backup Special Tax rates.fbr Developed Property by Zone, and insert change to Maximum Special Tax ratesfbr Undeveloped Property and Provisional Property by Zone] (b) The CFD Public Facilities Costs in Section 8 shall be changed to $ 2. Special Tax rates for Taxable Property may only be modified prior to the issuance of Bonds. 3. Upon execution of the Certificate by the City and CFD No. 16-1 the City shall cause an amended Notice of Special Tax Lien for TA2 to be recorded reflecting the modifications set forth herein. By execution hereof, the undersigned acknowledges, on behalf of the City of Chula Vista and CFD No. 16-1, receipt of this Certificate and modification of the RMA as set forth in this Certificate. CITY OF CHULA VISTA By: Date: CFD Administrator COMMUNITY FACILITIES DISTRICT NO. 16-1 OF THE CITY OF CHULA VISTA By: Date: A-15 4852-7256-1 10�7v I 2/024036-00�89 2021-03-16 Agenda Packet Page 575 of 724, APPENDIX B-�2 APPRAISAL REPORT 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 576 of 724, APPENDIX B-�2 SUPPLEMENT TO APPRAISAL REPORT B-2-1 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 577 of 724, APPENDIX C FORM OF OPINION OF BOND COUNSEL Bond Counsel will deliver an opinion for the Bonds substantially in the form set forth below: C-1 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 578 of 724, APPENDIX D GENERAL ECONOMIC AND DEMOGRAPHIC INFORMATION FOR THE CITY OF CHULA VISTA AND SAN DIEGO COUNTY Set.fbrth below is certain demographic iqfbrmation regarding the City of'Chula Vista (the "City') and the County of San Diego (the "County'). This iqformation i's providedjbr informational purposes only and general background. The information set.fbrth herein has been obtainedftom third party sources believed to be reliable, but such infbrmation is not guaranteed by the District, the City or the Underwriter as to accuracy or completeness. Neither the delivery of this Official Statement nor any sale thereafter of the securities offered hereby shall under any circumstances create any implication that there has been no change in any infbrmation contained in this A endix D since the date of'the Qf pp ficial Statement. The Bonds are not a debt of'the City, the County, the State, or any of its political subdivisions, and none qf the City, the County, the State nor any of its political subdivisions is liable thereon. The District believes the iqformation and data within this Appendix D to be, the latest data available; however, the current state of the economy at City, County, State and national levels may not be rqflected in the data discussed below because more up-to-date publicly available iqformation is not available to the District. General Information The City is located on San Diego Bay in Southern California, 8 miles south of the City of San Diego and 7 miles north of the Mexico border, in an area generally known as "South Bay." Chula Vista's city limits cover approximately 50 square miles. Neighboring communities include the City of San Diego and National City to the north and the City of Imperial Beach and the communities of San Ysidro and Otay Mesa to the south. The City,with a total population of approximately 272,202, is the second largest city in the County. Population The following table provides a comparison of population,growth for the City and the County between 2016 and 2020. TABLE NO.D-I POPULATION 2016-2020 Year San Diego (January 1) Ch u la Vis ta County 2016 2631278 3�285�150 2017 2651673 31)3061)889 20 108 2681406 3�326�318 2 0 1'�-) 2711032 3�340�312 2020 2721202 3i343i355 Source: State of California,Department of Finance,CA;E-4 Population Estimates for Cities,Counties and the State,2011-2020, with 2010 Benchmark,Sacramento,CA Employment and Industry The following table summarizes the civilian labor force, civilian employment and civilian unemployment figures over the period from.2015 through 2019 in the City, the County, the State of California D-1 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 579 of 724, and the United States. As of November 2020,, the County and the City's, unemployment rates were 7.7% and, 9.3%,respectively. TABLE NO.D-2 City of Chula Vista,County of San Diego, State of California and United States Labor Force,Employment and Unemployment Yearly Average Civilian Civilian Labor Civilian Civilian Unemployment Year and Area Force Employment") Unemployment(2) Rate(3) 2015 Chula Vista 1201,700 1121800 7�900 6.5% San Diego 11,5481,600 114681100 W500 5.2 County California 181,828.11800 17,660,700 1.1168.1100 6.2 United StateS(4) 157113000 148�8341,000 8.1296.1000 5.3 2016 Chula Vista 120,600 114400 6200 5.2% San Diego 1.115631,000 L4891100 73,900 4.7 County California 19,021 200 17980 100 110411100 5.5 United StateS(4) 1591,187,000 15 1�4361,000 7.1751.1000 4.9 2017 Chula Vista 122,000 116700 5400 4,.4,% San Diego 11,5721,800 1�5091600 63,1200 4.0 County California 1911761400 1812571100 91V00 4,.8 United StateS(4) 1601,3201000 15313371,000 619821000 4.4 2018 Chula Vista 1221900 1181400 41500 3.7% San Diego 115181500 115281100 531500 3.4, County California 1912801800 1814601700 820�100 4,.3 United StateS(4) 162107500 15517611000 6�31400 3.9 2019 Chula Vista 1231600 1191300 41300 3.5% San Diego 115901600 115391900 501700 3.2 County California 191,4111,600 1816271400 7841200 4.0 United StateS(4) 163153900 15715381000 60 1 NO 3.7 Note: Data is not seasonally adjusted. (1) includes persons involved in labor-management trade disputes. (1) Includes all persons without jobs who are actively seeking work. (1) The unemployment rate is computed from unrounded data;therefore,it may differ from.rates computed from rounded figures in this table. (4) Not strictly comparable with data for prior years. Source: California Employment Development Department and U.S.Department of Labor,Bureau of Labor Statistics. D-2 4852-7256-1 I07vI2/024036-0089 2021-03-16 Agenda Packet Page 580 of 724, The following table sets forth the industry employment and the labor force estimates for the years 20 15 through 2019 for the San Diego Carlsbad MSA. Annual industry employment information is not compiled by sector for the City. TABLE D-3 SAN DIEGO CARLSBAD MSA INDUSTRY EMPLOYMENT&LABOR FORCE -BY ANNUAL AVERAGE 2015 through 2019 20�15 2016 2017 20�18 2019 Civilian Labor Force 11548,1600 li56300 115721800 115811500 1�59000 Civilian Employment 11468,1100 1 i48%100 11509160�O 11528,1100 1�53%900 Civilian Unemployment 801500 73i900 631200 5 315 O�O 50�700 Civilian Unemployment Rate 5.2% 4.7% 4.0% 3.4% 3.2% Total Farm 9J00 81900 8�700 V00 9.00 Total Nonfarm L38400 1�42200 1.�452�2O�O 11482�200 ].�503N0 Total Private I�148�700 1�p 1 80�300 11205NO 11234�100 L254�200 Goods Producing 176.00 18500 189�200 196�400 199�500 Mining&Logging 300 300 300 400 400 Construction 691900 761300 791500 83170�O 8400 Manufacturing 1061600 108,400 1091400 1121300 115J00 Service Providing 1120�8,1000 1123700 1 i2631000 I i28518,00 1�3041)400 Trade,Transportation& 2191300 220i900 2241700 2251100 22400 Utilities Wholesale Trade 44�100 43�700 431800 431800 44�200 Retail Trade 146.00 147�500 149MOO 148MOO 145 A0 Transportation,Warehousing 28�400 29�700 321000 3 313 O�O 34A0 &Utilities Information 23 400 231)200 23 400 2300 23�500 Financial Activities 71140�O 731,000 741600 761000 761400 Professional&Business 2291500 234,1700 2391000 2481900 25600 Services Educational&Health Services 1921700 1981700 2041300 2081900 21600 Leisure&Hospitality 1821400 1901400 1951600 1991600 202400 Other Services 531200 541,400 551000 551500 551800 Government 236,200 24 246,300 248,100 24 Total,All Industries 1 P393P900 1 A3 1�500 1 P460P900 1�4911400 1�513�500 Note: Does not include proprietors,self-employed,unpaid volunteers or family workers,domestic workers in households and persons involved in labor-management trade disputes. Employment reported by p,lace of work. Items may not add to total due to independent rounding. The"Total,All Industries"data is not directly comparable to the employment data found in this Appendix C. Source: State of California, Employment Development Department, San Diego Carlsbad MSA (San Diego County) Industry Employment&Labor Force-by Annual Average,March 2019 Benchmark. D-3 4852-7256-1 10�7vl2/024036-00�89 2021-03-16 Agenda Packet Page 581 of 724, The following tables lists the largest employers operating within the City and their respective number of employees as of June 30,2019: TABLE NO.D-4 LARGEST EMPLOYERS JUNE 305 2019 Name of Company No. of Employees Type of BusinesslProduct Sweetwater Union High School District 4J33 Education Chula Vista Elementary School District 31680 Education Sharp Chula Vista Medical Center 2�287 Hospital Rohr Inc./Goodrich Aerospace 1�928 Aerospace Manufacturing Southwestern Community College 11743 Education Wal-Mart 11323 General Merchandise City of Chula Vista 1�208 Government Scripps Mercy Hospital Chula Vista 1 M73 Hospital Aquatica 698 Water Park Costco Wholesale Group 674 General Merchandise Source: City of Chula Vista,Comprehensive Annual Financial Report for the year ended June 30,2019. Income The following table summarizes per capita personal income for San Diego County, California and the United States for 2015 through 2019. TABLE NO.D-5 PER CAPITAL PERSONAL INCOME 2015-2019 Year San Diego County State of California United States 2015 541882 55�833 49M 19 2016 561606 58M48 50M 15 2017 581380 601549 521118 2018 611147 63�720 54 06 2019 631729 66fil 9 56�490 Source: U.S. Department of Commerce,Bureau of Economic Analysis. D-4 4852-7256-1 10�7vl2/024036-00�89 2021-03-16 Agenda Packet Page 582 of 724, Commercial Activity The following table summarizes the volume of retail sales and taxable transactions for Chula Vista for 2015 through 2019. TABLE NO.D-6 CITY OF CHULA VISTA TOTAL TAXABLE TRANSACTIONS (in Thousands) 2015-2019 Total Taxable Retail Sales Retail Sales Transactions Issued Sales Year $(000's) Permits $(000's) Permits 2015 21474570 2926 2767403 4803 2016 21,4571,307 2.11976 2.1752.1844 4.1896 2017 21,5271,879 3.11055 2.1842.1457 5.1055 2018 21653,083 31132 2 979 61,1 5296 2019 21696,571 31187 3039 149 5443 Source: California StateBoard of Equalization,Taxable Sales in California(Sales and Use Tax). Building Activity The following table summarizes building activity valuations for Chula Vista for the years 2015 through 2019. TABLE NO.D-7 CITY OF CHULA VISTA BUILDING ACTIVITY AND VALUATION (in Thousands) 2015-2019 2015 2016 2017 20�18 2019 Residential $ 143�1761844 $ 17112121179 $ 30813531176 $420�1,786i954 $ 192,926,249 Non-Residential 6120662094� 862935J26 18323321244 832069�145 6928822180 Total Valuation $::::::2:Q4:j:24:2 9 3 8 $262 808 4"n Total Permits 717 1 M45 1�071 1�741 825 Source: California Hornebuilding Foundation and Construction Industry Research Board. D-5 4852-7256-1 10�7vl2/024036-00�89 2021-03-16 Agenda Packet Page 583 of 724, APPENDIX E SUMMARY OF CERTAIN PROVISIONS OF THE BOND INDENTURE The.fbllowing is a summary of'certain dqfinitions and provisions qf'the Indenture which is not described elsewhere in the Official Statement. This Summary does not p�urport to be comprehensive and rqprence should be made to the Indenturefior afull and complete statement oj'its provisions. E-1 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 584 of 724, APPENDIX F FORM OF DISTRICT CONTINUING DISCLOSURE AGREEMENT F-1 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 585 of 724, APPENDIX G FORMS OF DEVELOPERS CONTINUING DISCLOSURE CERTIFICATES CONTINUING DISCLOSURE CERTIFICATE (LENNAR HOMES OF CALIFORNIA,INC.) CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 16-1(MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS This Continuing Disclosure Certificate (Lennar Homes of California, Inc.) (this "Disclosure Certificate")is executed and delivered by the undersigned(the"Property Owner")and Spicer Consulting Group as dissemination agent (the "Dissemination Agent") in connection with the issuance of the bonds captioned above (the (.'Bonds") by Community Facilities District No. 16-1 (Millenia) (the "District"), situated in the City of Chula Vista, County of San Diego, State of California. The Bonds are being issued pursuant to a resolution adopted by the City Council of the City, acting as legislative body of the District on March—, 2021, and a Bond Indenture, dated as of April 1, 2021, (the "Indenture"), by and between the District and Wilmington Trust,National Association, as fiscal agent(the"Fiscal Agent"). The Property Owner covenants and agrees as follows: Section 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and, delivered by the Property Owner for the benefit of the holders and beneficial owners of the Bonds. Section 2. Definitions. In addition to the definitions, set forth above and in the Indenture, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings: "Af .filiate" means any person presently directly(or indirectly through one or more intermediaries) currently under managerial control of the Property Owner, and about whom information could be material to potential investors in their investment decision regarding the Bonds (including without limitation information relevant to the proposed development of the Property or the Property Owner's ability to pay the Special Taxes related to the Property prior to delinquency). "Assumption Agreement lv�means an undertaking of an Obligated Owner,or an Affiliate thereof,for the benefit of the holders andbeneficial owners of the Bonds containing terms substantially similar to this Disclosure Certificate (as modified for such Obligated Owner's development and financing plans with respect to the Property),whereby such Obligated Owner or Affiliate agrees to provide Periodic Reports and notices of significant events,setting forth the information described in sections 4 and 5 hereof,respectively, with respect to the portion of the Property owned by such Obligated Owner and its Affiliates and, at the option of the Property Owner or such Obligated Owner, agrees to indemnify the Dissemination Agent (if any)pursuant to a provision substantially in the form of Section I I hereof "Dissemination Agent" means Spicer Consulting Group, or any successor Dissemination. Agent designated in writing by the Property Owner, and which has filed with the Property Owner,the District and the Fiscal Agent a written acceptance of such designation, and which is experienced in providing dissemination agent services such as those required under this Disclosure Certificate. G-1 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 586 of 724, "Improvement Area 1�means Improvement Area No. 2 of the District. "Liste�d Events"means any of the events listed in Section 5(a) of this Disclosure Certificate. "MSRB" means the Municipal Securities Rulemaking Board, which has been designated by the Securities and Exchange Commission as the sole repository of disclosure information for purposes of the Rule, or any other repository of disclosure information that may be designated by the Securities and Exchange Commission as such for purposes of the Rule in the future. "Obligated Owner"means, as of any Report Date, an owner of all or a portion of the Property that represents more than 50%of the single family residential units in the Planned Development. "Official Statement"means the final official statement executed by the District in connection with the issuance of the Bonds. "Partiei ating Underwriter" means Stifel, Nicolaus & Company, Incorporated, the original P Underwriter of the Bonds. "Periodic Report"means any Periodic Report provided by the Property Owner pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate. "Person" means an individuaL a corporatio�n, a partnership, a limited liability company, an association, a joint stock company, a trust, any unincorporated, organization or a government or political subdivision thereof. "Planned Development" means the development plan for the Property described in the Official Statement under "PROPERTY OWNERSHIP AND THE DEVELOPMENT—Lennar Homes Development and Financing Plan"as such information has been updated, if any, in a prior Periodic Report. "Property 99 means Lot I of Tract No. 16409 and Lot I of Tract No. 16408. "Report Date"means December 31 and June 30 of any fiscal year. "Rule" means Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time. "Special Taxes" means the special taxes of the District levied on taxable property within the Improvement Area. Section 3. Provision of Periodic Reports. (a) The Property Owner shall, or, upon written direction of the Property Owner the Dissemination Agent shall,not later than the Report Date, commencing June 30,202 1,file with the MSRB a Periodic Report which is consistent with the requirements of Section 4 of this Disclosure Certificate. Not later than 15 calendar days prior to the Report Date, the Property Owner shall provide the Periodic Report to the Dissemination Agent (if different from the Property Owner). The Property Owner shall provide a written certification with (or included as a part of) each Periodic Report furnished to the Dissemination Agent(if different from the Property Owner)to the effect that such Periodic Report constitutes the Periodic Report required to be furnished by it under this Disclosure Certificate. The Dissemination Agent may conclusively rely upon such certification of the Property Owner and shall have no duty or obligation to review the Periodic Report. The Periodic Report may be submitted as a single document or as separate G-2 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 587 of 724, documents comprising a package, and may incorporate by reference other information as provided in Section 4,of this Disclosure Certificate. (b) If the Dissemination Agent does not receive a Periodic Report by 15 calendar days prior to the Report Date, the Dissemination Agent shall send a reminder notice to the Property Owner that the Periodic Report has not been provided as required under Section 3(a) above. The reminder notice shall instruct the Property Owner to determine whether its obligations under this Disclosure Certificate have terminated (pursuant to Section 6 below) and, if so, to provide the Dissemination Agent with a notice of such termination in the same manner as for a Listed Event (pursuant to Section 5 below). If the Property Owner does not provide, or cause the Dissemination Agent to provide, a Periodic Report to the MSRB by the Report Date as required in subsection (a) above, the Dissemination Agent shall send a notice to the MSRB in substantially the form attached hereto as Exhibit A,with a copy to the Fiscal Agent(if other than the Dissemination Agent),the District,the Participating Underwriter and the Property Owner. (c) With respect to the Periodic Report, the Dissemination Agent shall, to the extent the Periodic Report has been furnished to it, file the Periodic Report with the MSRB and file a report with the Property Owner (if the Dissemination Agent is other than the Property Owner),, the District and the Participating Underwriter certifying that the Periodic Report has been provided pursuant to this Disclosure Certificate, stating the date it was provided to and filed with the MSRB. Section 4. Content of Periodic Reports. The Property Owner's Periodic Report shall contain or incorporate by reference the information set forth in Exhibit B, any or all of which may be included by specific reference to other documents, including official statements of debt issues of the Property Owner or related public entities, which have been submitted to the MSRB or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from the MSRB. The Property Owner shall clearly identify each such other document so included by reference. In addition to any of the information expressly required tobe provided in Exhibit B, the Property Owner's Periodic Report shall include such further information, if any, as, may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading. Section 5. Reporting of Significant Events. (a) The Property Owner shall give or cause to be Oven,notice of the occurrence of any of the following Listed Events with respect to itself or the Property, if material: (i) bankruptcy or insolvency proceedings commenced by or against the Property Owner and, if known,, any bankruptcy or insolvency proceedings commenced by or against any Affiliate of the Property Owner which is reasonably likely to have a significant impact on the Property Owner's ability to pay Special Taxes or to sell or develop the Property,* (ii) failure to pay any taxes,special taxes(including the Special Taxes)or assessments due with respect to the Property on or prior to the delinquency date to the extent that such failure is not promptly cured by the Property Owner upon discovery thereof; (iii) filing of a lawsuit of which the Property Owner is aware against the Property Owner or an Affiliate of the Property Owner seeking damages,which is reasonablylikely to have a significant impact on the Property Owner's ability to pay Special Taxes or to sell or develop the Property; G-3 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 588 of 724, (iv) material damage to or destruction of any of the improvements on the Property;and (v) any payment default or other material default by the Property Owner on any loan with respect to the construction of improvements on the Property. (b) Whenever the Property Owner obtains knowledge of the occurrence of a Listed Event,the Property Owner shall as soon as possible determine if such event would be material under applicable Federal securities law. (c) If the Property Owner determines that knowledge of the occurrence of a Listed Event would be material under applicable Federal securities law, the Property Owner shall, or shall cause the Dissemination Agent to,promptly file a notice of such occurrence with the MSRB,with a copy to the Fiscal Agent,the District and the Participating Underwriter. Section 6. Duration of Reporting Obligation. (a) All of the Property Owner's obligations hereunder shall commence on the date hereof and shall terminate(except as provided in Section 11) on the earliest to occur of the following: (i)upon the legal defeasance,prior redemption or payment in full of all the Bonds, or (ii) at such time as the Property Owner owns fewer 105 residential units (or property (or property intended to be subdivided into fewer than 105 residential units)in the Improvement Area, or (iii) the date on which the Property Owner prepays in full all of the Special Taxes attributable to 50%or more of the Property. The Property Owner shall give notice of the termination of its obligations under this Disclosure Certificate in the same manner as for a Listed Event under Section 5. Nothing herein shall require any person (including, without limitation, the District and the Participating Underwriter) to confirm the satisfaction of any condition for termination of the Property Owner's obligations hereunder pursuant to this Section 6. (b) If a portion of the Property owned by the Property Owner, or any Affiliate of the Property Owner, is conveyed to a Person that, upon such conveyance, will be an Obligated Owner, the obligations of the Property Owner hereunder with respect to the property in the Improvement Area owned by such Obligated Owner and its Affiliates may be assumed by such Obligated Owner or by an Affiliate thereof, and the Property Owner's obligations hereunder with respect to such property will be terminated. In order to effect such assumption, such Obligated Owner or Affiliate shall enter into an Assumption Agreement in form and substance reasonably satisfactory to the District and the Participating Underwriter. Section 7. Dissemination Agent. The Property Owner may, from time to time, appoint or engage a Dissemination Agent to assist the Property Owner in carrying out its obligations under this Disclosure Certificate, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The initial Dissemination Agent shall be Spicer Consulting Group. The Dissemination Agent may resignby providing thirty days'written notice to the District,the Property Owner and the Fiscal. Agent. G-4 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 589 of 724, Section 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate,the Property Owner may amend this Disclosure Certificate,and any provision of this Disclosure Certificate may be waived,provided that the following conditions are satisfied(provided,however,that the Dissemination Agent shall not be obligated under any such amendment that mo�difies or increases its duties or obligations hereunder without its written consent thereto): (a) if the amendment or waiver relates to the provisions of sections 3(a),4 or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature.) or status of an obligated person with respect to the Bonds, or type of business conducted; and (b�) the proposed amendment or waiver either (i) is, approved by holders of the Bonds in the manner provided in the Indenture with the consent of holders, or(ii) does not, in the opinion of nationally recognized bond counsel,materially impair the interests of the holders or beneficial owners of the Bonds. Section 9. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the Property Owner from disseminating any other information, using the means, of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Periodic Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the Property Owner chooses to include any information in any Periodic Report or notice of occurrence of a Listed Event in addition to,that which is specifically required by this Disclosure Certificate,the Property Owner shall have no obligation under this Disclosure Certificate to update such information or include it in any future Periodic Report or notice of occurrence of a Listed Event. Section 10. Default. In the event of a failure of the Property Owner to comply with any provision of this Disclosure Certificate, the Fiscal Agent shall (upon written direction and only to the extent indemnified to its satisfaction from any liability, cost or expense, including fees and expenses of its attorneys), and the Participating Underwriter and any holder or beneficial owner of the Bonds may, take such actions as may be necessary and appropriate,, including seeking mandate or specific -performance by court order, to cause the Property Owner to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Indenture, and the sole and exclusive remedy under this Disclosure Certificate in the event of any failure of the Property Owner to comply with this Disclosure Certificate shall be an action to compel performance. Section 11. Duties,Immunities and Liabilities of Dissemination . The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate,and the Property Owner agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents (each, an"Indemnified Party"),harmless against any loss, expense and liability which it may incur arising out of or in the exercise or performance of its powers and duties, hereunder, including the reasonable costs, and expenses (including attorneys' fees) of defending against any claim of liability, but excluding losses, liabilities', costs and expenses due to an Indemnified Party's negligence or willful misconduct or failure to perform its duties hereunder. The Dissemination Agent shall be paid compensation for its services provided hereunder from the Administrative Expense Fund established under the Indenture in accordance with the Dissemination Agent's schedule of fees as amended from time to time, which schedule, as amended, shall be reasonably acceptable,and all reasonable expenses,reasonable legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder. The Dissemination Agent shall have no duty or obligation to review any information provided to it hereunder and shall notbe deemed to be acting in any fiduciary capacity for the District,the Property Owner,the Fiscal Agent,the Bond owners, or any other party. The obligations of the Property Owner under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds. G-5 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 590 of 724, Section 12. Notices. Any notice or communications to be among any of the parties to this, Disclosure Certificate may be given as follows: To the Issuer: Community Facilities District No. 16-1(Millenia) c/o City of Chula Vista 276 Fourth Avenue Chula Vista, California 91910 Attention: Director of Finance RE: Community Facilities District No. 16-1 (Millenia) Improvement Area No. 2 2021 Special Tax Bonds To the Fiscal Agent: Wilmington Trust,National Association 650 Town Center Drive, Suite 800 Costa Mesa, California 92626 Attn: Corporate Client Services RE: Chula Vista CFD To the Participating Underwriter: Stifel,Nicolaus &Company, Incorporated One Montgomery Street, 35th Floor San Francisco, California 94,104, Attention: Public Finance To the Dissemination Agent: Spicer Consulting Group 41619 Margarita Road, Suite 10 1 Temecula, California 92591 Attention: Shane Spicer Email: Phone: To the Property Owner: Lennar Homes of California, Inc. 16465 Via Esprillo�, Suite 150 San Diego, California 92127 Attention: Tom Atkin,Vice President—Finance Email: Tho�mas.Atkinglennar.com Phone: 858-618-4916 G-6 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 591 of 724, WTV ith a copy to: Lennar Homes 15360 Barranca Parkway Irvine, California 92618 Attention: Legal Department Phone: (949)789-1653, O'Neil LLP 19900 MacArthur Blvd., Suite 1050 Irvine, California 92612 Attention: Sandra Galle Email: sgalle@onell-Ilp.com Phone: (949) 798-0725 provided, however, that all such notices, requests or communication may be made by telephone and promptly confirmed by writing. Any person may, by notice given as aforesaid to the other persons listed above, designate a different address or telephone number(s) to which subsequent notices or communications should be sent. Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the District, the Property Owner (its successors and assigns), the Fiscal Agent, the Dissemination Agent, the Participating Underwriter and holders and beneficial owners from time to time of the Bonds, and shall create no rights in any other person or entity. All obligations, of the Property Owner hereunder shall be assumed by any legal successor to the obligations of the Property Owner as a result of a sale, merger, consolidation or other reorganization. Section 14. Counterparts. This Disclosure Certificate may be executed in several counterparts, each of which shall be regarded as an original,and all of which shall constitute one and the same instrument. Date: April 2021 LENNAR HOMES OF CALIFORNIA, INC., A California corporation By: Thomas Atkin,Vice President ACCEPTED AND AGREED TO: SPICER CONSULTING GROUP, as Dissemination Agent By: Authorized Signatory G-7 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 592 of 724, EXHIBIT A JU.d NOTICE OF FAILURE TO FILE PERIODIC REPORT Name of Issuer: Community Facilities District No. 16-1(Millenia) Name of Bond Issue: City of Chula Vista Community Facilities District No. 16-1 (Millenia) Improvement Area No. 2 2021 Special Tax Bonds Date of Issuance: April_, 2021 NOTICE IS HEREBY GIVEN that Lennar Homes of California, Inc. (the "Obligated O�wner") has not provided a Periodic Report with respect to the above-named bonds as required by that certain Continuing Disclosure Certificate(Lennar Homes of California,Inc.),dated April 202 1. The Obligated Owner anticipates that the Periodic Report will be filed by Dated: Spicer Consulting Group, as Dissemination Agent By: Its,: cc: Fiscal Agent District Participating Underwriter Property O�wner/Obligated Owner G-8 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 593 of 724, EXHIBIT B PERIODIC REPORT CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 16-1(MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS This Periodic Report is hereby submitted under Section 4 of the Continuing Disclosure Certificate (the"Disclosure Certificate")dated April ,202 1,executed by the undersigned(the"Property O�wner") in connection with the issuance of the ab,ove-captio�ned bonds by Community Facilities District No. 16-1 (Millenia) (the"District"), situated in the City of Chula Vista, County of San Diego, State of California. Capitalized terms used in this Periodic Report but not otherwise defined have the meanings given to them in the Disclosure Certificate. 1. Property Ownership and Development The information in this section is provided as of (this date must be not more than 30 days before the date of this Periodic Report). A. Property currently owned by the Property Owner (the "Prop�erty") in Improvement Area No. 2 of the District(the"Improvement Area"): Development name: Number of lots (acreage): B. Status of land development, intract improvements, or construction activities with respect to the Property: C. Status of building permits, and any significant amendments or material changes to the description of land use or development entitlements for the Property described in the Official Statement or the Periodic Report last filed in accordance with the Disclosure Certificate: G-9 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 594 of 724, D. Status of Special Tax payments on all parcels,of Property owned by the Property Owner or its Affiliates: E. Aggregate property in the Improvement Area sold(closed es,crows)by the Property Owner to end users: Since the D�ate of Issuance of Since the Last Periodic the Bonds Report Acres* Acres* SF Units SF'Units For bulk land sales only(excluding sales of finished lots or completed buildings). F. Status of any land purchase contracts with other merchant builders or owners other than end users,with regard to the Property. II. Legal and Financial Status of Property Owner Unless such information has previously been included or incorporated by reference in a Periodic Report, describe any change in the legal structure of the Property Owner or its Affiliates or the financial co�nditio�n and financing plan of the Property Owner or its Affiliates that would materially and adversely interfere with its ability to complete its development plan described in the Official Statement. III. Change in Development or Financing Plans Unless such information has previously been included or incorporated by reference in a Periodic Report, and other than as provided in Section 1, describe any development plans,or financing plans relating to the Property that are materially dijj�rentftom the proposed development and financing plan described in the Official Statement. IV. Other Material Information In addition to any of the information expressly required above,provide such further information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made,not misleading. G-1,0 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 595 of 724, Certifficaflon The undersigned Property Owner hereby certifies that this Periodic Report constitutes the Periodic Report required to be furnished by the Property Owner under the Disclosure Certificate. ANY STATEMENTS REGARDING THE PROPERTY OWNER, THE DEVELOPMENT OF THE PROPERTY, THE PROPERTY OWNER'S FINANCING PLAN OR FINANCIAL CONDITION, OR THE BONDS.) OTHER THAN STATEMENTS MADE BY THE PROPERTY OWNER IN AN OFFICIAL RELEASE, OR FILED WITH THE MUNICIPAL SECURITIES RULEMAKING BOARD, ARE NOT AUTHORIZED BY THE PROPERTY OWNER. THE PROPERTY OWNER IS NOT RESPONSIBLE FOR THE ACCURACY, COMPLETENESS OR FAIRNESS OF' ANY SUCH UNAUTHORIZED STATEMENTS. THE PROPERTY OWNER HAS NO OBLIGATION TO UPDATE THIS PERIODIC REPORT OTHER THAN AS EXPRESSLY PROVIDED IN THE DISCLOSURE CERTIFICATE. Dated: Lennar Homes of California, Inc., A California corporation By: Name: Title: G-1 1 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 596 of 724, CONTINUING DISCLOSURE CERTIFICATE (PINNACLE NEW HOMES LL�C) CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 16-1(MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS This Continuing Disclosure Certificate (Pinnacle New Homes LLQ (this "Disclosure Certifficate")is executed and delivered by the undersigned(the"Proper�ty Owner")and Spicer Consulting Group as dissemination agent (the "Dissemination Agent") in connection with the issuance of the bonds captioned above (the "Bonds") by Community Facilities District No. 16-1 (Millenia) (the "District"), situated in the City of Chula Vista, County of San Diego, State of California. The Bonds are being issued pursuant to a resolution adopted by the City Council of the City, acting as legislative body of the District on March � 202 1, and a Bond Indenture, dated as of April 1, 202 1, (the "Indenture"), by and between the District and Wilmington Trust,National Association, as fiscal agent(the "Fliscal Agent"). The Property Owner covenants and agrees as follows: Section 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the Property Owner for the benefit of the holders and beneficial owners of the Bonds. Section 2. Definitions. In addition to the definitions set forth above and in the Indenturel which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms s,hall have the following meanings: "Affiliate" means any person presently directly(or indirectly through one or more intermediaries) currently under managerial control of the Property Owner, and about whom information could be material to potential investors in their investment decision regarding the Bonds (including without limitation information relevant to the proposed development of the Property or the Property Owner's ability to pay the Special Taxes related to the Property prior to delinquency). ,"Assumption Agreement"means an undertaking of an Obligated Owner,or an Affiliate thereof,for the benefit of the holders and beneficial owners of the Bonds containing terms, substantially similar to this Disclosure Certificate (as modified for such Obligated Owner's development and financing plans with respect to the Property),whereby such Obligated Owner or Affiliate agrees to provide Periodic Reports and notices of significant events,setting forth the information described in sections 4 and 5 hereof,respectively, with respect to the portion of the Property owned by such Obligated Owner and its Affiliates and, at the option of the Property Owner or such Obligated Owner, agrees to indemnify the Dissemination Agent (if any) pursuant to a provision substantially in the form of Section I I hereof. "Dissemination Agent" means Spicer Consulting Group, or any successor Dissemination Agent designated in writing by the Property Owner,and which has filed with the Property Owner,the District and the Fiscal Agent a written acceptance of such designation, and which is experienced in providing dissemination agent services such as those required under this Disclosure Certificate. "Improvement Area 11 means Improvement Area No. 2 of the District. "Listed Events"means any of the events listed in Section 5(a) of this Disclosure Certificate. G-12 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 597 of 724, "MSRB" means the Municipal Securities Rulemaking Board, which has, been designated by the Securities and Exchange Commission as, the sole repository of disclosure information for purposes, of the Rule, or any other repository of disclosure information that may be designated by the Securities and Exchange Commission as such for purposes of the Rule in the future. "Obligated Owner"means, as of any Report Date, an owner of all or a portion of the Property that represents more than 50%of the single family residential units in the Planned Development. "Official Statement"means the final official statement executed by the District in connection with the issuance of the Bonds. "Partiei ating Underwriter" means Stifel, Nicolaus & Company, Incorporated, the original P Underwriter of the Bonds. "Periodic Report"means any Periodic Report provided by the Property Owner pursuant to�, and as described in, Sections 3 and 4 of this Disclosure Certificate. "Person" means an individuaL a corporation, a partnership, a limited liability company, an association, a joint stock company, a trust, any unincorporated organization or a government or political subdivision thereof "Planned Development" means the development plan for the Property described in the Official Statement under "PROPERTY OWNERSHIP AND THE DEVELOPMENT—Pinnacle Homes Development and Financing Plan—Development Plan" as such information has been updated, if any, in a prior Periodic Report. "Property"means Lot I of Tract No. 16377. "Report Date"means December 31 and June 30 of any fiscal year. "Rule" means Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time. "Special Taxes" means the special taxes of the District levied on taxable property within the Improvement Area. Section 3. Provision of Periodic Reports. (a) The Property Owner shall, or, upon written direction of the Property Owner the Dissemination Agent shall,not later than the Report Date, commencing June 3 0,202 1,file with the MSRB a Periodic Report which is consistent with the requirements of Section 4 of this Disclosure Certificate. Not later than 15 calendar days prior to the Report Date, the Property Owner shall provide the Periodic Report to the Dissemination Agent (if different from the Property Owner). The Property Owner shall provide a written certification with (or included as a part of) each Periodic Report furnished to the Dissemination Agent(if different from the Property Owner)to the effect that such Periodic Report constitutes the Periodic Report required to be furnished by it under this Disclosure Certificate. The Dissemination Agent may conclusively rely upon such certification of the Property Owner and shall have no duty or obligation to review the Periodic Report. The Periodic Report may be submitted as a single document or as separate documents comprising a package, and may incorporate by reference other information as provided in Section 4 of this Disclosure Certificate. G-13 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 598 of 724, (b) If the Dissemination Agent does not receive a Periodic Report by 15 calendar days prior to the Report Date, the Dissemination Agent shall send a reminder notice to the Property Owner that the Periodic Report has not been provided as required under Section 3(a) above. The reminder notice shall instruct the Property Owner to determine whether its obligations under this Disclosure Certificate have terminated (pursuant to Section 6 below) and, if so, to provide the Dissemination Agent with a notice of such termination in the same manner as for a Listed Event (pursuant to Section 5 below). If the Property Owner does not provide, or cause the Dissemination Agent to provide, a Periodic Report to the MS,RB by the Report Date as required in subsection (a) above, the Dissemination Agent shall send a notice to the MSRB in substantially the form attached hereto as Exhibit A,with a copy to the Fiscal Agent(if other than the Dissemination Agent),the District,the Participating Underwriter and the Property Owner. (c) With respect to the Periodic Report, the Dissemination Agent shall, to the extent the Periodic Report has been furnished to it, file the Periodic Report with the MSRB and file a report with the Property Owner (if the Dissemination Agent is other than the Property Owner)�, the District and the Participating Underwriter certifying that the Periodic Report has been provided pursuant to this Disclosure Certificate, stating the date it was provided to and filed with the MSRB. Section 4. Content of Periodic Reports. The Property Owner's Periodic Report shall contain or incorporate by reference the information set forth in Exhibit B, any or all of which may be included by specific reference to other documents, including official statements of debt issues of the Property Owner or related public entities, which have been submitted to the MSRB or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from the MSRB. The Property Owner shall clearly identify each such other document so included by reference. In addition to any of the information expressly required to be provided in Exhibit B, the Property Owner's Periodic Report shall include such further information, if any, as, may be necessary to make the specifically required statements,, in the light of the circumstances under which they are made, not misleading. Section 5. Reporting of Significant Events. (a) The Property Owner shall give or cause to be Oven,notice of the occurrence of any of the fo�llowing Listed Events with respect to itself or the Property, if material: (i) bankruptcy or inso�lvency proceedings commenced by or against the Property Owner and, if known,, any bankruptcy or insolvency proceedings commenced by or against any Affiliate of the Property Owner which is reasonably likely to have a significant impact on the Property Owner's ability to pay Special Taxes or to sell or develop the Property; (ii) failure to pay any taxes,special taxes(including the Special Taxes)or assessments due with respect to the Property on or prior to the delinquency date to the extent that such failure is not promptly cured by the Property Owner upon discovery thereof; (iii) filing of a lawsuit of which the Property Owner is aware against the Property Owner or an Affiliate of the Property Owner seeking damages,which is reasonablylikely to have a significant impact on the Property Owner's ability to pay Special Taxes or to sell or develop the Property; (iv) material damage to or destruction of any of the improvements on the Property;and G-1,4 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 599 of 724, (v) any payment default or other material default by the Property Owner on any loan with respect to the construction of improvements on the Property. (b) Whenever the Property Owner obtains knowledge of the occurrence of a Listed Event,the Property Owner shall as soon as possible determine if such event would be material under applicable Federal securities law. (c) If the Property Owner determines that knowledge of the occurrence of a Listed Event would be material under applicable Federal securities law, the Property Owner shall, or shall cause the Dissemination Agent to,promptly file a notice of such occurrence with the MSRB,with a copy to the Fiscal Agent,the District and the Participating Underwriter. Section 6. Duration of Reporting Obligation. (a) All of the Property Owner's obligations hereunder shall commence on the date hereof and shall terminate(except as provided in Section 11) on the earliest to occur of the following: (i)upon the legal defeasance,prior redemption or payment in full of all the Bonds, or (ii) at such time as the Property Owner owns fewer residential units (or property (or property intended to be subdivided into fewer than residential units)in the Improvement Area, or, or (iii) the date on which the Property Owner prepays in full all of the Special Taxes attributable to 50%or more of the Property. The Property Owner shall give notice of the termination of its obligations under this Disclosure Certificate in the same manner as for a Listed Event under Section 5. Nothing herein shall require any person (including, without limitation, the District and the Participating Underwriter) to confirm the satisfaction of any condition for termination of the Property Owner's obligations hereunder pursuant to this Section 6. (b) If a portion of the Property owned by the Property Owner, or any Affiliate of the Property Owner, is conveyed to a Person that, upon such conveyance, will be an Obligated Owner, the obligations of the Property Owner hereunder with respect to the property in the Improvement Area owned by such Obligated Owner and its Affiliates may be assumed by such Obligated Owner or by an Affiliate thereof, and the Property Owner's obligations hereunder with respect to such property will be terminated. In order to effect such assumption, such Obligated Owner or Affiliate shall enter into an Assumption Agreement in form and substance reasonably satisfactory to the District and the Participating Underwriter. Section 7. Dissemination Agent. The Property Owner may, from time to time, appoint or engage a Dissemination Agent to assist the Property Owner in carrying out its obligations under this Disclosure Certificate, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The initial Dissemination Agent shall be Spicer Consulting Group. The Dissemination Agent may resignby providing thirty days'written notice to the District,the Property Owner and the Fiscal Agent. Section 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate,,the Property Owner may amend this Disclosure Certificate,and any provision of this Disclosure Certificate may be waived,provided that the following conditions are satisfied(provided,however,that the G-15 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 600 of 724, Dissemination Agent shall not be obligated under any such amendment that modifies or increases its duties or obligations hereunder without its written consent thereto): (a) if the amendment or waiver relates to the provisions of sections 3(a),4 or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature.) or status of an obligated person with respect to the Bonds, or type of business conducted; and (b) the proposed amendment or waiver either (i) is approved by holders of the Bonds in the manner provided in the Indenture with the consent of holders, or(ii) does not, in the opinion of nationally recognized bond counsel,materially impair the interests of the holders or beneficial owners of the Bonds. Section 9. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the Property Owner from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Periodic Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the Property Owner chooses to include any information in any Periodic Report or notice of occurrence of a Listed Event in addition to,that which is specifically required by this Disclosure Certificate,the Property Owner shall have no obligation under this Disclosure Certificate to update such information or include it in any future Periodic Report or notice of occurrence of a Listed Event. Section 10. Default. In the event of a failure of the Property Owner to comply with any provision of this Disclosure Certificate, the Fiscal Agent shall (upon written direction and only to the extent indemnified to its satisfaction from any liability, cost or expense, including fees and expenses of its attorneys), and the Participating Underwriter and any holder or beneficial owner of the Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Property Owner to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Indenture, and the sole and exclusive remedy under this Disclosure Certificate in the event of any failure of the Property Owner to comply with this Disclosure Certificate shall be an action to compel performance. Section 11. Duties,Immunities and Liabilities of Dissemination . The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate,and the Property Owner agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents(each, an"Indemnified Party"),harmless against any loss, expense and liability which it may incur arising out of or in the exercise or performance of its powers and duties, hereunder, including the reasonable costs and expenses (including attorneys' fees) of defending against any claim of liability, 'but excluding losses, liabilities, costs and expenses, due to an Indemnified Party's negligence or willful misconduct or failure to perform its duties hereunder. The Dissemination Agent shall be paid compensation for its services provided hereunder from the Administrative Expense Fund established under the Indenture in accordance with the Dissemination Agent's schedule of fees as amended from time to time, which schedule, as amended, shall be reasonably acceptable,and all reasonable expenses,reasonable legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder. The Dissemination Agent shall have no duty or obligation to review any information provided to it hereunder and shall not be deemed to be acting in any fiduciary capacity for the District,the Property Owner,the Fiscal Agent,the Bond owners, or any other party. The obligations of the Property Owner under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds. G-16 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 601 of 724, Section 12. Notices. Any notice or communications to be among any of the parties to this Disclosure Certificate may be given as follows: To the Issuer: Community Facilities District No. 16-1(Millenia) c/o City of Chula Vista 276 Fourth Avenue Chula Vista, California 91910 Attention: Director of Finance RE: Community Facilities District No. 16-1 (Millenia) Improvement Area No. 2 2021 Special Tax Bonds To the Fiscal Agent: Wilmington Trust,National Association 650 Town Center Drive, Suite 800 Costa Mesa, California 92626 Attn: Corporate Client Services RE: Chula Vista CFD To the Participating Underwriter: Stifel,Nicolaus &Company, Incorporated One Montgomery Street, 35th Floor San Franciscol California 941 O�4 Attention: Public Finance To the Dissemination Agent: Spicer Consulting Group 41619 Margarita Road, Suite 10 1 Temecula, California 92591 Attention: Shane Spicer To the Property Owner: Pinnacle New Homes LLC [Address] Attention: pro�vided, however, that all such notices, requests or communication may be made by telephone and promptly confirmed by writing. Any person may, by notice given as aforesaid to the other persons listed above, designate a different address or telephone number(s) to which subsequent notices or communications should be sent. Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the District, the Property Owner (its successors and assigns)�, the Fiscal Agent, the Dissemination Agent, the Participating Underwriter and holders and beneficial owners from time to time of the Bonds, and shall create no rights in any other person or entity. All obligations of the Property Owner hereunder shall be assumed by any legal successor to the obligations of the Property Owner as a result of a sale, merger, consolidation or other reorganization. ection 14. CounteEparts. This Disclosure Certificate may be executed in several counterparts,each of which shall be regarded as an original, and all of which shall constitute one and the same instrument. Date: April 20�21 G-17 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 602 of 724, PINNACLE NEW HOMES, LLC By: Name: Title: ACCEPTED AND AGREED TO: SPICER CONSULTING GROUP, as Dissemination Agent By: Authorized Signatory G-18 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 603 of 724, EXHIBIT A JU.d NOTICE OF FAILURE TO FILE PERIODIC REPORT Name of Issuer: Community Facilities District No. 16-1(Millenia) Name of Bond Issue: City of Chula Vista Community Facilities District No. 16-1 (Millenia) Improvement Area No. 2 2021 Special Tax Bonds Date of Issuance: April_, 2021 NOTICE IS HEREBY GIVEN that Pinnacle New Homes LLC (the "Obligated Owner") has not provided a Periodic Report with respect to the above-named bonds as required by that certain Continuing Disclosure Certificate(Pinnacle New Homes LLQ,dated April_,,202 1. The Obligated Owner anticipates that the Periodic Report will be filed by Dated: Spicer Consulting Group, as Dissemination Agent By: Its,: cc: Fiscal Agent District Participating Underwriter Property O�wner/Obligated Owner G-19 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 604 of 724, EXHIBIT B PERIODIC REPORT CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 16-1(MILLENIA) IMPROVEMENT AREA NO. 2 2021 SPECIAL TAX BONDS This Periodic Report is hereby submitted under Section 4 of the Continuing Disclosure Certificate (the"Disclosure Certificate")dated April ,202 1,executed by the undersigned(the"Property O�wner") in connection with the issuance of the ab,ove-captio�ned bonds by Community Facilities District No. 16-1 (Millenia) (the"District"), situated in the City of Chula Vista, County of San Diego, State of California. Capitalized terms used in this Periodic Report but not otherwise defined have the meanings given to them in the Disclosure Certificate. 1. Property Ownership and Development The information in this section is provided as of (this date must be not more than 30 days before the date of this Periodic Report). A. Property currently owned by the Property Owner (the "Prop�erty") in Improvement Area No. 2 of the District(the"Improvement Area"): Development name: Number of lots (acreage): B. Status of land development, intract improvements, or construction activities with respect to the Property: C. Status of building permits, and any significant amendments or material changes to the description of land use or development entitlements for the Property described in the Official Statement or the Periodic Report last filed in accordance with the Disclosure Certificate: G-20 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 605 of 724, D. Status of Special Tax payments on all parcels of Property owned by the Property Owner or its Affiliates: E. Aggregate property in the Improvement Area sold(closed escrows)by the Property Owner to end users: Since the D�ate of Issuance of Since the Last Periodic the Bonds Report Acres* Acres* SF Units SF'Units For bulk land sales only(excluding sales of finished lots or completed buildings). F. Status of any land purchase contracts with other merchant builders or owners other than end users,with regard to the Property. II. Legal and Financial Status of Property Owner Unless such information has previously been included or incorporated by reference in a Periodic Report, describe any change in the legal structure of the Property Owner or its Affiliates or the financial co�nditio�n and financing plan of the Property Owner or its Affiliates that would materially and adversely interfere with its ability to complete its development plan described in the Official Statement. III. Change in Development or Financing Plans Unless such information has previously been included or incorporated by reference in a Periodic Report, and other than as provided in Section 1, describe any development plans,or financing plans relating to the Property that are materially dijj�rentftom the proposed development and financing plan described in the Official Statement. IV. Other Material Information In addition to any of the information expressly required above,provide such further information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made,not misleading. G-21 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 606 of 724, Certifficaflon The undersigned Property Owner hereby certifies that this Periodic Report constitutes the Periodic Report required to be furnished by the Property Owner under the Disclosure Certificate. ANY STATEMENTS REGARDING THE PROPERTY OWNER, THE DEVELOPMENT OF THE PROPERTY, THE PROPERTY OWNER'S FINANCING PLAN OR FINANCIAL CONDITION, OR THE BONDS.) OTHER THAN STATEMENTS MADE BY THE PROPERTY OWNER IN AN OFFICIAL RELEASE, OR FILED WITH THE MUNICIPAL SECURITIES RULEMAKING BOARD, ARE NOT AUTHORIZED BY THE PROPERTY OWNER. THE PROPERTY OWNER IS NOT RESPONSIBLE FOR THE ACCURACY, COMPLETENESS OR FAIRNESS OF' ANY SUCH UNAUTHORIZED STATEMENTS. THE PROPERTY OWNER HAS NO OBLIGATION TO UPDATE THIS PERIODIC REPORT OTHER THAN AS EXPRESSLY PROVIDED IN THE DISCLOSURE CERTIFICATE. Dated: Pinnacle New Homes LLC By: Name: Title: G-22 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 607 of 724, (J-23 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 608 of 724, APPENDIX H BOOK-ENTRY ONLY SYSTEM The infbrmation in this section concerning DTC and DTC's book-entry onlysystem,has been obtainedftom sources that the District believes to be reliable, but the District takes no responsibility f6r the completeness or accuracy thereof.' Thefbllowing description of'the procedures and record keeping with respect to beneficial ownership interests in the Bonds, payment of principal, premium, if'any, accreted value and interest on the Bonds to DTC Participants or Benqficial Owners,coqfirmation and tran�fers qfbenqficial ownership interests in the Bonds and other related transactions by and between DTC, the DTC Participants and the Benqficial Owners is based solely on iqformation provided by DTC to the District which the District believes to be reliable, but the District and the Underwriter do not and cannot make any independent representations concerning these matters and do not take responsibility for the accuracy or completeness thereqf Neither the DTC, Direct Participants, Indirect Participants nor the Beneficial Owners should rely on thef6regoing infbrmation with respect to such matters, but should instead confirm the same with DTC or the DTC Participants, as the case may be. The Depository Trust Company ("DTC"'), New York, New York, will act as securities depository for the Bonds. The Bonds will be issued as fully-registered securities registered in the name of Cede & Co. (DTC's partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully- registered Bond will be issued for each annual maturity of the Bonds,each in the aggregate principal amount of such maturity, and will be deposited through the facilities of D�TC. DTC,the world's largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a "b�anking organization"'within the meaning of the New York Banking Law, a member of the Federal Reserve System, a"clearing corporation"'within the meaning of the New York Uniform Commercial Code, and a"clearing agency"registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC's participants ("Direct Participants")deposit with DTC. DTC also facilitates the post trade settlement among Direct Participants of sales and other securities transactions in deposited securities,through electronic computerized book-entry transfers and pledges between. Direct Participants' accounts. This eliminates, the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations,and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust&Clearing Corporation("DTCC"). DTCC is the holding company for DTC,National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S.and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly("Indirect Participants"). DTC has a Standard & Poor's rating of"AA+." The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com. Purchases of Bonds under the D�TC system must be made by or through Direct Participants, which will receive a credit for the Bonds on DTC's records. The ownership interest of each actual purchaser of each Bond ("Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants' records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests, in the Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial, Owners will, not receive Bonds representing their ownership interests in Bonds,except in the event that use of the book-entry system for the Bonds is discontinued. To facilitate subsequent transfers,all Bonds deposited by Direct Participants with DTC are registered in the name of DTC's partnership nominee, Cede & Co,., or such other name as may be requested by an authorized representative of DTC. The deposit of Bonds with DTC and their registration in the name of Cede & Co,. or such other DTC nominee do not effect any change in b�eneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Bonds;DTC's records reflect only the identity of the Direct Participants to whose accounts such Bonds H-1, 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 609 of 724, are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by D�irect Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Bonds may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Bonds, such as prepayments,,tenders,defaults,and proposed amendments to the Bond documents. For example, Beneficial Owners of Bonds may wish to ascertain that the nominee holding the Bonds for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to,the registrar and request that copies of notices be provided directly to them. Redemption notices shall be sent to D�TC. If less than all of the Bonds within a maturity are being prepaid, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such maturity to be redeemed. Neither D�TC nor Cede&Co.(nor any other DTC nominee)will consent or vote with respect to Bonds unless authorized by a Direct Participant in accordance with DTC's MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the District as soon as possible after the record date. The Omnibus Proxy assigns Cede& Co.'s consenting or voting rights to those Direct Participants to whose accounts Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy). Redemption proceeds, distributions, and dividend payments on the Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC's practice is to credit Direct Participants' accounts upon DTC's, receipt of funds and corresponding detail information from the District or the Fiscal Agent, on payable date in accordance with their respective holdings shown on DTC's records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC, the Fiscal Agent, or the District, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as, may be requested by an authorized representative of DTQ is the responsibility of the District or the Fiscal Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial. Owners will be the responsibility of Direct and Indirect Participants. A Bond Owner shall give notice to elect to have its Bonds purchased or tendered,through its Participant,to the Fiscal Agent,and shall effect delivery of such Bonds by causing the Direct Participant to transfer the Participant's interest in. the Bonds, on. DTC's records, to the Fiscal Agent. The requirement for physical delivery of Bonds in connection.with an.optional tender or a mandatory purchase will be deemed satisfied when the ownership rights in the Bonds are transferred by Direct Participants on DTC's records and followed by a book-,entry credit of tendered Bonds to the Fiscal Agent's DTC account. DTC may discontinue providing its services as, depository with respect to the Bonds at any time by giving reasonable notice to the District or the Fiscal Agent. Under such circumstances, in the event that a successor depository is not obtained,physical certificates are required to be printed and delivered. The District may decide to discontinue use of the system of book-entry only transfers through DTC (or a successor securities depository). In that event,Bonds will be printed and delivered to DTC. THE FISCAL AGENT,AS LONG AS A BOOK-ENTRY ONLY SYSTEM IS USED FOR THE BONDS, WILL SEND ANY NOTICE OF REDEMPTION OR OTHER NOTICES TO OWNERS ONLY TO DTC. ANY FAILURE OF DTC TO ADVISE ANY DTC PARTICIPANT, OR OF ANY DTC PARTICIPANT TO NOTIFY ANYBENEFICIAL OWNER,, OF ANY NOTICE AND ITS CONTENT OR EFFECT WILL NOT AFFECT THE VALIDITY OF SUFFICIENCY OF THE PROCEEDINGS RELATING TO THE REDEMPTION OF THE BONDS CALLED FOR REDEMPTION OR OF ANY OTHER ACTION PREMISED ON SUCH NOTICE. H-2 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 610 of 724, APPENDIX I MARKET ABSORPTION STUDY 4852-7256-1 107v12/024036-0089 2021-03-16 Agenda Packet Page 611 of 724, + I.......... all 123, IKE, %'I'll "A 'pill, T,t., Chula Vista CIFD ,16ml (lMillenila 1A No 2) Meyers d otentia Assessaierit,of il,la��id Absa�,-�ptb�n F"') City of G[�iUb Vsta S EA,�R'C�H Cl�nila Vista, Sari� [Ilego Ca,,,irity, CA �Novenllibeir 2020 ILS I mm""m e t r 0" 1 t u dk 1" i 2021-03-16 Agenda Packet Page 612 of 724 �Meyers IR,:E S EA R, C�H O§J'ect�4e oif,thJs ana�ysis is to �arovide @ii re&iden�[-Iial @iid nl�lllia�rlll fl'�ie Sa��'IIi 1�ego Cou�,'I'rty la�nd GhUa Vis'ta areato die r6ev&'it qpace �rnatllk,et fir&nds arlid to �arovide m�,Iliic�usio��'IIis �,,-6ev@l�it to flie U]��etl�)iO 1A No 2 �,D��an la��Iid the abso�rptbrlIi pot&I'lit4 fbr the �planned residerlfl"Ja]� u��,Ili�ts atid co�� III WH be used kn 'Hil with filI�Iie sa�b of bon(IS a No 16-1 Area No 2) Co���iltact I S I'll "]"'��ie f'oHowirig le�ey tel&,'n prbicipated o�ii fl Is ana��ys' 111`]i��Illln Su[li[lv&�,Ii, Se�n�ior [Mmimg�"I�� ov&,'sees OU1111111 A(Ilvisory Wi[fli� over fli�i�lllee decades, ofexp&,�encie, I%...... SuHivan is atl�i ex���)ert ihn relside��,�rbi4� and i xed use fela§lo�H[lty Skj6es, &trateg�c �p�4mil I wl"id prodUct devebp�,II'nent,, &nd �regularlly condi.,icts n�iiarket ia��Iia��Yses a�,'-otl,i�nd �flhe States, a�nd Ililille mili� be reacIII'ied at 6""'19 9 4.81."18 3 6,, ex�per�etice Sti�p�.p, 11&n Cmn�'�, Vice !:Ires�id&n�t, rn a rIli aged flrl�e a dc,"Ily-to-,liday, 1,ila§s M r Canil� ove],I�'25 ye&'s of ex�pe�,-��e�nce �rli fl[ie real lestate fi6d i has s"ll Sa��ii [I"')"h�"e g o C o u ri ty A(IJ(11 It��o s i, was p��llovde(,J as riee(Jedill 1.............. t�'I'n g C o n�di't 10�n S City of' CliUa Vista is res�pon§]Ne for ('3bOLUt, hs �p]b�ns, exr,,)ectcaflor'I'llis arid fo�11111 cflsdosu�re of la�ny &gf1Jficwit that ��li"IkIht affectthe 9 Utkmate �rea�izafib�ii� (Yf the pro,jected �"IeRlt "I'lli&I'lle MH jsuaHy lbe differ&"I'llices lbe'ltwe&i prc Illected and acl[Iui,1131 resUfts because eve�nts la�"Iid frl"equerlifly, do tic)'t occur as ex�pected, and the di`ffe�,11111e���ices �may lbe �I'Iriaterli4� We IlIiave ��ilio t I�te otlir re�piortfor ev&nts wIlid cirmmsta�nces occur�ring aft&,t[Iie da'["e. lo'ltl®rlur rqao�illlt �`hlay�,I nerit of ,es rebted to t[Ii" till, arlliy and aH of our I�f'ees a�nd experises is not in @11ily way cont��Illlqerllt III 1piotli @11ily factor ot[I)&r tl'lia�n ou�illl' �ol serivK.�' ��s rlep� 2021-03-16 Agenda Packet Page 613 of 7241 �Meyers , 1��E + IRR,E S EA R, C�H IK,ely �'�ndi�llllgs 6 lVaill�]ll(ellIt Analysis 9 lRes'I""d e n"It i�a ll lftrlkellt Aillialysis 23 0offlice lftrl�lll(ellt Anallysiis 33 1�...........ocallltia��i Anal�ysi�s 62 1 111 O'livervi'lew, 1111170 �11,1,1,1,110usll i illig Marke"t Overview 84 �l I 0 S a 1�e 0 Lil S 11 1 n g �11'111,111)e���Illlln a n d 95 1110111 2021-03-16 Agenda Packet Page 614 of 724 ...I.I.... IIIIIIOCA I ION MAl") �M e, "y,ers rollect,, Ove��Illl,V�ew IRR:E S�E�A R, C�H l.l,.l,OC,(,)ted 'hdn t],�ie Ci,ly of Chub Vista, the sub ect ��s loca,ted Just east of State [Route 1125 ��i South Sa�n [,'I�ego Coul��Irty,, 1`1111`1]i�ie site is, bicated 22 nnJ�J�esi soul lient of the Sari 1'11,11)iegol Ahrpuil-[, approxk��iiat,6y 29 �lm�les s()utheast IoWnlv&�111'slty Tom�i Cetiter @r"id 8 �,TiHes nu�lll"i o'ffl'lle [`IIJ&1111 "T'loie Me S easHy accessed o'ff State [:lZOL[te 1125 (tH �11-oad) ur,wa hiterstate 805 &,ild GY,in�Piv, l-"l@ill]<way (norli-WH) I" -1 lr,�,,a e, R a n�c�,ll lo� ','Z3,,iEI oll a n a 81 e a c,1111 0."') Paway D e I M a, lu ;'In,; c 114,itw,).r)c t',luO/,o St It',e 1[' r,'1, 1, Santee, go M, I a, Ilk er il, S Ili):I'W"1"),0 Oft 1,1 ide I Cl uci ii tiii!i,,in,is 'A I pil,��ri e Wi I d e fr p,,/�ii,e Is s C) ori orl is ............ R�i g I r i,a I a�r lk 0 ........... '1011 L ii M e,,c,Nb Ca fO S p ri r1li g V a I I ey ,San D *iegoIIl-, t y 0 1, h Ll I a Vil s it a Subject Property WJ'I�I C ils,rlrl,p 0, I r.T)I�r ��m�p e,i,/�, 1�1 B", c h Wr o Q Tecate RRA 22D IT I* It* O� 5 1/10 1,5 rn"lles: ij U'a n fa Page 1615 of'724 11 01 1��E C NA A A N 1",I) USES �M e, "y,ers D I Ove��IIIV�ew li�llb� Auct�iur,v� ro"jec-,, E S�E�A R, C�H -I� resdenfi�a�� `]"'��ie sd�bject pi�,"qpe�rty', D`�`[Ill) (KJ�b�riia I No 2) is cu�,Iqp�risied of five bit's w�'�tliidi��Ili 11],Iie MJ��e�n�'�a �,naste�r curn�iiiuitty Ove��� these prcidstotal 335 fo��I%l u "tsi, 4.00 00(l osed s��,,)ace attadhed to bts 1115 arlid 22 1,ili aquare feet of corn�n&,1-64� qiaice and the �pote��iifi4� fdr 15(1,)fu�'111�1-1rlllent ap,,iiartr,r��&,it ho�rnes Two s�iin a a i�-ce��is of ��p o 1,I)II 1%, 110 IWO 1 110 v(l:1 �ii a I<e fi in g a n d s a e s, c a�iii p a 1 g ri s Ii.,o t oil 9 S orli fl"ie iiiq) b6ow 4,31re. inot a pa�,-lt of this, ari4y§s Ii.i.ots 1112,11,113,115, and 22 (residential uses) liave IaH� brd<en grotl,j�nd Wth a(11, il ie�riiV�s�bried as t�ie 0�Ijllj,t �fi-,��,,)hasied offte coni�p�bx la�nd &�,m§�uriied as si��ngle bu��Idll�ng full- �Ill'e sea la�nd Jife sidi&iice T�he ...........I arid `1�11V&[Itl I of I p�ro v le Ri le ri A,���,-e a N o ca L"Ises a��11111,e �'iot a pa�� ......................................... CF�D 16-1 (lA Nol) SUMMARY ...................................................................................................................................................................I Ilk IAY Commerciak, 400,000 sf For-Salle Resident"'al- 335 Units Oil, @�Jlr orl- For-,Rent Residential- 150 Un*ts* *Potential use within Lot 19 if I or-I yopl, I,".P,%J I III 011C, 1) qA�, Lot 19 ,Y's -All r Commercial Parcel Will Meridian Development gill > 400,000 SF of Commercial 3 J1 Lots 12 1& 13 Votential for 150 Apartments IN "Pinnacle" by Meridian Development All I'l\ VOI 126 Attached Units all Madill Lot 1 5 Lot 22 "Vibe" by Lennar Homes 0 3010 "Cleo" by �Lennar Homes 92 A,ttachied 3-Story Townhomes -------------- ------------- ----- -------------------------------------------------------------------- 117 Attached 3-Story Townhomes L,AND USE MAPI P���RO,POS,,ED,C,O���M�M��U�N��l���TY"FACILITIES DISTRICT NO.116,11-11 (Millenia) COMMERCE MU LTI-FAMILY CM 16-1 A2 BOUNDARY ZONE B MIXED U1 SE CM 164 1A I PARCELS, ZONE A NAP NOT A PART 2021-03-16 Agenda Packet Page 616 of 7241 �Meyers IR,:E S EA R, C�H gr e n a 'I'll A ol. u a V���s"Ita 2021-03-16 Agenda Packet Page 617 of 724 Ulu (1101111%0 lululull I UU11 ulululuum I 1��E UUUUUU1 I'll I'll 1 10 N S U I'V IM A 11"I Y' u l:::'0 l"'R U,,,U S A lulluou 1hUIR E I lu 1111)E N T l A 100,00,00,A N lol) C 10 M I'V E lul�C l A loolool,A l� �M e, "y,le,rs I NGS IRR:E S EA R, C�H 'I'll 6 l (M i l��l e i a U1A No., 2) is m�,Un�prlsied o�f five lots wltlhid1UUUi 11"l,uie Mll��e��ila rnaste�r m�,Ti��ii-iuiilty Ove��IUUU4H, thesie prcels total 335 fo��U,Uul,sale reslde��ifi�,, l subject D1h"`[h1Ul 11) 0 uill�ts�! 4U(,'1)O,,000 sqt,j@-e �feet o��f cu1Uiirii&1-clal, sj��)al` (111;e' la��,Uuuid tlIUUie potential for '11150 br-ll�ru&at apartment horries. [�'3asied &�Uui oi,ui�'- researclui [luUie ruesid&7��b4l cuimpm�i&ats ouf I (1111A No 2) l I lbe al)so��Ibed lDy �11-n��d-,U2023, l:U11)lut sojft&1"TH[19 CD,TT�Tuui e l a l d e�rTi@uid is li]<�ely tio delay tlu,ie cu�i,i�pu�lie��it past 20.30.... ......1"l �fdtwu���Ulg tables ]�k,uis�h&ate our- flur-ecasted a�bsorlautl(','Yn vc�irious uses: �:::Uo�i'-Sa�e e s U d le n 1:i a��l t M�M Pinnacle Townhomes 4-Story 126 36 821 36, 8 �8, '42, 42,,, Cleo Townhomes 3-Story TH 1,17 42 2 Vibe Townhomes 3-Story TH 92 36 �41' 36 115 ui� o�f��sa��esto date (ea��Iuuuu��y Nove��,Unber) @��,Iujd �"esid&ri'U4�� are expected to [,")e s6dull-OLI't by 20�23 Tuie jec.te�(:] 2020 sa�bsi fl�gt.jres la���*e a cu�m�[)��,Iafiu� U I' S 1pr ec�l:ed sales �for t11UUUIie loal,&1UU1Iice o�[� Novenil)&, atuUid l"I'll,I)ecei'Unber. Sales �fbr 202,111 and beyond utiHzethe Iiistorlic sales rates ftl)ir t1ie, 0 Lul t 11 S a�Ui 1.,',1'eg(,11) Sub�r�uuuuiarl<etu Wl,UiHe t1ule sub"le(ulft Oj i a�iuuue exceed�ng filuuuuiJ�s h��stuica�� sa����es �fi g u���,"e (3.0-3 5 sales, p&tlU, we tooll< a la�p��,),�t'oadui case §h�ft u�,iex�pected�y Ll irui d e ut h i s lulypotlruuietica�� loull(,UJ1111111o�it scenw-,Io, bul"Yth @1UU1Iid Vibe vvll�l sell ulut liuUi ea���Iy tO and Cleo (tlie niost riec&uuit coi T I t-n i uinity "to, ('U)l)ei'U1) will s6H ot it early 2023 ('11Q2023) lul Ufluu*��'U'e��it cu�uid�t�uis �UUid�d, t���,Ties WJ��� �,,UxE.�, mud�iui�fasterfluuilan pres,&,ited �11&,"e. A 4, a Ah a All I 1 01 1 1 19W, Lot 19 Stacked Flats Three-Sbry 150 15 �-c�njl]), G�v&i-i cutuum�rit iUiUi,,U Wt ci�iuuuul�,,id�fions, �,,)Iiansfu�'U,fi,Uiluls, lmrce au��-e fldd at t��Uuuuui��s fi�[Tie l����,"ie cu�"n��ruiierd4� �ma�tluu],(et 1��l " ului"]�U,iie �,,)ote��,Uuuui'L4� fu�uuuu uii��ts e,xists ()�Ur �u............ 019 I U has slofuleiUUied &1id while la�parti n I. i"Un@111<et is la��so ex�per��enu ig suine mlxed �I-esults iuiatl(�"),iiWde tl,�Uuuie ql:ail-blil i&iit niark,&U1 ln Sal,�l 11111111`)'�lego Cuimurtuy I�Uuiias vivelatheirled utlie COVO cl, s s w6��� to fl�'UUUIJ�s p6�ult Wui��e ufli,uUe�re I iuuum f]��'Uruyi� sta�rt dates p]aii��ied fu�uuu, fli'ie wie aSSUIT"ied Chat fluile, owl"TEN"' WoUd (:.u�,iti��riue 1:o eva��t,jate ll�,-O Ig 1rul �rutj U C� 1.1los", U... I h ouf fluie flrat lv�uuia[�f ouf 201,20, WhiCh WOLUIld lxIS111 lll<,ely iu-narleet en�'1]11-y U) 2.......Z12. Wile lrmve assi inied a leasel qp ra�te of' '15 u��i��ts, per wli�br�i 's (l n ,U) " I r, ^10 �)-,i'', til UlDrIflul) A si s t,,i, ia�r�ket e���Uibry �ii tiu�"iid-21022 t��Uuuuie 150 O'�f filuuie s��,,mctru��'Ti as most luiave �ielased-(,.j��� at �a fa, st&1- l"Mice 18 24 Luuirui�As 1,, 0 ir g a SlIOUld l0e My leased ln lla[f of'2023,, 2021-03-16 Agenda Packet Page 618 of 724 Ulu CU11%0 ilululull "I'l UU11 pululuum 11111 hul 1��E UUUUUU1 lool, '0'0 1 10 N S U I'V NA A Y' u 0 1"R U,,,U S A lulluou 11"UR E I lu 1111)E N T 1 A 10,00,00,A N lol C 10 M I'V E I`�C 1 A looloo,A i� �M e, "y,le,rs I NGS IRR:E S EA R, C�H C o��ni rn�l�e i-c i a���U Total Office Demand&Suggested Absorption(SF)at Improvement Area No.2 of Millenia Total Oiffice Demand(SF) 404,066 31�4,95l8 61,004 60,582 59l,667 59,323 5l9,206 58,333 58,,875 57,930 58,,542 58,122 58,233 57,502 1,426,343 1�111uu)i IS C C 1 )v le�r C a�rn p us UU, U l'i Chese pa��I-c6s ..............out 1 a��,Uid ............ot 11117) la�re W��,Uiuuuii��,hi a sqru)a��"ate 1,111A, No 1).... .......I'l fhrst are two s�les riu,-cii of t��Uuuuie s,t.j ect s cove r Ca rn[)LIS 310t�� C ("U'll 6 U h, U I �0 "h�uivent" miui,i�p��is (Lot'll) is ex�pec�ute,.,d utio ["Un-ecak g-ouluu1id nex�t ye&', @Uid U11)LIfl' E13,I-Dsor��autloiu i ta[��Ie iassi nuunes tliuiat uthis par(l U;6� will la��i�sor[�� ov(u� 11he next uflve ye@-s �,.Uinder so�uul��Uter nUU1@1<,et C011�1,lt�uns. %1% UU,opei,uty (Lot 19/Discover C@"`11�pLUJSl) WJI fo�����olw Uthe two cu�unuuuui�u�ierc I ial situes 'to 'U'lie tuuio��Uflhu, U�i(J e tu lui i s 0 t luuuui�e p i ji,��,imse of repwuut, NAte have assumed t1lu,iat �tr�ie (:)��,.Uib,,Ueict pi -cels, C xU11111111 or selve�Uui UUUyea p&,,-i U �s tio se scenario, the Kib'ect p�uuqp&luuuuty WH lbe bWft leased olve��111- a S, od beutwe&ui 2036 atuid ,20412 �lUUUU1owe\/1eI "U'rere t schedUe for conuum'Utulliei c'al p&, i a�nd it is, pioss�J�Dle t1luilat'll Dscov&1,-a�rid hruivent m�lnpu.jsesi cu,.,Ui��(Ilj fi��p, �Ui ter��runs of�Uuiuui@�111�et ei'lifirly. ri d eve[o (�U�.d busi��luiess dist��Uict wiflh��n t�r�e Mil��en�a �UUT�,iaster corrii,in,tn�ty lia!) a luuuui��gluui degi,,ee of fllex��ID���hty WA�hin sppe la�nd �.UfltJ��,Unate �and �Uuise(s),, [Ulluot 1 ua�ruid Lot 119 are UU1hU` ovv�ned lby S1..............[h" @iicll &Uuuuifituled 1�6r dev6op��Uri&iu it wifiluuui a bu'Hdill ig square footage of 800,0�00 la�n�d a of� 1 1 90110 5 0100 "h1h,"his bws'H�Uuiess (J�s',[Irk"I""I ��s also &iti�Ue(u i luuui�� fur to 225 1 ui�,iJtsl, wliuiiclui r"i ilay luu)e fui--�reiu it ur for,,,,sale products. If a uu-eside��U�i'6al pi,'ouu��ect is �iuicluded i�n tlie business 6st�rict, it inay be �ocate(il Mtluuuii��r, eifllui&ir, Lot 19 (W�t �)��e pi�,-ov'�(Je @1i esthui,�Uiate(,,J c%U�; ��,�Ui�ot" dElc��d ecl w Iluui let Ir le r a�11 iy i,esid&1UUi11Ja1 develqp��Uiient 41�� be hdt ide('11i I U.,ot '19 @11d is cur�t,&,�Urfly uiia[l C I` t fr��S C 11 1 0 r I..........U,oll, 1 (out'side 1,[�i UU) 1i a cu; tirrluiO�,,�ame foli,,a ded§uri as to WJI be la�rliy �,,e§d&iuitial d eve lo ��nt w�fi,uui r1l I'llullot 19. 01 vuu resideruuit4� rn@111�et aiU4ysis does indLU'lle a of ex�pelc �bhe dei,unaind ful", re§dei�uuit'4� @UU1d 111111111,,&Uit �iuuuuuu roduic"�', �arogi"arn ��S �Xlrsued fot- '1911, .......... ts 'l i,uumn'Ftu� I U150 t10 ��)[Uuo,V�(,Uje soa�uie (,".ullitext for i�UUTUiat"111�0 �,'�Uuuuiot&uitia� 'Ff a f'o rill C01711�,l S�pace to rnal<e a as�to �,,j�4n Lot 19 and Lot 11. 2021-03-16 Agenda Packet Page 619 of 724 �Meyers IR,:E S EA R, C�H s a e ,.1 a a NNW C����iula V�Is,lta I'll 6 'I'll A 2) 2021-03-16 Agenda Packet Page 620 of 724 �l I ll��E U IM IM A luh`�`ZY A N III) C 0 N C U IS 10 N IS l...I.I....�`,E IS A llulululull' IS �M e, "y,le,rs Ma��,11K,et A��,hmlys,Js IR,:E S EA R, C�H s e s, a p o irt i o n o"f It Ili e iM i i le i a m a st le�111 Mllle��Iila rniaste��" pla��n �'��s la�n a(I'%AI've n"illxed-Iluse �,)Y�'ol', l�n the Sot,.itli Cou�rllity ofSa�n 1`1 1 lego Countly A�rea l�o 2 p��i a n e d c o rl�n�Iil�i t jni�ty t[�mt is ex�[,,,,,I)e.(111;11�1111�1e.(I ItO �116lLlcle ovi&r 2,500 fu�'--sa�e la��,id �Il i I I i la��,��id ov&1- '111.81 spa�re"'fee"'t o�f mnrnia��,-c4� spliace at buildout Ti���ie y Area 1% 2 -e feet I office i�n tle,ie l[',)1111 ji� ),,�`:lct a��,,id the pot&,ifi4� full-I 150 qp,@,"bme�lit, wltlliidii fl�,I',�e develq��,'I�iie�nt wiJll cuill"isist o,l' 335 �1"6r-,Ilsa��e reslde��rllvtlal unitls,, 40(),,0(1)0,1 squa��, ����scove���l� ��scove 3 132 t jni�ts are sold la�tl the l,") I ,g _,Nov&r6b&r� 202011, co i nm&1-64� cai�-nlot is Of tli���ie 335 furlllll,sa�b ��rlleslden't4� UH,'''fl''ts �[Ihat are tided N o ................................................................................................................................................................................................................................................................................................................................... ........... hi wltl,li a qte�l� s h a tl ....................................................................................................I"I.....................................................I...... t 111 211, "1 @,,e hot `1h11l1`1]�ie sale of fo�[,---lsale �,Yroducts hli� the ov(:.�111��IIlall Mlll&,�Iib maste��111111l sta, ��Ied l�n� wlt1i llf,11-21'171' Units all, [El"I'vo, iMetro @Il "h!"hrio (WilJCi Jt�uded �1,i A��Ilea 1\1o, 2), I- I renta�l ja��'ojec�tsi (m&1-k&l[l 1 11 l Tlll�i&'-e are a��so orni,.fl&ted and kr-develop� and ad6�tbna�l units by Sl���iea ll,ll,lu�Ir iles, KB 1-l-lui ile la��Id: k'''r'ilprolvell ient,Area No. �111-ate q,,Ind affordable), a hotel arlid develol)��'n&,Ilt ll\Aille�rila (l"xit �1110t in Area 1% 2) I ll rou�ridi��,',ig la�real ��'nount@�ns la�nd 6sta�nt 4kie/ocea�n. Sorine of ,flilie §Ie W�l�� off6�r to mnp�,li la��,Ii�d I']hie Mi��e��iiia p��-oject is, 6evatied la��'id edges ulfe�r views of su� -eeway (Ithe 125 Toll I�Road) and is clos(:1 to a wide a ��ray exls��ti�ng s&,'�,vlces, retail, scilmols major I olmi���i sipace areas,,, Milbn�c,�i ls located ric�ljllltl 01�ff a i pir�k,s, etc,, "IllIg thl"OLIgIlM Ilt J"''ile COU"Ity (tli���Iierel were over 130 il���Ictive p�I- 'ects 20,19 and fewl&—tlhan 80 today) Wli,iHe was a b�lll&l�'jz)ull I'll"ill"he o�facflve new hon��i�e 1p�rojei(� is cllii-nlnisl cl Oj ���,,)ack housr�rig de��,,na��,id at ,fl,�Ilie of fii�ie ll�lio(I�ng acc6b��&ateid ����\Aay I [ionne..�b(lj�Jde��`S flh�1`0 U g 110 L.1 t, flh le �"eg�b�n 1"ilave �,iepu�,Ilted ld(.:,.n��mnd lli��-ougl���Ii (lie balance oI'' 2020., The (.:1.xl&ting lionie m&1ket li�iasM�bnessed sinnllai—tren(l Js atild til'iere is less tliai o I e n ion�tlii o�fa('�l.,tive I,I��i�ttached lis�fl�ngs in tlieS�O U I h ('Ill I"F 0 ul III t'y SL of t1riis a��,i4�y§s �.I.low �ev6s of �nve�nto��',y cioq�,,)�bd Wfl,i� de��,T'ia�nd is pe��b�ng acc6e��,,a,b�`Ig �,-ates Wi'ii��e m�,Tli�pet��five atta6[ied riew lio��'Tle C011 ln tivl�ie trade area [��Iiiave an ave�1�11'age absuplatiun ra�te lo�f 3.6 units ov&�IaH, absorption overtlie �lpasttl�i��,Ilee mon ths is 5,,2 LU"litS l)(E�lffll "I sul)jec%/t p��,�qpl&ties have �1111'ates ove��111-8 0 ilj�n��ts pe��,-1 �111nunfi") is, good de��Inand poti&nti4� 11�,Iie Souflil���i COLIP�Tty hmjsi��,Ig tia���-gieb,�,:,�.d tofiam�Jyl �,ious,6�li6�ds ages, @',ic] to e��'qpty g ��ii N/e 1i - of cm���idltlons n�tory has caipplind �I��t��i@rl'ket 1poten�tial. 0 Ll't 11 'C 0 L! I new honie sales trencis ll��mve 1110`11,' I)Elei''''i a good i�ncl ul as dltiiinisl,l�iiil sa����es �,,ea16hieid li-1-11,35() ui'i�Is 2018 a��rl lid f6H !,�o 200119 yei �Iiia��"Ikiet p�)Wl`ie of Cml,j�tvty �,Iiiew �Iio��,Tlie sa�bs was a�bove 30% hli 1)oflii �yea���,-s C'16��ng furwa��11111'd, SOLJ'b�l I -eg�(�)n Witil'i qLil li�,�iii�ted County, wl,iich li,ias past, ("Jecade liad �rTlm��Ile active Imme bUildlng olperatioi,��Iis, is H111(,ely "I"D se,E). i i��i('I'.�rlliea`�Sled devebion ietit, and captu,-e in a t I re§ide�nfi4� �4nd optio��rl'is 16seW,ie�re Ill A �%.,2 1,1�11�1,,e s6�Ji��,,ig Che $4,,00,0100 'to $6010,000 Ui,liat la��,"e [a��,,,ge��y unava���4��)�b 6seW,ie��,e tl]�,ie �,,e4b��li aind these C011 IIMLflli''�',Jes @,Ile selll�ng bet ler tlian rnol&t lo�f the cu,l In ple titive �rrarll(et area. The �1-erriaii,��iing jl�llts i�ll A��,ea ll�o. 2 C�:��Iui"e p"opec.,�tel,d' 1.''0 1�I..I..I..I 1),E) larg:�.,.ly al,11)sui-lbeicl by 2022. 14 pip pip OR RVA gen a ac e age o 2.4 1A N,0., 2 UCTA[Rlulu AY �M e, "y,ers Mar��Ke�t A�rhmlys��s IRR,E S EA R, C�H ie d&tallied floor#la�n lar�cing br 1%��H&nla ln,�ilar'over T i&l it Area 1A No. 11 product: arr"ay si im itihned below. AH [11��u,ee cot��nniunl�tles aire ql),&n aind actively selhng lYr��u�c��I i,��ig -ade rl'ieveni,,ie. Becai ise rnoat aire �11-ebtiv6y new, 1,11ielr, ct jr,�rer�v[ ��s l'1)' a&EI1d on I,ial sales lar"ic( o��f�fer,ed �bly tl���ie respec��Uve bt ii1del"S hldlLidhi'''ig inc&t��ttives ancl e&tlalb��i§lhed optlunA i ID g�11 I 6bsoirlalbn lev6�s a�re soriiewl���ia1l� eleva�ted (r'6a��Uvely shor"t selhing 1p&'Jod M[11���i pre-sale deii��Iia�nd rm ilting hn higher, absorlatlu,�i� sta�ts ocf �1,1113 rl,ecei vt[y We exar��r�flnecl tI��ie sa��es pa(1111,.(,%, sold ui.rt a�ttached cui��urnunlIies tli���ie South Couaty ia�nd collllpamd �t ��to [�[��ie ave�rage sales pace �R'I'Yr active new iu�me at�tladhecl 11"3ased on tliese &tatis�tics,i we 11���iave 11 a e J 3 0 L I I 11���ts la&r a��uatli Wi�bh bwer 1pr��ces, we esti��'���rm�ted tllie overa�H sales pace bi,, Cleo a�t assigr�ied 11,Jhie. ��two, ll,,�,)rlced c(,11)��,ni I I Ll 1�lties ove�rall e&tirra�ted almrp�tior�i 1pcacil�0, 6J ull 10 J e��i&brai ned I aGCOL11"It `f('11)1- fLl��l sale 1pe�riods re sdb&tan�blaHy b6ow sales ml.es hi inv&r�vtoiry m� uiil�ts l�)e�r 1 11 1 ontll I 11���iese proj(�11)1(111-,�ts a�Jgli� lbroadei- a��� C, Wh�]e curre�at sa�bs rates SLIggles''t �fasteir absorpblm���i tin��ies, we have �[111����ie sales pace "to accoUll"t s4l��fts i�n 17'url<e't derna�lid. """I liese albso�r�latlon pr�ect��u,���is are less liia[f tllli�e pace estal)��lsll��ied ��to da�tia witlhin Kl�b�nla 1A No., 2 and tia��<e a conseiva''bve Vi1aW0`f`fL,[tt Arle sdbs pace Subject Property Name Mo Base I Incentives Net Base Net Base Assumptions Total Payment Assumptions 80.0% Location Size Sales Base Base Price/ Options, Price Price($ Price/ Options/ Estimated Total Price/ Monthly Base Addl Tax 3.5% Product Detai�ls Sales Summary Mix SF Bed Bath Level Pkg,Pace Price Price SF Upgrades Reduction Impacting) SF Upgrades Premiums Price SF H�OA Tax Rate Assess. Mo.Rmt. Pinnacle Meridian 21 1,362 3 3.0 2 2 3.0 $445,900 $445,900 $327 ($5,000) $0 $445,900 $327 $30,0100 $5,5010 $476,400, $350 $339 1.101% 0.84% $2,821 Lots 12,&13 Millenia 21 1,433 3 ZO 2 2 $469,900 $469,900 $328 ($5,0010) $0 $469,900 $328 $30,0100 $5,5010 $500,400, $349 $339 1�101% 0.84% $2,946 Product: Townhomes Total Units: 126 21 1,989 4 3.0 2 2 $532,900 $532,900 $268 ($5,00,0) $0 $532,900 $268 $30,0100 $5,500 $563,400, $283 $339 1,1�01% 0.84% $3,274 Configuration: 4-Story Units Sold: 76 21 2,185 3 2.0 4 2 $551,900 $551,900 $253 ($5,000) $0 $551,900 $253 $30,000 $5,500 $5,82,400 $267 $339 1.110% 0.84% $3,373 Lot Dimensions: ATT 3 Months Sold: 21 21 2,380 3 3.0 4 2 $579,900 $579,900 $244 ($5,00,0) $0 $579,900 $244 $30,000 $5,500 $610,400, $256 $339 1.101% 0.84% $3,519 Units Remaining: 50 21 2,522 3 2.0 4 2 $601,900 $60 1,900 $239 ($5,000) $0 $601,900 $239 $301,000 $5,500 $632,400 $251 $339 1.1�0% 0.84% $3,633 %Remaining: 40% Summary,Statistics: 1,9179 3.01 $530,,400 $530,400 $268 ($5,1000) $0 $530,400 $268 J$30,000 $�5,500 $5601,900 $283 $339 1.110% 0.84% $3,261 Cleo Lennar 10 1,182 2 2.5 3 2 15 $377,900 $377,900 $320 ($7,5010) $0 $377,900 $320 $15,0100 $0 $385,400, $3,26 $277 1.1�01% 0.84% $2,285 Lot 22 Millenia 12 1,215 2 2.5 3 2 $373,900 $373,900 $308 ($7,50,0) $0 $373,900 $308 $15,0100 $0 $381,400, $314 $277 1.1�01% 0.84% $2,264 Product: Townhomes Total Units: 1,17 11 1,265 2 2.5 3 2 $364,900 $364,900 $288 ($7,50,0) $0 $364,900 $288 $1�5,0100 $0 $372,400, $294 $277 1�101% 0.84% $2,217 Configuration: 3-Story TH Units Sold: 21 7 1,504 3 2.5 3 2 $414,900 $414,900 $276 ($7,50,0) $0 $414,900 $276 $15,0100 $0 $422,400, $281 $277 1.101% 0.84% $2,477 Lot Dimensions-, ATT 3 Months Sold: 21 36 1,616 3 Z5 3 2 $441,900 $44 1,900 $273 ($7,5010) $0 $441,900 $273 $15,0100 $5,0010 $454,400, $281 $277 1�101% 0.84% $2,644 Units Remaining: 96 1,6 5 4 3.5 3 2 $458,900 $45�8,900 $274 ($7,50,0) $0 $458,900 $274 $15,0100 $10,0010 $476,400, $284 $2,77 1.101% 0.84% $2,759 %Remaining: 82% Summary Statistics- 1,519 3.5 $426,558 $426,558 $281 ($7,5010) $0 $426,558 $281 $15,000 $5,043 $439,101 $289 $27'7 1.10% 0.84% $2,564 Vibe Meridian 26 1,681 2 2.5 1 2 3,.0 $485,900 $485,900 $289 ($7,500) $0 $485,900 $289 $15,0100 $3,5010 $496,900, $296 $277 1.101% 0.84% $2,865 Lot 15 Millenia 30 1,819 2 Z5 1 2 $510,900 $510,900 $281 ($7,50,0) $0 $510,900 $281 $15,000 $3,50�O $521,9001 $287 $277 1�101% 0.84% $2,9,96 Product: Townhomes Total Units: 92, 36 2,037 2 2.5 1 2 $535,900 $535,900 $263 ($7,5010) $0 $535,900 $263 $1�5,0100 $3,500 $546,9001 $268 $2,77 1.101% 0.84% $3,126 Configuration: 3,-Story TH Units Sold: 35 Lot Dimensions: ATT 3 Months Sold: 28 Units Remaining,: 57 %Remaining: 62% Summary,Statistics: 1,865 3.0 $513:,,617 $513:,617 $275 ($�7,500) $0 $513,617 $2751, $15,000 $�3,500 $524,617 $281 T $277 1.10% 0.84% $3,010 2021-03-16 Agenda Packet Page 622 of 724 z ol ol ol oll 1��E :�j lu o,o,o 'Z S U I'lo)J E C 1��)1�uiu 0 1:::) ol ol�J:ul S "Rooloollooloo 1��)1�ul 0 lol I)U C T A fu`u� A'Y �M e, "y,e,rs Ma�,I,Ket A�r'mlys,Js IRR:E S EA R, C�H 1,7�� &,��id wfive si&Hhig. Cleo is the �,�nost affordal:)1e option Wtlhii,��ii the SUbject ar'ea. ar�id AH tlh��I-ee co,��Il 1 11�MLUnJ''IJes U���]`,) 16-1 (K�Henia 111A,, No.2) @,'e oipe� 11111 iey over"lap hi §�ze, 11.11]"t tl���ie lar"ger, 6evator servicecl hil i::)inr�mde ai-e the rnost exipet��is�ve �n hi��nr�nedbte area. Vi["),leo I�ftE),r s i m i I a �P,1"l C I I W 1 11 $6501,000 - Pinnacle-Tolwnhomes, Meridian, 3.0 sis per�mo $600,000 - Cleo�-Townhomes, Lennar, 3.5 sis per mo $5501,000 - A00� Vibe-TownhIomes, Meridian, 3.0 sls per�mo .Z $5001000 - 0- a) "0 $450,000 - A000/ $4001,000 - $3501,000 - 500 11000 1 1500 2,000 21500 3,000 Source- �Meye,rs LLC, Lennar Hurnes, Meridian U�nit S,ize (Square Feet) BASE PRICE NET BASE,PRICE, $ASSUMPTIONS AVERAGE,PRICE Price of Unsold Est%of Average Estimated Project/SubdMsion 'Type Configuration Units 'Total Units, Unit Size Base Price $/S,F Impacting Net Base Price $tSF Options Premiums Average Price $ISF Sales/Month, II I I ncentives I m Pinnacle Townhomes 4-Story 50 25% 1,979 $530,400, $268 $0 $530,400 $268 $30,000, $5,500 $560,900 $283 3.00 —1 Cleo Townhomes 3-Story TH 96 47% 1,519 $426,558 $281 $0 $426,558 $281 $15,000, $5,043 $439,101 $289 3.50 Vibe Townhomes 3-Story TH 57 28% 1,865 $513,617 $275 $0 $513,6,17 $275 $15,000 $3,500 $524,617 $281 3.00 COMMUNITY SUMMARY 203 100% 1,729 $476,58iO $276 $0 $476,580 $276 $18,6915 $4,,722 $493,1`13 $286 91.501 2021-03-16 Agenda Packet Page 623 of 724 0 1111UUUIJ)i"I'llu Oil\ "I I m I N I A 1 A NO 1, 2 11 0 J G"I'll"I"E I'D A,113"Ifull" 101N �M e, "y,le,rs Ma��,,��K,et A��,hmlys��s IRR:E S EA R, C�H "ove��iiie��'it Area ����A �'�Jo 2 p���lwo d LI I e l)�el-oj le c led ���s mit�J�e�lied 1>n�bw rjjgS I h le 1)U��l��l d��l n g Is .......... e c o�m nU�I�Iiity �s m�-n��,,Y'��sed of 21111 6-1)��l e x 1)U��l d )��ii�nade by NAe��-��jd4� �...,ots 12&13) sa�es of 2020 (126 �im�lnes tota�) �ij, 111 1 1) Ofi�le��,* a Lfl�Tq��,,ie tl'liree &iiia��IeSlt U���"Ii�Is o���I�li t�,ie fi�rslt two fbo��,-,sl �L�Oad�tb�ia�� 2-sto��"y des,Jgns) aind the t h�111111le le �a��Illlges t w,-Ii�lls "'stad,Ked" oili to�p t[liat, (-%/aii I)e accessed 1")y sta���m lo��'-6�eva,b�,�I)... .........I I'llias beie��,,i very ...................... s6��J���ig over 8 u��rliits pe��I'1111� §�nce o�l)iei�i��ng As 2020, �111-1-76 of [011, %�l I �,Ilinovi��,Iig fo�ma��111111ld U��ide��—fllliJ�s mnse��,,vatlllll t[jie 126 p�b�niied w�iJts sold or 11�11�ie l,)U� )ose io,!o fii�li��s we hilave the sales, pace to la��� flqj�:� SU���)ject apl,,)�roac[i, t���Iie !��)���n�iade COITU[Mu�nity s6�� OUt e(,1�1�y 2022 ff �Tliwl<et m�oid�tlons ���I'idld, J��4,ely s6��� out �ri 202,1 ',,,1/-35 of 36 u�n��tsl ��6bas(:I.��id Vibe 4J�� offe���r 92 3-sb�,y tmri��mmiesl 1 6811 'to 2,1037 squa���e ff,,D-et V��l 1) .............ot 15) �tsi fi��-st sa����es �1111l6ease ()�n l 15, 2020 a����Iid 1��ias sd�d ave��,I,aige sales, l,)ac��,D. 'to (late is ove���r 8.....0 u�n�t nio�nfl�,�Iii M:) ll�,iave u,bJJzed tl�,�,ie %3jlll(J, u��'i��'ts P&tlo for 1:1"ie la�r-o,jected 1)1��Ii]d-out of 1I �,,)ut JJ,�Ihe Me��,��dla�� �f mndlfilmlis �,��idd sa�bs are JJ<6y to &,ir�pass bv6� 1�'Iide��",OLflr absorlpfio�n ass��It�,i'ii)tions, Vll)e 4J��� s6��� out �ri 'y .............e�n�na�r �illllilo���Tlies ����s fl�,�',ie ����,,iewest cl(, ��[l NA�J�b�n��ia 11A �"Io 2. T�,��ie m��-n�nitn�ty ci(� ns,Jsts of 117 l3ulllsto��,,y tow��,Ii��m�,Y'iesi 4�,U,��i six fioo��wp��a��,is fro���n 1 182 to I'll�675 Gbo (l 22) square feet As, of ea��,-]y fil"ie m��'ii Id[T'11,1111ity �,I'iiassd�d 21 u��,i�ts. Wifl�,�Illi so�rniei of rl�lnost new �io�me pil'Ices, ���n 'U,"iie Soufii��'i Cmnty,, we la�n'bd��platie fliiat GbowiJ��� s6��� at a 1pace fil,"ile ave�rage We ���l",iave ass,Jgne(l a�n av&rage absoipfio��'Ii �rate of 3 5 lYlIJIs pe�r b��', Gbo fiil�,iwi 'Uiie av(,.:,,��11'11'age, lx,11 w6��� [,,)elow cunri&� t abso��,,pfio��ri �,,al:es LJ<e fi,�ie ofiil��)ers,, fe.6� fii�i�s is a m�'ise��,'I,va�five absorp'bo��ii pace g��ve��n 'the m�n�,,er'it [3ased o�ri a 3 5 per sa�bs place, Gbm 4���� s6��� OU'll oil Pinnacle Town�homes 4-Story '126 316 82 36 8 Cleo Townhomes 3-Story TH 117 42 28, 42 42 5 Vibe Townhomes 3-Sbry TH 92, 3,6 1 41 1 36- 1 15, 1 1 1 1 Perh,pr�:')df.ict absorptions of 3�(1)to 15(l), urnls'�,1"W morith are, bellow a, bsoipfior') rab;,s within the clonp;1ifive (9,jrl(�,,�I)ia andthe acttial r1ates actlii6�,lved to date Afittlit"IMille 7k TA No 2, but iri firie wititt"i 17J�tori(,.Ial p(��,11�,t���lfot���r�r�iarice ir)theSOUthCounty Me,yer's Research vielAIS Ittilis hyp(,"),117efical cori,7nmnity,sell-out as a C017ISet"Vative approach. 2021-03-16 Agenda Packet Page 624 of 7241 0101OR m 0��.Uuup "I'm iol ol ol ol S 1llllllOCA"'1l lolo 10 N M A l ul : AG"I [Vill"ll"ll"ll" 10�� 1`11,1Z SA �M e, "y,ers Ma��,11K,et A��",ialys,Js 1R,:E S EA R, C�H Uhlere are n�ne attacl���ied hn �� I n -ee attladhed li ile i bebw lt�gliliglh'ts a(11`1'.`bV1Etl ri le w ho i Y lie cunl�m iit�es ��n ft SOL]"111"I Countly EA j b rn a C L d i g e h i D m rt iun��ties Mflt��i %Hiei,���iia C cui i�rmllllties seHhig h,l�ii flll''ve SOLI`Ur��) coun�ty. le��r,e ai,e &,��i add it�ut��i a eiglit single fa��Iil�iHy detadr��Iied curinniw,l�iit�es tll��ie cu,�npetitive s�pl���)&,'e (Ca�rilage in 1',3orl�i��t,,a c&id I ���f tlie higliest�priced hi�i the COLIll Ity Witill �prices oveir$1 NA). on tl��ie iinset �l�na��,,') �u�'s one S,,�vv I(.,,el)� all rit'v,["I'a rk, 4 KL Wulf it? (1, N]"E R F� d R ely if,f,Jll B11' Oil I d I katc�0 RA (Tw E, cl" I All , �11!1�1,M, El"A"!"I'lill"A 'All G�L- NS F'?,A,L V i S t L"�1111l�51 )�Sil K [3DAYF RO I'd T "i 11`,',�2 ltA� L 4%1K 4ace lay, E'IS)t a I p ["u, r S umte r1te B el I I a Sffi��a vl� Car"Irtarl"tur k Uudb '73 3QJ BJ MILLENI ECT 11:7L Ave n fi n e Cleo Eg-D a r t)IF' M o�l�n te Vl]'�],I a Sidul C L r es nlli r,k,lR V 1,VY,[,d 1 0 T'iOk`f Pinnacle Lk Vibe 't.:a y ro 73 ,:scaya rado al�t P r ie�,,r (fl, E Gl iG L G 1,i'�L A 13,S PA t,il Inset:, Bonita E 511" Veraz F, C111% RK�(IfICLS 0 ;�)ohil,iar I P k, "'M Y "J 31 Clan"i'age Seo BUfl`,AL1J(',',�U,4 ol, �C A `"Tbsoiro alt "Vista del N"",f6f)�6 ill"111N,YIJI_31,41], &ue Subject i,j -eerli Attached Rr, 'ects ",sf, Gt 01 Grey �::)��lpjec'ts 2021-03-16 Agenda Packet Page 625 of 724 �1 I 1��E U IM IM A luh`�`ZY A N lo) C 0 N C!...U S 10 N S 1..........�"'E S A lulululu" S �M e, "y,e,rs + Ma��,11K,et A��'h'ialys,Js IR,:E S EA R, C�H ""I"' e rr t�rr�i�be�r ofact,Jll�ve cunriplefitive �a�,,'(,)Jlecti s, Soufl"�l cou��1'1'1'y �l��s ge��'�ie�ra��y Oil 'U�,�ie dedJ�,"ie bL It �'�iew �,��iiorne ()pt�b�ns a��"-e bioosfi���iig sa����es rates Wl�hi�n '1:],�ie hi�� "'P �1 90i 1�1`1 C 0 Ll�Tlyl a�rea Histo�rica��y, at�lt,"f,�,,,ac����l���"lie.(�iI new �ii fii�ie Sif,')�rU�,-'i Coui��ity 1��iave ave��rage('J i�ihl�3 0 sa����es AJ��� @ '(J�ve attadi'ied cu�'nrnun�I�Jes hii fil Sul.,F[ Uflr��,"e�nfiy' ave�rage 3.16 sa����es pe�r TIDI`Ifi� (ove��l"�a���O W�,�i&ii we exarnJ�ne fiil��e�nds ove�r fliie past qUa��'"te��, sa�bsi a�re even [')ette��l'� Wt��ii a�rl ave�ragie sa����es (')f 5 2 u���iits p&r ..............ow �,��'it&rest �,'ates cot.,j�p��ed W�t�h t���ie ��nu,eased fOCLJS Url [�ion�lie t],'ie COVD pa�n(Jerlii�'iic �s 111�1�nc�rease(lj derlii"ia��11�(:] ��iliudh ("fli"I"ie COLJI'Tb�y @�rid ���s readi��y �n Sa�rl Dbgo Ciot.tnty "I'" e .......... hot.j&"H�,"ig iiar���l�et fii�iie Slot Cot.j�nty has a §Jg��,�'ifly slow&r ov&raH� rate of2 0 units, ���,)er Gv&�""filie past qUa�rter, sa�bs a�re averaig���ng 3 5 sa�bs per ��rst 'Uiie (ieta("";����'ied o us 111��11 �7m�,11(et �,�Iiias ar�i ave�rage base P��,*��ce �ria�r��rows 'Uhe n'l 0�"'l t 1"Iie��Ike a�re seve��11�4� 'facturs fl�iiat are driv��rig t���,�ie §blwe�r 1k, 'Z� iea��"hi'�ig [)OJ�d-,ot.jt ('fewe�r fii��ia�n 10 u�'�Iiits buye��- ��)od hn ad(Jibb�n, 'U'ie wdt��ve set���s sd�d Wfii��'�i� -e,�����ty s 't e Y, 1�<et's average sa�esi pace) A��'Uh()ug�h SLJ�bject �a�,Iope��,t�bs §�,'�iow rcates fi"O�Ti 3.0 tio 3.5 wri�ls, uri fll'ie ta���)�b (to t��'��ie ma��, le C) ...................... sui�ie of tl��ie 10lest a���)sui"�a6ons in fll�ie con�i�pefitive s�pl��ie�re a re ct jil'r&ifly s6�Hiig 'lb�r betIler. 1',Iin�niade, Vbe @rA Gbo liave siales rates, ovier 8.10 �'riunt ll� Milli I Lots 12M 3 4-Story 1 6 7'6 5(") 30 1,97�) $560, 00 $28"") 1,�)4 $ 2(3 1 .............................................. ........................................................................................... '3-stary I 1 117' 21 96 1,519 '3 $289 $A`�?7 7 1,94, $2,5(�"4 C'�e(:� &�t"ialr' L(A'22 3,5 $zl-"�9,10 1 Y"'y $281 $211177 '1,949/'(6 $3,"YI 0 V�be 'M6,1cfian Lot 1 115" 11 92 'i 5 7' 10 ........ 1,865 $524,6 1`7 Suwerte Heritage Build�ing and Development Chul�a Vista ATF 212 80 80, 0 132 2.9 5.7 1,819 $446�,025 $245 $362 2.00% $2,708 Alay Heritage Build�ing and Development Chul�a Vista ATr 80 68, 68 0 12 3.5 6.7 2,233 $562,900 $252 $260 2.00% $3,220 Parc Place Pacific Coast Communities Chul�a Vista ATT 162 144 140 4 22 3.2 3.3 11429 $454,233 $318 $285 2.00% $2,674 Veraz Pardee Homes San Diego ATT 111 111 109 2 2 4.2 7.0 1,643 $493,729 $301 $325 1.40% $2,675 Solmar Pardee Homes San Diego ATT 74 1 74 1 74, 1 0 1 10 1 5,2 1 8,3, 1� 1,602 $471,859 $295 $325 11,60% $2,649 Tesoro at Vista Del Sur Cornerstone Communities San Diego ATT 13 99 99 0 35 2.7 0.0 1,498 $463,657 $309 $Tj 1,94% $2,685 NEW HOME AVERAGE: 7 E73 5�76 E5,70 6 203, 16, 5.2 1 704 $48,2,101,67 $28,7 $30:5 [E1.82% $2,768, 0 0 0 NEW HOM�E MEDIAN:- 773 E5�76 5,70 6 E203 13 6.2 [?1 622E $467,758 $29�8 $305 1.970% $2,680 Aventine Cornerstone Communities Chul�a Vista 2,975 100 91 91 0 9 2.5 3.7 2,210 $646,990 $293 $113 2.00% $3,51�6 �Monte Villa Pacific Coast Communities Chul�a Vista 3,500 103 91 91 0 12 2.1 4.0 2,494 $607,567 $244 $48 1.80% $3,142 Cantamar Pacific Coast Communities Chul�a Vista 4�250 109 98 88 10 21 2.4 8.3 21768 $739,233 $267' $48 1.75% $35,782 Signature Heritage Building and Development Chul�a Vilsta 5,000 79 79 78 1 1 1.9 3.3 3,600 $975,2,33 $271 $52 1.80% $5101�8 �Estancia Cornerstone Communities Chul�a Vista 6,300 37 20 20 0 17 1.4 1.0 3,637 $974,323 $268 $53 1.89% $5,086 Bella Sitia Pacific Coast Communities Chula Vista 8,000 68 55 45 10 23 2.4 3.3 3,960 $959,900 $242 $59 1.80% $4,947 �Prado at Escaya Brookfield Residential Chul�a Vista 3,120 130 130 127 3 3 3.1 4.0 2,415 $79�5,213 $329 $131 2,00% $4,3 13 Carriage Hill Da)Adson,Communities Bonita 7,0100 '18 '18 9 9 9 0.3 0.3 2,788 $1�,200,000 $430 $379 1.13% $5,820 NEW HOME AVERAGE: 644 5�82 549 33, 95 2.0 3.5 2,984 $862,308 $2913 $110, 1.,77% ::,$4,:453, $ 0 NEW HOM�E MEDIAN: 644 5�82 549 33, 915 2.3 3.5 2,778 $877,557 $269 $5�6 1.�801% $4,630 2021-03-16 Agenda Packet -I Vag I e 626 ot-724 I 1��E C% E C 0 NA ful"Z 1 IS 0 N M 1 1 N I A N5 E lulululull 1 C �M e, "y,e,rs Ma�,I,Ket A�r"ialys,Js IRR,E S EA R, C�H ����,),ase pr��c':J�rig ()ft�,�ie No 2 prodL,JG1'S ���S w new �I�iousvng products �ri tlie Otay �Randi'i aii(:j SoufiI�i Saii IaOL.flllty III detacl"�ied opfibris i�n the �1-narl<et and cio�ni�'ie dose tot�,�ie derisity detad�,��i�e(l q�' b" ' 'i fl"Iie ni,'iar��<et area ir,)�nces are w6��� [)61ow rnost $1,3001,000 - Pinnacle-Townhomes,Meridian,3.0 sis per�mo ................................................................................................................................................................................................................."I'l""I'll""I'll'll""I'll""I'll'll""I'�...................................................................................... ...................................................................................... .................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. ................"I'l""I'll""I'll'll""I'll""I'll",'ll""I'll""I"ll""I'll""I'l'll""I'll""I'll",'ll""I'll""I'llI............................................................................................................................................... mmdr�,Cl�eo(Millenia/Lot 22)@ 3.50/mo. .............I.......................................................................................I.......................................................................................I......................................................................................................................................................................................................................................................................I....................................................................................... Townhiomes;Lennar $1,200,000 r-1 -11................. Vibe(Millenia/Lot 15)@ 3.00/mo. ....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... ................"I'l""I'll""I'll'll""I'll""I'll",'ll""I'll""I"ll""I'll""I'l'll""I'll""I'll",'ll""I'll""I'll",'ll"I.................................................................................................................................... Townhomes;Meridian ................ $1,1001,000 Suwerte(Otay Ranch/Chula Vista)2.87/mo. ........................................... ............................................ ............................................I........................................................................................ Townhiomes;Heritage Building and Development($10.OK) ...... ........ ............... 000� .......................................................................................................................................................................................................................................................................................................................................................................................................................................................................... ........................................................................................................................................."I'l""I'll""I'll,,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll'll""I'll""I'll",,'ll""I'll""I'll",'ll""IlI.................................................................................................................................... Alay(0tay Ranch/Chula Vista)3,.45/mo. ...........................................................................................................................................................................................I...... ......................................................................................................................................................................................................................................................................... Townhomes;Heritage Building and Development($10.0,K) $1,000,000 0 f ---e--Parc Place(0tay Ranch/Chula Vista)3.20/mo. ................................................................................................................................................................................................................................................................................................................................................................... ....................... Townhomes;Pacific Coast Communities($7.0K) $900,000 .........El.......Veraz(Playa del Sol/San Diego)4.16/mo. LU ..................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... Attached;Pardee Homes($5.OK) ................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. ............."I'l""I'll""I'll'll""I'll""I'll",'ll""I'll""I'll'll""I'll""I'll""I'll""I'll",'ll""I'll""I'llI..............."I'l""I'll""I'll'll""I'll""I'll",'ll""I'll""I'll'll""I'll""I'll""I'll""I'll",'ll'I..........I................................................................................................................................... Solmar(Playa del Sol�/San,Diego)5.19/mo. ......... ..................................................I............................................ Attached;Pardee Homes($5.0K) LU $8,00,1000 ................................................................................................................................................................................................................................................................................................................................................... ............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... ....................... .....................Tesoro at Vista Del Sur(Vista Del Sur/San Diego)2.74/mo. ........................................................................................................... ........ ........................................................... ...................................................................................................................................................................................................................................................................................... F_ Attached;Cornerstone Communities($5.OK) .............. LU z $700,000 Aventine(0tay RanchlChula Vista),2.46/mo. ............ Detached;Cornerstone Communities(None) .......................... .................................................................................................................................... Monte Villa(0tay Ranch/Chula Vista)2.1 01/mo. ................................................................................................................................................................................................................................................................................... ......................................................................................... ................ .............I......................................................................................U, ........................................................................................................................................................................................................................................................................ Detached;Pacific Coast Communities(None) $600,000 ................................................................................................................................................................................................................................................................................... .................. Ca,nitamar(Otay R.anch/Chula Vista)2.40/mo. .............I.......................................................................... A .............. .............................. Pacific Coast Communities(None) Detached, ............................................................................................................................................................................................................. ..............................................................................................................I Signature(Otay Ranch/Chula Vista)1.92/mo. $500,000 .................................................................................. o Detached;Heritage Building and Development(None) ............................................................................................................................................................................................................................................................................. 0.,40011') ........... ............... ............... 01 Estancia(Otay Ranch/Chula Vista)1.,37/mo. .................................................................................. ...................................................................................................................................................................................."I'l""I'll""I'll'll""I'll""I'll",'ll""I"ll""I........... .................................................................................................................................... .................I ................................................................................................................................................................................................................................................................................................................................................................................................................................................... Detached;Cornerstone,Communities(None) $400,000 -1........................ ........ --E+--Bella Sitia(Otay�Ranch/Chula Vista)2.43/mo. ......................................................................................................................................................................................................................................................................I...................................................................................................................................I.......................................................................................................................................................................................................................................................................I................................................................................................................................... ................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ Detached;Pacific Coast Communities(None) ........................................................................................................................................................................................................................................................................i....................................................................................................................................i....................................................................................................................................i.................................................................................................................................... .................................................................................................................................... ---S—Prado at Escaya(Escaya at Otay Ranch/Chula Vista)3.1 1/mo. $300,000 -1 Detached-,Brookfield Residential(None) 1,000 1,500 2,000 �2,500 3,000 3,500 4,000 415010 UNIT SIZE(Square �Feet) ----B-Carriage Hill(Bonita)0.321rno. Detached;David�son Communities($,10.OK) Source:Meyers Research Individual Community Sales Offices 2021-03-16 Agenda Packet Page 627 of 7241 l�oi oi oi �u�u�u' k ,0 11"�: I'M 0 N o1olool I I 1��E A C"looll I I IV EI N W 0 M C 0 Im 1���)A I IS IIIIIIY 1�����)AYI M E N T �M e, "y,e,ris ll&Abso��,pfio�n IRR,E S EA R, C�H t III �,ilia'11'1'ed �,,)ay�'ne��rits at lb�,�ie Subject p��,'q,)e��wty �'*a��,Iige fi�-o��,-n $2,21111171 to $3,633 pe��" nI*�'Ilt��"11 0�r p��,-oducts use t��,�'ie sa��,'ne L,Pnd&�y��,'ig 20%') dw�ri a y ni e r�'i t, 3 5% �Ilte�rest ���l'ate a 310-Iyea�r ten'n.... ...I... o ���Iust���-ate id��'ffe�re�nces W��Uiii�n Ulle ic(111�111 li")ebl��ve ni�li&ket area, tl'ie quoted Assio6�abb��"Ili dues ia�nid �,)�rq,)erty ta)i(es I bb�ns fo��,-t��"Iie Sul) D 1' 1)Ith (G�eo i.vn��IqLje 'I'o eac��,i prqpe��,-'ty �,iave laee�n ufiJJ�zed.... ...I... ie aSSLin,i p 1, �" $21111711117 ject rope��,*ty are a "1 94% tota�� ta),( �I'"ate a��iid A dues f 1 ol a�rid VJ�,)e) tio $339 A��� acfive h1(,,'Y1i,iei ��n Cl'lUb \[�sta �"�iave tax �,,'ates 1.8% to §Jg�h�fly ()ve��r 2 10% Gri a �piay��,iIie�nt S �1�0 ut we fe6� NA�J�erda o'ffe��rs a �better m�''' �' 111110I(',') 4�F t I a�nd do c��,o is si("Yni i�e de�ns,Jty deta6�1��ieiid a�[ter�nafiVes, b, 11 11LInity erIiv���� to't],Iiesie alte��,'I�nat��ves a��iic:j a���� 'Ui'iree o'�f, ese detj"a6�1'ied ia�fte�n���'iates are ��iea�ly s()�kl out (W���Ii6h �,'nay acc('.)L,fl1'"1tf()r so�rnie oUUhe bwer pr��ces as w6d� §�nce t���iey a��,,e waifi��Iig to r6�easiie p����iases)., $16,500 ==1111111lom Pinnacle(Millenia/Lots 12&13)@ 3.00/moI. ................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ Townhomes;Meridian ............................................................................ Cleo(Millenia/Lot 22)@ 3.50/mo. .............................. ............... Townhomes;Lennar $6,000 mmeiiiiiiiiiiiiiimVibe(Millenia/Lot 15)@ 3.00/mo. Townhomes;Meridian, ...................................................................................................................................................................................................................................................................................I.........................................................................................I.................................................................................................................................................................................................................................................................................... ---B—Suwerte(Otay Ranch/Chula Vista)2.87/mo. $5,500 7 Townhomes; Heritage Building and Development($1 O.OK) ................................................................................................................................................................................................................................................................................... ....................................... .................................................................................................................................................................................................................................................................................................. ---A—Alay(Otay Ranch/Chula Vista)3.45/mo. ............... .................................................................................................................................................................................................................................................................................................................................................................................................................................. Townhomes; Heritage Building and Development($I O.OK) Parc Place(Otay Ranich/Chula Vista)3-20/mo. $5,000 X" Townhomes;Pacific Coast Communities($7.OK) �z LU 2 -11- Veraz(Ocean View Hills/San Diego)4.16I/mo. ............................................................................. ............................................11111"I"'I'll................................................................................. Attached;Pardee Homes($5.0K) .............................................. CL $4,500 A-......Sol�mar(Ocean View Hills/San D,iego)5.191mo. >- Attached;Pardee Homes($5.0K) .j "I'l""I'll""I'll'll""I'll""I'll",'ll""I'll""I'll",,'ll""I'll,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""IlI I...................... ............... .................................................................................................................................................................................................................................................................................................................................................................................................................................. or Tesoro at Vista Del S,ur(Vista Del Sur/San Diego)2.74/mo. z ..................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... Attached;Cornerstone Communities($5.0K) 0 $4,000 2 . ......., Aventine(Otay Ranch/Chula Vista)2.46/mo. ............................................................................................................................................................................................................................................................................................... Detached;Cornerstone Communities(None) . ......... .................................................................................................................................................................................................................................................................................................................................................................................................................................. //�//�//////////////////////////////,////////////////////////,///,/...................................................................................................................................................................................................................................................................................... ............... 0 Monte Villa(Otay Ranch/Chul�a Vista)2.10/mo. $3,500 Detached;Pacific Coast Communities(None) ............... ................ ............................................................... ......................................................................................................................................................................................................................................................................... Cantamar(Otay Ranch/Chula Vista)2.40/mo. ............ 1"'%1,,#'j11VjfjT1/,��,/,///////////////////////////////////////...................................................................................................................................................................................................................................................................................... ........./ Detached;Pacific Coast Communities(None) $3,000 ......I.........Signature(Otay Ranch/Chula Vista)1.92/mioI. M, Detached;Heritage Building and Development(None) .............................................................. .......................................... ............................................................................................................................................................................................................................................................................................................................................................................................................................... ..................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... Estancia(Otay Ranch/Chula Vista)1.37/mo. $21500 ................................. Detached;Cornerstone Communities(None) ..................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... ............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. Sitia(0tay Ranch/Chula Vista)2.43/moI. . .............. Detached;Pacific Coast Communities(None) ............................................. "I'l""I'll""I'll'll""I'll'll""I.......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... .......................................................................................................................................................................................................................................................................................................................................................................................................... Prado at Escaya(Escaya at Otay Ranch/Chula Vista)3.1 1/mo. $2,000 Detached;�Brookfi�eld Residential(None) 1,000, 1,500, 2,0010 2,500 3,000 3,500 4'�00 4,500....................-B--Carriage Hill(Bonita)0.32/mo. UNIT SIZE(S,qu�are Feet) Detached;Davidson Communities($10.0K) Source:Meyii 21euryh, In,dividyl$pmmunity Sales Offices 6 Agen a acket Page 628 of 7241 ol 111 1 1 111 ol� III ol ol ��ko 1��E 0 1:::' S 0 U olooll I C 0 U N Y A C oloof I V lol ol ol ol N 1[�ol ol ol I W 0 IM C 0 M U T ES �M e, "y,e,ris Ma��,I,Ke�,[A��",ialys,Js IRR:E S EA R, C�H 1)L11 S g x S I�1 "i ie [,)ased if,,, n e .......... SLA n ew B6bw ���s c�,-Iie et��cal ,it �of active SOLI'U�1`1 COLI[Ity new �ii,dvidL,4�� average sa�bs ratie to dat I�P 60' clul-ruil llflii�ties ���s 4�il,�g6y expecte(I 'to [,,)e sdd�III�,(,,Yut' 'u�,�ie e��rid of2021 S�x of Uhe 144� act'J�ve IIiul"Ine 1�nJties a�re ex�pected to be m it i�n 1,bt (11)1111ua�rter of 2021 1� 1� ected t(�") be i�n, 20Z11 we b6Jbve cu,Iist��-a��I�ied s�qi,14,')Iy �1,ialf tl�,��iie deft�,'ied cum�peblive ma��111<,et area Wi,�i�Je tl�iere s6ecll" �ii�,E,)Iiw iie C�0�7u�`11 ILIJ��ilies ex�p WJI 20Z111 Wlh pot&nt,IJ4� �rnp��rov&,Ine�nt ��n 2022 202311, Project Communityl Builderl Product Units Mthly l/ Supply 2020 2021 2022 20,23 20,24 Mpc Developer Type Total Sold Remain Sis Rate Mos. 40 10 20 30 40 10 20 30 40 10 � 20 30 40 1 10 30 40 Pinnac�e MNerfla Meridian 4-Story 126 76 50 3.01 16.7 9, 1 9 9 9 ---------------------------------------------------- Cleo, UlleNa 11 eii 3-Stoliry TH 117 21 96 3.5 27A 4�, "11 11 11 11 11 11 1,"1 4, .................................................................................................................................................................................. .................................................................................................................... .................................................................................................................................................................................--L------------ ........................................................................................................................................................................................................................... Vilbe Ullerfla 11 eii 3-Story TH 92 35 57 101 19�0 .3" '9 91 9 9( 91 ................. ............... ..................—...... 2.9 46.0 6 9 9 9 91, 9 91, 9 9 9 9 Suwerte Ota,y Ranch Heritage Building and Development ATF 212 80 132 Alay Otay Rainch Heritage Building and Development ATT 80 68 3,5 3,5 7 Parc Place Otay Ranch Pacific Coast Communities ATT 162 140 3.2 &9 6 101, 1 6 Veraz Ocean View�Hills Pardee Homes ATT ill 109 1 2 4.2 0.5 Sol�mar Ocean View Hills Pardee Homes ATF 74 74 0 51.2 0.0 5 Tesoro at Vista�Del Sur - Cornerstone Communities A-FF 13,4 99 35 2.7 12.8 8, 8, 8 Aventine Ota,y Ranch Cornerstone Communities 2,975 100 91 9 2.5 3.7 5 4 Monte Vi Ila Otay Rainch Pacific Coast Communities 3,5010 103 91 2.1 5�7 4 6 2 Cantamar Otay Ranch Pacific Coast Communities 4,250 109 88 21 2.4 8.8 5 7 7 2', Signature Otay Ranch Heritage Building and Development 51,000 79 78 1 1.9 0.5 1 Estancia Otay Ranch Cornerstone Communities 6,300 37 20 17 1.4 12.4 3 4 1 4, 4 2 I I Bella Sitia Otay Ranch Pacific Coast Communities 8,000 68 45 23, 2.4 9.5 5 7 7' 4 Prado at Escaya Escaya Brookfield Residential 3,120 130 127 3 3.1 1.0 3 Carriage Hill DaI%4dson Communities 7,000 18 9 9 0.3 27.7 M............. 2021-03-16 Agenda Packet Page 629 of 7241 ol 111 1 1 111 ol� III ol ol ��ko 1��E 0 1:::' S 0 U olooll I C 0 U N Y A C oloof I V lol ol ol ol N 1[�ol ol ol I W 0 IM C 0 M U T ES �M e, "y,e,rs Ma�,I,Ket A�r',ialys,Js IRR:E S EA R, C�H I 'Ilg b,6�ng �arodaced Wl�i�]e 'Ui'ie Sot.jfi�ii� COL,flllty amot,,Ivnt of 'U�,�ie Sari Gatnty �1-nar],�et ����s decreashrig ani(l Uhe deiIiar'id I �1',i0L,1S]J1g outst�r����Ds �,-musi�r 1110 I S ��n fii��ie fii',�iere ����s, J��,K6y go���nig to [,,)e a J��,T'flted Uhe next sJx ni,,iari'Uhs JJ�Kdy ���l"i�as severa�� 4rge-Isca�b dev6op��n 1�9.n't III af`cam�,,)efifive ects tici "I id&,"nand/sq�, ply d w tI t e b Li,l���I< ()f M e a "I'll A, o 2 f i 1) a i�Ii'i�u�rn 1) aI�ice ����s expected bst �,Tmst of sa�bs per��oc, sa�b pi�riodt,,ict ex�pectec'�,], to, [1,I)e s()��(111 Wflh���n 'U�I�ie next 18 rnai��it����'is ACTUAL HISTORICAL SALES PROJECTED NEW HOME SALES DEMAND DEMAND PROJECTION C, C, 0 New Home Sales(1) San Diego MSA 2,277 2,041 2,785 2,340 1,939 2,441 2,323 2,669 3,66.4 3,724 4,450 3,500 3,800 4,000 3,800 South County%Capture of MSA 151.1% 271.1% 221.3% 18.8% 15A% 19.7% 191.8% 251�0% 31�9% 27�6% 14�0% 20�0% 251.0% 24�0% 24�0% South County Submarket(Forecast based on historical share) 343 553 6,20 44,1 299 4,82 460 666 1,168 1,027 625 700 950 960 912 Less:Estimated 5%for Sales in Misc.Neighborhoods (17) (28) (31) (22), (15) (24) (23) (33) (58) �5,1)1 (31) (35) (48) (48) (46), Potential Absorption for MPC's in South County Submarket 326 525 589 419 284, 458 437 633 1,110 976 594 665 903 912 866 SUPPLY PROJECTION(2) ACTIVE PROJECTS INVENTORY ESTIMATED SALES OF REMAINING UNITS ACTIVE PROJECTS WITHIN�MASTER PLANNED PROJECTS Total Units Sold(5), Remaining(2) Escaya at Otay Ranch 130 127 3 3 PA12(North of Otay�Ranch,Town Center) 292 148 144 13 41 36 36 18 Millenia(excludes Improvement Area No.2) 0 0 0 Ocean View Hills 185 183 2 2 Otay,Ra,nch-V2(Montecito) 658 553 105 29 76 Total inventory and Future Sales within Active South County Master Planned Projects 1,265 1,011 254 47 117 36 36 18 Over Supply I(Under Supply)of Projected Demand (5417) (5,48) (867) (876), (848) Cumulative Over Supply/(Under Supply)before Future Proposed Projects Add units to the Market (547), (1,095) (1,961) (2,837) (3,686) PROPOSED PROJECTS WITH POTENTIAL HOME SALES IN,2018+(3) Planned(2) SF MF 2020P 2021 P 2017'P 2018P 2019P Otay Ranch-V13(4) 1,938 5,30 1,408 Otay Ranch-V8 West(4) 1,210 0 11,210 Otay Ranch-V4 3,50 73 277 Otay Ranch-V10(4) 1,740 695 11,045 Otay Ranch-V8 East(4) 3,560 943 2,617 Otay Ranch-V9(4) 4,000 166 3,834 Aggregate Estimate of Otay Mesa Future Projects 11,375 3,125 8,250 Total Estimated Proposed/Future Projects with Potential Market Entry by 2024 24,173 5,532 18,641 Footnotes 1)Actual Existing and New Home sales through 2017 per Meyers;projected sales for 2018-2022 per Meyers Research. 21 Remaining Active supply includes for-sale units in active projects only,some MPCS have future unit count 3)Unit Counts within Future Projects are Estimates Only-Actual Timing is dependent upon variety of factors including: efforts of Applicant,CitylAgency Approvals,and capital resources 4)Per materials provided by builder or planning documents 5)Sold through 111412020 per sales offices 2021-03-16 Agenda Packet Page 630 of 7241 ol 111 1 11 10 10 10 1 o o o o���o o o o 1�11h\�ui UUM11 AGooll I I IV EI L I S I IN G IS A 11 E A 11 0 X 1 NA Alooll"I"E IIIIIIY 3 3% I I G E,1111uluu) A N S 0 lo�,IIII) 11,110 IA E S AT 5,111 0 10 0 Si Q U A �M e, "y,e,ris �\Aa�r��<et Assess,rrhi e�,,Ijt IRR,E S EA R, C�H Sui,,)jl�ectl`s attac���lied ���s �ii ui'ie 10 1,,� IF%,� 9 11 "11 7 & `3tta(,,��,�'Iied �resa�[e va��Ues, �11 fi�ie �riea�['-Iby a���'eas of Otay (defi�i�lied as t��, ee c,()dE'1S 919151� p��,-oduct offe�r��Ig \4��[&,i�b 1A, ��o. 2 a���nd p��Ices are towa��"ds filie 'top (Ifli"le resa��e �,Tia��111<et, �")Llt 'Ulli.S is to ble EN.X�[)E(`ItE�d 19 1(9 13) i rl a c���e s, It e �ii i cPve��,'Ii ���,iew rnast&r �,)��a��mrieid elevat(,)rse��Ilmced o uses, Wifl�ii� a �,()cat��(Y�i of'I� To[� ���"Road ja�re��,Thfler �m��xed-use flew tow o�I�n e Is S Ll cl"'i as tl�iesie ac�h�eve a Cjl.�bo ia��I�id V��be a�re po§l�b��ned the �,Dortio��n of,Uhe resa��e rn ace a��rld �,,,ep�rese��,"Iit good va�be Wfi'�k�n fii,�ie mrripe'bt�ve �4�,"idsca��,)&, ��ote tl�,iatsubije(I':,'t p ices a�re `Ibasel' �ar��ces a��rid do �i�ot bcatl�llo��I�i �ii rs, arid qpgrC,,lides. Ov&�a SL,flbject ��)�riodt.ict pio§t�b��riir'ig W��� E.k q,,,)��,,)iears fii,�i��s mrq�)ar��so��i cha�rt $700,000 ............... --*—Pinnacle(Millenialots 12&13)@ 3.001mo. ................................................................................................................................................................................................................................................................... ....................................................................................................................................................................................................................................................................................................................................................... Townhomes;Meridian ............................................................................................................................................................................................................................................................................................................................................................................................................................................... ................................................................................................................................................................................................................. 0 $650,000 ............... mm*iiiiiiiiiiiimCleo(Mill�enia/Lot 22,)@ 3.50/mo,. ............................................ Townhomes;Lennar ............... Vibe(Millenia/Lot 15)@ 3.00/mo. .............................................................................................................................................................................................................................................................--,""I'll"............ Townhomes;Meridian $600,000 ....................................................................................................................................................................................................................................................................................................................................... OW", 9,1915(Built 2007) ........... 1/10 Ii/i/o/o/m/010/00/1 Avg. 1,509 SF Units $469,255($,311/SF), WO Owe W $550,000 soomm WO/m/e/0 91914(Built 2001) ............ ....... Avg. 1,326 SF Units @$453,311 ($,342/SF) ............... ...... ...................................................................................................................................................... .................... ---—--------------------------------------------------- .........../ LU .............. .......... od/l) 91913(Built 2005,) < $500,000 Avg. 1,383 SF Units $435,615($315/SF) ............... ............... ............... ................. ............... ......... ................ Fill, ....../,/,/,/,/,/,/,� R —Log.Zip 91915 ................ ................. ............... $4507000 ........... 0 ...............0, .......... ............... ...................................................................................................................................................................................................................................................................................................................... Log.Zip 91914 mor(a I ................................................ .............. ....................................................................................................................... .......................................... .............. 4/91C —Log.Zip 91913 $400,000 A ..................................................................................................................... ....................................................................................................................... ............................. ....... .................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................I....................................................................................................... ................................................................................................................................................................. W ........................... ............... ....................................................................................................................... $350,0100 It 1,000 1 P200 17400 1,600 1,800 2,000 2,1200 2P400 2,600 2,800 3,000 Source:Meyers Research, MLS UNITSIZE (Square FeeIt) 91915 Jan. `20to Nov. '20 2007 2571534 17'6 16.94 15.33 13509, $469,3255 $310.93 9191�4 Jan. `20to Nov. '20 2001 86,532 56 5.31 �4.33 13326 $4533311 $341.78 '435 615, 1A�O $314.89 91913 Jan. `20to Nov. '20 2005 121 5,705 234 22.17 18.33 K 5 1"f)J OQ 14 A Fr Aa 11-4 4 R 0 R 090 1 111 0 R-r- 4:2 J I. _V P7 V 1-18U11Ua I CtI%,1`ii I ctPZ, V_Y I oil I I fill I 1 so, oil -------------- S 0 U HIM\ �Iuuuuuo III ��� COUNTY ATIolooll"AC 111"I'l IS Ma�,I,Ke�'[A�rhmlys,Js A EI S & A(1111111h11%00 I V E I S I IN G IS �M e, "y,e,rs IR,:E S EA R, C�H c��"Iiart bdbw �,,,)�res&iits attad�,�ied sa�bs �,-ecarde('J �Ii� 20211101 (b�be) ai,id wrr&litactive Jst��rigs (gre&n). The §�qpe oftil�'�ie act�ve J�strig tr&iiid�Ji��rie ���s steqoaarthar'i 'Ui'ie sd�d trerid Ji�rie due to a s6ect (11�)'f roxeanfrant Jst'J��rh'lgs �rll ,)e�r��al Beacl"i T 1-i e s u b "nim a'I r Idea the bottam af t�,�ie attadi��-ied �resa�b rnal,�et dr��ve��"'i ,,I���ect p��,*ope�rty ����s pne�ra��Iy loosifianed 't('�� ',,es ("%oi.pled Wt�,Ii �arg6y' by tax �"ates ai'hid fees W��� J](,,dy [X]§�,i fli��ie UJI�b�n��a (111n a payi�'Tlie��"Iit �,,)a§�s, the bw de�rnam:] [ev6s (p�,�'mrated by bw ��nte��I-'est ���I"ates alid ��nai*eased 'fOCLJS� ('Y�1 §�'idlerid,uri�ng fli��ie COV���'1'111'11) �s gene��rat��,'�ig si'b&arig derii�'iaiiid Iie �P'Ieg��an, $1,000,0010 - Pinnacle-Townhames,Meridian,3.0 sls per�mo $9,001,000 - 0 0 Cleo-Townhames,Lennar,3.5 si�s per�mo 0 Vibe-Townhomes,Meridian,3.0 sls per mo $800,000 South Bay Submarket, Listings(Built 19,93)37 DGM Avg. 1,3�53 SF Units @$5919,775($443/SF) 0, South Bay Submarket,Sales(Built 1996)20 DOM Aft Avg. 1,311 SF Units @$437,669($334/SF) $7001�1000 D Trendline-ACTIVE MLS South Bay S,ubmarket 0 > 0, 0 0 Trendline-SOLD MLS South Bay Submarket $6001,000 LAL 0 0 0 *0 0% $5001,000 _0 lb $4001,000 0 411 Date Ratigf2.� 0 Sold Li,stitigs Jam '2(.'-Nov '2�,' $300,,000 --0 500 1,000 1,500, 2,000 2,500 3,0100 UNIT SIZE (Square �Feet) 2021-03-16 Agenda Packet Page 633 of 7241 �Meyers IR,:E S EA R, C�H ii im IN 3''a n e a (e Ove v ew 11 Mil C��Jiiula V��I slta 11A 2) 2021-03-16 Agenda Packet Page 634 of 724 ol ol ol Ul UUUUU C 0 NA T I V A NAA l< T Ol C AT 10 N NA A �M e, "y,le,ris A�partri�ient �MaI<et Ov&�,v��ew IRR:E S EA R, C�H several In �ve i nai """lie §te ��s il,64tiv6Y i i il�lii u s i j a I I r,l tliat @11-e 1 1, 10 11���flfies lw�fliun ot,i r 11�et a rea. 11 Al 11' We utlhEed bi I acflve apar'trnei I I ull In 1�� I 1 10 1 IN ulxfl��,��)etitors nearby ��to h6�p es�talohsl,��i ireii�t i-ates and I ease L1�3, 1-ates. AH cui���r'imt i�11,i��Jes liave 1"'1111),eer"i SSLIccess"fi il theh, leas&����IU��) W[th all achievvig om w��''Illilii abOLIt 12 ��to 16 ilinal lo��f qper�iing. 1,I����i le se "I Col"T i I irtir ii t in[bes �rqoreseii I a "t(..I..I....1,a, I I o" 1::' 11,,111107 qpa �il�i&at li(""'Ames typically ��n a 3�����Istory wak:����i I Bmil-dwall< does �have one 4-����Is''Iory bUildhnig is, serv'ced by aiii elevatior �Ily in Uhe CMA ��s i�I s le (ID u h 11 10 11118 ��to 2 0,1119. 1 1[he io�des't 1 2 0'Ill 5) w ba�@,-ice were l"KIIHt h') 2 TRk LS C"i R E�E,r,J S F TA ... ......1, V", EAST LA,'��,,I, 'V S FA S E 11 ep '011 A N C�,,d "IF "v'i I A(..........lr'�El`� �.N D 21h ViOJ Ol P Sr .1 S t 3,ir�,j "0 ??f S Sir 4%, e, P u I e "I"AsLa N`ou'J;,k-zJ IT G 1)"?, rs t e iii, Ili AK'I fn', Fla I a�i S I r,J,d 6 roper"Ity zi�iiD rtrmzi r Sub �iict 111 Ile P,a rl k, Z "2 Ale (,I !,t rl"), 1."M 1,, N C H "I"h ic-w. I'Rie,.11�111.) d el ri ices al't [,'1,',',',',sca'ya N s nio V, ................. ............................. .................................................... ..........................................................................................................................................................................................................I .................................................................I IN, .......... 1 Alexan Rivue Greystar 3 253 97.2% -18 21.5 753 1,8391 1,126 $2,095 $3,848, $2,671 $,M19 $218 $2A8 $0 $2,095 $3,848 $2,671 $2.09 $2.78 $2.48 2 Boardwalk Gireystar 3-4 309 96.1% -19 15.0 844 1,236 1,027 $2,147 $2,897 $2,,592 $234 $2.84 $2.55 $0 $2,147 $2,897 $2,592 $2.34 $2.84 $Z55 3 Pulse Fairfeld Residential Three 273 981% -24 11�10 7891 1,371 1,002 $2,085 $3,125, $2,5351 $2,,28 $278 $Z56 $0 $2,085 $3,125 $2,535 $2.28 $2.71 $Z56 4 The Residences Gireystar Three 272 97.4% -22 -- 747 1,654 1,149 $2,225 $13,825 $2,811 $2.23, $2.98 $2.52 ($351) $1,947 $3,347 $2,459 $1.95 $2.61 $2.21 2021-03-16 Agenda Packet Page 635 of 7241 ol ol ol Ul UUUUU C 0 NA T I V A ���\A NAA l< T 1�'R E N TAIIIIII. E IS A p a i-t ri mrit �Mal<et Ov&l'v��ew �M e, "y,le,rs IRR:E S EA R, C�H a irl�'a 13, ��i�i:1. proj'elicts, We aiit,Ic.I��pate tl'��Iiat actua�� askII,ig Irer�i�ts IwIll 1"')e but dUrIr'ig We [��Iiave positI(""'),ned fl,ie st ibject pr"qper'ty towa,-ds ulie lower end af u,�ie ca,11�pat[bve NAIHei-iia can��" ile Ices b6('''w air le i'�iet affect��ve average p�I-K�',eis hn 11'��ie ci.jIi.'I'"ent Gvali the Ngll (IIII CGLI��I ancy C the base�����IqiD plias,ila..,, im(")st pr(II ects (��'f IR I I &I-vtIve p�I fly afIferhng u�p��to 6 weelKs �free reIil��vt �foip lheh'��argest town[I�mnie I a a re c [kill (''"aya IS CL]irreii I I lin the arEa �n(,) pr(II ects hili INAIII&n' Uil"'reill"i'lly i-q�:oibrig ai��iy s�pledals, however 1,�ie �Ii Es ver 20 �.jnits per ni all ri�t[i des�pIte the COVU u r"i I 1"S. ..........I I lie !Re§dences qpeIl���ied R�Ii October 20,1119 aI,IxJ lr�iacl stabted occi i�pai,'icy hili At igust af' 2020 1 e a s i r�li g a a Ili average irate afa sbwdlovol'i. $49000 llwwo�Lot 19 (Three-IS,tory)TBD, 15/Mo. $39500 --W—Alexan Rivue-2019,3-,Story,97.21%�Occ. E llglolll $39000 000001000 00,001001100 C 11 0 �Boardwalk-2018 3-4-Story,96.1 Occ. $29500 ....I.......M111111111111111111 I Rulse-2015,,Three-Stary,98.2%Occ. $29000 The Residenices-20,191,Three-Story,96.7%Occ. $19500 500 700 900 1 1 100 11300 11500 1 17'00 11900 2�100 UnIt Size(Square Feet) Source-Meyers LLC,-Individual Community Management Offices 2021-03-16 Agenda Packet Page 636 of 7241 ol ol ol Ul lululul, 11111111TI S C 0 NA T I V A ���\A NAA l< T I'll Bled roo A�part�ri�mnt �MaI<et Ov&l,v��ew �M e, "y,le,rs IRR,E S EA R, C�H "f[ts" h�itci fl,ie ("'Werall wlll lo��ff& on(���11 llDedr()(Drn wl'i'ts 650 SC U&I-le "'feet to 800 sqUare "'feet. le Lflt�t s��ze �rar��ige pneraHy OL11- llypot�ietl(�14� sulDjecl,,t pi I I le I 11�i c o a r s lo i,i I I lio t all fl�o�l o r�p a�n s )�fferedl at corn�petlt'We 411idsca�pe. Wl,��ille �t tliIii,"It uj�'. 'qoosed t sizes & '[o the rnarl<&t &rea clin tI��iie clhai,�[ t�elom, s a l I "t �,,qp�,-eser�tled or�i tl,��Iie dmrt and 0 LI I- s u ni��1n a�ry ��ta bi I e s corn�petlt'we �I)rojectc:,,;,, are �,-&flected on the c1iart. (J l��ts H i�a t weria io�tl avallabl,,,,.:�), f'io�rl rent la�t the lli���ne �11)�f @�Ialysis are n(1) 1, �,�'nost beicl roo rn s avaHabl(l,,� withh"i 'eic ts a�re the larger wlilts. 0 n le bed R I U 117 1 t i��nre 1 01 S 1 presen t 3,1111% Yf tlhe over"all ChUla Vlsta/lrqc)er�4� Beac[�l 35% to 41,5% lo�fcir�ie bedroums. Sullmarl<e�t. We an�fld�pate that tli lie p�rqperty wHI o�ff&,�a wili�t tl,�iat apprc $29600 llwww��Lot 19 (Three-Story),TBD, 15/Mo, $2,500 $2114,00 —&—Alexan Rivue-2019,3-Story,97.2%Occ. $2l,300 E $2l,200 Boardwalk-2018,3-4-S,tory,96.1%Occ. $2,p 100 $2�000 Ar—Pulse-2015,Three-Story,98.2%Occ. $1$900 $1 800 The Residences-2019,Three-Story,916.7%Occ. $1 P700 6010 650 '700 750 800 850 900 950, Unit Size(Square Feet) Source:Meyers LLC;individual Community Management Offices 2021-03-16 Agenda Packet Page 637 of 724 ol ol ol Ul lululuill S C 0 NA T I V A ���\A NAA l< T Bled roo A p a rt ri mrit �Mal<et Ov&l,v��ew �M e, "y,le,rs IRR:E S EA R, C�H st.�ID" t �,)&,[y w��l io�!"fer I -'s ��t� a 01 L. 0 L!I- In)�,'-n qp�p�rox��,nately 900 sqUare fleet"to '111 100 squarle �feet,, LRe fliie c(,',lrq,,)larsui wl,�iHe 't la�p�pe@l h t I I Y���)0 jec'', pl'o r -ori�petifive projecis are rli&flected 11,��Iie d,�iart since ]<e:t ail'-ea Ulie chart b,iirs),�(� a��l fl,DOI`�,[D�ans ci�l'"�fered at c. �,,)rqposeczl §zes wl,e sr��Ina ��i I cum�par"Is()n to tiv��ie . ...... ur�i[l,,,s 11,fiat are no�t ava'Hable full-, rer�it at the tfr�ne �11)��f tN�ss ar4�ysis are rqpresented. wlnts rqpresent 55% oftl��ie overaH Ci.lj���i�,.fla 1111,113eadh 141-110% to 50% Sul,Imarl<le�t. We an�tld�pate that t1i lie p�rqperty wHl o��ff&,�a wili�t fl,�iat la�p,��prc $31200 mmm*m Lot 19 (Three-Story)TBD, 15/Mo. $3,000 $2�800 v0000 411—Alexan Rivue-20119,3-Story,97.2%,Occ. E >t $25600 M 0 --so—Boardwalk-2018,3-�4-�Story,96.1%Occ. $25400 $2,200 Pulse-2015,Three-Story,98.2%Occ. $2,000 $1,800 91111111110---The Residences-2019,'Three-Story,96.7%Oc;c,. $15600 800 850 900, 950 15000 1�05�O M00 11150 11200 1 ZO 11300 Unit Size(Square Feet) Source.- Mevers LLC,-Individual Community Management Offices 2021-03-16 Agenda Packet Page 638 of 724 ol ol ol gu'u'u'u'u'u, Ul ululululu e,d o o m s ui�u�u�ii :�j C 0 NA T I V A p a rt ri ient �Mal<et Ov&�'v��ew 111111111F jjjjjj� �M e, "y,e,rs IRR:E S EA R, C�H peru"111111in tage af overaH� un'[t nx, all "s al,"ie '11,11,500 spare feet. ffl��ille 3�����bedroaqi wxts nnal�e a &�7�41& OL11- 1-ypot�ia(� subject 1prqparty o�ff& -iu��a cornr'r�it j�n���ties tl,��ie trade are h,�16caled 1111���mt flliey are gan,Efli-a�ly a pq1,1111"YL11ar qp lia�i wlfi,�i faniHles, U'1��IS �rqprieser'it qo���)rw(Hi iat6y 012%,, of the ov("'� ra��I C I at(�'���fly 5�0/0 "t( A 01��ftlr�iese largar L,1111'[S. 1��i��g[ier rerii ts for Vlstaflr�qperb�� Beach Subr��iarli(et. We 11�' a�t '111"11,i�le subect pr(111)1�perty Ml affer a ut�t �,�"nlx that C011i�prses a��,�)�priomaic 10 j &fl e d t s fa ct. e U 1`1 1"n"X S h 0 U d thes(l"� tlljr�i�ts creates a srnaller dern,wid ancl U I $4,000 =meow Lot 19 (Three-Sto�ry)TBD, 15[Mo. $3,8001 $31600 E --6—Alexan Rivue-2019,3-Story,97'.2%Occ. $31,400 0 $3,200, Pulse-20�15,Three-Story,98.2%Occ. $31,000 $2,8001 =ppppO,,'The Residences-20�19,Three-Story,96.7%Occ. $21,600 1�1000 11100 11200 11300 114010 11500 11600 11700 11800 1)900 Unit SIze(Square Feet) Source.-Meyers LLC,-Individual Community Management Offices 2021-03-16 Agenda Packet Page 639 of 724 0 C C U[01011111h l I ii"A N C Y I'll"Al000llooloo qSi� �M e, "y,le,rs A�partri�ient �Mali<et Ov&�,v�Iew IRR,E S EA R, C�H OCCIIIU� Pailcy irates I'liave aveill"aged 911`711% ovmlii the �past 2 yemrs iiili the Ght,ila 13eadill slilli'fly ft oveII,4[1 Swn I..........1),IhIl e g ol 10SA ('96% average c=qpailicy). Wlb i���nany �r(,ports, Ir�i6cate sorne hili&taID'Hity ul'i Ullie la�par''b���nen�t rnail<,et na�tbnWde as a �resu[hafthe COV11,11,111,11"I") pai-ideliiicl, alanced SLI�[)��D rates for ur�i'[1,,S a f,ter 2000 are U���) last year Ullie ('Dh�l Vsta/h T ll�perb�� [l,�each SL,1h,'n@,-1Ke'L i ocicqo@ncy rates p()ihilt, 10 b ��y and clemIar�id cor��116�tbns �,,)@rfiCUarly in U,�ie Sot 11�1�13ay des����,)[te �@rge blo )sses. 1010.0% 9,6.0% 19,41.0% CL Q 19,2.0% 910.0% 8,6.0% 81,41.0% -,Q CINJ CN CN CN -"Q CN C C CN C CN C C NJ CN C CN C NJ CN C ,*�I- U") LO CO CO r1— r1— CO CO Cr) C:7,j C-D CD C"N CN CO CO U") U") CO Q0 r-- r-1 CO CO CF) <7") C-D C-D CN CN Cn CO *�I- *l LO LO CC) CO rl-- rl-- CO CO �7`j C7) CD N— IRI- IRI- IN— N1- Ir— Ir— IRI- IN— v- Cl CD CD CD CD CD cz�� cz�� CD CD CD CD C�4j C"Q CN CN CN CN CIQ C-11Q C"Q CI-J CN C*Q CN CN CN CN C-11Q C'%j C'%j CN CN CN CN C-1,,J C� C� C� CN CN CN C-11Q C-11Q CIIQ CN CN CN CN C-11Q C-11Q CIIQ CN Source.-MPF'Research San Dieligoi-Carlsbiad., CA allillillillillillillillillillillillillilliillillillik�C,hulaVista/l��mp,eriaI Beach 96.6% 96.6% 964% 9,,,,6,.6,% 917.51% Chula.V.,staimperla.1 Beach 96.61"NO 9,6.4% 9,6.6% 96.6% 9:6.6% 96.9% 9750% 96.6% 96.1% 96.7% 96.90 .......... OJ -, I - I k 4-ji I'll ? - " ,- 0 T r 0 "I "O"i �'& k "")�''� "1 1 .......... 1 1 5 9p" 7iP ��'-N 6"'3"0 21"",, ,,,-)6 61"�� 9 6 9 6 96 0"(" 6,) �,'7', 9 64 96 'M' 96 S" El'', ;,] �, � ( C19 96,'- 2021-03-16 Agenda Packet Page 640 of 724 nhq�'Pi uumul T 111R,E N�D S UY I.............I �M e, "y,e,rs ...............I A�partri�ient �Mali<et Ov&�'v��ew IRR:E S EA R, C�H �w -I)ed in Q32020 Ili e A[Uhot��i g e c('')11()III I C I flil'icertain'ty reRlfted In sor iie �i�ioderatior�i ��n ovaraH Irer''it, grOW11"I U'T'(''')Ug�'l Uhe I��i��i�ddle paill"t �f 2020, I-'er��Irts h-i C[��iU�a 1:111 eac,i ... .... ...... 'I average �rei,i I bi, qparb�i iants bi J[t aftar' 2000 ��n Ullie bcal D''lUb Beacli St ib,��narl�et diribed to $2,1289 Hn 111"ie most recei-it quar''ter- Uir�le 1"�iig�,�iest level recar(I"Jed. Un��ts are t 1(Eltely $1,1111140 pler n'mrltl,��l lilg[��ier and avarage $2,428 per IMD[Ith', bu'Ht al��ta-200(1) hi fll���ie rwierall Sar��11� ego . ....... $3�000 $2500 $2,000 $1,500 ......... Opow 0 $1,000 $500 $0 M CO M M M M m M M, M m m a a 0 0 a a a a a a a 0 0 a 0 a 0 0 0 0 0 0 0 0 0 0 a 0 a 0 0 0 0 CO m 1:1- '�J_ U11) UD (.0 (.0 r1- r1__ 00 00 CD CD CD CD V_ V_ m CO -It lqt U11) Ul) r-O Q0 F__ P.- 00 00 M CD C> CD C�O (D C) C� C> C) C) C) CD C�l C) CD CD C) CD C:> C) V_ T_ Ir- Ir- T_ 'r- T_ Ir- Ir- IT- IT- Ir- It- T_ N_ Ir- N_ Ir- T_ CN CD C) C> C:) C:> CD C> C) CD C> CD C) CD C> CD CD CD CD CD CD CD CD C> CD C:) C) C> C:) C'> C) C:> C:> C> CD CD CD CD CD CD CN San Diego-Carlsbad,CA Chula Vista/Imperial Beach Chula Vista/Imperial Beach(20001+ Product) —San Diego-Carlsbad,CA(20001+ Product) Source.,MPF Research Chi i1a VistaXinvefial Beact') $,I, �i$I�,704 $1,,7(,,)4 17(,,'),,5 1 795 $1Y780 $1762 $1,,8,24 $1, $1,866 $4,8 6 1 $1 9 10 ,640 $1,,62 6 $1,6,99 $',755 �i$1� y 839 $1,862 2000+Product $2�008 $2�01 5 $25135 $2�093 $2,061 $2�072 $2,149 $25189 $2,123 $211109 $21203 $�21202 $21231 $�21237 $27208 $27289 lg�j 3 /1 $'1' 1 p '11", i 965 050 '�'', -(I,.jat 11 $"1,8 15 6' $I p�8 93 $1,�3 6 8 "1,8 51 $1,93(" $1,984 $'01 $1,957 $2,002 $21,047 �$2,042 $2, $2,0 17 $2,029 San Dii�� I bad '//- 61o, 789 $1,7921 2000+Product $2240 $2)238 $2,318 $2�367 $2,312 $2,327 $2,406 $25448 $2,399 $21,386 $2,447 $23,485 $2A78 $21480 $21421 $21428 2021-03-16 Agenda Packet Page 641 of 724 hil luumululul lululululull W �M e, "y,ers A�pa�rt��,i mnt �Ma��I<et Ov&l,v��ew IRR:E S EA R, C�H Accordhi�ig 'to 11,Reall?-age, tlie ovei�-al�l San llilego ill"Inairli(I'let lilias giivahteii,, iil-'elalflivie sllta�l,)IHH[ty mIrsus otlilmi,�, ii,-ieg�'OIirial ilmir�l i (elts Ailigeles airlid Qil-'ange County). e aveii-age pr,ice pei,� fiDot I ilewer qp@"tni&i-vts ii,�i tl,��ie Clit M St libi"narl(et 'IS CUrrel''I'l, 7 'fOC)t $0,,051 fi,-,oil�n �ast year (3Q201"19),, vvitl,�, 4.hill f(III)II-ecastecl "lob growth hi 21022 ancl lmyond, we aiii�flqp,,a�te tl,��iat Sai,�i Diego qp&,"fi r i&r it h jindarnei�itals wIll iilii�pi-iove oveir lt��Iie �f iex 1 1112 914' if �t[ie COVO crisis cfissi�pates $3.00 $2.50 $2.00 al All am 000 --r- $1.5lO C 0 $1.00 $0.50 $0.00 M ";J- C'-,J M '111;t r- CN M 'Il Cq Cl Cq M, �I- Cq M "l Cl M C*4 M 'Il CNI M lql- Cq M zJ- C,-j Cn, 'll CA M 'll C`-j M -,t CN M, "C�t C%J CO 000000 000000000000000000000000 000000000000 a 0000000000 0000 C.0 CO rl- rl.- �rl- CO CO CO CO m m m m C) CD C> CD v- v- v- v- CN CN " C*-4 CO M CO, M -,f ,l rl "l U') LO LO U'> C.0 QD CO Cc [*-- rl r- P.- CO CO 00 CO M M M M C) C) C) C:) C:> (=> C:)� CD C:) C:) C:) C:) C:) C) C:> CD C:) v T- T- T- v- T- 1C `T- X V- `r- V T- V v- v- v- T- v- v- v- It v- T- v- v- v- v- V- v- v- IT- v- T- V r- v- I- v- v- C�O C> C�� CDl CD CD C) C�O CD C�O CD C) C> C:> C:> CD C> C� CD CD C�O C:) C> C:) C:> C:) C:) CD C:) C:)1 C) CD CD CD C) CD C:> CD CD C:) C) C) C) C�l C:) CD C�O C�O CD C�� C:)l C:) C:) C) CD CD CD " " CN Cq CN CN CN " CN CN CN CN CN CN " "I Cq Cq CN CN CN CN " 04 CN Cq CN CN " CA Source.-MPF Research Chula Oistallmperial Beach $I�80 1�8() $1.89 $I�89 $1h,88 $1�,,8 9 $1.�94 $1.��9 9 $1.�9 7 $1�96 $2.03 1$2h,04 $2,05 $2.106 $2.(),5 $2J�'I 2,000+Product $1.90 $1.91 $2.03 $1.99 $1.96 $1.96 $2.04 $2.09 $2.03 $2.01 $2.11 $2.12 $2.12 $2.14 $2.11 $2.17 Sl $2h,121 $12 14 $2.19 $2.25 $2.22 $2121 $217 $Z 31 $2 310 $2.312 $2.28 $2-29 kllat,7 Diegal,Cadsbaid, C/1 $Z 02 $2.03 $2.11 $2h,15 2000+Product $2.21 $2.21 $2.29 $2.35 $2.30 $2.31 $2.38 $2.43 $2.38 $2.37 $2.44 $2.47 $2.47 $2.49 $2.43 $2.44 2021-03-16 Agenda Packet Page 642 of 724 11 oul lululull ?A - x I S I I G U N A N 1D IS U I'M A 1�`Z I<ET CA 1����`T U T 11olooloo' �M e, "y,ers A�partri�ient �Mali<et Ovel,v��ew IRR:E S EA I R, C�H Alltll,iougli apartnien"t carinjolieltiolilis are elevalted 13y lolcal� �linarlwllt statidards, Ift loallailice c:,,u rille�nlc�y ipeinaihns in ci.flheicicll Uir�ie i� i i I< af a,:�p a e�li��t c I f'ar, the st,A)"ect proper ty., CIILfla Beach ci(���,.�Hvales are ex�pected to 1�, e ���fo ic t Ised ff��) flil��Iie towl'i ar��id NuI,��[Iieast &.flbniar1<ets wh�ch wlH� i,��6�tlgate s(,,,)rfle j subn��iarll�et has h6d steady at a �11-augli�y 10.81/c), �i�iarl<et cqatt ii'lerafl,11..,('11,11,110, 1 g (a ��,-elabvdy aven g,�owtli rate wl"ie"i CO 1"T1 pE,lrec,l to, Sai i Dlego overaH., 350,000 11.2% 300,000 w WIN 11.0% wo Ow 11111111111111111111 iluI1111111111 00 111111111111 an mulK NM M me 111111111 =1 an inuil M W on 111111111111111111111 11111110M� M go ON 0 2%000 10.18% 5 ICU Cn 2001000 4- 0 10.6% Soo- 1509,000 10.4% 1000 1001 10.2% E 50)1000 0 10.0% CO CO CO CO CO CO M CO 'r- CO 'r- M r- CO r- CO T.- CO — M v-- CO v-- M r-- CO v--- CO 'r- M 'r-, CIO 'r- M r- CO 'r- CO 'r- CO CO r-- CO CO a 0 a a a 0 0 a a 0 0 0 0 a 0 0 0 0 a 0 ICY 0 a 0 0 0 a 0 0 0 0 0 0 0 0 0 0 0 0 0 0 a 0 0 a 0 0 U*') L�O QD to rl- rl- W W, M M CD CD 'r- 04 CN M M "i 'wi U") U.') (0 QD r,- r,- w W M M CD CD — — (N C`,J M M *rj- "tl- ILO U.) (0 (0 r%, r, w w M M (=) C) M M M M M M M M M M C> C) CD (=> CD CD C) C) (=) C) CD C) (=> 4=) (=) C> CD -r- r- -r- 'n- n- N- N- T- T- -r- -r- v- r- r- r- 'C- T- -r- T- r- C"44, Cq CY) o) cy) cy) 0) M cy) M M cy), M M C> CD, C:) C:) C__) C:) C:) C:) (_—) (D (_—) C:) CD C-> CD CD C) C) CD CD K_—) C) CD C> CD CD CD �_) CD C:) (Z) CD C—) CD C:) C> (Z) C), CD V--- r-- T--- -- T-- ' Cl CN CN CN Cq CN CN CN 0-4 CN CN CN CN CN CN CN C�4 CN Csj " CN 04 04 C*4 CN Cq CN Cq C%J CN Cq Cq CN C%4 CNJ C,4 CIJ C-4 CN CN CII4 Chula Vista/Imperial Beach as a%of San Diego-Carlsbad,CA Chula Vista/imperial Beach San Diego-Carlsbad, CA Source.*MPF Research I pill f 65 133,2143 33,45,19 313,537 33,579 331,711105 3,31,925 33,925 Cluila Osta,111t7iPet-iial Beach 3121711 327,11 32 711 32,839 321,9 13 33,108 33 33,381 33,,537 as a% 10.9% 10.8% 10.8% 10.18% 10.8% 10.9% 10.81% 10.8% 10.9% 10.8% 10.8% 10.8%, 10.8% 10.8% 101.9% 10.81% 1 3 I 1)iegia-I�Cadsbalci,, L'3/1 301�361 3(l)"119,151' %'d 1Z815 302,934 303,9108 1"304,789 301116 1 1 9 306�596 30711,5931 308,518 30911412 3,10447 lk"13f,10184%,c) 311,540 312�1518 313,128 2021-03-16 Agenda Packet Page 643 of 724 �Meyers IR,:E S EA R, C�H Ce .,,V. al, �(e Aff a ys s C��Jiiula V��I slta 11A 2) 2021-03-16 Agenda Packet Page 644 of 724 I I 1 01 01 01 01111 ol ol ol ol ol ol 0101010 Ul iuiuiuiuiu MIMI, lu I I ```I V III I L 0 1��)N4 ,1 0 C """ 1') 1,1,11 M A["�Z 1<E 111" 0 U 0�11:4 loolooll, �M e, "y,le,rs Office �\Aa��11<et Aqia��ys��s IRR:E S EA I R, C�H ii3ased 0111 OLII� �r,ionemrcllli, ihnicludiing Visi[Its, "'to, Itihie silte, marikelt ll�ds, broik&r ihn'terViews wnd s ip 1 y,ill,d e�m a d ariallys'I's, the proiposed o"IfIfice d eve I o ip rilll�e 'It al"t IWHHie��'Iulia e flo i I i[l)1l'IS SU a�ipj��)elars suip�iamrtalble o�iitel�r a omng parag�ra,,, lk,e'y CUICIUSi,011S "l"11 Mro'ffice la�����,ialysis: Oiflfi�ice �rnz�r��ket conditions are soft in Smn ego Cot,u�ntyi, a COV�� "I'll 9 Ove�ra��, ave���l,�age off"�b,'n", leii��Ise �ralj,efs. �apll',�i:)earto �,�,iave sta��,i,�JJ�zed at $2 88 per siqLia�,*e fbilot pe��,* i�n, 2020 `Pi,lie vam�,icy �Illate �1,iasi to 11 16% ��n 2020, a (,I),f deur-eased de��I�n&nd fi�lr ofl s�i,,,)ace due 'to t���I�i�e COVd[' -19 ��.:)a�nde�rrlflc. G()�ng fulllward, CoSta�r p�11111'ojects re��ritsto �iic��,'ease 'to $3.18 pi&,"sqLja�re fif,�)(,)t pe�rl i'm"Y1,ith a�mil va"ma��ilicyto r&rna���n at 01 I'll% by 2024.... ...I...I lie Sa��,��i ..........legi() NASA ,I m i c A b s o t,�,,,)t��i o n 1��i a s off�ice ril�,ia��111�ket ���s rig riept�ve net 21020, a furictiuli ofdel(�,l���l,,,i�-easil,r,�,�.,,d delni��iia��,��id f`o�roffi(:�,e s���,,)lace CJLJ,�` t(l) '11 e (".'OVd'111-19 pa��l�ide�� outlpaced �I�liew ir,16kv&�es �n eac�h of tl�'�"ie i,),ast"' 10 yea��Ills, ��i d��i cat��i n g fii��'i e�Ille has supi)��y Sa�ll ill"11)��i ego \4SA.............."I'l""I'll"������������t���,����ie����,e is a g�reat dea��� i S cui"n��ng years �ri t&r���Y'is of ���i,()wo,ffice la��,,)su�l,,ptiun recove�rs i��Ii the YC31a��,,I, c, . %,111 II Sout���i "I"s Coi unty Un lt&�Im��rns of sta��b���e occu�ipa��ncyiii SOL,It��"i �1�1�,3ay base rates �,�,iavesofte��ried §Jigl�itiy 2020, fii��ie vamrlicy rate r64t�v&�y k)w Av&ll-'age base �11"at,es d(,Wrl uff" of t��l 16��r ipea��< of $2 32 pe�r sqmre folot Q14� 20"119 tin $2 216 �pe����,- sqL,m�re fo()t �ri nli��d�lII2020...I ...I... vamrlicy rate a bw of 4 ��n, �02 2020 tol 5 0% i�n tl'ie seci,und (,,ji,,,ia�rter of 2020, afunct�un of ls�Jg��'it�y deureased fo��I,�office q,,,mice due to t�ilie lll�19 I I ��i rt�ii le �",]I'ie SOU'llb Bay office ���s pa�rlidern��c. StJJ�, a vamacy rate of 5 01% (,Yr bwe��'- a�n u�n(J e �Ilved (,1:)ffk,,,.e sqp�p(,Yrt add tbl�ria��i lg�row,th �--ebOLHICI��Ig 202('11) wi,th riew as weil as ipos�tive rliet aiosuqa,bui Niew de1iv&1-ie1!::; �,��iave. finakily outpill:iced al�,)surptiu�li ov&-fll�lie ioast 12 �,noritl��is, wifli�li 41,000 square feelt of ���,,jositive net arld 11 11,0010 sq�,.lta�re 'feet ofi,�i(:�)ffl Tlhis is, arl ov&r riega,Ne net 2019, la�rid foHows se�verlia�� yewrs witi'li S Ill nut d6iveri(:.. ift�,,-Iket ltre��iids ih�,Iid�icate tihat nlmdolcal offloice coWitimons are �1111'11elatively, stroing &n(�! staiblb wii'llien com�ipared to offoice marii(et mn(�Jil�iions. ...I...I he ���-'riedical off�ce lmarlllket is fwllling �z)ettertiiiar'i 'Uhe ov&raH off�ce ma��,Ilklet 4�i terr-ns, of lease rates,,, vacaricy �ll,ates.,, la��,��id a�bsoil,ll�ptiuri acbvitl'y Ov&,,�ail, t1lie San [","I'llego nl�ied��ca�� office �,,Iriarlie�et has, an av&rage base ���1--ate of $3 101 �,,3&r sq�,lja�re foot S&I"vice), ve��`SLJS tj'11��ie ov&ll�ali office lease �111�late of' $2 88 s(.'p.,i�&I'lle foot,, la�nd tl�ie rnedical office vacancy rate of 5 4% ��i bwe��I—Uhan tillie overall office vacancy i"llate olf 11.6%). ll'!�1'ie SOUtill COLfir"Ity �1`1,1�edica�� office has, a veil"lly ilow vam�,��icy �111�late of3.4,94) cui�ipared to the overlal�� lmedicai offilice vamilicy rate of 5 4l",'I S&rli [)i ego COU[Ity.. ......I has be&rli sol�rrlie sufl',&, ter�rrlisi of Wtiili, negative of "I"I'll 7105 square feet i�n tilie lmedicai off�ce 111"xit till(,��)t is a very &rrial�� aniu�.liirlit olfmrlibi'actior'i cu�lm�pared 'to O'llie -1.71 �rinJllrun square 'feet uf �,,Iiegative aiosol�rptiun i�n 'the San Dego Dffl��ce �`Tiarl<,et over'a�H. it is 'to i�����iote tl�iat albsor�p,Jun has belei���i �po§�ti�ve SOUti'll COL111tyl, W'[11 14,,,5111111 absorbeld tlliisi yea�r. I 1'�i��s data tl��Iat deiZo�piteti��ie �xnc&'-ta�rlity arid soft ni���iiarli(et cun6fioris k,,liitl��ie cui��iv&�rlitbnal office t�,,ie ni���iiedical office rinar'llket ��s weH. 10a`o�r 1(ileal"Itiliciariel systems &re n"Itively ipu�1"SUi4lIg �new d eve I oil pi e��,Ilillts amt,u�iid Swi D'I'ego COL111111ty, ih1`l1C1Ud'1ng ibold"i ex]�,3&�Iis'l'u�i "to �newllfaciililtiies aill"id ���,eibcalt'IV�111'11i lfm�1111111n ��ce ipro I�11&,,�rinanelrite nioving h1ito a Outdated offil' duct. Two of ti��ie toip fourl brgest office moves �ii Sw��i I 1�ego Co�,.dHltytlhe plast ye&I,� have lbe&i, by 1��iealtlli cw',(:,�), systea"is: Ka��set '90,000 40,qL,j@,,e foot rnedical offlce bLlilding Kell,�Trrliy I'Mesa, @iid !`Rees-Stea[y 11�11s rnov�ng la��I��i 86,000 sqLliare foot rriie6cal fab�lity hn S@I''ite�e. CUrr"er"i'lly, Sil i a i-p C h I a J G�'IU[a Vistia�111 ot��,i�,&r vi4ble ��ieaiti'i m�111"e il)rov��de�rs tl�ia,[, cuulcl ��i�I�i e re Is te i�n locati�ng at tii�le Vista Medic,,,l Cerliter la�nd UC San aretl�lie rria,,1111or* �,medical iprw��d&".,sl site ii����iciude Kaiserl-. -,-,-Iea,"�ltlii, an�d tl�ie of V&terar l���s Affairsill 11 �. If l� Mir "obs g�row'Cii ld&m,&�nd analysis su�ip�ipo�rts a i��3�iprlloki alli ate ly 6411,,000 sq ulzrie. feet o1folffice s�ipaoe at arlt�nual�iy, lo�n av&rage. i\AiJ1&nJia ���s fora totai of' 1 41,25 miJlion squw-e feet: an,'iong three pl��-iases G�,j�r �11-ea�histic id&,'na��lid aliodel ca�ii� average o''If' 641.,,800 spal`e "l. of office sioace a�t ft SLIlbject artni,.iaHiy, fur a I'll, of 1 1426 ilin i�k, sqt ja��I-e fe,rr)�I��� Ill, 11-c)��jgli 21C)42 202 1-01-?9 Ag el'naa Pa" clet Page 645 of 724 I I. `��` 1 0 1 1 11111 `�`I `��` I h I ql IN I Ili,I I hl I I hl 1h�I ..................I.................. 1�I A 0 �Ihl I, C 0�I'jj Oflf�ce lMarllket Analy&"s C 11�hI��13 A IS 10 1�'R �M eye ris R.-E S EA Rw C�H e tables 13elow imel3ii-esent (Jeimai,llid (average C a 1 ra n si 'uob piro"llectioins aind Woods & �����)oolb "i foii"I'll offlice s�pace ailint 411y' oveill", t1he next 22 j ye&rsiii Md�bit�a ���s atotal of 1 4,25 �Ti�J�Jun siiq�ia��`,E.Ifeet �11�11 10 n g 111 h i �l�'I�a,s le s, OL,i�rl �-ea�J�stic di&�Tia�nd n,�iod6� la��i ave��age of 64,800 ,sqLia�re feet of lo'ffice space at the SLI.dt) I" tll�n ,li ���)�rqject (,a t'ota�� of ""1 4,26 �il-d�lJurl� sqL,,a fel�et fi�'InUig�h� 204.2 -I Emil I in I il No IBM imill I :Iio' III wl �1011� -- NMI 11"Mmlill'"MM"'i on In NMI 2021 21077,020 20,71702 85,158 Think Ca 2022 2,;1250,183 2251018 921257 Four Year total 2023 21,200,114 220,011 90,1205 337,000 SF 2024 1 t 5,45,872 170,046 69, 564 2025 17,486,264 163,489 18 2 2026 1 ly�4 171062 155,877 637768 2027 1 14291503 1571245 64,328 ---------- _1-,,,,-1-1 1-1 1,-1-,,,-,-1-1 1-1-11 11-1 1-11 1-1 1-1-1 _1 I- 2028 1 t4021322 154,255 63,1104 Invent Campus 2029 1 1 386,411 152,505 62,1389 -1 -11-1-ii-1-—-11-111.1-1-11- _11-111-11-iiiiiiiiii:I- --111-1111--1-11--_1_'11-1-1-I-__ 11 Year total 2030 1 1�3631744 1501012 .............................................................1. 61,368 681,0001 SF 2031 113555642 1491121 61�004 2032 11,346,275 148,0901 60,582 2033 11325,942 145,854 5916617 2034 1 l�,3 187 284 145,011 1 59,323 2035 11,315,694 144,726 In aim=w lam aw''5UMMIX HIM 4M no IM 2036 1 1,2961287 1421592 -7 58,333 2037 11,308,340 14319 17 58,875 ---------------------------------------- Discover Camp S 2038 1,;287,34 1 141,608 57,930 01, Seven Year total 2039 1 1,3001941 143,104 581542 ------ 407,000, SF 20410 1 1,291 1 1608 1421077 58,122 ...............................................................4.........""'i..........I.................""",I..".........U.............. 2041 17,294,06 '142,347 58,1233 20412 1 ly 2 7'71816 140,560, Awol NNINHIM WWI AVERAGE: 11467,124, 1589417 6411934 6�TOTAL 32,P2716,11728 31485�167 1,�4269343 2021-03-16 Agend�%ra&Meyers Research, Woods & Poole, CA DOT, CoStar Page 646 of 7241 0 C S"` U\tNAA��RY CA�,� �::��AINS \40�''' ih�lh�lh� �Meyers Office 1\A&,*et,N4y§�s R.-E S�E�A Rw C�H The ft�llnand aiialysis below is based Oil iol��) �R11 g row"t 1i �p r0j"e c"t io ii S �p le i "I C a I i h,fo iIl"l ii i a of' (Gal"ll iIi'llairlis) 1[�)Y Low High Low High illiduslltiii-y hil"bir"I the Sail lliego IASA,, hthz�lli inelllfihned by 2021 9.0% 11.0% 30.0% 50.0% 2021 1,727,469 172,747 J_____M826 ap�plyi��-Iig Im and higli captuil"lle eslitinlahtes foi� 2022 9,0% 11.0% X0% 501.0% 2022 1,999,08,0 '199"9018 815ji t1lie la�ppi,11111110IRI In 2023 9.0% 11.0% 30.0% 501.0% 2,023 2,061:,3813 206,1318 84,517 iate and Llltiimatdly 111W 2024 10.0% 12.0% X0% 501.0%, 2024 860,180 94,620 38,70,8 Ift SUI "ec"t !�' r "ec"t., h e taU("'� lblelow �,-qpresent )J 0'J 2025 10.0% 12.0% 3&0% 501.0% 2025 7157684 78,725 32,206 dierinai�icl (av&rage of "m a�n d lr�i��g li ca p t u�re %) flo 1". 2026 10.0% 12.0% 30.0% 50.0%, 2026 561,629 61,779 25,273 20,27 10.0% 12.0% 30.0% 501.0% 2027 60810,21 661882 27,361 ofllces�pace ar�i��iivaHy jgll�li 2042. Our Cc,'���i I �,-a n 2028 10.0% 12.0% 30.0% 501.0% 2,028 603,284 66,361 27,148 10.0% 12.0% 2029 5951267 65,479 26,787 ��based dern@"�id �Iil'iod6 SLJ��')��)Orllts an avet-age of ---2"-0"2"'9-' -3"0",-.0",-%"" 5"'0'-.-0,,%"' 2030 10.0% X0% 501.0% 2030 557,533 61,329 25,089 33 ...... square feet of lo�!�� ice s���l ace at �Il le S�u bi e ct 2031 10.0% 12.0% X0% 501.0% 2031 556,329 61,196 25,035 [:)�i"0 jec"t antit jally, fuln a tialta�� of. ....7314,554, squa��1111'e feet 5591344 61 5,28 25,1171 2033 10.0% 12.0% 30.0% 50.0% 2033 539,5,83 59,354 24,281 dUrh"'ig a 22 year It is, ��to �iiote 2034 10.0% 12.0% 30.0% 501.0% 2,034 539,1139 59,305 24,261 tlhat J(,111flo p�rojecfibns la�re cmis&rvatve, and 2035 10.0% 12.0% 30.0% 501.0% 2035 545,357 59,989 24,541 2036 10.0% 12.0% 30.0% 501.0% 2,036 519,0154 57,096 we liave con§dered a der�nar�lid rl�rli('IIA6 1)ased u'�l 2037 10.0% 12.0% X0% 501.0%, 2037 556,260 61,189 25,032 Woo(I"'J's, & i��"oo�e prollec't,lions as weH (see the 2038 10.0% 12.0% 30.0% 501.0% 2038 525,218 57,774 23,635 ----------- 2039 10.0% 12.0% 30.0% 501.0% 2039 5621358 611859 25,306 fi)Howing page) 2040 10.0% 12.0% 30.0% 501.0% 2040 550,261 60,529 762 2041 10.0% 12.0% 30.0% 501.0% 2041 561,892 61,808 ............. 2042 10.0% 12.0% 30.0% 501.0% 2042 533,5186 58,694 24,011 AVERAGE: 765,360 81,559 33,389 Assum�ptions/Rationale: TOTAL: 16,837',911 1,794,291 734,554 Market: The South Bay market comprises 9.5%of the total office inventory in the San Diego�MSA,and current indicators suggest For PerMective CoStar Market Data mixed indicators in terms of office development: annual deliveries South Bay market share of San Diego M�SA 9.5% over the past five years represent 4.5%of the�MSA, and Avg.Annual Deliveries in San Diego MSA(1982-2019) 2,100,000 absorption equates to 7.2% of overall absorption. Over the past A�q.Annual Deliveries in San Diego MSA(2010-2019) 497,8197 12 months, deliveries have comprised 33.7%of the MSA and A\q.Annual Deliveries in San Diego MSA(2018-2019) 329,548 absorption has represented 6.7%of the MSA. We suggest a A\q.Annual Deliveries in San Diego MSA(2020P-2024P) 9027987 capture of 9.,0%,to 11.0%ofthe overall market over the next,five San Diego MSA Under Construction(Current) 21124,181 years and increasing to the 10%to 12% range going forward. Average Absorption in San Diego MSA('20101-2019) 1,040,465 Average Absorption in San Diego MSA(2018-2019) 62418,90 Subject: Capture as a percentage of the South Bay Market is intentionally Average Absorption in San Diego MSA(2020P-2024P) 145,742 aggressive(30%-50%)since Millenia's concept and design is Avg.Annual Deliveries in South Bay(2015-2020) 22,572 unique, l�ocation is excellent and is a compelling opportunity to Office Deliveries in South Bay(Last 12 Mo.) 111,000 capture a large share of South Bay office demand. A\q.Absorption in South Bay(2015-2020) 74,676 Source:Meyers Research,CA DOT CoStar OIffice Absorption in South Bay(Last 12 Mo.) 41,608, [South�Bay Under Construction�Cur�rent� 0 2021-03-16 Agenda Packet Page 647 of 7241 0 C S"' U\tNAA��RY WOG�`II S & �MG�"' ih�ih�IIII �Ihi III �Meyers Office 1\4a,*et,N4y§�s R.-E S EA Rw C�H MEN I lqp 1111-- �J T li e d e m a d &�ialysis below, is 13ased oil Jol) growtili l3i'llo,11010ec"Itiuns l�,er M<)Ids & !��Ioole by flAusllbry III ItIllie Saill"i 1',Yiego 114SA, theill"i irellfihned I)y I ALL Low H�igh Low High, a�p�plyi�ig low ailid II'IiigIi ca��pllht�re N es"Chrna"Ites 111I tail, 2021 9.,0% 11.0% 1 30.0% 50.0% 2021 2,426,570 242,657' 99,489 -1-1-1-1-1-1-1-1-1 1-1.-1-1-1-1-1--1-1-1-1-11 1-11-11-11-11-1-11-11-11-11-1-1-1-11-11-11-l-,-''-"-''-''-I.......-4..................................... ............................................. ...... ...... and uIl"Chn"I'lialtely Ifur 20,22 9.0% 11.0% 1 30.0% 50.0% 2022 2,501,285 250,128 102,5,53 ..................................... ...... ...... ...................... ..... ...... ......-...... 20,23 9.0% 11.0% 30.0% 50-0% 2023 2,338,,845 233,885 95,893 I SLI13"ec''t 'ec"It., "'I"'11he ta!Dbs )ielow �I-qz)�resent J 011 20, 0. .0% 30.0% 50.0% 2024 2,231,,5�65 245,472 106,��b ------- --- ------- d e i��n a n c] (a ve�,,�a ge of' bw @,Iid liig�h capture for 20,25 10.0% 12.0% 30.0% 50.0% 2025 2,256,,845 248,253 101,558 20,26 12.010�0 30.0% 50.0% 2026 2,272,,495 249,974 102,262 office space @,"u�m jaHy ov&I,� 'UIIie rIiext 22 years. 0 LJ�r` ---------- --------- 2027 10.0% 12.0% 1 30.0% 50.0% 2027 2,250,985 247,608 10,11294 --------------------------------------------------------------------------------- 20,28 10.0% 12.0% 30.0%, 50.0% 2028 2,201,360 242,150 99,06,1 Woods & 1`1'-")o6e 1:���)Iased den,'un(IJ ode an 20,29 10.0% 12.0% 1 30.0%, 50.0% 2029 2,177,555 239,531 av&r'aige of 96,279 s(,,I�I,�Ie, 'feet of offli�ce spCa(1";e, at fl'Iie 20,30 10.0% 12.0% 1 30.0% 50.0% 2030 2,169,955 238,695 97,648 ----------- 111� 20,31 10.0% 12.0% 30.0% 50.0% 2031 2,154,9,55 237,045 96,973 SUbject F"rIol,lIect anr�i�,.41y, fu�,- a [.ota�� of 2.118 rrJ�Tbn I--,-,,-,-----, I.-I-1-11-1-1-1------ ...... 20,32 10.0% 12.0% 1 30.0% 50.0% 2032 2,133,205 234,653 95,994 -------------- ---------------- -------1-1-1--l-1-1------- ...... ------- SCJL,Iareft,"�).et d�.,ul'i�rlig a 22 yea r,1J�me,f�,-a�rlrie.i 20,33 10.0% 12.0% ..........30.0% 50.0% 2033 2,112,300 232,353 95,054 20�34 10.0% 12.0% 1 30.0% 50.0% 2034 2,097,,430 230,717 94 -------------- -----------1-1-1-1-1-1---,-------- 20�35 10.0% 12.0% 1 30.0% 50.0% 2035 2,086,,030 229,463, 93,87'1 20�36 10.0% 12.0% 30.0% 50.0% 2036 2,073,520 228,087 ---------- ------ --------- 20,37 10.0% 12.0% 1 30.0% 50.0% 2037 2,060,,420 226,646 92,719 1-11-11-11-1-1-11-11.-1-1-11-11-11--1-1-1-1-11-1-1 1-1 1-11-11-1-11-11-11-11-1-1-1-11-11-11-1-1-1 1-11-11-11-1.......-i..................................... ............................................. ...... ...... ...... ......---............-,...... ...... 20,38 10.0% 12.0% 1 30.0% 50.0% 2038 2,049,,465 225,441 92,226 ------------- --------------1-,-,-1 ----------- 20,39 10.0% 30.0% 50.0% 2039 2,039,525 224,348 91,779 2040 10.0% 12.0% 1 30.0% 50.0% 2040 2,032,,9�55 223,625 91,483 ------------ 2041 10.0% 12.0% 30.0% 50.0% 2041 2,026,,235 222,886 2042 1 10.0% 12.0% 1 30.0% 50.0% 2042 2,022,045 222,425 90,992 AVERAGE: 1 2�,1168,888 235,275 96,279 Assumptionst Rationale: TOTAL: 47,715,545 1 5,176,043 1 211 Market: The South Bay market comprises 9.5%of the total office inventory in the San Diego MSA,and current indicators suggest mixed indicators in For PerMective-CoStar Market Data terms of office development: annuall deliveries over the past five years South Bay market share of San Diego MSA 9.5% represent,4.5%of the MSA,and absorption equates to 7.2%,of overall Avg.Annual Deliveries in San Diego MSA('1982-20,19) 2,100,000 absorption., Over the past 12 months,deliveries have comprised 33.7% Avg.Annual Deliveries in,San Diego MSA(2010-2019) 497',897 of the MSA and absorption has represented 6�.,7%of the MSA. We Avg.Annual Deliveries in,San Diego MSA(2018-2019) 3291,548 suggest,a capture of 9.0%to,11.0%of the o\erall market over the next Avg.Annual Deliveries in,San D,iego MSA(2020P-202�4P�) 902,987 five years and increasing to the 10%to 12%range going forward. San Diego MSA Under Construction(Current) 2,124,181 Average Absorption in San Diego MSA(2010-2019) 1,040,465 Subject: Capture as a percentage of the South,Bay Market is intentionally Average Absorption in San Diego MSA(2018-2019) 62418910 aggressive(30%-50%)since Millenia's concept and design is uniique, Average Absorption in San Diego MSA(2020P-2024P) 145,742 location is excellent and is a compelling opportunity to capture a large Avg.Annual Deliveries in South Bay(2015-2020), 22,572 share of South Bay office demand. Office Deliveries in South Bay(Last 12 Mo.) 111,000 Source:Meyers Research,Woods&Poole,CoStar Avg.Absorption in South Bay(2015-2020), 74,676 Office Absorption in South Bay(Last 12 Mo.) 41,608 1 South Bay Under Construction(Current) 0 2021-03-16 Agenda Packet Page 648 of 724 I I I u I III Ow0000000��I000u C t olool Illoolool 11111 hi)1�ul I I u olool lh,00h, u�i huothu olliolool till) I oo�� ot o holooll oil, olooloo y �N U� looloolloolool 0 C to JG�uuo`) G CA�.......... �A�N S M 0�[u`l L �M eye,ris Office KlAa�r�k,,et A,ia[ysos R.-E S EA Rw C�H V o C a 1� ii s �p�rowect'V��n ofo�,00to �p�roofessimnal� bLISi'i'lliess se�rvices ailloole irel alhu'live ly slotro�ng fln filie Un 11111`,IY�ubp I SA, though 20210 is &nticipaloted Mltl,00i "ob decliiies dueto the COVU11),loo, 19 la�nd Se�rv��(,:,.es se�cturs 11 the �(,�1�1*giest office000,o�rjiented base i�n San ���..............I.o),o ego ('486,1000 j6b.,si cu�iooil),����i�ed) n "a I 1 70 000 tiota�� idbs shnce 210010., Clt'd�looi� -3 dec�rease (ol ut la�rooi �,000icrieasel o�f g �1`u�,otwa�ltl000cool C(I )s as of 202G���') " j()�[,)ls ��rooi uffice (�Yr��e�ntjo'ed fields tota��� 584,000 1 g 2 0 2 10 b, t a "i&nted -ease ol s ��nuiol'ease of 1111109,,0001 offlte-u�� ��dbs throug��ii 20,140 (a 0 6% av&mge ��nc�i 350.0 300.0 250.0 0 o,-"% . .......�,a_.oaM 0 E 2,00.0 - am 150.0 ............. 0 0 .a 100.0 - ............... 11111 �Ill 11,It Arlillillillillillilliilll*"*,"=4"'. 0kim*MM�11� 50.0 - ...................... .............. ......... ................. 0.0 - '00 '011 '02 '03 '04 '05 '06, '07 '08 '019 '10 '11 '12 13 14 '15 16 17 '18 "19 '20 '21 '22 '23 '24 '25 '26 '27 '28 '29 '30, '31 '32 '33 "34 '135 m410mlinformation woMpaFinance Activities amsomProf/ Business Services e/w/m/A Government ild Information 36-00 35.62 34.43 33.41 32-50 32-56 31-68 31.27 31.40 28.23 25-08 24.17 24-39 24-13 24.14 23.43 23.23 23.43 Finance Activities 71 55 72,18 75l,13 80,01 82,04 83 32 83,80 80.39 75,33 69,,80 67.18 67,42 69.85 70,96 69.64 71.38 72�99 74.64 Prolf.1 Business Services 199.13 201.22 204.38 203.85 207.58 214.11 217.88, 221.65 220.57 203.43 20130 204�91 2110�93 218.69 222.55 229.48 234.68 239.00 Government 206.65 213.80 219.69 217.28 21431 215.11 217.94 22238 225.112 224-53 230.47 228.9,6, 2,27-83 229.,48 231.92 236.16 242.24 246.29 %Change linformation -11.1% -3.3% -10% -2.7% 0.2% -2.7% -1.3% 0.4% -10.1% -11.2% -3,6% 0.91% -1.1�% 0.0% -2.911/oi -0.9%, 0.9% %Change Finance Activities 0.9% 4.1% 6.5% 2.5% 1.6% 0.6% -4�1% -11 -T 3% -31,8% 0.4% 3�6% 1.6% -1.91%, 2.5% 2.3% 2.3% %Change Prof/Bus Services 1.05% 1.6% -013% 1.8% 3.1%, 1.8%, 1.7% -0�5% -T8% -0.1% 0.8,% 2.91% 3.7% 1.8% 3.1% 2.3% 1.8% %Change Government - 3.5% 2l.8% -11% -1�.4% Ol.4% 1.3% 2l.0%, 11% -01.3% 2,6% -0i�71%, -0.5% 0.7% Ill 1% 1.81% 2.6% 1,7% 1E Information 23.63 23.49 22.17 22.76 23-65 24-33 24-99 25,31 25-51 25-83 26,27 26-65 26.90 27-09 27-21 27-33 27.46 27.52 Finance Activities 76.03 76.42 75.29 75.87 76.76 77.97 79.00 79.72 80.39 81.39 �82.39 8336 84.22 85D7 85.91 86.75 87 53 88.25 �Prof.1 Business Services 248.93 256.58 248.28 250,,99 258,58 265.55 26T29 268.91 270.65 27239 274.13 275�87 277.62 279.36 281.22 282�97 284.71 286.57 Govern�ment 248.10 2,49.63 238.30 2,46.26 2,49.20 252.315 254.84 258.41 259.65 260.94 262.19 263.48, 264.75 266.02 267.29 268.61 26,9l,93 271.26 %,Change Information 0.9% -M% -5�6% 2.7% 3.9% 2.8% 2.7% 1.3%, 0.8% 1.3% 1.7% 1.4% 0.9% 0.7% 0.5% 0.5% 0.4% 0.2% %Change Finance Activities 1.9% 0.5% -1�5% 0.8% 1.2% 1.6% 1.3%1 0.9% 0.8% 1.2% 1.2% 1.2% 1.01% 1.01% 1.01% 1.01% 0.9% 0.8% %Change�Prof/Bus Services 4.2% 3.1% -31.2% 1.1%1 3.0%l 2.7% 07% 0.6%, 0.6% 0.6% 0.6% 0.6% 0.6% 0.6% 0.7% 0.6% 0.6% 0.7% _qq.e jkpvejnm2nt 07% 0.6% -41,5% 3.3% 12% 13% 1.0% 1 A% Ol,5% 0,5% G,5% 0.5% 0,5%0.4�.5016 0'0 jilliIII 0.5% 0,5% A"�O_q� 4 4 Mill 4r;-4 202 1-03-1 Ub 61r&F"bb@S 1K 0 L I ct 8%, V-T 7 tj 1, U S ll, ��l�,�� u 11 hill u) �N[1hl I �`D U ST�����ZY WOO S & ��"10G� IMOD�"�"I� �l Ill �Meyers Office lq@rkiet A,�4y&`�s R.-E S EA Rw C�H Woocis & F�hloole 111111 I'd usunes rwze �::�oo�e pri� 'ectbns were �Plrojec vis a,illi"t i c 1111111�p allte s1troiliger iticreases 1111ili 1`13 11111 s S le 11111 11111 1 jo i iii the coi,n il'ili g years., Not& Wo(��"I'll'��)(�"I'l���,i�l,�7,, & Dj ill tiu���is �Iiiay be o pti�r�n i sti�C of -iojec, pul)hslhied idl��i e@ll"lly 2020 an(] do �iiot inck.,ide ho�b. bscl";es dill to fl,�ie COV111"11111' flhus the currerlit �Iiun�ibe, jobs as weH� as p� 700.0 k: 600.0 mill- 00-% 500.0 'low 11111MI: MEM 'for 400.0 - Fill LLJ M 0) ONE=& (A I*. 0/l/w/w/A o 0 300.0 - 200.0 ............ E MM* 100.0 In IN z kwo ........... . ...................... M M 0 1111 , M M � 0.0 ..................................... '00 '0 1 '02 '03 '04 '05 '016 '07 '018 '019 10 11 12 13 14 15 16 17 '18 '19 '20 21 '22 '23 '24 '125 '26 '27 '28 '29 '30 '31 '32 '33 '34 '35 104&M 1 nfarmation mm&wFinance Activities mmommProf/ Business Services G o v e r n m e n t OEM Information 44.66 46.49 44.28 43A 1 42.85 44.43 43.93 44.49 38.36 36.47 31.71 31.02 31.27 30.60 31.43 30.49 29�91 31.19 Finance Activities 72�,05 72.38 7423 77.69 7913 8023 80 B4 82.90 83.28 87,44 83,11 88.71 90M 90 B8 87,09 8&63 92.40 9219 Prof./Business Services 3,61.66 361.63 373.41 385.28 397.40 407,41 416.84 426M 431.70 411.43 41830 425.11 431.31 444.32 456.65 463.70 468.07 471.77 Government 316,12 324.86 338.51 343,78 339,12 335,20 335.17 337,20 343,94 344.24 338.51 333,79 330,42 330,85 332.93 334.94 341,23 346,5 1 %Change Information 41% -4,8,% -2,6% -0,6% 37% -1�,1% 1.3% -13,8% -4,9% -13,0% -2,2% U% -2,2% 2,7% -3,0,% -1,9% 4,3% %Chang�e Finance Activities, 0.5% 2.6% 4.7% 1.8% 1�.4% 0.8% 2.5% 0.5%, 5.0% -5.0% 6.7% 1.5% 0.7% 4.0% 1.8% 4.2% 0.4% %Change Prof/Bus Services -0-01�% 3.3% 3.2% 3.1% 2.5% 2.3,% 2.4% 1.1% -4.7% 1.8% 1.5% 1�5% 3.0% 2.8% 1.5�% 0.9% 0.8% %Cha nge Gove rnme nt 2.8% 4.2% 1.6% -1 A% -1.2% 0 0%l 0.6% 2.0%, 0.1% -1.7%, -1 A% -1,0% 0.1% 0.6% 0.6% 1.9% 1.5% Information 30.78 30.62 30.45 30.29 30.13 29.98 29,82 29.67 29.52 29.38 29.23 29.09 28.94 28.81 28.67 28.53 28.40 28.26 Finance Activities 94,91 98.62 101.24 104,51 107,46 110,25 112.88 115,3�7 117.72 1119.92 12 1.98 123,90 125,68 127,32 128.83 130.22 131,47 132,611 Pr�of./Business Services, 494.06 501.47 509.60 5,19.09 529.48 53878 547.43 556.3�7 56551 574.60 583.42 592.17 600.96 609.73 618.44 627.09 635.72 644.34 Government 348.07 349.35 350.62 3,51.88 353.13 354.37 355.60 356.82 358.03 359.23 360.42 361.61 362.79 363.96 365.12 366.28 3,67.43 368.58 %Change Information -1�3% -0.5%l -0,5% -0l,5% -0,5% -0,5% -0.5% -0�5% -0.5l% -0,5%l -0.5%l -0.5% -0l,5% -0�5�% -0.5%l -0,5% -0l.5% -0,5% %Change Finance Activities 2.3% 3.9% 2.7% 3.2% 2.8% 2.6% 2.4% 2.2% 2.0% '11.9% 1.7'% 1.6% 1.4% 1.2% 1.1% 1.0% 0.9% %Cha,nge Prof(Bus Services 4.7% 1.5% 1.6% 1.9% 2.0% 1.8% 1.6% 1.6% 1.6% 1.6% 1.5% 1.5% 1.5% 1.5% 1.4% 1.4% 1.4% 1.4% %a"p&8fw.T-wbk,t-0.5% 0.4% 04% 0A% 0.4% 0.4% 0.3% 0.3% 0,,3% 0,3% 0.3% 0.3% 0.3% cre -210�3% 0.3% 2 0 2 1 403--0/1 5U...........&I Source-.Wood'!�&Poole oh�i UUMI uhl I Imul k 0 IDEIMAI' G vv 20201"I'll 10 2021 ������, CAI............. Tl���ANS IMODE1............ �M eye,rs Offce NUr��<et A�n(,"i�ysis R.-E S EA Rw C�H III y U[Iie eilid of 20,2111, ouill'� e irn p I oy rllri�e 'It 13 as ed demwnd irriodel wilt1ii 'v���)s prolll'lecluo�iis yields a 3 1� J I 1111710�,11,826 sqLiaire "Fee"t 011f SLflp�pmrtal,�)Ib ollf"Fice s�pace demainded ai,1111411y alt I Sulojl`ect 2020 2021 20,20 to 2021 Occupied in Tota I Em�p. Tota I Office Buildings No. Employed in Tota I Occupied in Office No. Employed in Growth in Office New Office Space Indus" Employment 1/ 2/ Offi�ce Buildings Employment 3/ Bui�l�dinigs Office Buildings Buildings Needed 41 Traditional Office Users Finance Acti\Aties 75,293 70% 52 P'705 75,871 '7'01% 53,110 404 80,899 Information 22)169 50% 11,085 221763 50�% 11,382 297 59,411 Professional/Business Ser\Aces 248,276 70% 173,793 250,993 701% 175,695 1,9011 380,282 �Education/Health Services 209,926 20% 41,985 214,809 20% 42,9162 977 195,300 Leis ure[Hos pital�ity 163,513 15% 2415,27 178,027 15% 26,1704 21177 435,408 Other Services 4,6,196 20% 9�,239 5,0,556 201% 101,111 872 174,389 Government 238,303 20% 47,661 246,257 201% 49,251 1,591 318,184 Non-Traditional Office Users Mining 2,431 3% 61 2,661 3% 67 6 1,147 Construction 82,032 3% 2,051 84,499 3% 2,112 62 12,330 Manufacturing 112,013 3% 2,800 113,504 3% 2,838 3�7 7)456 Wholesale Trade 42,086 3% 1,052 45,3�67 3% 1,134 82 16,407 Retail Trade '129,,067 3% 3,227 138,044 3% 3,451 224 44,887 Trans portation/Uti lities, 33,960 3% 849 345233 3% 856 7 1,368 Total '1,4015,265, 22% 371,035 1,457,583 22% 379,672 8,637 11727p4169 Annual Average 11727p469 Estimated Annual Ca'pture'.-, SOUTH BAY MARKET 9.0%-,1 11.0%, Notes: Est.,Annual Office,S�pace'Absorptiori: SOUTHI BAYMARKET(SF) 1,55,472'-1900 1/Per the CA Dept of Transportation and BLS Estimated Annual Capture: MILLENIA SITE(/o),,5/ 301.01% 50.0% 2/Meyers Research Estimate Est.Annual Office Space,Absorption: M[LLENIA SITE(SF) 146p642 95,011 3/Per the CA D,ept ofTransportation projections Annual Average (,SF)-.,1 70,826 �4/Assumes 200 square feet per employee for traditional office users, and 200 square feet per employee for non-traditional office users. 5/Reflects estimated capture rate of the South Bay markets'capture of office inventory 2021-03-16 Agenda Packet Page 651 of 724 oh�i "IM UUMI uhl Mulul k 1""G 0 Nuumululu 11")EIMA11 vv 20201"I'll 10 2021 ������, WOODS & 001............11"'I" IMODE1............ �Meyers I Offce NAar��<et A�n(,"i�ysis R.-E S EA Rw C�H 1"13y the eilid o"I" 20,21, our deinan�d inodel wilflh Woods & !���Ioole �projecltll�`�'ons yields 99,41,189 square fee''t o''I' suppor"talale o"If"fice s;mce deiiiailded ai,1111411y alt t1he SuIoj'ect F���Iiropeiily. 2020, 20,21 2020 to 2021 Occupied in Tota I Em�p. Tota I Office Buildings No. Employed in Tota I Occupied in Office No. Employed in Growth in Office New Office Space Industry Employment 11 2/ Office Buildings Employment 31 Buildings Office Buildings Buildings Needed 4/ Traditional Office Users �Finance ActiNAties 101,240 70% 70,868 104,,511 70% 73,158 2,290 457,940 Information 30,453 50% 15,227 30,29,2 50% 15P,146 (81) (16,100) Professional/Business Ser\Aces 509,598 70% 356,719 519,,087 70% 363,361 6 P 64�2 1,328,460 Education/Health SeNces 270,922 20% 541 184 278,,603 20% 55,721 1,536 307,240 Leisure/Hospitality 250,499 15/6 37,575 256,021 15% 38A03 828 165,660 Other Ser\Aces 130,981 20% 26,1196 133,191 20% 26,638 442 88,400 Government 350,624 20% 70,125 351,882 20% 70,376 252 50,320 Non-Traditional Office Users Minin�g 67570 3% 164 6,536 3,% 16,3 (1) (170) Construction 114,849 3% 2,871 115,,627 3% 2,891 19 3,890 Manufacturing 12�2,923 3% 3,073 123,,358 3% 3,084 11 2,175 Wholesale Trade 62,572 3% 1,564 64,075 3% 1,602 38 7,515 Retail Trade 191,893 3% 4,797 194,969 3% 4,874 77 15,380 Trans portation/Uti lities, 95,39�6, 3% 2,385 98,568 3% 2,464 79 15,860 Total 2,238,520 22% 6451748 272,761720 22% 657 P 881 127133 214269570 Annual Average 2$42655,70 Estimate,d An' n,'Uai CaptUte: SOUTH]BAY' 'MIARKET("/o), 9.1010/0-11.0% �Notes: Est.An'nu''al Offlco SpaceAbsorollon. SOUTH 'BAY MARKET(SF) 2,181,391 --�266�923 1/Per Woods and �Poole Economics, Inc. Estimated Annual Capture: MILLENIA SITE(1/6)5/ 30.0%-15�0.0% 2/Meyers Research Estimate Est.Annual Office Space Absorption: MILLENIA SITE(SF) 659517-133,461 3/Per Woods and Poole Economics, Inc. Annual Average (SF)-. 99,489 4/Assumes, 200 square feet per emp�loyee for traditional office users and 200,square feet per employee for�non-traditional office users. 5/Reflects estimated capture rate of the South Bay markets'capture of office inwntory 2021-03-16 Agenda Packet Page 652 of 724 oh�i UUMI uhl I Imul k 0 IDEIMAI' G vv 2024,111"I'll 10 2025 �1�1�1�1�1�1�1�1�1 CAI............. Tl���ANS IMODE1............ �M eye,rs Offce NUr��<et A�n(,,,i�ysis R.-E S EA Rw C�H 1'3y U[Iie eilid of 20,25, ouill", e irn p I oy rllri�e as ed demwnd irriodel wilt1ii `61�n prolljlecltio�ils yields 32,20�6 sqLiaire "Fee"t ollf"Fice s�pace J demainded ai,1111411y alt I Sulojl`ect 2024 2025 2,024 to 20,25 Occupied in Tota I Ern p. Tota,I Office Buildings No. Employed in Tota I Occupied in Office No. Employed in Growth in Office New Office Space Industry Employ�rnent 1/ 2/ Office Buildings Employment 3,/ Buildings Office Buildings Buildings Needed V Traditional Office Users Finance Acthvities 781,9196 '70% 55,297 79,723 70% 55,8016 509 101;795 Information 24,986 50% 12,493 25,,312 50% 12,,656 163 32,583 Professional/Business Ser\Aces 267,289 70% 187,102 268,907 70% 188,235 1,132 226,450 Education/Health SeNces 225,930 20% 45,186 229,280 20% 45,856 670 133,996 Leis ure/Hos pitality 2091,211 15% 31,382 211,157 15% 31,673 292 58,377 Other SenAces 55,686 20% 112137 56,268 20% 11,254 116 23,275 Go\ernmen't 25,4,837 20% 50,967 258,413 20% 511,683 715 143,040 Non-Traditional Office Users Mining 2,931 3% 7'3, 2,961 3%, 74 1 153 0/ Construction 85,493 3/6 2,,137 83,870 3% 2,0917 (41) (8,1`14) Manufacturing 115,1120 3% 2,�878 115,379 3% 2,884 6 Wholesale'Trade 47,611 3% 1,1190 47,969 3% 1 1199 9 Retail Trade 142,235 3% 3,,556 142,407 3% 3,5,60 4 858 Trans portation/Utilifies 35,043 3% 876 35,080 3% 877 1 184 Total 1,545,368 22% 404,275, 1,556,725 22% 407,,854 3,578 7159684 lAnnual Average 7157684 Estimatod Ann�ual CapII. SOUTH BAY MARKET I 0i 0%,Wi 11,00/0 Notes: Est.Annual Offide Space Absorption,: SOUTH BAY MARKET(SF) 71,568'W,851,882 1/ �Per the CA Dept of Transportation and BLS Esfirnated Annual Capture: MILLENIA SITE(0/6)51 30.0% 50.0�% 2/ Meyers Research Estimate Est.Annual Office Space Absorption,: MILLENIA SITE(SF) 21 v,4711 42M1 3/ �Per the CA Dept of Transportation projections Annual Average (SF): 321,206 4/Assumes 200 square feet per employee for traditional o,ffice users and 200 square feet per employee for non-traditional office users. 5/ Refiects estimated capture rate of the South Bay markets'capture of office inventory 2021-03-16 Agenda Packet Page 653 of 724 oh�i UUMI uhl Imul k IIII"G 0 Nuumululu IDEIMAI' vv 20241111"I'll 10 2025 �1�1�1�1�1�1�1�1�1 WOODS & 001............11"I" IMODE1............ �Meyers I Offce NAar��<et A�n(,"i�ysis R.-E S EA Rw C�H 1 11 11111111111 -nadel wilflh Wolods &, 1��Ioole yields approxima"Itely '101111,558 sqLiare "Fee"t ollfsuppoiuble o"Ifte s�pace '3y Ift eilid ollf 20,25, our laased deilinand i �d e iii a ii d e d a ill 11 Li a 11 y a It It 11 e S u bj,ect 11111111I1111iropeilly. 2024 2025 2024 to 20,25 Occupied in Tota I Em p. Tota I Office Bui�ldinigs, No., Emp1o,yed in, Tota I Occupied in,Office No. �Employed in Growth in Office New Office Space Industry Employment 1/ 2/ Office, Buildings Employment 3/ Buildings Office Buildings Buildings Needed V Traditional Office Users Finance Acti,�Ries 112,883 70% 79,018 115,374 '70% 810,762 1,744 348,740 Information 29,824 50% 14,912 29,672 50% 14,,,836 (76) (1511200) Professional/Business S,er\Aces 547,427 70% 383,199 5561367 70% 3891457 61258 11251,600 Education/Health Ser\Aces 302,716 20% 60,543 311,114 20% 62,223 1,680 335,920 Leis ure[Hos pital ity 272,469 15% 40,870 277,9�73 15% 41,,696 826 165,120 Other Ser\Aces 139,815 20% 27,963 142,022 20% 28,404 441 88,280 Government 355,598 20% 71,120 356,816 20% 71,363 2,44 48,720 Non-Traditional Office Users Mining 6,513 3�% 163 6,550, 3% 164 1 185 Construction 117,935 3,% 2,948 118,696 3% 2,967 19 3,805 Manufactuftg 123,716 3% 3,093 123,860 3% 3,0917 4 720 Wholesale Trade 671172 3% 1,679, 68,065 3% 1�702 22 41465 Retail Trade 200,675 3% 5,017' 202,066 3% 5,052 35 6,955 Trans portation/Uti lities 108,573 3�% 21714 112,080 3% 2,802 88 17,535 Total 2,385,316 22% 693,240 2,420,655 22% 704,524 11,284 21256,845 Annual Average 21256�845 Estimatod,AnnuM Capture,-....SOUtH BAYMARKETI 100,0%,1 12,00% Notes: Est,,f Annual Office Space Absorption., SOUT'H BAY MARKET(SF)� 225$685-,270,1821, 1/Per Woods and Poole Economics, Inc. Estimated Annual Capture: MILLENIA SITE(%)-5/ 301.01%-50.0% 2/Meyers Research Estim�ate Est.Annual Offi�ce Space,Absorption: M[LLENIA SITE(SF) 67',7'05-135,411 3/Per Woods and Poole Economics, Inc. AnnualAverage, (SF): 101 1,558 �4/Assumes 200,square feet per employee for traditional office users and 200 square feet per employee,for non-traditional office users. 5/Reflects estimated capture rate of the South Bay markets'capture of office inventory 2021-03-16 Agenda Packet Page 654 of 724 oh�i UUMI uhl I Imul k 0 IDEIMAI' G vv 20291"I'll 10 2030 CAI............. Tl���ANS IMODE1............ �M eye,rs Offce NUr��<et A�n(,"i�ysis R.-E S EA Rw C�H 1'3y U[Iie eilid of 20,310, ouill", e irn p oy rllri�e as ed demwnd irriodel wilt1ii `61�n prolljlecltio�ils yields 25, 1 '111089 sqLiaire "Fee"t 011f SLflp�pmrtal,�)Ib ollf"Fice s�pace demainded ai,1111411y alt I Suloj,ect 11111111I1111iropeilly. 2029 2030 20,29 to 2030 Occupied in T'ota I Em p. Tota I Office Bui�ldinigs No., Employed in, Tota I Occupied in,Office No. Employed in Growth in Office New Office Space industry Employment 1/ 2/ Office Buildings Employment 3/ Buildings Office Buildings Buildings Needed V Traditional Office Users Finance Ac,ti\Aties 83,364 70% 58,355 841218 70% 5�8,952 598 119,577 Information 26,651 50% 13�,-3;',)-53, 26,901 50% '13,,450 125 24,982 Professional/Business Ser\Aces 275,874 70% 193,112, 277,616 '7'0% 194,33 1 1,219 243,852 Education/Health Ser\Aces 235,627 20% 47,125 237,184 20% 47,437 311 62,280 Leis ure[Hos pital ity 2,17,12 3 15% 32,,569 218,020 15% 32,703 134 216,883 Other Ser\Aces 58,945 20% 11,789 59,618 20% 11,924 135 216,926 Government 263,483 20% 52,697 264,755 20% 5�2,,951 2,54 50,884 Non-Traditional Office Users Mining 3,102 3% 78 3,138 3% 78 1 177 Construction 80,954 3% 2,024 80,708 3% 2,018 (6) (1,233) Manufacturing 116,299 3�% 2,907' 116,409 3% 2,9,10 3 547 Wholesale Trade 49,173,8 3,% 1�243 50,143 3% 11254 10 2,024 Retail Trade 143,669 3,% 3,592 143,791 3% 3,595 3 610 Tra ns portat i on/Uti I i t i es 35,185 3�% 880 35,190 3% �880 0 24 Total 1,590,015 22% 419,695 1,,597,689 22% 4221483 21788 557,533 Annual Average 5577533 Estimated Annual Capture: SOIUT�H BAY MARKET'(0%), 1 0jII-124 0% Notes: Est.,Annual Office,Space Absorption:. SOUTH BAY MARKET'(SF)', 55,751-6,619 1/Per the CA Dept of Transportation and BLS Estimated Annual Capture: MILLENIA SITE(1/6)5/ 301.01,%-50.0% 2/Meyers Research Estimate Est.Annual Office Space Absorption.- WILLENIA SITE(SF) 163726-33y452 3/Per the CA Dept of Transportation projections AnnualAverage JSF): 25,089 4/Assumes 200,square feet per employee for traditioInal office users and 200 square feet per employee,for non-traditional office users. 5/Reflects estimated capture rate of the South Bay markets'capture of office inventory 2021-03-16 Agenda Packet Page 655 of 724 oh�i '114 ulululul uhl Mulul k 1""G 0 Nuumululu 11")EIMA11 vv 20291"I'll 10 2030 ������, WOODS & 001............11'"' IMODE1............ �Meyers I Offce NAar��<et A�n(,"i�ysis R.-E S EA Rw C�H 1'3y the eilid o"I" 20130, our deinan�d inodel wilflh Woods & !���Ioole �projecltllibns yields 9111171,64,118 square fee''t o''I' supportalale ollf"fice s;mce deiiiailded ai,1111411y alt t1he SuIoj'ect F���Iiropeiily. 2029 2030 20,29 to 2030 Occupied in Tota I Em�p. Total Office Buildings No., Employed in, Total Occupied in,Office No. Employed in Growth in Office New Office Space Industry Employment 11 2/ Office Buildings Employment 31 Buildings Office Buildings Buildings Needed 4/ Traditional Office,Users Finance Acti\Aties 123,898 70% 86,729 125,678 '7'0% 87,975 �246 249,200 Information 29,086 50% 14,543 28,944 50% 14�74,72 (71) (14�7200) Professional/Business Ser\Aces 592,169 70% 414,518 600,956 '70% 420,669 6,11511 1,230,1180 �Education/Health Ser\Aces 346,388 20% 69,278 355�,6010 20% 712120 1,842 368,480 Leis ure/1-los pital�ity 300,261 15% 45,039 3051873 15% 45,881 842 168,360 Other Ser\Aces 150,845 20% 30,169 153,0,49 20% 30,,610 4,41 88,160 Government 361,607 20% 72,321 362,786 20% 72,,,557 2136 47,160 Non-Traditional Office Users Mining 6,635, 3% 166 6,661 3% 167 1 130 Construction 121 Y 700, 3�% 3,043 122,441 3% 3Y061 19 3,705 Manufacturing 124,520 3% 3,113 124,673 3% 3,117 4 765 Wholesale Trade 711408 3,% 11785 721213 3% 1,805 20 4,025 Retail Trade 206,264 3% 5,157 207,081 3% 5,177 20 4,085 Trans portation/Uti lities, 127,029 3% 3,176 131,010 3% 3,275 100 19,905 Total 2,561,810 22% 749,036 2,596Y965 22% 759,8�86 10,850 2116%955 Annual Average 211690955 Esti ma'tid,Ann Uzi I Czipture' SOUTH BAY MARKET(9/0),' 1 0im"01/6-12.0%, Notes: Est,Annual Office Sp';ace'Abs'orption: SOUTH 'BAY MARKET(SF) 2 1 16 1 1995-260 39 1/Per Woods and Poole Economics, Inc. Estimated Annual Capture: MILLENIA SITE(/o),,5/ 301.01%-50.0% 2/Meyers Research Estimate Est.Annual Office Space,Absorption: M[LLEIIS11A SITE(SF) 65y 099-1 301�197 3/Per Woods and Poole E,conom�ics, Inc. Annual Average (,SF)-.,1 9117,648 1 �4/Assumes 200 square feet per employee for traditional office users, and 200 square feet per employee,for non-traditional office users. 5/Reflects estimated capture rate of the South Bay markets'capture of office inventory 2021-03-16 Agenda Packet Page 656 of 724 oh�i UUMI uhl I Imul k 0 IDEIMAI' G VIV 20341111"I'll 10 2035 �1�1�1�1�1�1�1�1�1 CAI............. Tl���ANS IMODE1............ �M eye,rs Offce NUr��<et A�n(,"i�ysis R.-E S EA Rw C�H 1'3y U[Iie eilid of 20,35, ouill", e irn p I oy rllri�e as ed demwnd irriodel wilt1ii `61�n prolljlecltio�ils yields 241, 51411,Ill sqLiaire "Fee"t ollf"Fice s�pace J demainded ai,1111411y alt I Sulojl`ect 2034 2035 2034 to 2035 Occupied in Tota I Em p. Total Office Buildings No., Employed in, Total Occupied in,Office No. Employed in Growth in Office New Office Space Industry Employment 11 2/ Office Buildings Employment 3/ Buildings Office Buildings Buildings Needed 41 Traditional Office Users Finance Acti\4ties 87,531 70% 61�7272 88,246 '7'0% 611772 500 919,984 Information 271457 50% 13,728 27,518 50% 13,759 31 6,130 Professional/Business Ser\Aces 2841708 70% 199,295 286,574 70% 200,602 1,306 2612282 �Education/Health Ser\Aces 243,548 20% 48,710 245,145 20% 49,029 319 63,880 Leis ure[Hos pital�ity 221�,594 15% 33,239 2221737 15% 3 3,,4 11 171 3,4,287 Other Ser\Aces 62,251 20% 12,450 62,922 20% 12,584 134 216,816 Government 269,929 20% 53,986 271,259 20% 5�4,252 2166 53,184 Non-Traditional Office Users Mining 3,276 3% 82 3,312 3% 83 1 176 Construction 78,902 3�% 1,973 78,132 3% 1,953 (19) (3,849) Manufacturing 116,821 3% 2,921 116,9117 3% 2,923 2 484 Wholesale Trade 51,980 3% 1,300 52)41�4 3% 1,310 11 2)171 Retail Trade 144,684 3,% 3,617 144,802 3% 3,620 3 587 Trans portation/Uti lities 35�,289 3% 882 35,334 3% 883 1 224 Total 1,627,971 22% 433,455 1,635,311 22% 436,1181 2,727 545,y3517 Annual Average 1 54151,357 -------------- 0%, Estl m'atod,Ann mi I Ca ptu re SOUTH BAY MARKET,(0/o), 100"0%1-,12. Notes: Est,Ahhu'al OfficeSpace Absorptidn:' SOUT'114 BAYMARKET($,F), 54,536-65,443 1/Per the CA Dept of Transportation and BLS �Estimated Annual Capture: MILLENIA SITE(0/o),,5/ 301,.01%-50.0% 2/Meyers Research Estim�ate Est.Annual Office Space,Absorption: M[LLENIIA SITE(SIF) 161361 1 3217 3/Per the CA D,ept ofTransportation projections Annual Average (SF): 241541 �4/Assumes 200,square feet per employee for traditional office users and 200 square feet per employee,for non-traditional office users. 5/Reflects estimated capture rate of the South Bay markets'capture of office inventory 2021-03-16 Agenda Packet Page 657 of 724 oh�i '114 ulululul uhl Mulul k 1""G 0 Nuumululu IDEIMAI' vv 20341111"I'll 10 2035 �1�1�1�1�1�1�1�1�1 WOODS & 001............11'"' IMODE1............ �Meyers I Offce NAar��<et A�n(,"i�ysis R.-E S EA Rw C�H 1'3y the eilid o"I" 20135, our deinan�d inodel wilflh Woods & !���Ioole �projecltllibns yields 93,81111711 square fee''t o''I' supportalale ollf"fice s;mce deiiiailded ai,1111411y alt t1he SuIoj'ect F���Iiropeiily. 2034 2035 2034 to 2035 Occupied in Tota I Ern p. Tota I Office Buildings No. Employed in Tota I Occupied in Office �No. Employed in Growth in Office New Office Space Indus" Employment 1/ 2/ Office Buildings Employment 3/ �Build�ing�s Office Buildings Buildings Needed V Traditional Office Users, Finance ActhAties 131�474 70% 92,032 '132,611 70% 92,828 796 159,180 Information 28,395 50%, 147198 28,262 50% 14;131 (67) (13,300) Professional/Business Ser\Aces 6351720 70% 445,0014 6,44,342 70% 451,039 6,,035 1�,207,1080 Education/Heal�th SeNces 393,674 20% 78,735 403,503 20% 80,701 1,966 3913,160 Leisure/Hospitality 328,554 15%, 49,283 3341289 15% 50,143 860 172,050 Other Ser\Aces 161,867 20% 32,373 164,072 20% 32,814 441 88,200 Government 367A31 20%, 73,486 368,578 20% 73,716 229, 45,880 Non-Traditional Office Users Mining 6,784 3% 170 6,816 3% 170, 1 160 Construction 125,373 3% 3;13�4 126,098 3% 3,152 18 3,625 Manufacturing 125,281 3% 3,132 125,425 3% 3,136 4 720 Wholesale Trade 75,365 3% 1,884 76,,135 3% 1,903 19 3,,850 Retail Trade 209�'775 3% 5;24,4 210,333 3% 5,258 14 21790 Trans portation/Uti I ities 147,997 3% 3,700 152,524 3% 3,813 113 22,635 Total 2,737,,690 22% 802,375 2,772,988 22% 812,805 10,430 21086,030 Annual A\erage 250869030 Estirnate'd Amu''All CAptute'.* SOUTH BAY MARKET(0/6), 10.0'%,-i12,W/``�" Notes: Est,Anilual t1on,,:-,', SOUTHBAY MARKET 208,603-�250,7324 ,paco Abso,rL (SPI, I 1/ Per Woods and Poole Economics, Inc. Estimated Annual Capture: MILLENIA SITE(9/6)51 30.0%-50.0% 2/�Meyers Research Estimate Est.Annual Office Space Absorption: Ml�LLENI,A S1TE(SF) 62�i5�81 -125,;162 3/ Per Woods and Poole Economics, Inc. Annual Average JSF): 931871 4/Assumes 200 square feet per employee for traditional office users and 200 square feet per,employee for non-,traditional office users. 5/ Reflects estimated capture rate of the South Bay markets'capture of oiffice inventory 2021-03-16 Agenda Packet Page 658 of 724 oh�i UUMI uhl "I'll 10 204110 �1�1�1�1�1�1�1�1�1 CAI............. T11�1��ANS IMODE1............ k 1111" 0 %.J IDEIMAI' G VIV 2039 �M eye,rs Offce NAar��<et A�n(,"i�ysis R.-E S EA Rw C�H 3 11�111is `61�n pro Jlecltia�iis yields 2411,51411,I'll sqLiare "Fee"t 011f SLflp��0011a!,�)Ib o y U[Iie eilid of 20,41,10, ouill'� e���rnployi�Ill'i'lli�e����illtilI 13ased demwnd irriodel wilt1ii Cal"1111'1'11��mi J "Ifte s�pace �d e im a ii d e d a ill 11 Li a 11 y a It It 11 e S u bj,ect 11111111,1111iropeilly. 2034 2035 2034 to 2035 Occupied in Tota I Em p. Total Office Buildings No., Employed in, Total Occupied in,Office No. Employed in Growth in Office New Office Space Industry Employment 11 2/ Office Buildings Employment 3/ Buildings Office Buildings Buildings Needed 41 Traditional Office Users Finance Acti\4ties 87,531 70% 61�7272 88,246 '7'0% 611772 500 919,984 Information 271457 50% 13,728 27,518 50% 13,759 31 6,130 Professional/Business Ser\Aces 2841708 70% 199,295 286,574 70% 200,602 1,306 2612282 �Education/Health Ser\Aces 243,548 20% 48,710 245,145 20% 49,029 319 63,880 Leis ure/Hos pital�ity 221�,594 15% 33,239 2221737 15% 3 3,,4 11 171 3,4,287 Other Ser\Aces 62,251 20% 12,450 62,922 20% 12,584 134 216,816 Government 269,929 20% 53,986 271,259 20% 5�4,252 2166 53,184 Non-Traditional Office Users Mining 3,276 3% 82 3,312 3% 83 1 176 Construction 78,902 3�% 1,973 78,132 3% 1,953 (19) (3,849) Manufacturing 116,821 3% 2,921 116,9117 3% 2,923 2 484 Wholesale Trade 51,980 3% 1,300 52)41�4 3% 1,310 11 2)171 Retail Trade 144,684 3,% 3,617 144,802 3% 3,620 3 587 Trans portation/Uti lities 35�,289 3% 882 35,334 3% 883 1 224 Total 1,627,971 22% 433,455 1,635,311 22% 436,1181 2,727 545,y3517 Annual Average 1 54151,357 ------------------------------- Esfim'atod,Ann mi[ CapturI SOUTHBAYMARKET(P/6), 100"0%1-,12.0%, Notes: Est,.,Annual OfficeSpace Absorptidn:' SOUT'114 BAYMARKET($,F), 54,536-65�443 1/Per the CA Dept of Transportation and BLS �Estimated Annual Capture: MILLENIA SITE(0/o),,5/ 301,.01%-50.0% 2/Meyers Research Estim�ate Est.Annual Office Space,Absorption: M[LLENIIA SITE(SIF) 161361 1 32,721 3/Per the CA D,ept ofTransportation projections Annual Average (SF): 241541 �4/Assumes 200,square feet per employee for traditional office users and 200 square feet per employee,for non-traditional office users. 5/Reflects estimated capture rate of the South Bay markets'capture of office inventory 2021-03-16 Agenda Packet Page 659 of 724 oh�i '11h1l "I'll 10 204110 �1�1�1�1�1�1�1�1�1 WOODS & 001............11"I" IMODE1............ k 1111" 0 %.0 Nuumulululu 11")EIMA11 G vv 2039 �M eye,rs Offce NAar��<et A�n(,"i�ysis R.-E S EA Rw C�H 1 11 IN '3y Ift eilid ol'11� 2014110, our deinan�d inodel wilflh Woods & !���Ioole �projecltllibns yields 93,81111711 square fee"t o''I' supportalale ollf"fice s;mce d e iii a ii d e d a ill 11 Li a I I y a It It 11 e S u bj,ect 11111111I1111iropeilly. 2034 2035 2034 to 2035 Occupied in Tota I Ern p. Tota I Office Buildings No. Employed in Tota I Occupied in Office �No. Employed in Growth in Office New Office Space Industry Employment 1/ 2/ Office Buildings Employment 3/ �Build�ing�s Office Buildings Buildings Needed V Traditional Office Users, Finance ActhAties 131�474 70% 92,032 '132,611 70% 92,828 796 159,180 Information 28,395 50%, 147198 28,262 50% 14;131 (67) (13,300) Professional/Business Ser\Aces 6351720 70% 445,0014 6,44,342 70% 451,039 6,035 1�,207,1080 Education/Heal�th SeNces 393,674 20% 78,735 403,503 20% 80,701 1,966 3913,160 Leisure/Hospitality 328,554 15%, 49,283 3341289 15% 50,143 860 172,050 Other Ser\Aces 161,867 20% 32,373 164,072 20% 32,814 441 88,200 Government 367A31 20%, 73,486 368,578 20% 73,716 229, 45,880 Non-Traditional Office Users Mining 6,784 3% 170 6,816 3% 170, 1 160 Construction 125,373 3% 3;13�4 126,098 3% 3,152 18 3,625 Manufacturing 125,281 3% 3,132 125,425 3% 3,136 4 720 Wholesale Trade 75,365 3% 1,884 76,,135 3% 1,903 19 3,,850 Retail Trade 209�'775 3% 5;24,4 210,333 3% 5,258 14 21790 Trans portation/Uti I ities 147,997 3% 3,700 152,524 3% 3,813 113 22,635 Total 2,737,,690 22% 802,375 2,772,988 22% 812,805 10,430 21086,030 Annual Average 250869030 Estirnate'd AniIII CAptute'.* SOUTH BAY MARKET(0%), 10.0'%,-i12,W/``�" Notes: Est,An'nual Off1ce,,,,,,,S t1on,,:-,', SOUTHBAY MARKET 2081603-�250,7324 paco Abso,rL (SPI, I 11 Per Woods and Poole Economics, Inc. Estimated Annual Capture: MILLENIA SITE(1/6)51 30.0%-50.0% 2/�Meyers Research Estimate Est.Annual Office Space Absorption: IVII�LLENI,A SITE(SF) 62�581 -125,;162 3/ Per Woods and Poole Economics, Inc. Annual Average JSF): 931871 4/Assumes 200 square feet per employee for traditional office users and 200 square feet per,employee for non-,traditional office users. 5/ Reflects estimated capture rate of the South Bay markets'capture of oiffice inventory 2021-03-16 Agenda Packet Page 660 of 724 �Ii�Ii 111�I IhIolu Will) lih lih I ION 01:-- SA[lq 11H["�`GO NASA SUI��IIMN"` Office [Oarl<iet Ar�4ysis I HIMIN, �111.hflfl HIMIN �M eye rs R.-E S EA Rw C�H e S a�n ���1111Y�bgo ��'WSA �����s of 38, olf�'F�te d�Vde u�p It le ����)d o�f IVISA. The Udl&���,iia Site ��s bcated hi�`l Ulle SOL]"111 Bay Mail<et, Whidii ���s cu'l�`Ip�llse SiX Klbrnerkets, (hrli Ght.da Vista of &te), as wd�� as b saii lrq��)erb� [Beadi'i, 1,h"'Iiast Cot.i�nty, Southeast S@,l 11`11)1�eqo �114afiorIi4�� C'ty', wid Otay Mesa subr'lt mi'll"kets C Pendleton-,1 " I L b ,d-2 20 Chula Vi�to 31 College Area-4 or nali C wo n ad o S 91 29 �,el Mor Hts,/Ca�rmet"Valley-6 bawntown-1 2 gA,, .......... timst County-8 I It Escondido-9' :Giaverinar Park,-10, 18 Kearny Mesa 11 La J cal I a 12 19 er 28 MC AS M i�ra mn r '13, f 1hu 27 Mira Mesa?'Miramar-14 Miss,i,on GOrqI2-1,5 6 '16 Mission Valley Notional C"Ay-1 1 D Noff,th l8eo-ch Cities-TH, 4 Noffth,Centraltounty- A D-Ocecn:s,ide, 20 O�A Twn/S Arenq/Pit Loma-211 58 w Otay,Mesa-22 [],Oiu-0,yinq5D County N 2 15 ............ t IIj,-1D1u-t[,ryflmg SO County S-24 216 Otay Mesa ............. ... ............... 10 r k to st 25 ........................ ........................... //",//"",�.......... .... ....... 36111 Powaiy 27 kainchio 011,2�rnardo-28 211 4, Sen,Ramos-211,11� 5a n,Y&[Idr oA mpe fla 1 Beadh 3110 5 34 Scripps Ranch-51 Swrenta,Maio;-12 17 24 1:3 SQuento VcMe'y-S�,, 54c�utherjst-San Diago-14 <— Torrey Pinies-�5 Uptown,Eu,&t- A Li Qlptcrwnt Wi��,sk)'Pcrk West,-'37 22 IN �Lj UjTC-3-B IN J 2021-03-1 Page 661 of 724 11, vist, 7' Source:CoStar iu iu 11 iu iu I I I 1.ih�f V S SAN ��GO �MSA G��� C �M eye,rs Offi(;,e I\Aa�rlkel, Analys��s R.-E S EA Rw C�H New office d6h'�llveiries tlhe Sain Diego IVISA av�emrageid 2,1 ipnillh'bin squairefeet wmnuall�y o�ini�'Olthe �past 38 yelairs. Gf�'fjce d6hv&iJes fd�low cycles of d eve I�o m ei��it, a�nd tl�oi��s ���l��iad s6ect yea��,-s Wh&re d6Jvei,ies were �,-n��d-1980`s, 4te 11990"S/ �nn�d,,1,12000's particuliEl�",. A�inual d6iv&rbs have, ea(,11)" i v&-y bw for ov&r a decade, [)ut uffice develop�rhnent ap��,oimrs��to be �11-6,',)OL,Vndng M�U,i 1 1 sqL,orie feet of s�oacie �pr-o jec,"I ed ��to be ddJvered in 2020 Office Deliveries (in Millions of Square Feet) 6.00 5.00 0 4.00 Average 2.1 Million &F 3.00 LL IMMUMME NO))))Y RMIRM MUNAM MWOMM MWEE, MANERN "MONA)" 111mmmol F111111111A W I IN)) MUMMA MAMR), ORMU)NA Cr 2.00 II!!:M!! II!!:M!! II!!:M!! 1.00 .........momm"m...................... "Umm"m............................................................ 0.00 1 1 m I I I I 1 �1 I I III �m '82 '83 '84 '85 '86 "87 '88 '89 '90 '91 '92 '93 '94 '95 '96, '97 '98 '99 '00 '0 1 '012 '03 '04 '05 "06 '07 '08 '09 10 11 12 13 14 15 16 17 18 19 '20P Total Deliveries(Mil.SF) 3.60 140 4,90 4M 5,40 3,6�O 3.40 420 4,50 2'.10 110 0,50 020 0.40 0.80 0,80 3,10, 2.90 3.20 3,80 2.10 1,20 1,10 2,20 2,70 3.60 310 140 0,80 0.50 0,80 O�190 1.00 1,20 0.60 0.80 0,70 020 1.10, %Change — -6% 44% -18�% 35% -33,% -6% 24% 7% -5�3% -48,% -5�5%, -6,01% 100% 100% 0% 288% -6% 10% 19% -45'1/6 -43% -8%, 100% 23% 33% -14% -55% -43% -38% 60%, 13% 11% 20%, -,50% 0% -13% -7,1% 450% Source:CoStar 2021-03-16 Agenda Packet Page 662 of 724 SAN MSA �Meyers OI�Ifice I\Aa�1-11<elt Ai�������ia��ys�s R.-E S EA Rw C�H 1 1 11) s q i I a�"E. tarlt'�llliig t"o �"�linarease pasi,� "10 years avaro,3ged I r-I.I I.I...I I ,, fe el After a (lecade only i�linarease in iinvei,itaryl, tlle Sail il,Y'�lbgol off'ice i�lilveilllllltollly Is s 7 0 0 af �nall"eased �nvei,"i tall'y per yea" flie IMSA, �Ul�iat ���s ��fca,�1- lllhis year, i�nvelrvlory has ����iareaseld loy over 11 milhian square feet alid CoStap projects t�,Omtl, �Iime��l ltory Wll �Iicrease by 4 5 sq�.Ijarl-e feat(,Wer t�,��ie �Iiext five years Office Inventory (in Millions Square Feet), 125.00 120.00 -115.00 0 110.00 %..,--105.00 4-1 Q W LL 100.00 W LM Cr 95.00 90-00 85.00 80.00 2008 20,09 20,10 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 YTD 2020P 2021 P 2022P 20,23P 2024P Total Inventory(SF) 111,382,774 112,740,099 113,443,538 114,090,959 114,490,119 11�5,,193,293 11�6,024,,064 116,614,658 117,059,974 116,856,985 117,301,923 117,516,080 118,533,679 118,6331,6,79 1191,405,301 120,386,,840 121,103,513122,031,017 Inventory Change -- 1,357,325, 703,439 647,421 399,160 703,174 83,0,771 590,594 445,316 -202,989 444,938 214,157 1,017,599 1,117,5919 771,622 981,539, 716,673 927,504 %Change -- 1.2% 0.6% 0.6% 0.3% 0.6% 0.7% 0.5% 04% -&2% 0.4% 0.2% 0.9% 0.1% 0.7% 0.8% 0.6% OI�8% Source:CoStar 2021-03-16 Agenda Packet Page 663 of 7241 i i1i'luili'lui, p k 11 SAN 1,1,'1,')1EGO IMSA 01 11"'I"ICE EVS VA C A N GY �Meyers 1, ,,,E S EA Rw C�H Office Ar,114�y§s R Oveir,4H�, avier"I'lage olififite lease rates ia�ppeaii* to �ia�ve stai)�'�11J'�lzied at $2.88 peir sqtjaire 'foot �perll rnont�ili 'iin 2020. 1`11`1,ie vacaricy creased, ��to 1,11111.6% i�n 2020, a 11) pil"Olects ren�ts 111��,mrease ��to $3 1,1118 ��,jer spai,'e foot, ��,jer and fls�l��,ictior,i of decireased ld&,��pnand for io�ffice sp�ace due "to 11���ie COVID-19 pand&rn��c. G61�lig fo��,Iwa�[-d, Cc:Sic 11 q It vam��icy to at i�t e''4 11% by 2024., $3.50 16.0% Lease Rates =4)mmVacancy Rates $3.00 14.0% 000ki LL 00000 CIO, ....... 12.0% $2.50 10.0% $2.00 8.0% W $1.50 6.0% M, (D -1 $1.00 4,.0% < $0.50 2.0% $0.00 01.0% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020'YTD 2020P 2021�P 2022P 2023P 21024P lip 1: �= Lease Rate SH K/i $236 $2.10 $1.96 $2.06 $2.14 $231 $2.44 $2.50 $2.61 $2.73 $2.86 $2.88 $2.85 $2.8,6 $3.01 $3.12 $3.18 Lease�Rate Change -- ($0.26) ($0.12), ($01.012) $0.10, $0.08 $01.17 $0.13 $0.06 $0.1�1 $0.12 $�0.,13 $0.02 ($0.03) $0.01 $0.15 $0.11 $0�.,06 %Change -111,01% -5,71% -1 10% 5,1% 3.9% 7.9% 5.6,% 2.5% 4.4% 4,6% 4.8% 0.7% -11,011% 0.4% 5.2% 3.7% 1.9% 11 ZME I �� Vacancy Rate '13.9%, 14.6% 13.9% 132% 12,2% 11.7% '11.2%, 111.0% 9.9% 91.8% 9.6% 9.2% lt6% 11.4% '12.2% 121% 11.8% 11.9% Vac.�Rate Change 0.7% -0.7% -0.7% -1.01% -0.4% -0.5% -01.2% -1.1% -0.2% -01.2% -10.4% 2.4% -01.2% 0.7% 0.0% -0.3,% 0.1% %Change 1.41 5,111% -5,1% -7,9% -3,61% -4,0% -22%, -9,71% -,l,,7% -1,9% -18% 26,1% -11,611% 6.2% -01,1%, -27% 0.9% 2021-03-f 6 Agenda Pa&et Page 664 of'724 Source:CoStar ui\��DTIGN VS. CGM[1�11.................. 1�`,[I'lu) IS AC SAIN I`IH`��'�,GO MSA G1 �M eye,rs 01'"fice �mwi<et Ana�ys��s R.-E S EA Rw C�H I "T"he swti ��,')iego MA olf"fice �mwri(ellt 'i's negative ��"Iielt iiii 20210, a 0"IfIdecreased demluiw�lid lfo�,-olflfice s�pace due 111to "Che C OV 11) 1119 p&ndeni'ic. Abso��,-ption lias OLI[placed �li�iew deliv&�,Ies �n ead���oi I tli�i�e joi,�'Ist 10 yea���-s, ir�idimt i�ng Uliere lias �Iiist&tally be&n nl��Iore supply in Sw'l i le g o M S I, th&�,-e is a great deal of lb�,��ie m�i iing yn�,-s vn tl "ISO" f how lo�flfte alDsoi�-pt,io�n recov&I'-s i�n (11���ie years. 3,000,000 2,500,000 m Deliverie,s (SF) Absorption (SF) 210001000 1,500,000 1,000,000 5001,000 .............................................................. .............................................................. ........................................................................................................ ......................................................................................................................................................................................................................................................... ....................................................................................................... LL 0 Cr -5001,000 -1,000,000 -1,500,000 -21000,000 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020,YTD Deliveries(SF) 2:,912,872 1,35,7:,325 703,439 647,421 399,,160 70,3,,174 83�0,771 590,594 445,316 0 444,938 214,157 1,017,599 Absorption(SF) (1,126,743) 330,049 1,439,952 1,359,414 1,543,727 1,123,339 1,283,478 8,016,572 1,578,961 19,424 6�20,152 629,628 (1,,997,457) Source-.,,Costar 2021-03-16 Agenda Packet Page 665 of 724 I S o1himilimhull�iihfoii?i ��JhIH113 U o1himilihim 10 SAIN I`IH`��'�,GO MSA GI M A l< S I �M eye,rs Gi�fl ice �mari<et Ana�ys��s R.-E S EA Rw C�H :uj HUI desiginated as 4/5, Star, (Glass A) &iii�,icl 3 Stair (Class 1�� s�pace accouin't foir ov&i '1716% o,,Vtotal office s�pace iiii the irnailhlli�'e't. Class A s�pace adh��eve filie lhiglliest lease rates, bLlt al�,o I�ias a I�iiglii&r va(3,,,ai,*icy i"ate tl un ofi�,,mr bui](,,Ifii��,�ig dasses. Sair�i Diego ���s a rdat'ji'v6y active Cbss A offic,,.e developil"n&1 it mai��*I�et wifli,�i 1,,7 sqUa��,-e 'feet unclei* c,u,�,i�sfi,,,uctiun (,"Irlid 881 0100 squa�re feet'j, d6hivei#ed ov&�,,1,11��ie ���,,,)ast 12 rnu,��itl�lis With fl�iat said, fiwre be oversu�pply iSSUE),S �n t���,�ie cu�Til�lli�,ig a�nd years, §��,��ice tl�lie past year I,iwl r"iewly 2 sq,.iare feet o"friegative absoqpfion (4rgely (ILie 'to tl�ie COVIDmi,19 pai,,Iidem��c) It is so�ri�ieWhat 'to note fli,,mt t��,��ie rnafority of ry............. il C�,,I i filie r�hiegafiive iliet �`�s lhll 3 Sta�r(C��ass 1',1,13) s�,,)ace, i�n�Jicabiig 1:]hattl��ie 4, & 5 Sta�i, w&,"Itoi J ,hlig new 3 Star si,,,,�,ace. 4 & 5 Star 39,216,320 518497 6 11 14.9% (356,579) 881,901 111784,004 $3.52 3 Star 4718301970 5;657,1858, 11.8% (1:,�20,8�329) 1681,115 2541 177 $�2.70 1 & 2 Star 31)4�86;389 232737469 7.2% (4 312�54 9) 0 01 $2.33 TOTAL. 118,15331679 13,780,,1938 116%, (1 19917,457)' 1 1050:016, 2'1,1'038,,l 81 $2.88 Total Inventory $4.00 '16.0% Oomm%, SF/Mo.) UL. $3.50 14 0% CO mm*==Vacancy Rate 1 &2 Star 26.6% 6 $3.00 12.�0% $2.50 10.0% 0 3 Star m 40.4% wi $2.00 8.0% >% $1.50 6.0% C >1 0 $1.00 4.0% > $0.50 2.0% �4 &5 Star $0.00 0.0% Source: Costar 33.1% 4&5 Star 3 Star 1 &2 Star 2021-03-16 Agenda Packet Page 666 of 724 1111 1113 11 Ul UI H 1,"R, 0 1 C E C I i A A Ffff% I S I C S 1111 111 Y IS U B Im A l000 �M eye,rs Gf�fice Ma��rlket Ar��4�ys�s R.-E S EA Rw C�H �1 e Ciiu�a visota si ibiiiairket is otli'llie eigliltlh, laii-gest ooffice tiv Sail ii�',)itgo 1VSA,, coimpilising 2.9% of the off ice iIpairlii(et oveiI-all. [t is a ioi,,e a��f'�fo��table o���f���f'ice �,,narl(&[, dl���Iie Dego 1MSA, avei,age base �11-ates o���f $2,,53 �per sqLiare bot v&�-sus $2 88 pei,'I� square �foot i�n tl�ie �MSA, 111110LIlg��"l it ���S i�l-iportw��vt ��to note blmt [11�-Iese �Ildca�b��I'-s a�l o���f'���fice i��I��,Iventory, rl'11J,Ijdi�i o��fwliidii is Class 11,",'13/C sp.ace �n Ch�jla \li&ta. TI��ie vacancy rate ���s bw&r d,iar�'i [11�-ie MSA overa�l, at 5 8% v&1-&.,is "I 1.69/o, the �11MSAII and fli���v&re has beein a 10,500 sq�.jar,e �feet(1)�f negative ��rl DlLda Vista, a rdia����Jvdy low arnour�,vt corn�pared ��to the MA overaH (-1 7 n,�,flHbn s�:pijaire �fe&l,),,, Carlsbad 7,641,000 1:,217,109 15,9% (79,676) 12,0010 0 $2.89 College Area 1,605,000 82,,834 5.2% (31,105) 0 0 $239 Coronado 181,000 2,732 1.5% 3,2910 0 0 $2.95 Del Mar Hts/Carrnel Valley 5,,128,000 713,497 13,.9% 221,535 288,000 2,17,000 $4.31 Downtown 13,962,000 2,997,157 21.5% (372,78�6) 372,000 1,073,000 $2.94 East County 5,,731,000 252,752 4.4% 52,046 111,000 0 $2.13 Escondido 2,660,000, 289,202, 10.9% (6,081) 80,000 0 $2.21 Governor Park 899,000 111,468 12.4% (25,902) 0 0 $2.86 Kearny Mesa 11,385,000 1,178,952 10.4% (292,648) 90,000 125,0010 $2.63 La Jolla 1,652,000 276,667 16.7% (111,391) 0 0 $140 MCAS Miramar 32,000 0 0.0% 0 0 0 $2.27 Mira.M�esa/'Miramar 1,519,000 98,252 6.5% (2,5,37) 0 0 $2.46 Mission Garge 697,,000 9,080 1.3% 4,900 0 0 $2.19 Mission Valley 7,,346,000 1,055,895 14.4% (2591,812) 0 0 $2.71 National City 797,,000 23,035 2.9% (923) 0 0 $2.17 North Beach Cities 3,308,000 232,861 T.0% (32,103) 26,0100 80,0010 $3.50 North Central County 408,,000 26,312 6.4% 49,,451 59,000 0 $3.86 Oceanside 1,771,000 140,845 8.0% 9,802 0 1001,000 $2.17 Old Twn/S Arena/Pt Loma 2,907,000, 122,157 4.2% (8,054) 0 0 $2.61 Otay Mesa 2,20,000 11,663 5.3% (2,331) 0 0 $2.53 Outlying SD County N 741,,000 44,303 6.0% (5,325) 0 0 $1.88 Outlying SD County S 186,0100 8,185 4.4% 4,525 0 0 $2.14 Park East 337,000 18,752 5,6% 315, 0 0 $2,28 PB/Rose Canyoni/Morena 1,,9107,000 117,166 &1% (50,7591) 0 0 $2,26 Poway 1,5,36,000, 40,131 2.6% ('10,834) 0 0 $2.42 Rancho Bernardo 7,032,000 927,324 13.2% (225,069) 0 0 $102 San Marcos 1,726,000, 1,38,410, 8.0% (37,815) 0 0 $2.38 San Ysidro/Imperial Beach 2,45,0100 0 0.0% 5,446 0 0 $2.04 Scripps Ranch 2,954,000, 484,197 16.4% (30,598) 0 0 $2.81 Sorrento Mesa 9,666,000 1,156,323 12.0% ('116,218) 0 0 $3.07 Sorrento Valley 779,000 167,567 21.5% (93,5801) 0 0 $2.46 Southeast San,Diego 664,0100 71,352 10.7% (6,5,69) 0 0 $2.17 Torrey Pines 3,231,000, 261,837' 8.1% (37,447) 0 74,0010 $140 Uptown East 293,000 8,537 2,9% 5,250 0 0 $Z23 Uptown West/Park West 3,382,000, 240,817 7.1% (101,4619) 0 0 $2.57 UTC 8,762,000 696,802 &0% (76,696) 0 369,000 $335 Vista 1,795,000, 355,449 191.8% (46,5491) 0 0 $2.08 2021-03-16,Agen4kL4cket, tloit,U,1000- 131780,1938, 11.,6% (11�,1718',303) 11038,000 @g,06§67,of 724,$2.818 Source: CoStar SAN �Meyers Office Ma�rlwt Ar�m��ys�s R.-E S EA Rw C�H "I"],le lftdical Office ill"Inai'lket 'i's "I ovei�",all� o'Iffice iii teioms of lease ir'lates, vacancy irates,, aielid albsonptbii activi"Ityi, Ove��I-IaHl, the Sa��Il�li 11`11)11ego -sus flr�lie overaH� off"ce �ease ��l,�ate of $2 88 pet"' square fbot, la:�I-i(',J the aliedica� office �rllrie(,Jica� office inwlllket lias ain ave�1111111age ��ea,se rate of $3 110 &qua�re foot Uhl S&-Oice) v& 'w vamncy 1*,�Il at,e,. o f 5.....4,% ��s ls��g�n���flmiifly lower,than flillie ov&rall offic%12. va"I'll,ca":ricy �111-ate of 11011 6`Xo "T"I'lie Soutli Cowity rre6cal offilice h�as a v&111-y bw viamncy rate o"f3 4% cu�,'nparlled to the ov(llll!�ra�H �Iredkl�,,iac �� (,�,�)ffice vam�,'Iicy i,llate of 4% hili �11'�D 1�11 ego County Ilias 1111�1)eie�li some soft&n�hi,lig �tli tieni�lns of al,,)su�'-�pflun, with �1�i�egafi�ve �net of�,- I -y &nnaH &1 1 IOUIT[" of culifirnfion to, the �1-1 7 [TIHIJOII squaire feet of negafi've net 'Hii the Sa�n 11 1 7 �Ilbet hi �the �,i�ied'ca�� office nnarli(et, lbt rtt"Ihat ��s a m, [1,I)I'llegic') offilice mai,11111<,et ove14l it is eiilcl;ouillllap�ng to tl iote t1hat, al)sul,�ption Ilias lbe&ii ��,,.)osit�Ve hili South County, lw'Fflh� 14511 s(',,�Ijua�,-e feet of s�,,l)ace albsulbe(l,'], ye&I s ility @,'Ilid soft �,�riarket corlid��fiuns the convenflot4 office tTliarllwt, Iliel �,�riedk�4� office rn@'Ret '�s �:e�l' data hi(�Ificates '[]"Iiat desp'Fte "Ihe Lflqci&rtaih� urmh1lig wei]H 1"m POOF4 Bill 7� '11 117 S3 6,6 C.,lass A, 3,550,93A. 10,069, 172,1138 3 4 19% 3�,,856 927 64,566 11 3 ............................................................. ................................................................................................ 0 2,00,"100 $3 08, C.,lass B 7,14 56,58 3, 7,,�,'1,69, 431,1481 5�81% ,-34;S),42 19,4314 127,022 .................................................................. ........................................................................................... 1,9'7 2,,'7 9D 0 S2 0�13. C"lass 0 103,150 5,2% 1'!1,814 6,802, 27,843 0 K"r'8 g; "15 5,317 $2 91 N11i Counly 3,355,141",-?P& F3,1 T12, 223,80 4 61% DU I a 4,628 53,8 8 6 0 $3.59 ...................................................... ....................................................................................................... 44,150 0 0 3 87 $4.37 5 1 D84 9% -,B,,14 2 7"8 Nikki. 2;4 47,4`3 146 5'. .............................................................. ............................................................................................... N F '1 13,74 3 -t%078 24,2212, 52 8 9 $411.00 15(.'.al 6k.Jo ir, 0 9 1 j 2�13' 85.2% 0 0 ........................................................... .................................................................................................. 1111,765 4.0% - 5 270j 00 $2 88 C.'entrd�1 St.i[M i�6a ri 1 13 7 5 Ult 5 0 1'3,,� 2 3,7 6(5, 2,405 48J,.)9,1-, 0 $3.71 .................................................................. ........................................................................................... East Coi i�ni ty, "I,11 14,1 G2 0 54�'31'1 19 5'.2% -2,10 7 1,221 10,961 0 $2 8 3 $3.2`211 .............................................................. ............................................................................................... 1,5714,0681 0 513,5 119 3.4% 704 "14,511 �13'0,14111(),F.4, 0 0 $3.512, a i�-n�p iu s 14,6181,459 6,322 2 f.",21.,2 8-3 5.9% '1�,19111 3FOO 1 2, 44,213,63 "1 If 5,0 0 D 281 $3.(.39 .............................................................. ............................................................................................... ;a ii-ri�p i l s 81,36 1,74 8,' 11,12,"1 F5 4 3,411,J 13H 5.2% -4 63 14,7(R 175,195 0 3�3,6,1417 3 24 3. 6 ,Pie,�r� r,,.it1E11N1.3 rfafllect I e1i1.Ts.3J:r)gr jr P�,,n le v v 3j,11 113 S,P AC EIIII ��D�E,MA.N��D I��D��E,�L I V E R.I�E,S, ��D I R.EC IT VAC ANCY A S K.I N G �R.E��N IT 12 5,j` I ,3 0 UP $ 01 2 1,30 11511 94 11 "I I,]C) 4,9',,,4 $2 5, 01 jjjjjjjjjjjjjjil NONE 2%11 $2 Dj() I-) 'M 2(.-115 2,01"1 4L D''1"17 211 "I�B 20 1 109 20�21111 2 U, 211 11 2017' 2,C) 211l'.)19 20.2111 ............ �m NJ et,A I I F' 1111111111111111 Cl(:i v "t (I t A �k I i�g R e $1 F" �F �M o rath Nio,"a c a nic Ratf rij c ��i o n 11 141"111111 2021-03-16 Agenda Packet Page 668 of 724 Source: Cushman and Wakefield 11 .............. lihi � SAN lk��......................G"0 0 �Meyers (1111111 f"fic e INA a r��k e�t A i��i a��y s��s R.-E S EA Rw C�H IV "or liealthcaire pirovideir's wre active Un t1he iiiedical office iinaimlket Un Sain Diego, ws, elivi&iiiced bly soi,ine olfthe activity un t,Ihe �pastyear. Aside 1190,000 s�q�uai,e ��te ni ��to frui�-i abisui'�'Iatior'i acbvi�ty at di��ie Gne 1'1`�1111&sleoi office dievelqjpirner��vt h I\Aar tw(l) oftli���ie [a��,,-gest a�lioves �iiiave been by Ka�s&i- 0 V g I (1 3, � :',I - 11 foot �inedica�� offte ftabH�ty i�n Saii�tee foot mediica� uffte Ix,.diding Kew-�ny Mesa, a�����id Shaip Stealy r-rIIi(')VIr`Ig �i�nto 86,0010 sqL,orie 12 MONTH NIE"T ABSORP1 TION &FAN SELECTED BUILDENGS One Rinae, (1) Kaiser PjOrri ia'r ieir"irte, Re,,ec.,,Steid��y Orie, Paseo ,(Z) 7650 'Misci,an V 11�ley Rxd Eas't,y,'ite Terrace S,napi,,-On 9360 Towne Cei-itr�,e D'Y' 0SOF'r"e'lD Tc`-),,vv',ers Cia�mpbeH� Place La.,Jofla- Cc,,)�ir'i'"iirnons Diel Ua�r Corporate,Ge�nt re, Kell,"Iner&Asli,ii Cla r��:,s]bad:, R.ese.,arrr,,Jh Ge,,�nte,�r Carn"wl Point Otfiw Park COUrtyaT d Seia,v i ew Co qp:airate,C e!nter 0 11010 101010 2,100 1 000 fiet Absoilption SF Building S u,Ib m,im. e t Bldg SF Vacant S,F I St QtT 2nd!Qtr' Ird Qtr' 4t Cltr 12 Month C)ne Paiseo, DO Mar"Ht'SlICLarTnel............... 191610 44.3 0 D 1,9018190 a'3 119 121" 174,80211, Kaiser Plermianente KE?amiy Mesa 901GOO 0 0 D 111901009 D gop,000 Rees-Stealy, �East C,ou nty 96,DD 0 0 0 D 0, 861000 96polm C)ne Pasec,(2 Del Mar Hts�,Czinnel............... 92,0 04 1 6F911 19, 0 0 �3715,47 47T575 95F'l 22 2021-03-1 OsAw.U&Pket Page 669 of 724 SO�Uhl�llhlfll�llhlll ll MSA �Meyers OI�Ifice �ma��1-11<el'l&���ia��ys�s R.-E S EA Rw C�H e Sout�ll i��ay off'�llce �"�linventory i�s staill"Itling to Oiiicirease olvertlie past two years. Aflei,� 2016, 201`7 and K1118 saw, v1I acl�bV��ty len,I T'llis cll)�f o�fficcl:, llu�l ivel�,'Ivh�')ry dhiarI�ige,l 1,he past '18 his lhave ex�perier�iced steady grmbli ii,I-i offlce ��nvel'i liory, W�t�,'�i 130.1,01C)ID, sqLel,e fe,&t acideJ ��to �Ul'�-ie 21019 w�id 120,1000 sq� re. fe cla:,ll 11, a d de ci i I e fl��11's a I f o��f 2 02 0 Office Inventory (in Millions Square Feet) 11.30 '11.25 11.20 0 11.15 1 lAO Q Q ILL Q L. 11.05 m Cr Cl) 11.00 101.95 '10.90 10-85 .......................................... .......................................... .......................................... .......................................... ........................................... .......................................... ........................................... ..................... Q2 2016 Q3 2016 Q4 2016 Ql 2017 Q2 20,17 Q3 20,17' Q4 20,17 Ql 2018 Q2 2018 Q3 2018 Q,4 2018 Q,l 2019 Q2 2019 Q3 2019 Q4 2019 Ql 20,20 Q2 20,20 Total Inventory(SF), 11,085,293 11,086,252 11,031,883 11,031,883 11,031,883 '11,026,483 11,026,483 11,026,483 11:,022,436 11,040,090 11,040,090 11,137,045 '11,2314,000 11,140,,000 11,170,000 11:,231,000 11,292,000 Inventory Change -- 959 -54,3691 0 0 -5,400, 0 0 -4,0:47 17,65�4 0 96,955 96,955 -94,000 30,000 61,000 61,000 %Change 0.01% -0.5% 0.0% 0.0% 01�0% 0.0% 0.0% 0.0% 0.2% 0.0% 0.9% 0.9% -0.8% 0.3% 0.5% 0.5% 2 ,�21-03-16 Agenda Packet Page 670 of 7241 Source-C ar S 0 U olmorm �110 10 1 .�lhf ,,, . I ��� UUUUl 11 B AY AV A Coll' lollllll.11 ICE [RAloofl000E VS. VACANCY �M eye,rs 1, --E S EA Rw C�H Office Arllia��ys��s ff 0 f t1l ei�r �,,),eak, lo�f$$2.32 p&�,� Wh�iIe South llil� ay 1ease �rates 11ave softeined slJ'ig11A1y iin 2020,, the vacancy irate IT I at'i live I y low,,,,, Average 1ease rates cwne dowil li c 1) square fwlil 04 2&19 I.lo $2.26 p&,,- spare foo''t i�n T,��)e vacancy ra�te k����ic��-,eased f�,-o��rhn a bw o�f4l.11% in 02 201210 ��to 5.0111/() in H��Iie seloo��Ild qua��,"twll lo�f201210, a ftlnc'bo�n lo�f sligl��Iitly dec��,-oeased ld&rna�nd foi- o�fflce space dt,ie ���to Uo��ie pa�nd&in�c. Sti1l, a vacai��,�icy ra��[e of5.101'),/�, or bw&,'�, repres&,i�ls an jiid&1111�se�rved o�ffice fl�ia��[ Klpport acid il.JonaI growtIlol�i,, $2.40 Off"Ice Lease Rates and Vacancy Rates 8.,0% Lease Rates immillo40mVacancy Rates $2.30 7.0% .00ml LL (1) %l $2.20 6.,0% $2.10 5�0%4w 0000 m 0 ODOM m $2.00 4.0% m m $1.90 3,,O%> m (D .j 0 $1.80 2.0% r. $1.70 1�0% $1.60 0,,0% Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q220201 Lease Rate($/SIF/W.) $1.98 $2.00 $2,11 $2.18 $2.15 $2.17 $2.24 $2.28 $2.21 $2.20 $2.21 $2.20 $l2.19 $2.26 $2,32 $2.29 $2.26 Lease Rate Change -- $0.02 $0.11 $0.07 ($0.02) $0.012 $0.06 $0.04, ($0.06), ($01.02) $0.02 ($0 01) ($01-01) $0.08 $0.05 ($0.03) ($0.03) %Change 1.0% 5.5% 3.2% -1.1% 1.0% 2.8% 1.9% -23% -0.7'% 0.7% -M% -M% 3.5% 2.4% -m%l -1.1% Ow"; Vacancy Rate 6.9% 6.9% 6�.3% 6.0% 5.7% 6.0%, �5.0% 4.8% 4.8% 4.5% 4.4% 4.,2% 4.1% 4.6% 4.6% 4.8% 5.,0% Vac.Rate Change -- 0.0% -0.6% -0.3%, -0.3% 0.3% -1-01% -0.2% -0.1% -0.2% -01.2% -OA% -01.1% 0.4% 0.1% 0.2% 0.2% %Change 2021-03-16'-'Agen(f-cil�ackee,"% 42%, -,5.5l% 5.1�% -16,,5�% -15% -1,5% -,4 9�% -1 4%l -2,fiage 61 1�lo f 7�4 7% 1.9% 4.2% 4.,0% Source:CoStar S 0�U hHh[IffilhIll Ih I ��I IN ��I �Meyers 01'"fice IMar,k&[Nia�ys��s R.-E S EA Rw C�H h e Soutlili 11,1,1� ay office nizrli(et 'is irdbouiidiiig 'iii� 20�20 W'ith iiew as wdll as �posit'�lve net New cleliv&ries 3,,ve fi��ia��y oul,'11,D' aced a��)sorp�tbil ciw&r I -OV t a���)Sorp�tbil hi I,he past 12 W�th 41,000 si(I jt,ia�re fe&t of"pos���flve �,i&!, 1�I'll 1,000 siqi mre frell uf ��,iew cui�iip��&buis., is ar'l 111�111p� em&i t over �iiega,��t�ve 2019,, a���,id folbws sev&ra�� yeairs wi��tl�i i,�oiew deliv&ries. OFFICE MARKET ABSORPTION VS. COMPLETED SPACE 2501,0010 Deliveries (SF) iiii Absorption (SF) 2010�50010 1501,0010 i 010�,0 010 LL Cr U) 50,000, 0 -507000 20,15 2016 20,17 2018 2019 2020 (1-12M), Deliveries (SF) 31780 0 0 171654 31000 111 1000 iiiiAbsorptian (SF) 167430 20,55578 1365650 83,341 (35,550) 4176018 Source: Costar 2021-03-16 Agenda Packet Page 672 of 724 �Meyers IR,:E S EA R, C�H lol c a W o s "Illy NNW C����iula V�Is,lta I'll 6 'I'll A 2) 2021-03-16 Agenda Packet Page 673 of 724 �lu ululululul �lh 1, 1��E DI IV I............... ........I HME NAAI�����) CAI..., "I'll 8AIM �M e, "y,ers ...........ocat�un IRR:E S EA R, C�H C 116 (1\4 -oxi-nately �flve nnHes east of' (",""Jiva 'vs�ta �H&n�a 1A lNlo. 2) ��s �ocated ��n soutli Sa��ll�'i ill")iegol cot,nity, 8, ��liiiles n(�)irti,i of tlie US/Mexilco lmrcl&�', StLiia'i�'ed ll"Q f:�� "'for R I i i"te s hlitersll�ate 1805 a�nd "n��i�medbt6y (���llast lo�!� 'U,'ie '1125..........toll �road a C', fl,�ie St i ID -e(����hm�iy ac(,����%ess li,im Subject ��s located Wll�h'n '115, i�n )i f I'llaict local I �ect i choice o�f fill C C I I -cliit hl�eas, (3,10hUa Vsta wid ��s wlflqhl�i a 30 �'to of'th(D��ll COLOTty'S ��tO���D cu Hr`)ClLiidh'��ig tli(111111111, lNa�tbnal C�ty and Cl�ii fla Vs�ta 1111,113ayfi, Owl'it(1,wn iego, Sa ...........11)" the Valley/Keanny Mesa area, @licl La JoHa/U 1'''''C. Shl�ice ul�[��lile '11980s, U,�ie COUr''llity at-ea [�llias beet��I'i une oftlie nm'ln ��Y,-ov�c,ilers ofnew 110L I S g Urm San [1,1,1114ego Clou,"ity mgbll. f Ell- "JO/6 I,"W, IN Endbit 4 53'ca,n tzio Of S a IV I Yl hfa,Na ...... ZY, All j FF Y "mji r f Alf "'0 �/Wik am// J111" Ci�.vyal Kell, p c h Statff F j ZJ ��J`,"rJ HL� f JrJ/1 4 r FU F1 /11211rai A/11111 P POP f /�/A'l j 31 IXT/l '1 04 1 J, ........ r V A'A�, Of r g VIA`, w Poll er 1/4 f j/11if" M" C I I d r p tio;i le a v, I Fu,llvl;fm:L j C a i n i o i II, i HeseF a t i n OF ij vm P", r a "N' ISO 400 A Ow OF AA N-A"" war Al r "I ,ON SO filyl/m l/l/l IF ............. le OF P Is de Rxj-s am"', to 2021-03-16 Agenda Packet Page 674 of 724 RATIGNS looloolool k �M e, "y,ers ..............ocat�un A��l�4�ys��s IRR:E S EA R, C�H 10., r 11) -,t Ii e s"z e o Ii e ID u b I ��e a n d t Ii e re n t��y I Ni e ��n ��t�,�I e 9,119 015 z'p (��oiol o d e (1"S U b e.,ct co ron i j'teto worlic,. lr�i e p"ea"t&I I lis, �:-oii rov��des a ���f Woieroe the re§d&ii�ts Wirm ct ji 1 0 "1 11�I Z,i u te t("'o) e r lllpby�,�n&nt w'Ftluo�oii tlie Mlrnl)�,Dr lo�f vvu*H��)g 9,119,15 �,-e§der�its wIi(',,o)l cioi�limiwte "to H i�a t la��,,eao, 46% o���f 9,119,115 resld(� n I'l ks C,01�lj I�r tj� daroli<&r fll���oie c o 1 11 d'�' ��t(11��,�),s c,::i groea,[&� I 11) 1 7'6% ai��fre§�deio�ovts cunmt)"te ("110[ty c�o)��f San ,o)l llxhli��iat6�y '1118%, wu* bcally wltl�ooilroi Uhe C[ty CIIU,`3:� Voc-ta. Afthiouglli sume r(o��11.1§�dents mrootli-nu''11E) as �fa�ip nutili as Oceanside, W[Uoo�ihi�i a 241.ooll,�r�or000ii i I e t-ad�us W,�ooi'KII,Iij 11 9(D��linei4ly trar'is�a't,19S tO [)Oh"')'tS SOU"I'll'i oftllo�ie Uri�v&"§�ty..........I own C&11�ovter/Sorreiq�to Valley arlea. v C,)C N '51 1 D I ............... rd jjINI1 L a",,$; A J,� ............ .................... o1p, "i t la,H"mi/", Oil 9 tj ho �v �J4,A4,0,64", hIr rim prni 11 1 u 1, I In t e f VI'o I I.,�jv� J o Doe ns i ty or t(7,�J ji qpp, d FIR 4p I u a n a W� F I 40 Ij 92 1514. (C 11"I LI 1�a Vis ta)111 Wo�-icflesa��e Tradel;� a�rid '�n g IR eta I ..........1"'r,ade 1,YI�Im loll 9210111 (11o")Ow i1towlooll)j I Ij Y j o,&,,6 —��t, Sbei-itific,V1 a,,� ii,�id I edl�ink;al Serovices�o "IF-VIO 41, j AGO I a�rd 0(`I)C ..Dervzeslo, �NhdJ'ta�ry a����id ................ 1"E" s e 'J' j 9119,111110 (0�1��oiu���a ViSta)1-1111 lu� I iealfli� Ca�re a�rid Sm iM Assiata�nc(�: I (a't-'i i r�a(.-J,e 6F, -V�ces I�1-i c,a Se� oll Sber�A�flc, a��,�id Ted[ 'If f I r E, 9 2"I'll"18 (C o i a d o) "W/ d I o r-i a I S c���e i-i t i fi(,,� a,,� ii,�i d I edl�ink,al Serovices;o �eal oo�' ��,,'Icj a�r�id ���...............ea§h�ig;� a�ii(1 0 0(1 T�1;J IJ t,,,,,[A )"e, Sel-Oces, [1olavy 2021-03-16 Agenda Packet Page 675 of 724 S C l�........... 1111 0 0 L IS 111GOL SCO11"'RES G[RIEAT SC1111111 �M e, "y,ers ..............ocat�un A��I�4�ys��s IRR:E S EA R, C�H emer I MlHer��ila 1A No. 2 wlil lv��iave excell&-vt �qs avall4NIe �1,io reslcleii�ts, St ibjiec�t ls cw,�r&ili�Uy Ilie OLH'idarles o"f Ille �folbwl�illg ls'� -ea�t Scliool s(��x)�,-esj f6r� eacli aria all 8 a scale lil e G 11111111111astlali<e Mld6e Scl,I�mol a,,I�I���11'id Olyri�plwI���i S(111;11I�mol average (113" 1 @11-,e als,o varlot)s dhart(,,�,�)�r aiqd private ratli�ig scal,11911, CUMCIer's �factors such as tes,I scor es aciadernlc progress, eqt ar�id dlscl�phr�ie. hiIi acid'Ftlor�Iii ��to H iese �:)Iul)Hc I 10, 011%S1 sclilio(�'11)ls hili flil'ie area Hi'icl�i d l g l g II I ech B&mentwry, I..........ech I Vista, Ea&���, Acadei-ny, I liMater", ei Cat[�mlic scl,Imol. S, 0,101 -.I.-........ E I Eastlake Middle I jj jj R A,N C H C) 'p� L)")E R E Y IS I W Ot a y R a rI��,it,.'111 lIP'I"'IP 4`......... C r.:) IN to es 61 j r n C'Dii C))/"- 'T A N C 11111 ul Subject �Irqperty Wolf Canyo Wolf Canyon Elementary G -eat Sdiiools 8 rI Easdake Kddle `1111.1':V,�..I I........ Olympian Hig, Gir-eat Sdiiools 8 Qlympian High Schod� �Sl Gir-eat Sdiiools 8 'S C, 2021-03-16 Agenda Packet Page 676 of 7241 0 1 10101010 S 0 1:::o �Ilh lololl cj�lololol ullo lo lo I I I N ["IRIZ looloo IM A N4 I I....L N I A �M e, "y,e,rs ..............ocat�an A��4�ys��s IRR:E S EA R, C�H Al 11' ow'. -iter (an qpen�����aHrlll MilleriJa ��rast&r �,,D]al�ined cor�r�u��nt in�ty al''fers abu�-idar�it slervi(��,,.es all'id nearby,, Ird�i cll�f�141H&I-da �IE��- (Dtay ['Ralwi i Cei�� X-es 131��Iaa,�flks 10 10 -al I ZPC 0111"Idoor ccl�,icer[s)i, Otay I.,,akes ai-id s ll 0 1 1 a ll/��I:estyle caliter anc 's Mth"n waHll(,Hqg di&tance ofgr(��,,)lcery st('��)i d ry (:::%a�� n r's a r'n "),re. Seqp ��,i lieatre 1,11)����Ing rr dO "d I I I I Otay FR,eglona�� are a��so r��ilearby. �................ P EP T1W, REM)?"U MW 5. OW RANMH lo" ull", ot 'ic T IN'l OEM ........................................ "I....... Rq sm lol'o'll,I I III ol ol ol R ul iuiuiuiuii ov�� ll�"'Zvrl'lml ...........ocat�an Al'ia��ys��s �M e, "y,ers IRR:E S EA R, C�H NAIHer��iIa is a 21G���acr(111111. nxed t�se iI,111�1111��ty. da"I"e, rn(I)Ire U,�ian �600 liaIi�ies and "I'll 1,1000 lionies have been cali,ipleted W�tluq MlHen�b In ad6�tlan ��to a AyI,�,,�.:],,s 1 7 000,, Irander-II�ig below ar lid 111130,,0()0 sqt iare fbet lo�f raltaIl al� M I I e I,�i I a C o I111 Ir""I""I U I, I o r�i s/MH e I�i I a a c e,, W I r i cioirn�plate, the conn lit"y COL111d liouse a pqi,wl,abon af oveI HlUs'brates tl���ie v1silloi,i for"tilie C 171 IT Ll I 111[ty at bt INES �ai . .....''I ''WAI 41161 fm®r",/iiiam ......... C lo,iii mi e ia s c ove r" 1111111111111111IN111111110 Punnac e 1 e NUNN,- �en i me t*all I SO A A."t I 11wr-S Orr, PIP, �0', le V o Owl ........ ......— ----- S 1�T l0000,,A N I N IN A C l000000,E Aloollooloo IM l l00000. IE IN I A (l000000.0 S "I'll 2 &13 �M e, "y,e,rs ..............ocat��un A��4�ys��s IRR,E S EA R, C�H ii-s six in 14,����stoiry buHdRigs wl��[Ii coili��i r�rl oil Meridlairi l3egari §��t'e woirl<, oin [��)liili,-Iacle 11 20,111119 and started sales lin 2020. l,�ie 12&����t jr�ilt towiiilq(�')i''ne COil'"IMUnity offe $1 " lioca�ted aloov(���,, Ilhe G���Iy ow n s aind accidessed by .1p 611 0 1 10 a ises C i ty Own 11 a yg 1-0 LI n d a����,e a,, l a iq s 1, 2 3 are Z����st(� i"y "Col 5 arid 6 ai,�,E., ���,,D,00l, bt jilige ar�id s While [��Ilar��is 41 I 1,���iave been lili�teirir4� &talirs aind ���)rlvate elevatoill-s. Accurding to sak,"11.1s da�ta p�rovlded �by tli(,,O�h 1�"Kilildialill-, 11,��ieire wer�e 66 liliornes sold as �Yf C111)(I tcbei, 015, 1������Iowever", addltk nal sales l recoi-ided since that T''Ie and we liave utilized a 111)I�E-il sold o�f.....71116 un��ts as o�f tlhe ei,�id o�f Octol,'O�)e'i,"(,ac0, irqpofted by tlhe �!4bs o�ffK \/Vltl,�i """126 total i,jril�[Is hn the i r�li in a c 1 19 1 S cuirreiafly 60% sold out wltl�i 50 lilior"ies rern&nlng to loe i,-eleased ai'idk�11)r Is',o��d I lhe i,-eSLIl'[lIqg sales pa(��,1111:e-i cu�!" ineaiIy 9 hiornes ��per is three tirnes �[Ile ir�ate oi�f`tlqe lr�ilstoirlcal aveirage a ltacIied cornr�rlt in [l,"ie SOU'U"11 COU"Ity. It is v&iy hlkely al''I't, coi�inimun[ty wl]l easily sui,�I,,1)a S's o fl,-forecasted i-ate ofal,1111)soirl�p 11cliq ff'cut-rei,it rnairkel,,.coinditlor�lis liold. ON P'lay Oro I'Ll/IML ,Af �Ov ol �ool omol 1��E -allEO 1[o3Y LEIMNAIR, (l�0000.o l� I S 1�T ol ol Vld�oo'3E AIV�olo) S 2 2 & 111115 �M ety,le,rs ..............ocat�un AI�4�ys��s IRR:E S EA R, C�H 1�1�13o�th Gbic) ar�id V11,1'1111)e are lbu��lt IDy llii�n�El 1�����ionnes. Vlbe liad ��ts fi r's s a le s re I e a s e o iiii J t fly 115, 2020 and has sold 35 (,''Y�f t[ie 36 un[ts rebased. avei-'age salles pace to date ls ov&r� H units �peir Oiil��vtl�i aind pi-ovld(,,,��Ilpld irelatively slr�i(-Drl SE� 11111"s perud cm Ad teni�per oveir tl,�ie life o���f C�eo �folr salles H��i Sqjitei,�nbiBlY lo��f2020 and accordlr�ig to, datia �,,)rovlded by the Leini����iair salles lo��f'flce, tll,�ie llias s(,,,��)ld as lo�f tlil��m beign illing lo��f Noveililbei". lr�i i s �fli-'s:t pliliase lo��f is ex��,,."I)ec�ted ��to be Coir'tj�ple''Ied in o� '1% ted salles ace ol��f 3.5 ui,i[ts ��per ir�lnointlii --,sl"ght[y M� I -ds .0 0 1 lo��f 2020. �Aillth �,xklll�,,e,.q Starl�ding tli'ie $300,000's (a��f�fordalbb 1,11)y ail��Ili I)'ego Courity s I�.-ii,idail� we havia assigned an average 1,10jec i the gener4l sales ��pace �for eacli ol��f Iliese today tlhan the [�Iils�torlc av&rage gkt&i tl'ie af'�fordable �piJce �pdr�its and coim�petltive leviels. [f were "t(�11), ��i i l i (-8/i,no.) bot[�Ili tlhes,ia (�ll,���l,.oi,������n��i�iui�������iii��[�,,�'l��'es would I)e solid ot it �by the ei,�id lo��f 202,111 Lot--2,2 ........... Lot, '*V,,TRE"'- Rn sm A RUM Iry 11111111 NO M111141mi"ALIST LN 19 OF HIM ..........I',,'',",.........."I Hill NN. I.. Irk, IBM, PAVE1.110 K L N N1 AINI]IV 55" ...................... C= —41 =1 I...................................................................................................................... IME.................. )MMMI ME— ................... 1)NOSIal I m fNNN �Nl am w plu min Npill mil,in W lit IRS ISIM(T pt ...............................- Maim R,ES I D E'N C E 1 R,EVE R S E N1 RESIDENCE 2 M, MODELS RAT ,A4 I SIT[ Sill R,ES I D E N C E 9 ACCESS I BLE z ............................... 2021-03-16 Agetktbiftcket Page 680 of 724 �Meyers IR,:E S EA R, C�H co o, �nc & IeTog: 01 a 31 w eiw 11A C����iula V�s,lta 2021-03-16 Agenda Packet Page 681 of 724 0 1 hihqk��Ui ululull 'IY A N I'l 0 1111ululull' ���\A 0 y M E,N I S �M e, "y,e,rs � Over,Vbw CO 1110 I,�r i C ............1)e Ii,i o g I''ja i�Ic IRR,E S EA I R, C�H A n i1i i ial "ob girmtl,��i had beer��i abir)vie the his:k 11)ir�'Ic C,::Ivelil-age I'm t gbbal I�s forecasted s(,,,��,�Ihe jolo girowtl��i con"Iract 1�� ipor�n a p.&rspective, the loca�� ecmi(�I)illy lr�ia(,,J I the forecas�t �-i adde(IIIJ a�MWa y. I I C; �11.ei�,i 111,firiving fi,�orn 20,1111112 ��to 20,119, aiI 25,0100 ��to 41.0,000 1 11111111w,,'(� bs liave 13eei I HOWvIg th's st ista"ned peri(��)d cl`�� abov&�����average job growtli f(1111)iii- 2020, does st iggest a ig(-Dtabk�1:1. slowdowii w[th an es�th-nated bss of' j.....7'0,0100 new bbs,, ��y is ex�pected ��to s�pHke to 8,,7% hi 2020. 1 W,il g ��t I S coii,ti,,,ac,tioi,i, I'Meti"OStUdy �,,)rc"ec ts a re(11.o,v&,-y oveir tle��Iie next five yeairs, wi��I,,h �11,11 W ive grmth ail'id dec�'H`IIH�lg Lli`. .... I y rn e r�li t. 1001000 12.0% 80,000 10.0% 60,000 0- 0 . 0, C 4011000 8.0% W 0 1 E 0 0 20,000 1 E Lu 6.0% E 0 E 0 01 CL W 100 E U- 0 .2011000 14.,0% 0� -40,000 2.0% -607000 .80,000 0.0% C> CO "I-, U-) C.0 I,,-- CO CD C> CO U-> <.0 1-- 00 CD U- U- U- U- U- CD C) CD CD C) CD C) CD CD C) T- Ir- T- Ir- Ir- Cq Cn 11� CD CD CD CD C) C) CD C> C) C) CD a> C) C) C) CD C:> CD CD CN CD C> C> C> (D Source Metrostudy, U.S.Burea�u of Labor Statistics(BLS), mmm Prior Year Change mmO�Unemployment Rate Non-Farm Employment 11240,192 112507133 11282�800 113161200 113441933 1138401692 114221400 11452)158 114821225 li504J33 11522,993 11550,577 11,576,098 1�5901263 Prior Year C hange (81667) 9�1942 321667 33,4010 28,733 39,758 37,708 29,758 30,067 21,908 (71,173) '901,03,3 27,585 25,521 141165 1�1'0 Diarige 8% 2.6 1.r,�/0 2.6% 2.2% 31.0% 2,794o 2�1 2.1 T,5111',� -14,71� 6,3111lu 1,81% 1.61% 0.9% Unemploymel6n-03-16 Age�O(ff�packtq3% 9.1% 7.8% 6�.4% 5.2%, 4.7% 4.0% 3.4% 3.2% PaPJU2 ofl- �4� 7.2% 5.5% 5.3% I 13Y `z I �M e, "y,ers CO�11 0 C ...........1 1)e o g�111"a Over,Vbw IRR,E S EA R, C�H ft A(I�1,0�bvilJjcic I I li L e s n 1,��I@rdest h[t. OfaH se(11111111.11�tors hn th�ia emnor�l,ly Sa�ili i ego! ��s �1�iegafive g��,�owtli acr'oss seve�11'i o���f t&I i slec torsl X in,e r e�n c n g w 1 sectur adcled an ad6tlonal 71 0 �Irily,I I ��11 I111) p o y e n t Ic caHy ast, 112 ��Iiior vtl,�Is. VvIiHe glob4� &qploymen�t firer�ids liave lbelan lmrd lr�i�t over fl,��ie aat §x nionths, the SL11' �ect',s larget & 1 11 u iled dei-nwid fur,lr�i '11 16JII -ea, secturs On [I'113hi je) have i In't bee�n as hard li�t as bwer� payh-ig sec"tors. iS �Hbs'trated bytilie coi i�1� OLI&I Ig hn th�ia bca�� @11 1010010 710 0 ............................................................................................................... -278 Em -3,9133 -352 -10,0010 -51412 -6p670 -5�765 -61490 '5 -14)72 1 0 -20,0010, E -30yOO,O 0 "a E w .40,00,01 E W LL. .50,0010 0 cc .60YOOO .70,00,01 �-7'011599 -80,00,0 Financial Activities Information Professional& Construction& Education&Health Government Leisure& Manufacturing Other Services Trade,Transp.and Business Services Mining Services Hospitality Utilities Source:Moody's Analytics; U.S.Bureau of Labor Statistics(BLS) MEN 77,112 2�219 25Z 071 7�,6314 213, 235,979 136,451 1 lzl",qz18 5( 491 2,17,887 Corer#Mcntti,(Jun-202(")) Current A4011th(�JLO,�-20191 -76 40''1 623,497 2574,R3 84,3194 216,958 25Q 7()() 2(1050 30(1) 5F�255 2,24,3717 12-Month Change 710 -278 -51412 1.61670 .31933 .14,721 1.70,599 -352 1.51765 -6�490 2021-03-16 Agenda Packet Page 683 of 7241 I ""1 0 1��)El"` MIT 11"I'llu'll) lululuRlull" AT10 �M e, "y,ers Over,Vbw CO 110 C ............ ld[c IRR,E S EA I R, C�H . ...... -atio over 11,10 aiearis nmil-e libs are ira tic), cor�q�)ai"es eim��pbyiment grlmfl,�i tc� t�It)Hdii����ig perr"nits. An Efl���lh i Sailli Diego ll���ias '11.14�ly beei-i an It jr�ider&,�j p p I i e d ll jsIlng rnailll<et. tLlit�ty 't'O new, I ai t ies to a rnarlll(at. Saii I'll �egol INASA E/1���) [�Ra ic, Illas I'Deelin well over ���Aios above 1.25 "nclilcal�la ::�i �I pa' I b,(D��lliil�ig adided dhai,�i hair"nes are being lbuill'.0 I ZE, I C, It -ne U,�ie dirq�) is di"Ilvein by the irecei,it job losses (vlv[��lncli [iave illot ��ed ��t(� "I diro� p t h e 25 equilibIlUir''tj ll,�ie �as�t �nine years, Wlr�iHe flll���ie ft ire isted di�p 2020 1 flay ap��,,"')eair wor iriscill" IC h Ll S'l I Ig deil-nand) aillid tll��lie E/1��) 1-atio Is ex�pected to ��I-e turi'l 10 2021 ��to 2024,,,, 15.0 C=; Ir- 10.0 00 C> C� C=) LO 5.0 C-O CN Cyi CF) LO C'14 Q0 C-� Cy') cl� C-� C1*4 cv� QD ,C- 0.0 m M m 0 -5.0 CL UU 10.0 -15.0 -20.0 -25.0 C) m ";zr iLr) Q0 1,,-- 00 d) C) CN m LO Q0 r-- 00 0) LL LJL �LL LJL LJL C) C) (=> C) C)� CD C) C�� C-) (=> T- V T- v T- It- (D V- C*,j m "I C) CD C> CD CD CD CD CD CD CD CD CD C) C) C) C) C) C) CN CN CN CN (N CN (N CN (N C\l CD CD C) C> C) CN C%4 CN Source:Meltroistudy, U.S.Bureau of Labor Statistics(BLS) '32 9160 1522 919' 151"(") 01,5..........76()981 590�263 1� 1�6,200 1,,344 933 1 1384,692 1� 422,Z100 ,',1 14,52 "ll 5,8 1 14,82,225 1,5,0(jdl 33, 1,14., ih3 "1,240 1�92 1 1�250 133 1 1 282,81 01) 3 3 13 14 165 '9 758 90( 17113) 90,033 27�51��135 2552 1 Yea,Cl-iar,ige (8�6111 7') 9 5 9,4,2 320 7 33AX) 28 733 3 711 708 29 7S1,l) )6..........7 21 1 1 'TV�"S % 1(1),le,44"1 91 834 8 2, "'1 10,3,8'1 31,494, 5il 3710 5 666 81�264,, 6,8""' 903 '10791 311(.,[�l 83,86 10 28,1 9 8,12 EmploymenV 1.1 5.8 4.0 4.2 4.0 3.5 2.9 3.1 2.7 -9984 of 4�3 2.7 2.5 1.,4 �MiP%3-16 Agenaa,Packet Page 4 Over,V�ew �M e, "y,ers CO�1 0 C e o g i��c IRR:E S EA I R, C�H 111���ig pirce i�r����ici,,-eases),. Ct jr�r&nt a�l'"�fordab�T�ty as a reSLI[I i&',vt and Aff)��-dabHlty �r ea(I...........1111.111i,119.,d ilS pealrc, �O�hn 2009 aill-id 2012 wltl,�i steady dem'eases (I I 1 0 11 11he �next �flve is hn the ��)'w Nice), wli�dili ��s c(�"I'�)��l��-n�����",,,�),ai,-all,o,li�,r.-,w� wh(11111).re tlie INASA/Cioi�ji,�Ity was 20,114.,, Moody's &,4y�tics forecasts Uhat Ulie a�!'futabHlty inclex wlH coi,�.......... 11�U EA' [(........... dedine ov&� jj�j 1% -al[y i,��nore a��ffurda�b�le thai,�i the NASA overaH &A tlie attached rimiucts 'n IAH&11,i�a '11A 1'q(� yeat-,c-,; i�:)S- hm i s le )i'll("D�%elS hicrease ff��i tl,��ie area., Ili e Sot jtl�i Cuj�iity Subni@,*&t is gei",iicail by Si@,�i standa��,-,ds., 2 are 1)6(111�11)w$60(1)110010 1125 100 1100 95 95 X 75 80, 78 71 67 78 86 85 82 79 82 79 74 8,0 81 82 77 71 66 54 .6-0 52 — 49 — 47 .0 50 25 CD 0*4 Ul) (.0 r%- CO (n CD C'14 m U-) CO I,,- CO m U- U_ UL- U- LL CD CD CD CD CD CD CD CD CD CD v C IT- It v v v IV-, CD X C111j m 11;j- CD CD CD CD CD CD CD CD CD CD CD CD CD C> CD C) CD C> CD C> C114 CN CIIIJ CN C*4 C1*4 CN CN CN C**4 C114 CINJI 04 04 CN CN 04 CN CN C1114 CN 014 CN CN CD CD CD CD CD C114 CN C11-4 CN Source Moody's Analytics,-National Association of Realtors(NAR) JJ, Affbrdabili� Index 86.2 94.,7 100.4 85.2 81-9 78.9 81.8 79.1 73.8 80.0 81.0 81�.7 '76.6 71.3 66.0 2021-03-16 Agenda Packet Page 685 of 724 10 1,1) G OWT �M e, "y,e,rs Overv�Iew CIO 110 C ...........I ld[c E S EA R, C�H 11�eaily 111111,000 hm iseholds are ex��,)ected ��to 1"')e wided H��i SwI��Ii Diego Coun�ty �ri 2020, rm�I re than girowth sbvved fror�ri 201 71�III20,119 bL,,It foirie('�,11.1,1(axstacl �I,Iio ireboun(11,11 iii 2020. 61 I)LI11"I"Ifle th�i-)O i i i im 13 formiad hi 2019. Uhe drqp �`b (1111111�lhim I 111 dded ��to fliie 1,�Ilo to Reasons h�idude: 01) scai I I pi�owfl,�Ii, t1liere still are not el"110L gl` 1 omes b6'�ii ig a Ising S d<'I 1" 11 bnd,,,� 2) slowiar/sii�mir,t growtli iIi��ien�tali��ty; ai,,icl 3) de(�,,,,-Teasing affordabil[ty,, 18,000 16,000 14oOOO 12po 0 100000 8�000 0 :C 6�000 41000 21000 0 C) Ir- CIA m U") �O rl-_ CO m C) M, U') cc r-_ 00 IM U- U- U- U- U- C) C� C) C) C) C) C) C) C:� Co *r- IT- T- T- T- Ir- IT- T- C) CN CO zi- CD CD CD, C) CD C) C) CD CD CD CD C) C) C> C) C) C) CD C) CD CN CN C\j Cq C) <D C> CD <D Source:Moody's Analytics; U.S.Census Bureau(BOC) Total�Households 110901775 '11,103,050, 1,1181200 111321475 111471,094 1,154,313 11162,820 11163,527' 1,1651,186 11,1695914 11180,532 111811565, 111891409 11200,540 19212,187 Prior Year Change 4 11 722 125275 1151 1150 K275 141 619 71219 81507 708 11658 4)728 M618 1�033 '71844 11�1131 115647 ,,,,A nrxml% (S-"hatl 16�1 0.4?1('J' 1� 1A% '1.3?10" 1,3% 6% 0,.7%" 0�I ir),�I% 114,�,Oi 01.9�?,Ibl U 10/10, 0,71,?10 0.9% 1.051� 202 f-03-16 Agenda Packet Page 686 of'724 CJOIJMI����A[Rl�SON IMAl') DEIMOGI...................\)All Ove��r,Vbw �M e, "y,ers co rl 0 c I,& ............ IRR,E S EA R, C�H �ne,xt s&r�ies o�f ���)ages ciol,�11����)are dernogra�p.h�c tr&�ids aci�ross fiot.ir geogi�,a�pliic areas Sa�,�i ��ego NASAID", th�ia Sm ufl,�i C(�)unty Subi-narl�,e t, tl��ie flilree codes SU'I'-0LH,idh,'ig 111he anicl �Hlie 1\4�11&,iia z"�p. cod,E). #,"Ajuh I weO oulit Jolly Jill S a�n D i�iego Ca��v�nty Sari Diego SOLI'th CoLifity' Subnlliarlcet -rIV 6, A C1 ta'Is a�, v 'M T'�ji Jji a in a 3 Ztp Are a (911191113,1 911,1111191114 &9 191151), Z'�I 1,3 911,1111,119,11,11115 B i�vflLa ric,o n ,Acii els Aj 411 411, Adddfihii/ ddf` Iff/c/d/f/l/w/f ......... A/d/m, .......... Jula vista ......... ........................ ......... [1a I blol'Sy d le c a p a .......... 2021-03-16 Agenda Pac"'k& Page 687 of'724 Source-ESRI 0 U S iol ol ol ol oll U01 01 01�uulR I omoloolool C S 0 1��)U!..,AT 10 N �M e, "y,e,rs Over,Vbw CO�11 0 C ............ IR,:E S EA R, C�H sublect zi��,,1111)1 cod(:1, IS h0l"Tie "'�10 shglr�vfly yot 1��lgla�r ar��id larger li(III)i jselr�iolds rela�t�ve lo San Dego Cou�ity as a Glv&,�i �,-elativ6y a�ffordal"',I)b hior nes �li,9.01)y wid good !1:3clhoolll���Is IC, -e feet ��to 2 522 sqUare feet that ml�i aclu''), od,:ile �:i var'ety of' the shgllit�y yow-iger ��s �to 11,11,e ex��,)ected. �11-oduct flocus un lmr�nes �hrorn 1111,182 squai lor", ser0ced h(�1111)i���i��ies a��so (I,.�hx�pw��id tl,��ie niarli(el to hl,idude -e -&Ureles, Ili e 6(���,.lva,t I C w I Ah� esh, h(''''Usel,"iold lypes (sh�,�igles, cot i�plles a�nd fw��nHJes) `Tota�� (2020) "ll"otM ��,iousel,,ii6ds(2020), 3,5001,000 3,318,139 1,4001,000 31000,000 1�2001000 1,160,,040 21500,000 110005000 2,0001,000 80070010 115005000 600�0010 1 V0005000 494,834 400�0010 500,000, 104,884 31,963 2007000 144,357 29,902 9,13,5 0 MMMMMMMME 0 �im SD County South Bay 3-Zips 919,15 SD County South Bay 3-Zips 91915 e d a A g e(2 0 19) Avg S ze(2 0 I'll 9) 36.5 36.0 4,.,o 3.4 3.5 3.5 36.0 3.5 35.5 3.0 Z8 35.0 2.5 314.5 34.3 34.1 2.�O 314.0 33.5 1.5 33.5 1.0 33.0 0.5 32.5 32.0 ............... .......III........................ 0.0 SD County South Bay 3-Zips 91915 SD County South Bay 3-Zips 91915 Source: ESRI 2021-03-16 Agenda Packet Page 688 of 724 101 0 iolooll oll 0 oil �u�u�u' 1:11R11)0000000��I000000' o' o' 1011) ���1'�CI 0 M El A,N ID N 1"I'l T W 0, ���Iolo) lool000ll,a S U 1")J E C N E I G 111 1 �M e, "y,le,ris o"I Oo Over'Vbw CIO n 0�000r C ...........I)eooi,loiogioo'al�)��ld[c IRR,E S EA R, C�H tli la�re all hg[�ooier in tlooi(:11 suloolect z'�p,, tloian 111"ie COL11"Ttly overaH anc the Sot iol�I III Wh l I le C('''i��l a r i qployr�n eoo n�t, iselirmid lricorn(:11 and lNet Wu, I I j I I COLIRty S1 Jblioiarl<et Atlalni�00000rient, ",o) I -i average lim isiel,�idd HIC('', -age r'iet wortloi ve $1951lK, @-ea st ir�,-oundlng sto.ibjlect deslralble r�ooiature (I tivI�oie cornrnunity. With @11I )m1eI abcve $1 "1 6K ar�id avei �,,Drqperty is hor�TI ie lo sor�rooie o���f wealtloilest INIII)l)Selliolcis in tl,�ie SGUtl"I'll D",I)W"'Ity SLIb"ona�rIKet. c o me(2 0 2 0) Worfl""t (2020) $1401000 $25%000 $120,000 $111 K $116K $200,000 $191 K $196K $1009000 $801000 $81 K $71 K $15%000 $601000 $1 Oopo $100K $75K $40,000 $20,000 $50,0010 $0 $0, SID County South Bay 3-Zi ps 911915 SID County South Bay 3-Zips 9,1915 (2`0�19) 0 c c a It o (2 0 2 0) 70.0% 801.0% 72l.9% 71.4% 60.0% 54.1% 57.4% 70.0%, 65.6% 57.4% 48.3% 60.0% 50.0% 50.0% 40.0% 33.6% 40.0% 30.0% 30.0%, ,20.0% 2"0.0% 10.0% 10.0% 0.0% 0.0% SID Coun'by South,Bay 3-Zips 911915 SID County South Bay 3-Zi ps 91915 0 White Collar IN!Services Blue Collar Source: ESR1 2021-03-16 Agenda Packet Page 689 of 7241 11 �10101) (1111011 )0 w 10101011 ulululull 1110 I 00000�i 1, 1 111 )1111ululull) :: C U��.:R 0 J EI C 1'3YAGIoI���I mIIIIIIII 0000000�i �M e, "y,e,rs Over,Vbw CO�11 0 C ...........I E S EA I R, C�H 25% o���f the tcita�� H,��ie irniIi��ie(`ate �::)qpi flatiior��i segirnei�i"ta ticn�i i i istira��tes a o�f �fai���nHy huisehoUs. h l�E) pqpi fl4flaiil Ilir�ider 15 years of' age wl,,`'1111,11COL111''Is 11 1 "JI -i-'e� P 0 1 -i,11:a area (sub'ec:t 211i�p code ancl c-1.1,odle @�eas). 1*1'11ze'U�Irees CLO "i"fly accot �R���)r th(::11 sil��iaHbs�t p.oi,tion 1, 1 e p lo p i flatiolin, but the ii�&[,J�lree co[��Iort is exp,11:ac 1,�ed "to ex��,)&il ai lice tlie higliest �)Eflr ceil'�'vtage growfli�i ov(���,.ir�I the i9ext���f��ve yeairs (growii,��Iig by near��y 301% over fl,�ie next flv(,,,� yeai,-s). il'iex bigges"t("ji"ow t1i siegi,�l lln�ts wiH� be ii-i the 25 to 34., a��I���Iiicl 35 tal I co 1,�i all il'ts Ulle r�i i,""i i�a iry tai,*g&i: buyers bi,-irn u[ti s tcli,'y �11",')Y//A/,"ge t,20 19) 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% Less than 15 15 to 24 2,5 to 34 35 to 44 45 to 54 55 to,64 65 Plus (Children) (Renters) (1 st Time) (Move-Up) (Pre-Retirees) (Pre-/Retirees) (Re,tirees) IN SD County N South Bay 3-Zips 111191915 C a I'i g e I,,))�/t 0��,).Jo U, a t o y A g e(2 019 t o 2 0 2 4) 35.0% 30.0% 25.10% 20.0% 15.0% 10.0% 5.01% 01.01% JIFEWEEMENEEMEN 1.5.0% -10.0% -15.0% Less than 15 15 to 24 25 to 34 35 to 44 45 to 54 55 to 64 65 Pl�us (Children) (Renters) 0 st Time) (Move-Up) (Pre-Retirees) (Pre-/Retirees) (Retirees) 0 SD County IN South Bay 3-Zips 11119 19 15 Source: ESR1 2021-03-16 Agenda Packet Page 690 of 724 �IAT 1 0 1111� U CA"I'll000l 10 N A I.,.,ATTA I N IM l000l IN olool000l A IN 1`111 0 C C U l�:: �M e, "y,e,rs + Over,Vbw CO n 0 C ............ ld[c IR,:E S EA R, C�H 1, ��f (x��llege edi.xated resld&l'its ll,'ie SoUt,1111 COUITty' SUI)rnarlo�,e't overall. �rest i�[t a lilgher cor�,i( 10��i e a r ea SUrrot��ndhng lMllI&Im ll���ias a c( 1"b-1,3tlon of' resliciile,r�vtos eHm�p��oyed ln wlr�ilte occupatlons @11id l(""Iffler percen tage "l)''f wair-l<,,ers. li e deslr4b��e ��'Iia tL,11-e o"'f tlie @-ea Wll a 11,'U,,ac�t a bil-oald cr�oss o���f Ulle 1,,ely ( bl�ji&�����collar worl<,ers as, cornr,r�it j�nl��[y @11id w1ille the target l31 jyers l4rigely will worl< hi,�i whlte coil l a occi�j p a��t l o in s, a ",."bve C"017"imUnitles are also l"l/ )i a�tbract liilgl�ier well. 0 c c u a t io (2 019) 80.,0% 170.�0% 60.0% 50.0% 40.0% 30.0% 20.,0% 110.0 0% IN 01-01 & 11 MMW White Collar �Management Professional Sales Admin. Services Blue Collar Farm ing Constr. Installation Business m SD County South Bay 3-Zips 9 19 15 35.01% 30.0% 25.01% 20.0% 15-01% 10.0% 51.0% 0.0% Less than 9th to 12th Grad High School GED/Alternafive Some College Associate Bachelor's Giraduate/Pro,fessional 9th Grad e �No Diploma Graduate Credential �No Degree Degree Degree Degree SD County myllill South Bay 3,-Zips 91915 Source: ESR1 2021-03-16 Agenda Packet Page 691 of 724 III C U ilululull 0 U IS i:::' whiq milIN,III � I� I C lolololl I E 111oll 10 111) 1 N C 10 IM E I'l I S T l"I Z I I'll, 0 1. R E N A N D I�R 0 J!�OIIIIII �M e, "y,e,rs CIO n 0 C ...........1 1)e�,il 0 9 E S EA R, C�H �)rfle s e x Ise 'r�Ii aH ii�iconie segn��I&llts above $,111100,000 ove�r the i���iext ���fot years I gll-owtli ��n uie 1'�Iiigl,�iest incui ie l,,,,)rad<et (over SOU'll"'I D'')LUTty l"10L,ls6l'i(')ld ��nc(� ..ct(Z��A to r I .A I �o 1"I"t to Col 11[PlUed dlarnar�Ilid �forI �I��Ii,ll:avlv hou&hlig" $200,1000 p&ll year") is ex�p&ab�,-),d ��to lm s�trlm,Iigest ��n NA�ller�iia's,z��p code (9,1915),, 1"ZJsir�ig li(lll)ltI jseliolcl ir�ic(I"I mes IOLJJ.S&�� o d s��b y c o e (2 0 ll,"i 9) 35.0�% 30.0�% 25.0�% 20.0�% 15.0% 1 0.0�% 5�.0% 0.0% Lessthan $15,000 to $25,000 to $35,000 to $50,000 to $75,000,to $100,000 to $150,000 to $200,000 $15,000 $24,9199 $34,999, $49,999 $74,9919 $99,999 $149,999 $199,999 o�r G reate r m SD County mmm,South Bay 3�-Zips 91915 C ��i a�n g e o u s e ��i o d c o rne(2 0"19�t o 2 0 2 4) 60.0% 50,.0%1 40.0% 30.,0% 20.0% 10.0% 01-01% mm -10.0% -20.0% Lessthan $15,000 to $25,000 to $35,00,01 to $50,000 to $75,000 to $100,000 to $1,50',000 to $�200,000 $15,000 $24,999 $34,91919 $49,999 $74,999 $99,9991 $149,999 $1991,999 or Greater SD County South Bay 3-Zips 91915 Source: ESRI 2021-03-16 Agenda Packet Page 692 of 724 0 U s i:::' �11 �Ilhl\ I 10 lo")s !'�1,3 Y N "I'll W 0 1"I'lulu)'oloolluo", �M e, "y,e,rs Over,Vbw CO n 0 C ............ ld[c IRR,E S EA I R, C�H ll,��ie area NffbJ�iia ty�p��caHy 1���ias preatall- liouseli(,�)�(,] wealtl,��Ii -i higl,�i nat����walh hauselioUs, Atliot igl,��i fll�ie SOI I��t 11 C �Iyp�cally bgs Sall'i i ego Cown�ty hll� C�01��j I��r tj�U I�i e s w't Ili �n e a s t E)il,11 lcorn�par�ed to U,�ie cot inty,, ��,�iet m suggests that bcal I'll",Lilyer's wlH have funds avaHall)h1�1E). �for�down pay��7�ial�its and acimn tuates tli(111�111111, I (,,"1101,��)Ua Vsta. 110 U),s e["'t,o d s y �",,,J.1 e t:W o r t (2019) 35.0% 30.0% 25.0% 20.0% 115.0% 10.0% 5.0% 0.10% Lessthan $15,000 to$34,999 $35,000 to$49,999 $50,000 to$74,999 $75,000to$991,999 $100,,000to$149,�999$�150,000to$249,999$250,000,to$500,000 $50010,010 $1 5�000 or Greater m SD County "Yoss.S o u t h B a y 3-Zips 91915 2021-03-16 Agenda Packet Page 693 of 724 ol 111 1 1 1 ol ol ol ol ol 111 0000000ll 000000loll ol 'I'l G C ul lulululull �Ilhl\ 0 CA 1...A 1�"R E A I S 1�1................1 0 IN C 1�ololololl I 10 N 0 f... s �M e, e,rs &ASIAIN 111111111111111OU&I I lal..Jlolll) CO n 0�"Il���C ............ �c Overv�ew IRR:E S EA R, C�H (',""Jivays�ta a�ncl ti ie )i d s���i sul),"ect p���qperty brge�y rnHr��,�or u,�ie diversity o�fs@�i ego Cowli�ty,, chart [,,111n Ulow by race 1"ul'�Sw��) I�tage, natbnaH�ty, hneage, ur�� �)e viem��, ,, ) I -a eci ac tl'��ie h&� v��ie p&rcll�&����Iitages ull'i ��th's rt exceed 1100( �011 C I a"LIISI(D�l urJgh�i c. [1,1'11141ego County and ('111"Kill" lc',Iel,,�fl�,�ied coll"T"I'l�[''arison areas. 1 0 10 country 0��f blrtl'��l 0��f the persimi ull�' ll,�ie pm,-son's pa��'&,its or a�lices�tolrs ID&f(,lYl'e @"r�vhnlg in [[�m Ui,uled 111C)tates. E)qp�e who �cient]��fy as [,,,,athio, air S���"I)ait�sh i'���nay be ra(1112. by R,acelElthr",�,,,.�",��c�'I'llty(2024) 70.01% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% WMe Alone B I ack.A one Amerl'can Indian Alone Asian Alone Pau'fl'c Islander Alone Some Ot,her Rwe Alone Twoor More Races Hispanic Origin iim SD CouNY So,ut h B ay 3.-Zip'S 91915 2021-03-16 Agenda Packet Page 694 of 724 �Meyers IR,:E S EA R, C�H 0 s a Ove ew e n a 'I'll A ol. 2) u a V���s"Ita 2021-03-16 Agenda Packet Page 695 of 724 13 ol 0 0 u iN I'lool"lly, 1��E UIIIIIIIDIdNG [���)EI�RIMITS SAN C �M e, "y,ers + CO�11 0�,,r��i C e o g�111,,a Id�C Overv�ew IRR,E S EA R, C�H I -o �peir,nii�t issuai,''ic el. sail��i i eg Cot �iias averaged 7,883 jn"ts plei, y(���,air �fi rl�ii K1,10 ��to 2019. Ili e jec"ted tata�� r 2020 is 9�700, iililts w��flh bo'fl,'i �,,)Eflr�rni�t counts ar��,,�d peirimi'l cot i rrl s a ri I i n rea se oveir 20,11119. Wlvl�ille Moody's Analyfics ��s brecas,tlill�ig anather juii�ip n peirrl�nits In 2021, we ex�pec,t tl,��iat t[iis r�i,iay cl, I �� C1 I I 1 11 -d a s o e b i jHders have pt,,fik���,d Soir''Ine af"their p.�ainr,�,Iiacl 202,11 cliosir��Iigs ii�i�tci 2020 No�t dt�e to den��iand sld(,111�11)hl �`SSUes a�j,t due "to Sli�c�le cor�isl�trahn�ts. We hav(���,, heal I st i�p p y c II�li a i in I in 2 0 2,Ill l lkee��,) qp wi�tli dernai,id and �,iat IaH� I,I�Iiave �at iinver"i"t()ry irqobin��sli then, 20,0100 18,0100 1670,00 14,0100 (A t E j1 2,0100 CL .zi 07000 81000 61000 47000 21000 0 C> CN M IU-) cc r%- 00 M C) M LO cc PlIll- 00 0) LL LL �LL �LL LL (=> C) C) C) C) C> C) C) C) C) IT- T- T- T-1 C) v- CN CIO C) C) C) C) CD C), C) C) CD CD C) CD CD (=1 C) CD C) C) CD CD CN� CN� CN CN CN CN CIl (N (N CN C) C) C) CD C)� CN C-41 Source:Moody's Analytics,-U.S.Bureau of Labor Statistics(BLS) SFD Bu�ilding Permits MF Building Permits Recession 111�1111 III I 1�1 11111 11111111111111111111111111 11 dill 11�1� 1�1 111 11 IN 111111111111 iiiiiiiiiiiiiiiiiiiiiillillililI 111111 11 11,11h11111111111111111 'T'otal Building Permits 33494 5�370 51666 811264 61875 9�883 10,791 101)441 91834 81216 9�735 121350 13�249 13)294 13,457 /1, 1�(,I Xr, 9-2% 2% -5,8 1�lo 16,5% 18,5%) 2 6.9%n, 7�3 0.3% 1,2 01�,ol Anni,ial 110 Change 18,6% 5 3�71AI) 5,5%, 45,9% 16,,8% 4".(31,11 0 SFD Building Permit's 21270 2245 25197 21565 27,487 3222 25351 41056 37489 311019 3,1207 41869 61406 61389 6242 "I i,-,1 (1)(v I 01 -Ol,% -2,3% Ant nial%Diange 27,7% -I�1 101/0 -2,l''1 16,8 0110 -3 1,0 29,6% -2T10% 72.5% -14.0% 4 3,5% 6.1,,' ,'/ 1 110",/0 31.6% 3 MF Building Permits 11224 3 P,1 2 5 31469, 51699 �411388 6�6I61 89440 61385 6,345 51197 6528 79481 65844, 6,905 7,215 Ol 9% Anr?val% '�acke't"-'%l 11.0 5/ni 64�3% -23�0 X, 151 8% 26.7% -24.311,16 -0.6 5,10 8.1 Page26 of 7 J4 61') -1,1% 4.5% Skf!03-16 Agendd" ol oi oi R 11 �Ih SAN I'Ikl''''GO COUNTY1141000,W MA lulu"RuZ I< DS �M e, "y,ers �\AaiI��e't Ov&�,"V�ew IRR,IE S EA R, C�H New Horne Closings, by Type Existing Hame Closings by Type ii�Jew at��id exis�th(i halTiei ic�iios��i,��igs (at�tadi�i&J and datadhed) iiq Sai���i �')iego COL11''Tty' I�ii 9 15 Yela r I otai 15 Year Fota] clanicad ar-OLInd t�,'''ie a�mr��< ov&r the pa&t six yearis. .....I his actiV��ty rai�ians oil far previOLIS i i iarl(at higlis (-6,11,50(1) t jni�ts �n 2005) ibl��.r[ sligl�i�fly aiDove tii���ie 5-111, year avarage of 36,36'17 uili�ts,111 ON1. P�j i�iiiiirritecl �iand ai���id �ncrea&111�1'19 III"., have created a need �fora grea ter, CI MOLPq I af attadhed ���,�iew hai�ie bu�]di��,���ig -i-- "to generate gi"eat&r leveis af afIfujdEaiA ilim,,i s 1�11�1�1 g Over pa&t 1115 years, 5T%, af S-an I'Diego Cot i vty ��new hame dosi�ngs ii���iave been at�tacihed T[��ie ex�s'tii�'''ig marl<,at h can bra&[ is af approxi��,Y iateiy V1113 at�tc,adii���i�ed nii�ts and 2/3rl,ds,detached hoa�ies. mi Detached Attacl,ied im Detached Attached 70-)1000 $70050,00, ��0/001/000011 I 6011000 do 000111000/1011"1" $600,0100, 0/0 01111111111110 5011000 z $5KO1010 a) E m 01 40,000 /011 `uL MIMI $4-00�010101 30,000 0 UU $3000,010 C cc 20,000 0 $200�010101 10,0100 0 $100,90,0101 ll QD CX) CD C) (.N LO W, r- CO 0') CD CD C) CD C"'D T�-, T-I T- T- It- T- IRV-- Ir- T- C) C) C) C-) C3 (D CD C) C) (D C) CD CD C) CIq CNA C-14 CN CIq "l CN, LN CN4 rN C'Iq Source: Zonda,Meyers Research C) 2021-03-16 Agenda Packet Page 697 of 724 11 ol ol ol I I ol III ui�u�u�il lllllllH l l,l, 101 S A N 1" 1 G 0 C 0 U N TY' — T 0 0000ll000A L N I ol W 10 �ol ol ol ol CLOSIINGS I[o�lll Y ''YlooloolAIR ANID DETAC1111111111 �M e, "y,le,rs Ov&�,"V�ew IRR,E S EA R, C�H a�,"e. a, p�,-emLIS niarl<et hig�,�Is. 111o",I es�p��'te New HomeClosings by Type *ell I�ew hior�ne 6k,1111)&hngs h��i S@li f�ac�tiu,,i o�f' fl,�ieh� ol 210,19 Hi-icrea&tig deflm@lid, �@,�id st,,i�p�p�y is 0(IJ [111"OLIghOU"t t1lie reg lurl i a �i d s u p p y Ili a s typicaHy r&,,��nained bdow ld&i�iand ��evels ov&r the pa&[six years.. 9 lmde&t 73 Lifln�`LS were 31,75,6 ��,���iew lioi'T�ie ck�I'Dol Is �,�i Sa�n 1,11,11,I)Ilego (,'.oun,ty hi 2019,,,,,,,, U�p a f�-,om 20,118. ''I Yea r1111111111:to d a,te closings mi�it eld Ithe dr�iar�t bdow ��-ep,�esei"As da,ta 'thi,-(�11111)ugl,�i At igi i&t 2020. Yea r1111111111:to d a,te dosh,igs are la�pproxohmatdy 300, Wlil"S Lflqd&,-the �evd estabhshe(��ll a't,iiil��',��e����llisi�,,,i�ll'T"i�e e rnarl(&t con�hl'acfiion a�l: flhe b ' g ��-f 121(1')��'O (dUe "'to flie �pat-lidel,�rlilc' m Detadhed 210,119 1 egi�il��Iii''�om'i,.l c�), is Aftached cou��qte�rl)a��a���i(��ll,��,��,e,d with �r�flgher demaiid �Uhrough fl,�Iie sul,'rlitiier and il`[ is, hl<ely fliat 2020 wdl &illd a"t a s,1 rli i I a I eve uf 2 0 8 a n d A2 019 169000 Wool 12100o 0 109000 E 0 8,1000, 61000 0 41,000, 2,000, 0 (.01 CD CO 1- - C.D CZ), C.-) CD T (Z) (Z) CD C) (Z) (D C) CD ICD CDI CD (=I (Z), CDI C> CNJ CS4 CN CN CN CN (Iq CN CN C114 CD C\1 Source: Zon e e r III SFD1 New Home Closings, Attached New Idorne Closings hhTT-M Xgenda Packet Page 698 of 724 I'lu N lol)IS (S D S A N l" 11''"G 0 C 0 U N TY: N E,W A,N D E X I IS T 1 N G 111 1 C I N G �M e, "y,e,rs Ov&�,"'V�ew IRR:E S EA R, C�H -��Iiod&rated ' I �I ��n recet"it ye&"s "ll"'Irie s��IiJft 's riot a rlest ilt of(,Jedi�nhng va�Ws, W[iile New lilo�I�Ine �ptidng exc(',�,'�'.lpld,ed ;)revious tilarl(,et 1,�i'V,is in 20115, iII'neldan new 1,io��III'le ��'Illl'lcll'lllg but t�h�e cm iposifio��Ii� and bca:bb�n I tIiew lhc)�rne sa����es Mtli'Hi tlie County., [�lli 201,1114. @nd 20�15 detac-,.lied new Imme sa�eswere hl'II'i Coasta�� �II'tl@111111111(ets I' emnt dosings ail-e imore Hkdy to be rnore ail'lfo��'�dable a�reas SLIcli as �lqorth Coutity, 1"Il��'�",ast Coutity ollid, Swout�[Ii� Cou��'Illlvtly r 1 11 1 1 1, Cu�,-��'*&qt inew detad lie(J �rnedall"Illi ��s,just u�nd&ll-$714.0,000 for a new lionie Wtli� tl i e )lill'eviolus �,narket ltg��Ii� ol'$91 0,,'l 11001 �h 20,15 III � I Wlh h��I'Ntled �lliew hnvl&�I'llvtory aind ltgli dernwid levds, we k��Iiow 'U,Iiat new lm��Ilne p�'III'ces aire rong.l. exsfikrig [-�ol�ne rrarket ha!'�3'� preVbus rnail<et [�iighs I (im, —$655,(l)OO) @,�id ��s �'�Tlore r1leflecfive of flhe loiroad&'* �"Tlai,'ket $01 11000,0100 $90U100 $8KO100 0 E $700,000 0001/1001/0000/11 $600,0100 ........... $50090,00 F/Ol/0/1001 0/ $400�0100 �z $300�0100 $200�0100 $10090,00 LO CO lr'- CO M, CD CIA (n LO (0 CO C.) C:) CD CD CD .11= .,,I- C) C) C=) (D C--) C-) C:) (D `5 CINJ 04 04 (N 04 CN11 C*4 CN4 C114 CN4 C114 CN 04 C%4 .1- CD Source: Zonda,Meyers,Research 1014MMMMMOSH)New Hurne Price S F'D I E x i s t i n g H o m e P r i c e 2021-03-16 Agenda Packet Page 699 of 724 10 10 10 1 1,uu N lol)IS (AT C 11111"I'll IIIE lo�ili) S S A N 1" 1 G 0 C 0 U N ITY: N E,W A,N D E X I IS T 1 N G 111 1 C I N G C 0 IS S A �M e, "y,le,ris �\U�11��et Ov&�,"'V�ew IRR,E S EA R, C�H 0112 'rlli IS a�n ["ll Attaclied �aricesl halve lbe&ii mi a stea(JY �11-ise s�nce 20 1 .1eigo County 11`3otl'li the new 1,liui�llne la�nd ex's�btig liorre pr�ce exceed p�' ms 11I.Illik"e t��he detaclied new liorne rnarli�,e't — pr�ces iin t1he attad�,Iied new hu���ne �11-mrlii(,et lialve �111111lemiifly filie attaclied mairke'[" dip is Hkely (,�3 �'�esu[t of 'mcu"'qp�ete 1 1111 -����ces on a �jo'11110��J�b[ily [e)las's have exceed $565,000 ha[f datia [Data for pa�l-bbl yiea�11'11's tie�l��Ii(ljl cE">' to ''fluctuate 1,,)aseld ullithe sizes New attached rne(J�4n hume p�, r I I t[�ie yea,�,%Ihilto-ihldate datia slet ft��s �iH<6�ytlliat once a���� data '6 tablUated flhatth��s, �Iiu'�n]Derll [Tleets ul"exceeds 2019's $559,500 ite��l'est rates ��iIi�e �11'redbn Sain Courity la�fta6�lied exis'b�ng recorded �ii 2019 was $43.0131150'0 ,�,�,�,�,�,�,�,we���� all)ovie the $4.15,()001 estall�l I in fl�,Iie �ast cyde (2005) [lh.cm 6, 1 �1111 )1 Is @lid sq�,I")��,)�y ail-le contit��iuikng to �,,,.flace �,)ressutllle u @nd we atifici�,,I)ate fliiatthe �iiiedbn exist'Hqg detached closi�iig i�n 2020WHI sur�pass $450,0011" (1,1)1111 $600,000 $5,50po go 10 190 190 lift 4W 40 to to $5,00,000 40 low, Wm go 100 $4.5,01000 10 '00 5 0 00 60 MAN, 00"1/001 so 00 II/mol ARM,, 011 MAP INN), $400l,000 wa,�' wa,�' 11111111 11111111 11111111 mm), IMM" 40 ft 001 01 10, 4%1 10 O/A`001 1/01 $35IO�000 111(k)411e, am OP/1 $300�000 It* INN, A/0 Z: 1/210 $250�000 Ilan "o) vom '111"', $200,000 $1 50po $1 00po LO CO M, CD CN LO CO CXD CD CD C) V— IT— IT-- CD CD C) C') C) C)l C-) C), (N CNi CNJ (N (N CD (11%4 CD am -tached Existing Home Price Attached IN le,w H o m el P r i c,el At Source: Zonda,Meyers Research 2021-03-16 Agenda Packet Page 700 of 7241 C l�"moilmool 1y 01 111 ''1 :::, UUUUUI "I'll U A V I S 0000ll000A oloof 0 TA El X 1 IS I 11�G A N D IN W 0 M E C 0 IS 1 IN G IS B Y A I'll, �M e, "y,le,rs �\U�11��et Ov&�,"'V�ew IRR,IE S EA R, C�H le, New Rome Closings by Type Existing Home Closings bIy Type [��i e fla Vista exlsfir�ig i el i ial,llket �.(:; IE�3i'�g,Fely a cj&U�11)cll� hot 1&"�'�Ig 115 Yea Fota�� 15 Year, Flotal 1)ut �new SLJ��D�P��y is la�mos�t eq.iaHy welgl���Iited between a Itadlied at��Iid d(���,.��[ad'�ied 110 tl'l S i�1'1 g 111/,15 0 0 0 '�'�i 2()11 to $5,75,000 li e medlian ek�stflilig lioal�ie 1�ias smil"I'lle('111 frurin in 20,111119 (a 66.7% '�i�mrease). I -ound Ulm 3, -k fo illl� t h le OveraH niarket dos'ng vo�urine lias liolviered &I 00011111111111i j n[t m a �past five years. lllllm�-61�ed st.q.i�ply '�'s 111�lely to ��'-esult in a small (�'Ilfi�p u1i 2020 desp��te ii,icreased deaia�nd dU1Jngflr'ie pandeni'ic. A I -m)r1<et was doskig 5,300 Lfll�t& If add'itk'�)nal "ts h6gll, thile, Cl"Wila Vista il I [�iul�lr lie st lj�pl)[y '�'s a("'ided to fl'�ie rnw,"11ket, we ar�iflclpiate tliat new 1'�iur�i�ie dos�ngs U)Uld ii,icrease espiec'41y �f new 1) oduc-t '�s atta'���'�4bly �pr��ced,, im Delcidhed Attached Detached Attadged 65000 $70,011,000 (0/001/1", 55000 $16001000 pp/0"' 01"Ieffe" 0000/00/0110111 a. wo M 'P, z 4��000 $500111000 4) 11A E % 1#10 0/0 PRO LJL $400171000 10 3,1000 29000 $30011000 ih m ME 0 EIN I�000 $2001YO00 06 U_ U) 0 $100111000 U') col 1�-- 400 ml CD CN cr) (I.) CAD M, C) CID, (D C=)I .11� r- N- .11� Ir- C) C.) CD CD C), C) CID, CID, C.) ('-D C) (Z), C) C) 014 (N CN CNII C,4 04 (N Source: Zonda,Meyers Research 2021-03-16 Agenda Packet Page 701 of 7241 C ily Ol 011 olill I I ul�ul�ul�l 01 o I "I'll U A V I S lolololl 0 TA N lE W 0 NA lo,IIIIIII� C 0 IS I N G S lool,3 Y Y A 11�Z ATTA C ioolo) A N D lololol)IoIIIIII�l TA,Cillai E loo) �M e, "y,e,rs �\Aall��et Ov&�,",V�ew IRR,E S EA R, C�H New Home Cbsings by Type ve, At [ts lilg[�li, the Gh�u�a Vista new liorne rnalll<at ga,-�,I��i&I-ed 381% af lo�tal [�lla ising I 20,19 doshligs (6stHI�ig 2,0,1'15),, At ��ts 101wes t i ��t 11 ��t[�li(:1. new hai��ie account for"t is"t 9% o�f tatal ('��'Jos��,llgs (2015),, Tlie 11 511111111111yea,-�average is 22% j Y. u"i r'ecallit 1/1"" New lhuli��ie ckl,)&'111��i(,��ys hll���lli 2018 an(�,J 201c') were th(111�101 lol-est (dec[hihig r�-ivantary '�s hdd'H�ig [)ad<,, i� Y b. .... il�iew li(�',',,Arne dOSHINIgs (3100 attached and detacl"lied UllitS I eall ci atel., s wel�� -c ed over flilie sarne &,Jold in 2()"ll 91, r���ie 577 Un"'Its rec(,)���, I lbelowfl I iin Detach�ed Cli�fla Vsta �,���lliew 1,�iome ldb&'�lngs 21020 Ml hlk6y fa[� short of 2019 &6s bUt Attached alDove ��evels recorllllde(�lllli hi 20,11,14, flh�rough 201T, 23500 ,2�000 0 1�500 E 0 1000 500 0 IlLr), QD W, 0) CDI Q0 l�,— (DO U) C) CD, <D 4=) CD C> IT— 1". Ir— C.) Cl) C-) C) C) C) CD C) C) CD CD� CN Cq C114 CsJ CN C,4 C%4 CN CN LN rq CN CN C%J Source: Zonda,Meyers Research 2021-03-16 Agenda Packet Page 702 of 724 C 0 1 011 1010101 �Ul UUUUl W A N III olll X I loololl N G 1�'l I' I C I N G (S f�`�Iol "I'll U I....A V I S N �M e, "y,e,rs �\U�11��et Ov&�,"V�ew IRR,E S EA R, C�H ll g I j&r bts ��to [��iig�hei', d&����is[ty detaclilill'''iecl 11OLIS]r''Ig., 1:�)�[-iorl-to 2006, new horne oiafluns ir�i th�e GhLlla Vista As tl��ie Ght,,i�b Vsta r��Ioril<et is �lmatLll` is silii�fti�ng fium -e feet.... ......I he re&dti�ng r�nure a��ffu�,.(Jal le ac(,l.:,.l w&re ty�p��cally un lols ov&rl' 51,000, sqUare feet I h e ji��( o��f new hor�,�lie ipirodi,xt ��s r�iow or�i Ilots &�,��naller than 5,,00(11) sqt o� ipr��ce 1)6�ats are �,,(eeping rnedian dle'tadl,''ied nut llmi'ie vaiLles bdow previ,�OLI.S. !��Inarllll(,et [��ii,Ye��is le" The G�,���iula Vista ex�stii,��ig lm�,��re ima�rll�&t �provldes til���ie 4rgesta�nd iiNe s�ze a�r�id �[][il&,,-&fore is the r iost r&flecb�ve o�f ov&rail rn@l1(,&t 11'3ased on� yea data,, Cil''IL11119. Vist(,�3's exis�t�,ig n��iarlll(,et is exipec�ted "10 til'��ie iprevv,js e&tab�Jshed ��n 2006 �11'e@,- ��to dal�ll(�:�)I, th�el, med4n Vsta exis�ti��ll�g C d&tadhed ciosi�ng is jus�t ovi&r$&I'll 8j"ll)(DO exceedhl'lg t[��ie previ�ous uf$6(1)0,000 �ii 2005., $80,01000, $700,000 0/000011011111 0 $6001,000 r ` IN E $5001,000 :5 r/o/o/o/o/o/o/011", PDX Fill V0111110111111111111, 0010 I 00/0 $40,01 0001 '0 z $3001,000 LL. 4A $2010,10001 �$1 HMO Ln� (0 00 m ILO Q0 CC) M. 0 C> CD C) (=I C) IV- T- 1�- CID, C.-Z> C) (D Cl) C) C:> (D (D CDI C) a) C) CN (NJ CN (N CNJ ClIq CN (NI (N CN4 CNJ (N ("N CN (N C) Source: Zo�nda,�meyers Research mmmmmsFD,New H�olmie Pvlce Existing Honne Price 2021-03-16 Agenda Packet Page 703 of 724 C 0 1 011 W A N lll,olll X I loololl N G 1�'l I'lz I C I N G (Aoloolloolool looloillooloA C D IS,A Ei S "I'll U A V I S oloolollooloA N 0 IS �M e, "y,e,ris �\Aall��e't Ov&�,"V�ew IRR,E S EA R, C�H The aLtaldhe�d ex�&ui,��ig �'iame r�liarlll<,&t and ie ��i ialll(at liave 4r,gdy bralided in tandeill. -ecess�c n., The aLtaldhe�d ��new ha�ne rnarl<&t h6d Cheir valLies s��gr��lvtly �Uliaq Ul���ie exi&Lng �lmi i�e i rmirll(e't durllrg the �lli 11. The new ha�ne marl<&t �iiareased 63.7%, �f�ru7n a ni�iedbn �price af$290,()'O'l C) ��n 2(1)12 $4 7417 5 0. 1,, 1, 1 lic"., risi�ng lcais�&laatlyi si�nce Year "to cla tie,, Ulie ila 'Vsta ex��&b�ng a[tached dos,Jng is, $440,00('11), �.,ip $30,00(l) �f��I-orn 2(1111)19. olooll he ri�,�nontlily ri�nediaI���'�� exi&bng haIT�ie �1)11�rice 1 3(; �be.& C,, 1 ie cal�isist O�nsi &i.igge&t that 2020 Ml easily surlop,,�iss 201191 ,,J a r��i t iall-ly I I �,ln JalUary '['o $44410(l)O i�n J�.fly., T $5%000 $5009000 SO 04 00 go go OL $4-50�000 0% 40 101 0/0 U) 110, 0 $4.00,000 OF go 001 SO* $3501,000 Im O%Wasao NO,'01,1111 lob $300,000 "PA, wo Ol fffffff� va, 1/09 �z llkf $250�000 401)) oMIj oO, Ij 11,11111111 HIM, 11111111 Owl 11111111 flffffff, 11111111 flwim 11111111 111111a Imp", Imm"ma lovj"! Ahv off"j) (f,,Jjjjj, mox 1XIM, < $2001,000 $15%000 $100,000 LO (0 CT) CD CN OD (m CD CD CD CD Tl- IT- N- C=I C) CD C)i �=l (D C) C.) CD CD C) C=I (D C-Di CIA CN, CN C14 CN Clq CNJ (N. 04 CN4 Clq C-D (114 Attadhed New Home Pirice Attached Existing Horne Pr-ilce Source: Zonda,Meyers Research 2021-03-16 Agenda Packet Page 704 of 7241 l:::) ��::R l\A I S 10 Rll�y S A N 1'o'o)1 G 0 C 0 U N TY111 S 0 U T C 0 U N I Y A N loo) U!..,A V S TA 11"'JS A l00000, I I S I �M e, "y,e,rs �Iqa��Iket Ov&�,"V�ew IRR:E S EA R, C�H SAN DIEGO COUNTY CHULAVISTA SOUTH COUNTY Year Buildinq Permits(1), New Home Sales(2) Building Permits New Sales (2), ror�n 1987 ��to 20,11119, the SOLIUl"I C(""t,,,inty nia�rket 11��md a to�tal o���f 141,13,028 new Ratio of Sales %of %Of SF MF TOTAL TOTAL to Perm its TOTAL County TOTAL County hui�ie sales, 011, C,r i avei"age uf 111�11-'111,3100 r�iew i r�ie sales lmi- ye@r a�nc.l 14,,,0('' 1\41 S% I ged ov&j. 19,80 6,254 6,913 13,167 407 3% a es av&ra 2�8,00 i p)&1- year at �Uile peal( 1981 3,915 5,0183 8,998 77 1% 11999 20()5 1982 3,735 3,818 7,553 192 3% 1983 11,052 9,729 20,781 483 2% 1984 12,318 20,862 33,180 1,200 4% Since �11987, "I"'lie SOLrt,1��l D")Unty averaged '1191X') o��ftotal County 1985 12,890 25,349 38,239 988 3% ���,�iew �iior�i��ie sales a�'Id :)eall<,ed at 371% 2018 Wth C1, lacl<l 11D���ehag 1986 16,585 27,545 44,130 2,076 5% 1987' 15,466 15,143 30,609 14,253 47% 1,028 3% 2,124 15% developed l�n rl'iec&i�t ye@,'s, the SOLI'til"I COUlty r�na��'Iket has or�ily been 1988 14,749 13,803 28,552 14,897 52% 1,370 5% 1,387 9% del��veitqg ar�i av&rage o���f ��i,��Jmm925 sales p&,- yeai, i�n the pas�t 5 years 1989, 10,856 7,854 18,710 10,425 56% 1,680 9% 952 9% i�:R� 1990 6,652 9,01810 15,732 6,842 43% 665 4% 681 10% f�)c(ar�it� sa��es 1,1111�,&qds [&,�id to be Lip w'''id dowli based u7� the a��TIQ I r�l��t 0�f "'""' 1991 5,3,65 2,526 7,891 6,817 86% 811 10% 677 10% 1992 3,812 2,259 6,071 5,805 96% 560 9% 648 11% hqv&atory in the a�i@111(etplace,, I lhe �1�iun��iloer o���f a(��,,,,tive 1�,�)I'IojectS witliiii San mi"111 I'l�ago 'OLH il,�y &�qd the Soutih ( t &.,ilDin@1-,l<&t have been or��i lihe decli�nia 1993 4,229 1,521 5,750 5,397 94% 440 8% 621 12% 1 1 C 6� 111"'F 0 Ll 11��y 1994 5,236 1,707 6,943 6,013 87% 1,164 17% 838 14% iti rec&ii�t years 20,1�191,, sales activity slowed to '11,1541, sa��es in tilie 1995 4,765 1,868 6,633 5,482 83% 672 10% 840 15% Ympr��se t�i e d ' d 3,11% (111�)��f ov&,.all coiirty 1996 5,831 1,017 6,848 6,064 89% 948 14% 891 15% SOUti"I CIOL11"Ity, 111111K[t StlH C( I C 1997' 8,236 2,903 1M39 8,275 74% 1,050 9% 1�127 14% the secior��id hl(�� iliest calptu,,e r'ate over' 'the ipast, decade despl�te the dip hil 9 1998 9,0112 2,879 11,891 8,413 71% 1,346 11% 1,655 20% saies. 1999 10,070 6,225 16,295 8,307 51% 2,561 16% 1,999 24% 2000 9,287 6,305 15,592 10,824 69% 2,639 17% 2,779 26% 2001 9,3�77 6,028 15,405 9,417 61% 3,613 23% 2,8013 30% As diniin�sluqg iand avaHabll[ty tenilmrs the n��, o���f sa��es, it is a��so 2002 8,880 4,804 13,684 11,957 87% 21250 16% 2,890 24% Ig suloply to, grea��ter d&nsity. Attached hor�ne sales arle caiatt j r,i n g a 2003 9,758 8,273 18,031 13,242 73% 3,143 17% 3,347 25% S 1� 2004 9,122 6,465 '15,5,87 15,505 99% 3,301 21% 3,96�5, 26% grea ti�er 1�1)ercei i'tag(.:1,, o���f well-call sia��es ii�i 20,18 a�,�id 20,119 new a ttached sah�,rns 2005 7,576 6,730 14,306 13,5 17 94% 1,636 11% 2,188 16% 2006 4,743 4,448 9,19,1 9,477 103% 1,180 13% 1,56�2 16% made Uj,-) ITOI-e tli���ian ha[f o���f ail new loim��ne sales hi�i till'''ie SOUIll COI.fll`�11 I��ly (5 6 2007' 3,422 4,0113 7,1435 6,359 86% 576 8% 1,078 17% 1 U/ 11.1111111�(''l, 2008 2,3�61 2,996 5,357 2,775 52% 334 6% 538 19% ail'id 54'/o, Yie@,*11111111111��lo d a��te data i�,idicate tiliat this hrl&,�Id �s 2009, 1778 168 2,946 2,755 94% 266 9% 567 21% C011tillUil1g, With more tlliai�i 60%o o���f new lmnie sales reloresen����I,ed by 2010 2,270 1,224 3,494 2,277 65% 518 15% 343 15% ia�ttached [���Iiionies. 2011 2)245 3,125 5,370 2,041 38% '7'23 13% 553 27% 2012 2,197 3,469 5,666 2,785 49% 794 14% 620 22% 2013 2,565 5,699 8,264 2,340 28% 632 8% 441 19% "'ll"I"'ie SOUtIl COt inty holds soi���ne o�f the l&,*gest coi�i(111',.e.n 111 itloiis o�f imteiitial 2014 21487 4,388 6,875 1,939 28% 1,086 16% 299 15% ft lj,�Iiv&,�i�tury hii lihe cot jr)ty. Whiie devel(�)�prner�i�t [�Iias been contrac J 119 2015 3,222 6,661 9,883 2,441 25% 679 7% 490 20% 2016 2,351 8,440 1�0,791 2,323 22% 11175 11% 640 28% there I a," r g, e p o ler�itlal sot i�rces oi�f`future si j�p�ply in Otay [Ranch ar�id Hii Ilie 2017 4,0�58 6,357 10,415 3,132 30% 1,017 10% 965 31% 2018 3,510 6,278 9,788 3,,664 37% 1,751 18% 1,366 37% CYtay iMesa at-ea riear t[�Iie LJ,,S./lVlexlco loorder w[�Iilclii sliot i i d n,19 I I) �fl i I t h e 2019, 3,023 5,05,9 8,082 3,724 46% 839 10% M54 31% in the �futt.jt-e,, r;7 2020YTD 2,200 4,20,0 6,400 3,413 53% 4 , 7% 536 16% Minimum 1778 1,0117 2,946 1,939 22% 77 1% 299 9% Maximum 16,585 27,545 44,130 15,505 103% 3,613 23% 3,965 37% Average 6,632 6,75,0 '13,382 6,954 64% 1,197 10% 1,304 19% �Medi�an �AG; :z 5,ftl A'AIM D""f4w 65% 1 1,0031 .......................1R 9521 19% -1" Page 705 of 724 I/Per SOCDS,`�%V arU 2/Meyers Research �Meyers IR,:E S EA R, C�H o S a e o s e n a 1�11� e n 1�11��a 'I'll A ol,. u I a V���s"Ita C 2021-03-16 Agenda Packet Page 706 of 724 o o o R Pi I I I I I I iool L I IN AT 10 N �M e, "y,le,rs .... ............... ................ 0 IS a e H lo s n g e a�'Ili d IRR,E S EA R, C�H San, 1311[ago IMSA Ow" dei,��nwid ��Iiiodel ul[Hizes a vari&ty fa(.��%'tors [�i o�.i lv��i o��d �ili cil o nl��i e, I'll C),L,l s e h lo I d 'll'Lill"I''''10i'ver,' growtl���l trencils, etc n botli a n"iac��"o @ d r6cr(���), [evd ��t(lll as§gn bg'�ca�� ld&m@,���Iid ca�ptt�ipe rates. Ulie FJL!r�p("')Se.,$) oil�li�f cz;-tudy, wie UtiHzecl IS,a n e g o C o t.,i n y a s t 11 lie ov&,-aH i-nau,-o �evi 91 and U,�ie South Cot,Jn�ty St as die i-n�cro �evel. ......I h e s e a p s I these two defhilied rl�i'rarkelll areas,, J Ii r v),t -i�Diego Smith, Coll,,,,Il����Ill""Ilty SUbiliimr1iii(et X r rim All Chip C� a OW111 I............. AD Source:ESR1 2021-03-16 Ag&da,-P,/ack-" Page 707 o f 724 1� I J J 1 10 10 10 1 DEIMANII,�,') NAODIII 0 0 GY �M e, "y,ers 01 IS a���e ��lo s n g I....I....I..I E S EA R, C�H as w6l as IIIIIJfe OLIr den''iand aria[y§s iorI� olects btal wi��'Iwal �1�iew 1i(111')1i,''ne &!n''iand� I)r(IlYi-In 2(1)21 Ito 21025. �iImd6 t[ie 1-1u,-nbers �by 1���)�[Jce ["Zange, Age @,id a r�i a y ���hs �r�lv�lo th�ia [�mi iseh6d o���f horn,11:a buyers by Stage categion'les (1�11id�jdir��Iig Sh,�ig�bs Yuu�nger C(I')U��,)�ells, Ern�p:ty Nest&,-s @11id I Zefiolrees). iis sis proviczil('� 1, -a�iabj�re. �,,)r��("Aie �range a�nd wl,�iat h ItUre growtli 411 be Hil'i S@i (.11"'.ot overall and flilie Sot 0 County St 11)�m�a rke I c,...... NEW HOME,DEMAND,MODEL FLOW CH�AR'T': South Bay Submarket 0 - 110- 5 0 Estimated Number of Households (2025) 11 ffiiii�111 milillill iii,ill 11111 M,111111111111 Minus Buy vs.Rent Current Number NEIM of Households (2021), 2021 - 6,25 Under25 Young Families Buy New vs.Resale 2022 - 734 25 to34 Growing Families Equals 2023 - 798 $250k to$375k 351 to44 Mature Families 2024, - 777 $375k to$600k 45 to54 Couples<45 Annual New Household Income 2025 - '765 $600k to$825k 55,to64 Singles Household by Avg 738 $825k+ 65 to74 EmptyNester Growth Age of Householder Total 3,691 75&Greater Retirees Implied Home 112-IMENEEMENEEMENEEM 0 Price torn *Economy.com Income Levels *Esri Meyers Adjusted Housing Expenditures Dataquick asa Percentage US Census Meyers Adjustments of Income Mortage Rates,Taxes,HOA Dues 2021-03-16 Agenda Packet Page 708 of 7241 1010101 111) 11 01111) 11 Ul uuuuI PI iuiuiuiuiui 111:U� 10101010)whiq ANIWAI... ENAAN�1'1) 01 S a��i e lo s n g .............. o,o(o'j o''o oo"I �o�ololo �M e, "y,e,rs IRR:E S EA R, C�H 0 LI I- n e vv h 0 I""T"i e I""T"I 0 JH���Iii liypoti�iiatica�i dern@-id ��f )�r 625 I'n hi 2020, Wtih cu�ithnued �ni��,)rciveimer it 2021 11 e d("'��011 ni a n d r�n d61 W L111itS In t�ie Su.iti'��i Coun�ty si�j i��' C' Hilidicates 1,11���iere �"�s growul-ig dern@���id flot, new liot.lSh"19 0 1 i I eii���)aid< as �l'�s sqUeezed wi�tihh'l tlie greater S@ri Diego ar a I�n Pti(�Yns in til���ds ar�ea wl���iid is w trI ess��ng a ciw n 11��" fo��Ijjk 11:a�thi-'ee pqpt "s, tx��Ios�thng '�r iterest in 11'��ie overali S@n -Ig a�11�i d g r(� I I I I i�E)gO U U ill y I g S 31 -iven 111111 y the (1.11"'OVI DIE 6 1 11� I a d d i fla,n i I�11�it&rest t-ates d �fo�,C,LI S 0 1`1 1 i v i lacel", ('d i rnari(e�t�'A ace,, Hypothetical �New Home Demand by Year 9(11)0 .......... 798 800 .......... 777' 7 5 734 "7 0 .............................................................................................................................................................................. 6 2 ......................................................................................................................................................................................................................................................... ............... 600 .......................................................................... 5C)O .................................. ............... �4 0(') "I'l""I'll""I'll'll""I'll""I'll",'ll""I'll""I'll",'ll""lI ............... 3C)O .................................. ............... 1200 ............... 100 ............... ............"I'l""I'll""I'll'll""I'll""I'll",'ll""II...........MM ...................................................................................................................................................... ............................................................... 202"'1 2,022 2023 2025 tes, of 1111 5%, and assodatio�����'i fees of$300 �pe���l" "'I"'Ilie totai d&i�'Iond a��nve averages "I'll"�����������ll�l�l�l�'7401 units yea�r hi �U,�I�ie 2021 ��to 2025 �pe���,,*iod i �,'�ie d&,i'iand analy§�s aSSLtmes pi,'qimr'II,y tcax �moi i'tl�i Ot ji, de��r-ni,Iind �,��-Ir-iod6 i�ndicates diat sales 4J�� �)e &brongest i $3175K $600i< wl�)er-e Ri�He�nia G�:::�i"') �11A No 2 is posi�tbr��I�ed Wi'-iile tihe rnodel doeS iz)iredict derinand [)y 1311'�Iicei (io,,,sed un �i����icurne levds),, all exe��,-cise full pow,&". (I "T"],iese S,aies by pl�r�ce sega'i I Eflnl: ai,e Tii(ely ��to slt��ft su,,-neW,'mt, loased o�n tl�ie de§res aiid goals (e g capital iorese�rvat�biri) uf bi iyers. Hypothetical N�ew Home Demand by Price Point $610(l)[<b"'), $8")5[< $8251( mi$25(111'�'� OZ5,975k 3 5 "I'l""I'll""I'll'll""I'll""I'll",'ll""I'll""I'll",'ll",'ll""'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""I'll",'ll"'ll""'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""I'll",'ll"'ll""'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""I'll",'ll"'ll""'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""I'll",'ll"'ll""'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""I'll",'ll"'ll""'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""I'll",'ll"'ll""'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""I'll",'ll"'ll""'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""I'll",'ll"'ll"""I..............."I'l""I'll""I'll'll""I'll""I'll",'ll""I'll""'ll""I'll""I'll,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll",'ll""I'll""I'll,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll",'ll""I'll""I'll,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll",'ll""I'll""I'll,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll",'ll""I'll""I'll,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll",'ll""I'll""I'll,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll",'ll""I'll""I'll,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll",'ll""I'll""I'll,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll",'ll""I'll""I'll,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll",'ll""I'll""I'll,'ll""I'll""I'll",'ll""I'll""I'll",'ll""I'll",lI..............."I'l""I'll""I'll'll""I'll""I'll",'ll""I'll""I'll""I'll""I'll'll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""'ll""I'll""I'll'll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""'ll""I'll""I'll'll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""'ll""I'll""I'll'll""I'll""I'll",'ll""I'll""I'll",'ll""I'll""'ll""I'll""I'll'll""I'll""I'll",'ll""I'll""I'll",'ll""I'll"I '13 0 01 ............... ................. "Ill.111,11.111,111.11,111.11,1111.111,11.11,1111.111,11.11",,,�........................................................................................... 200 100 ....... 50 "I'l""I'll,'ll""I'll""I'll","""1111111 0 .............. ..................... 2025 2( 2023 2(�) 2021-03-11�OX'genda Packet age 709 of 724 ol 1111 11 luol ol ol PI- �j R lululululuu, MAN D Y'AlG AN D 1 El �M e, "y,ers 01 IS a��i e ��lo s in g .............I E S EA R, C�H tic t, prqpeirty's gei���iieral 1pii-,ice segirl�neiit yeai1y dernaii���id by ag,11:a and iife stag(l"11.1 is iiiligliiigll���Ivled beim, We ailitiqpa�te 141.1,111 ofloveirail dennand Wil be wi��Huir�i l SlUbje -$3 751<tir) $6()01<,, I................................... ......... ...................... -............ Income$75,000-$99,999, 21,914 13.9% $250,000 to $375,000 101 14% 0.3% 3.0% 31% 2,6% 2.4% 1.4% 0.8%, 2.3% 1.8% 1 A% 1.6% 2.0% 2,2% 2�2% Income$10,0,000-$149,999 30,,347 19.2% $375,000 to $600,000 41% 0.6% 7.9% 7'.3% 3.5% 1.4%, Income$150,000-$199,999 '16,280 '10.3% $600,0010, to $825,000 2,10 28% 0.2% 3.6% 7.8% 8.5% 5.4% 2.0% 1.0% Income$200,000+ 12,004 T6% $825,000 or Greater 123 17% 01% 2.1% 4.4% 4.7% &2% 1.6% &6% 2.4% 2.9% 2.2% 1.6% 2.3% 33% 2.2% Oveir tiii(D�l forecasted fi v e e a J11, �,',)iei"io�d, i,-ncire tl,l�iail���i 1,5Z'11111 ijiltts ofd&,r-iand is aiitici���l tl,l�ie $3 7SK ��to $600i< price segii�ieint. Givei,l�li tha�t �11��iei-e is veil-y iittie s�,i�p�ply M�[I��iki Sot ith 0 01 the sqpp��yl/deimand in��Iibalaii���Ilice wiil iiikely iioost saies ipales witillin a(,11":,tive Tl�iunllties. Wi,�iile ��Ilre uty of Chula Vista (".0WIty in 'the si 311.1 price categ(III)i�-iel(IIED ��i pelailo,, years t[-ie city has calatw,�ed 23% ("Yf salies,, lie nuimio i. has captured alploi�llloxi�i�-nately �1,16% of Siai,�i Diego Cot in ty ihorne ciosings w''lillUaHly (Wiler ti,l'ie ��,Dast ","15"' years, h i e f W Jell, a(�� tive, new honie p.,rojis is ti,�ii Ot Igil"iout 'll"i"ie COUITty (tlliere were oveii'll '111130 active piplojects ii,�i 20,119 la�ilrid fewertl,�i@�l�i 80 ltoday),, While 1,lmt la�H 1,1e nil TIII flilities appeal to IC "1 11 111-lt basis w1ii lii<6�y rise as a reSLIft Of evei,-yune, �f w�ell designed @�ic,l a pp rqp�,J ate iy �prlce(:'Jl, it ,foikows tiliat demai,�I(l J, i naii,is conslill,'')i,it 1,i,�iat s,4�es ratles m I a per proje(,�'. i i 1'�l g coillpetiti0i'll. Income$75,,000-$99:,999 22,108 13.9% $250,000 to $375,000 504 14% 0.3% 3.0% 3.1% 2.6% 2.4% 1.4% 0.8% 2.3% 1.8% 1.4% 1.6l% 2.0% 2.2% 2.2% 41% 0.6% 7.9% 7.3%l 3.5% 1.4% Income$10l0,000-$149,999 30,739 19.3% $375,000 to $600,000 Income$150,000-$199,999 16,627 10,5% $6l00,000 to, $825,000 1,050, 29% 0,2% 3.6% 7,,8% 5.4% 2.0% 1,0% 70 10% Income$2010,000+ 12,358 7.8% $825,000 or Greater 616 17% 0.1% 2.1% 4A% 4�7% 3.2% 1.6% 0.6% 2.4% 2.9% 2,2% 1.6% Z3% 33% 2.2% MEN= EMCEE= 2021-03-16 Agenda Packet Page 7 10 of 724 1� 10 10 10 1 DEIMANII,�,') NAODIul 0 0 GY �M e, "y,ers Ol S a���e lo s n g .............. IR,:E S EA R, C�H c"Iefli'''riall by year ar�lid 1[�fe allage is bebw. Wlv��ule la�l �Ffe stage g"oqps cot�j��ci �111"mtentbHy �bt jy at tlie sL��i �le c.t p,�11'o p�le rty,, we a r vtld���Dlca�,',e tl"�Iiat derriand vvH�� be strong(IIIIIIIII'st �fr(�I)m 'Hliree gl"OLI���11,11��,,��"),Qo''lilll YO� I j�,'"ig C(""')U�p�es �.inder 114.5 and Gromlig 1� arrflli,Las. Coqpbs u��Iider 4.5 arA Ya�,.ing I flhes, all le ex�ipeac,Ill ��to r�nali(,e up a large segrner�'vt af t1he buyer. Hypothetical New Home Demand by Year and Life Stage le s<45 S g I e s E RUN 'Y o u n a rn e s a m Growing [\A�a t l�,,j re a rn e s M Z;UO tqestar' 40( 350 ..................................... ............................................................................................................................................................................................................................................................................................................. ............................................................................................................................................................................................................................................................................................................ 3 0 0 250 ........................................................................................................................................................................................................................................................................................................... .......... lie 0 0 ................ 150 100 50 ............. ...................................................................................... 0 2021 2022 202,3 2)',24 2025 Hypothetical New Home Demand by Year and Age il U n d le r mi 25 to m 35 to 4,5 to 55 to 65 to 75& 25 �34 44 54, 64, 74, Greater 250 200 ...................................................................................................................................................................................................................................................................................................................................................................... "150 .................................................................................................................................................................................................................................................................................................................... .......... 1100 50 .............. .......... .................... .................... .......... ................... 0 .................................. .......................... ........................... 2021 2022 2 0 3 2024 202! 2021-03-16 Agenda Packet Page 711 of 724 �Meyers IR,:E S EA R, C�H A 3 3 e C��Jiiula V��I slta 11A 2) 2021-03-16 Agenda Packet Page 712 of 724 A�p�pe�id�x IuR S A 1...E (JIT"I'll 1,,')E"'I'll"'A I L �M e, "y,e,rs IR,:E S EA R, C�H Project Name Builder Name Base Current Incentives Net Base Net Base Typical Total Monthly Payment linputs 80.0% Location M,aster Plain Size Base Price/ Price Options I Closing$ Price($ Price/ Options I Total �Price/ Monthly Base Addl 3.5% Photograph/Rendering Product Details Sales Summary, SF Bed Bath Level Pkg Price Sq.Ft., Reduction Upgrades Other Reduction) Sq.Ft. Upgrades Prerniums Price SF HOA Tax Taxes Mo.Pmt. Suwerte Heritage Building and Devel 1,,192 2 2.5 2 2 $372,,900 $313 $0 $0 ($10,000) $372,900 $313 $0 $0 $372,900 $313 $362 1.10% 0.9,0% $2,323 Chula Vista Otay Ranch 1,,357 2 2.5 2 2 $404,900 $,298 $0 $0 ($10,000) $404,900 $298 $0 $,0 $404,900 $298 $3,62 1.10% 0,90%, $2,491 Product: Townhomes Total Units: 212 1,,652 3 3.0 2 2 $439,900 $,266 $0 $0 ($10,000�) $439,900 $266 $0 $,0 $439,900 $266 $362 1.10% 0.90% $2,675 N Configuration: ATT Units Sold: 80 1,,719 3 2.5 3 2 $420,900 $245 $0 $0 ($10,000) $420,900 $245 $0 $0 $420,900 $245 $362 1.10% 0.90% $2,576' 3 Months Sold: 17 2,025 2 &5 4 2 $439,900 $217 $0 $0 ($10,000) $439,900 $217 $0 $,0 $439,900 $217 $362 1.10% 0.90% $2,675 Sales Open Dat�e- Jul-18 Units Remaining- 132 2,025 3 3.5 3 2 $499,900 $247 $0 $0 ($10,000) $499,900 $247 $0 $0 $499,900 $247 $362 1.10% 0.90% $2,991 Overall Sales Rate: 2.9 %Remaining: 62% 2,,139 2 3.5 4 2 $471,900 $2211 $0 $0 ($10,000) $471,900 $221 $0 $,0 $471,900 $221 $3,62 1.10% 0,90% $2,844 3 Mon.Sales Rate� 5.7 2,,439 4 3.5 2 2 $517,900 $212 $0 $0 ($10,000) $517,900 $212 $0 $0 $517,900 $212 $362 1.10% 0.90% $3,086 Totals/Averages: 1,819 $446,025 _$24:5 $0 $0 ($Moolo) $446,025 $245 $0 $0 $446,02:5 $245 $362 1.10% 0.910% $2,708 Alay Herftage Building and Devel 1,938 3 3.5 3 2 $527,1900 $272 $0 $0 ($10,000) $527,900 $272 $0 $0 $527,900 $272 $260 1.10% 0.90% $3,036 Chula Vista Otay Ranch 2,256 4 15 3 2 $560,900 $249 $0 $0 ($10,000) $560,900 $249 $0 $0 $560,900 $249 $260 1.10% 0.90% $3,210 Product: Townhomes Total Units: 80 2,505 4 &5 3 2 $5919,900 $�239 $0 $0 ($10,000) $599,900 $239 $0 $,0 $599,900 $239 $260, 1.10% 0.90% $3�,415 Configuration: ATT Units Sold: 68 '07 3 Months Sold: 20 Sales Open Date: Mar-19 Units Remaining: 12 Overall Sales Rate: 3.5 %Remaining: 15% 13 Mon.Sales Rate: 67 Totals/Averages: 2,233 $562,900 $252 $0 $0 ($10,000), $562,900 $252 $0 $0 $562,900 $252 $260 110% 0,90% $3,220 Pa,rc Place Pacific Coast Communities 1,,116 2 2.0 2 1 $412,900 $370 $0 $0 ($7,000) $412,900 $370 $0 $0 $412,900 $370 $285 1.10% 0.90% $2,456 Chula Vista Otay Ranch 1,,583 2 2.5 2 1 $459,,900 $291 $0 $0 ($7,000) $459,900 $291 $0 $0 $459,900 $291 $285 1.10% 0.9,0% $2,704 Product: Townhomes Total Units: 162 1,587 2 2.5 2 2 $489,900 $309 $0 $0 ($7,000) $489,900 $309 $0 $0 $489,900 $3019 $285 1.10% 0.90% $2,861 Configuration: ATT Units Sold: 140 3�Months Sold: 10 Sales Open Date: Mar-17 Units Remainiing: 22 Overall Sales Rate�: 3.2 %Remaining- 14% 3 Mon.Sa�les Rate: 3.3 Rg, Totals/Averages: 1,429 $454,233 $318 $0 $0 ($7,000) $454233 $318 $10 $0 $454,233 $318 �$285 1.10% 0.90% $2,674 Veraz Pardee Homes 1,340 2 2.5 3 2 $449,776 $336 $0 $0 ($5,000) $449,776 $336 $0 $0 $449,776 $336 $3,25 1.10% 0.30% $2,465 San Diego Playa del Sol 1,583 3 2.5 3 2 $482,266 $�305 $0 $0 ($5,000) $482,266 $305 $0 $0 $482,266 $305 $325 1.10% 0.30% $2,620 Product: Attached Total Units: ill 2,005 3 2.5 3 2 $549,145 $274 $0 $0 ($5,000) $549,145 $274 $0 $0 $549,145 $274 $325 1.10% 0.30% $2,938 Configuration: ATT Units Sold: 109, 3�Months Sold: 21 Sales Open Date: Sep-18 Units Remaining: 2 Overall Sales Rate�: 4.2 %Remaining- 2% 3 Mon.SMes Rate: 7.0 TotalslAverages:Tl-,643 $0 $0 $493,729 $3011 $325 1.10% 0.30% $27,6775 $493,729 $301 $0 $0 ($5,0010) $493,729 $301 Solmar Pardee Homes 1,,310 2 2.5 3 2 $430,175 $328 $0 $0 ($5,000) $430,175 $328 $0 $0 $43,0,175 $328 $325 1.10% 0.50% $2,444 San Diego Playa del Sol 1,,310 2 2.5 3 2 $432,435 $,330 $0 $0 ($5,000) $432,435 $330 $0 $,0 $432,435 $33,0 $325 1.10% 0,50%, $2,455 Product: Attached Total Units: 74 1,696 3 2.5 3 2 $468,390 $,276 $0 $0 ($5,000) $468,39�O $276 $0 $,0 $468,390 $276 $325 1.10% 0.50% $2,632 Configuration: ATT Units Sold: 74 1,777 3 2.5 3 2 $510,797 $287 $0 $0 ($5,000) $510,797 $287 $0 $0 $510,797 $287 $325 1.10% 0.50% $2,841 3 Months Sold: 25 1,,915 4 3.5 3 2 $517,500 $270 $0 $0 ($5,000) $517,500 $270 $0 $0 $517,500 $270 $325 1.10% 0.50% $2,874 Sales Open Date: Sep-19 Units Remaining: 0 Overall Sales Rate: 5.2 %Remaining: 0% ............ 3 Mon.Sales Rate: 8.3 ililli IN 111 Totals/Averages:t-1,602 tp�1,859 $295 $0 $0 ($5,000) $4711859 $295 $0 $0 $471,859 $295 $325 1.10% O.W% $2,649 ................................ .... ................. ..... 2021-03-16 Agenda Packet Page 713 of 724 A�p�pe�id�x IuR S A 1...E (JIT"I'll 1,,')El"I'll"I'A I L �M e, "y,e,rs IR,:E S EA R, C�H Project Name Buiilder Name Base Current Incentives Net Base Net Base Typical Total Monthly Payment linputs 80.0% Location Master Plain Size Base Price/ Price Options I Closing$ Price($ Price/ Options I Total �Price/ Monthly Base Addl 3.5% Photograph/Rendering Product Details Sales Summary, SF Bed Bath Level Pkg Price Sq.Ft., Reduction Upgrades Other Reduction) Sq.Ft. Upgrades Premiums Price SF HOA Tax Taxes Mo.Pmt. Tesoro at Vista Del Sur Cornerstone Communities 1,,410 3 2.5 3 2 $447,990 $,318 $0 $0 ($5,000) $447,99�O $318 $0 $,0 $447,990 $318 $270 1.10% 0.84% $2,604 San Diego, Vista Del Sur 1,485 3 2.5 3 2 $454,1990 $306 $0 $0 ($5,000) $454,99�O $306 $0 $0 $454,990 $306 $270 1.10% 0.84% $2,640 Product: Attached Total Units: 134 1,,600 3 2.5 3 2 $487,990 $305 $0 $0 ($5,000) $487,99,0 $305 $0 $0 $487,990 $3015 $270, 1.10% 0.84% $2,812 Configuration: ATT Units So�ld: 99 3 Months Sold: 0 'Sales Open Date- Oct-17 Units Remaini�ng� 35 Overall Sales Rate�! 2.7 %Remaining, 26% 3 Mon.Sales Rate: 0.0 Totals/Averages: 1,498 $463,657 $309 $0 $0 ($5,0010) $463!657 $309 $0 $0 $463,657 $3019 $270 1.10% 0.84% $2,685 Aventine Cornerstone Communities 2,014 3 2.5 2 2 $622,990 $�309 $0 $0 $0 $622,99�O $309 $0 $,0 $622,990 $309 $113 1.10% 0.90% $3,389 Chula Vista Otay Ranch 2,177 4 3.0 2 2 $647,990 $298 $0 $0 $0 $647,99�O $298 $0 $,0 $647,990 $298 $113 1.10% 0.90%, $3,,521 Product: Detached Total Units: 100 2,438 4 3.5 2 2 $669,990 $,275 $0 $0 $0 $669,99�O $275 $0 $0 $669,990 $275 $113 1.10% 0.90% $3,636 Configuration: 2,975 Units Sold: 91 Lot Dimensions: 38x95 3 Months Sold: 11 Sa,les Open Date-, Oct-17 Units Remaining: 9 Overall Sales Rate: Z5 %Remaining: 9% Mon.Sales Rate� 3.7 .............. Totals/Averages: 2,210 $646%990 $293 $0 $0 $0 $646,19910 $293 $10 $0 $646,990 $293 $113 1.10% 0.910% $3,516 Monte Villa Pacific Coast Communities 1,948 2 2.5 2 2 $560,900 $288 $0 $0 $0 $560,900 $288 $0 $0 $560,900 $288 $48 1.10% 0.70% $2,904 Chula Vista Otay Ranch 2,236 2 10 2 2 $571,900 $256 $0 $0 $0 $571,900 $256 $0 $0 $571,900 $256 $48 1.10% 0.70% $2,960 Product: Detached Total Units: 103 2,321 3 &0 2 2 $604,900 $�261 $0 $0 $0 $604,900 $261 $0 $,0 $604,900 $261 $48, 1.10% 070% $3,128 Configuration: 3,500 Units Sold: 91 2,,594 4 3.5 3 2 $613,900 $237 $0 $0 $0 $613,900 $237 $0 $0 $613,900 $237 $48 1.10% 0.70% $3,174 Lot Dimensions: 35x95 3 Months Sold: 12 2,851 4 4.0 3 2 $636,900 $,223 $0 $0 $0 $636,900 $223 $0 $0 $636,900 $223 $48 1.10% 0.70% $3,291 Sales Open Date: Mar-17 Units Remaining: 12 3,,016 5 4.0 3 2 $656,900 $218 $0 $0 $0 $656,900 $2,18 $0 $0 $656,900 $218 $48 1.10% 030% $3,393 Overall Sales Rate: 2.1 %Remaining: 12% 3 Mon.Sales Rate: 4.0 TotalslAverages: 2,494 $607,567 $244 $0 $0 $0 $607,567 $244 $0 $0 $607,567 $244 $48 110% 0,70% $3-,142 Cantamar Pacific Coast Communities 2,631 3 3.5 2 2 $718,900 $273 $0 $0 $0 $718,900 $273 $0 $0 $718,900 $273 $48 1.10% 0.65% $3,679 Chula Vista Otay Ranch 2,,776 4 3.0 2 2 $735,,900 $265 $0 $0 $0 $735,900 $265 $0 $0 $735,900 $265 $48 1.10% 0.65% $3,765 Product: Detached Total Units: 109, 2,,896 5 3.5 2 2 $762,900 $263 $0 $0 $0 $762,900 $263 $0 $0 $762,900 $263 $48 1.10% 0.65% $3,901 Configuration: 4,250 Units Sold: 88 Lot Dimensions: 50x85 3 Months Sold: 25 Sales Open Date- Oct-17 Units Remaini�ng� 21 Overall Sales Rate: 2.4 %Remaining-. 19% 3 Mon.Sales Rate: 8.3 $0 1 $48 1.10% 0.65% Totals/Averages: 1 2,768 1 $739,233 $267 $0 $0 $0 $739,233 $267 $0 $739,233 $26�7 $3,7827 .......... Signature Heritage Building and Devel 3,524 3 2.5 2 2 $947,900 $269 $0 $0 $0 $947,900 $269 $0 $0 $947,900 $269 $52 1.10% 0.70% $4,879 Chula Vista Otay Ranch 3,611 4 3.5 2 2 $9916,900 $276 $0 $0 $0 $996,900 $276 $0 $,0 $996,900 $276 $52 1.10% 0.70% $5,129 Product: Detached Total Units: 79 3,666 5 3.5 2 3 $980,900 $268 $0 $0 $0 $980,900 $268 $0 $0 $980,900 $268 $52 1.10% 0.70% $5,047 Configuration: 5,000 Units Sold: 78 Lot Dimensions: 55)(95 3�Months Sold: 10 Sales Open Date: Jun-1 7 Units Remaining: 1 Ove 11 Sales Rate: 1.9 %Remaining: 1% Sales Rate: 3.3 Totals/AverNes: 3,600 $975,233 $271 $0 $0 $0 $975,233 $27111, so ..................... $0 $975,233 1111$271 $52 1.10% 0.70% $5,018 Estancia Cornerstone Communities 3,,409 3 3.5 2 3 $931,990 $273 $0 $0 $0 $931,990 $273 $0 $0 $931,990 $273 $53 1.10% 0.07% $4,309 Chula Vista Otay Ranch 3,,597 5 2,5 2 3 $998,990 $278 $0 $0 $0 $998,99�O $278 $0 $,0 $998,990 $278 $53 IA0% 0,06% $4,611 Product: Detached Total Units: 37 3,906 5 15 2 3 $991,990 $,254 $0 $0 $0 $991,99�O $254 $0 $,0 $991�990 $2,54 $53 1.10% O�06% $4,579 Configuration: 6,300 Units Sold: 20 Lot Dimensions: 60x105 3 Months Sold: 3 ,Sales Open Date: Aug-19 Units Remaining: 17 Overall Sales Rate: 1.4 %Remaining: 46% 3 Mon.Sales Rate: 1.0 Totals/Averages: 3,637 $974,323 $268 $0 $0 $0 $974,323 $268 $0 $0 $974,323 $268 $53 1.10% 0.07% $4,500 2021-03-16 Agenda Packet Page 714 of 724 A�p�pe�id�x IuR S A 1...E (JIT"I'll 1,,')E"'I'll"I'A I L �M e, "y,e,rs IR,:E S EA R, C�H Project Name Builder Name Base Current Incentives Net Base Net Base Typical Total Monthly Payment linputs 80.0% Location Master Plain Siize Base Price/ Price Options I Closing$ Price($ Price/ Options I Total �Price/ Monthly Base Addl 3.5% Photograph/Rendering Product Details Sales Summary, SF Bed Bath Level Pkg Price Sq.Ft., Reduction Upgrades Other Reduction) Sq.Ft. Upgrades�Premiuims Price SF HOA Tax Taxes Mo.Prnt. Bella Sitia Pacific Coast Communities 3,654 5 4�5 2 2 $929,900, $254 $0 $0 $0 $929,900 $254 $0 $0 $929,900 $2,54 $59 1.10% 0.70% $4,794 Chula Vista Otay Ranch 3,971 5 4.5 2 2 $951,900, $240 $0 $0 $0 $951,90�O $240 $0 $,0 $951,900 $240 $59 1.10% 0.70% $4,90�6 Product: Detached Total Units: 68 4,256 5 4.5 2: 3 $997,900, $234 $0 $0 $0 $997,90�O $234 $0 $0 $997,900 $234 $59 1.10% 0.70% $5,141 Configuration: 8,000 Units Sold: 45 Lot Dimensions: 8OX100 3�Months Sold: 10 Sa,les Open Date: Apr-19 Units Remaining. 23 Overall Sales Rate: 2.4 %Remaining- 34% 3 Mon.Sales Rate: 3.3 Totals/Averages: 3,960 $959,900 $242 $0 $0 $0 $9159,90,0 $242 $0 $0 $959,,9,00 $242 $59 1.10% O�70% $4,947 Prado at Escava Brookfield Residentia,l 2,,289 4 3,0 2 2 $764,880 $334 $0 $0 $0 $764,880 $334 $0 $,0 $764,880 $33,4 $131 1A0% 0,90% $4,154 Chula Vista Escaya at Otay Ranch 2,392 4 10 2, 2 $7916,880, $333 $0 $0 $0 $796,880 $333 $0 $,0 $796,880 $333 $131 1.10% O�90% $4,322 Product- Detached Total Units- 130 2,,565 4 3.5 2 2 $823,880, $321 $0 $0 $0 $823,880 $321 $0 $0 $823,880 $321 $131 1.10% 0.90% $4,464 Configuration: 3,120 Units Sold: 127 Lot Dimensions: 48x65 3�Months Sold: 12 Sales Open Date: Jun-17 Units Rema,iniing: 3 Overall Sales Rate: 3.1 %Remaining- 2% ���]JJJJJJJ3 Mon.Sales Rate: 4.0 Totals/Averages: 2,415 $795,213 $329 $0 $0 $0 $795,213 $329 so $0 $795,21�3 $3219 $131 1.10% 0.90% $4,313 Carriage Hill Davidson Communities 2,,524 4 3.5 1 2 $1,000,000 $396 $0 $0 ($1�0,0001),$1,000,000 $396 $0 $1,100,000 $436 $379 1.10% 0,03% $5,366 Bonita 2,,643 5 4.0 1 3 $1,100,000 $416 $0 $0 ($10,000)$1,100,00�O $416 $0 $1,200,000, $454 $379 1.10% 0.03% $5,820 Product: Detached Total Units: 18 3,197 5 4.5 2 3 $1,200,000 $375 $0 $0 ($10,000),$1,200,000 $375 $0 $1,300,000 $407 $379 1.10% 0.03% $6,273 Configuration: 7,000 Units Sold: 9 Lot Dimensions: 3�Months Sold: 1 Sales Open Date: Jul-18 Units Remaining: 9 Overall Sales Rate- 0.3 %Remaining- 50% 3 Mon.Sales Rate: 0.3 'Totals/Averages:- 2,788 $1,100,000 $395 $0 $0 ($10,000),$1,100,0010 $395 $10 ####### $1,200,000 $430 �$379 1.10% 0.03% $5,820 2021-03-16 Agenda Packet Page 715 of 724 pululuum I<ET N"I'll I IM A lululul U N I"I'll I D 1 C 0 NA T 1�V 0 A�p�pe�id�x �M e, "y,e,rs IRR,E S EA R, C�H .............................. ALEXAN RIVUE GREYSTAR, CHULA VISTA 3-STORY YEAR BUILT.2019 %Leased/Occupancy:97'.2/97.2 90 753 1 1.0 1 1 0 $2,095 - $2,095 $2,095 $2.78 - $2.78 $2.78 $0 $0 $0 $2,095 - $2,,095 $2,095 $2.78 - $2.7'8 $2.78 Total Units/Leased:2531246 75 785 1 1.0 1 1 C $2,105 - $2,,175 $2,140 $2�68 - $277 $2.73 $0 $0 $0 $2,10,5 - $2,,175 $2,140 $2 k8, - $2.77 $2.73 Available Units:7 50 1,128 2 2,0 1 1 C $2,600 - $2,600 $2,600 $2.30 - $2.30 $2,30 $0 $0 $0 $2,600 - $2,,600 $2,600 $2,30 - $230 $2,30 Turnover/Monthly:2.5 38 1,839 3 2.5 3 2 DAG $3,848 - $3,,848 $3,848 $2.09 - $2.09 $2.09 $0 $0 $0 $3,84,8 - $3,848 $3,84,8 $2.091 - $Z09 $2.09 Lease-Up Rate:-18 253 1,000 $2,095 - $3,848 $2,471 $2.09 - $2.78 $2.47 $0 $0 $0 $2,095 - $3,848 $2,47'1 $2.09 - $2.78 $2.47 BOARDWALK I GREYSTAR CHULAVISTA 3-4-STORY I YEAR BUILT-2018 %Leased/Occupancy:94.2196.1 87 844 1 1.0 1 1 C $2,147 . $2,240 $2,1194 $2.54 - $2.65 $2.60 $0 $0 $0 $2,14,7 - $21,240 $2,194 $2.54 - $2.65 $2.60 Total Units/Leased:309/291 87 888 1 1.0 1 1 DIS $2,51�8 $2,518 $2,51�8 $2.84 $2.84 $2.84 $0 $0 $0 $2,518 $2,518 $2,518 $2.84 $2.84 $2.84 Available Units.18 54 1,140 2 2.0 1 1 DG, $2,759 $2,759 $2,759 $2.42 $2.42 $2.42 $0 $0 $0 $2,759 $12,,759 $2,759 $2.42 $2.42 $2.42 TurnoverlMonthly.-15.0 55 1,236 2 2.0 1 1 DIG $2,897 $2,,897 $2,897 $234 $2.34 $2.34 $0 $,0 $0 $2,897 $2,897 $2,897 $2.34 $2.34 $2.34 Lease-Up Rate:-19 283 990 $2,147 $2,897 $2,538 $234 $2.84 $2.56 $0 $0 $0 $2,147 $2,89�7 $2,538 $2.34 $2.84 $2.56 PULSE 1� FAIRFIELD RESIDENTIAL, CHULAVISTA THREE-STORY YEAR BUILT-2015 %Leased/Occupancy:991.3/98.2 51 789 1 1�10 1 1 0 $2,085 $2,195 $2,140 $2.64 $2.78 $231 $0 $,0 $0 $2,085 $2,1195 $2,140 $2.64 $238 $2.71 Total Units/Leased:2731271 49 86,0 1 1.0 1 1 0 $2,175 $2,,235 $2,205 $2�53 $2�60 $2.56 $0 $0 $0 $2,175 $2,,235 $2,205 $2.53 $2.60 $2.56 Ava�ilable Units:2 49 860 1 1.0 1 1 �DG $21,225 $2,29,5 $2,260 $2.59 $2.67' $2.63 $0 $0 $0 $2,225 $21,295 $2,260 $2.59 $2.67 $2.63 TurnoverlMonthly:11.0 106 1,131 2 2.0 1 1 DIG $2,890 $2,995 $2,943 $2.56 $2.65 $2.60 $0 $0 $0 $2,890 $2,995 $2,943 $2.56 $2.65 $2.60 Lease-Up Rate�-24 18 1,371 3 2.0 1 1 DG, $3,125 $3,125 $3,125 $228 $2.28 $2.28 $0 $0 $0 $3,125 $3,,125 $3,1125 $2.28 $2.28 $2.28 273 �986 $2,085 $3,125 $2,550 $228 $2.78 $Z59 $0 $0 $0 $2,085 $3,125 $2,550 $2.28 $278 $2,,59 THE RESIDENCES I GREYSTAR CHULAVISTA I THREE-STORY I YEAR B U I L'T-201�9 %Leased/Occupancy:98,.5/96.7 63 747 1 1.0 1 1 0 $2,225 $2,225 $2,225 $2,98 $2.98 $2�98 $0 $0 $0 $2,225 $2,,225 $2,225 $2�98 $2.98 $2.98 Total Units/Leased:2721268 63 789 1 1.0 1 1 0 $2,330 $2,,330 $2,330 $2�95 $2�95 $2.95 $0 $0 $0 $2,330 $2,,330 $2,330 $2�95 $2.9�5 $,2.95 Available Units:4 63 1,049 2 2,0 1 1 0 $2,33,5 $2,335 $2,3135 $2.23 $2_23 $2,23 $0 $0 $0 $2,33,5 $2,,335 $2,335 $2,23 $223 $�2,23 TurnoverlMonthly,:-- 62 1,096 2 2.0 1 1 0 $2,655 $2,,655 $2,655 $2A2 $2A2 $2.42 $0 $,0 $0 $2,655 $2,,655 $2,655 $2.42 $2.42 $2.42 Lease-Up Rate:-23 11 1,560 3 2,5 3 2 DAG $3,495 $3,495 $3,495 $2,24 $2.24 $2.24 $0 ($437), ($437') $3,058 $3,,058 $3,058 $1,96 $1,96 $1.96 10 1,654 3 2.5+ 3 2 DAG $3,825 $3,825 $3,825 $2.31 $2.31 $2.31 $0 ($478), ($478�) $3,347 $3,347 $3,347 $2.02 $2.02 $2.02 272 972 $2,225 $3,825 $2,483 $2 23 $2.98, $Z55 $0 ($35) ($35) $2,225 $3,347 $2,448 $1.96 $2.98 $2.52 2021-03-16 Agenda Packet Page 716 of 724 �M eye,r s �'Iiq��I I I x IRR:E S EA R, C�H Zonda and Our Research Cwnpefitivei Analys�s throqlhWt the Country Exclusive A,cce�ss,to our lResearch&Coii-isuftiriig Executives Metro Analysis& Housing T�erids A�lparfiment Analysis& Forecast Meye��,IIIS �esea��'d�,'Ii is a iia�bbri,,,Wde gUdi�nig rea�� )tatEl".1 i�nvestors Exclusive Dent Events, 11 tli���Iie co�.,intry,, (1111"1)t i�r highly edLicated and ex�per�'�enced c(II,��)ll��i.su������,,,��,��l,����ig s�I:a�ff biet'�eves hi�i provdi�ng fihe [iig��,�iesit qua�Jty si&rv�te pos§J�,ir]e to OL,fl` dJei��`ItSi, W��'Iidi'i 1,'nii,aa��Ils CG,�-np�bting the 119,xact lPresentations&Webinars, P COU 11111, a�nalysls tliey need,, We are 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CHUIAVISTA March 16, 2021 File ID: 21-0579 'TITLE RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA, ACTING IN ITS CAPACITY AS THE LEGISLATIVE BODY OF COMMUNITY FACILITIES DISTRICT NO. 17-1 (WESTERN CHULA VISTA DIF FINANCING PROGRAM), EXTENDING THE TERM OF ANNEXATION OF PROPERTY INTO SUCH COMMUNITY FACILITIES DISTRICT AND TAKING CERTAIN OTHER ACTIONS RELATING THERETO RECOMMENDED ACTION Council adopt the resolution. SUMMARY In March 20,16 the City Council formed Community Facilities District 17-1 ("CFD No. 17-1)) or the "District") the Western Chula Vista Development Impact Fee (DIF)i Financing Program.CFD No. 17-1 was established for the purpose of financing the payment of certain DIF oblijzations for apartments, commercial or industrial properties in Western Chula Vista (i.e.,the area generally located between Interstate 5 and Interstate 805), and the Chula Vista Auto Park,which is situated to the east of Interstate 805 and to the west of Heritage Road. CFD No. 17-1 was established for a period of five years, expiring in March 2021. The proposed resolution would extend the program for an additional five years and allow annexations into CFD No. 17-1 through March 2026. ENVIRONMENTAL REVIE'W The Director offlevelopment Services has reviewed the proposed activity for compliance with the California Environmental Quality Act (CEQA) and has determined that the activity is not a "Project)p as defined under Section 15378 of the State CEQA Guidelines because it will not result in a physical change in the environment; therefore,pursuant to Section 1,5060(c)(3) of the State CEQA Guidelines,the activity is not subject to CEQA. Thus,no environmental review is required. BO,ARD/COMMISSION/COMMITTEE RECOMMENDATION Not applicable. DISCUSSION The District was formed in March 2016 with the expectation that it would induce investment in the Western Chula Vista area by allowing the deferral of Development Impact Fees.Increasing construction costs and high equity requirements presented a financing challenge for the development of infill projects. To date, six separate properties have annexed into the Diistrict and are either completed or under construction,providing much-needed new housing in Western Chula Vista.These projects collectively represent an investment value 1111. 0 0 1 P �3ge 11 2021-03-16 Agenda Packet Page 719 of 724, of over$100 million into Western Chula Vista and will bring over 500 new rental units to the City and up to 1,200 new residents to the area.The total amount of fees deferred for these projects represents about 10%of the total investment colsts,approximately$10 million to-date. Below is a list of projects that have annexed into CFDl No. 17-1 and the amount offees deferred to�-date,: CFD 17-1 Projects Dwelling Commercial Total Fees Year Proj e�ct Units SF PAD PFDIF WIMIF Deferred 2016 �Villa del Oro 80 21114 $ 614)960 $ 751,840 $ $ 1,366,800 2017 �Urbana 135 0 $ 1�056Y375, $ IY295fl,50 $ 13SY690 $ 2)487P11S 2018 �260 Broadway 62 0 $ 593)092 $ 5831555 $ 30)319 $ 1,206,966 2018 �2 88 Center 43 0 $ 411Y338 $ 444P491 $ 48Y715 $ 904,544 2018 ]230 Church 26 0 $ 277)414 $ 299,773 $ 32,854 $ 610,041 2020 Bonita Glen 170 0 $ 1�6421030 $ 11796)730 $ 251784 $ 3Y464�544 Total 516 21114 $ 4pS95,209 $ 51171y439 $ 273,362 $ 101040p0110 The Western Chula Vista Financing Program allows the deferral of the folllowing three Development Impact Fees: 1. Public Facilities DevelolDment ImDact Fee, (PFDIF) which includes: Civic Center expansion, Police Department facilities, Corporation Yard relocation/expansion, Library system expansion, Fire Suppression system expansion and Recreation Facilities. 2. Western Area Parkland Acquisition and Deve�loi)ment Flee (PAD) (residential projects only) for acquisition and construction o�f'parks. 3. Western Tran,s,pg,rtation D eve I Fee (WTDIF) for,construction of facilities listed in the WTDIF program. Only that portion that is not allocated to the San Diego Association of Governments (SANDAG) pursuant to the Regional Transportation Congestion Improvement Program, as required by SANDAG's T'ransNet Extension Ordinance may be deferred. While some public facilities may be potentially delayed,the interest charged on the fees deferred to-date will earn over$4 million of interest that will accrue to each of these funds,in addition to the positive fiscal impact of over$1010 million investment in Western Chula Vista.This new investment increases property values and the City in turn receives incremental additional pro�plert,y tax revenues. A "future annexation area" was established when CFD No. 17-1 was formed. Only properties within the boundaries of the annexation area can annex into the District.The process for annexation in CFD Nol.17-1 takes approximately 4 to 6 months and requires City Council ap�proval. Uplon annexation, a lien is recorded against the property which documents the payment obligation in the public record.The fees are deferred for a period of 10 years and then payments are collected twice a year via property tax payments for the subsequent 20 years. The deferred fees accrue interest at a rate of two percent per annum, on the outstanding balance. If a property is sold or subldivided,the obligation to repay the fees runs with the land.The non-payment period aligns with standard commercial lending practices. Often these types of projects are refinanced at the 10- year mark, providing an opportunity for the debt to be paid in full. The goal of the fee deferral program was to incentivilze development and,while this has been accomplished,the projects took longer to come to market Pli3ge 12 2021-03-16 Agenda Packet Page 720 of 724, than previously anticipated.,Now, five years later smaller infill projects are still difficult to commercially finance, mainly due to the increasing cost of' infill construction, including the practice of building podium parking to maximize efficient use of the site,and rents that don't yet support these increased costs.When CFD No. 17-1 was formed, the City Council determined that in any one year, after a project was approved that increased the number of'units annexing into the District over 200, staff would schedule an action item to be, discussed by the City Council to address the impacts and the need to continue the program. Less than 200 units were annexed in any given year and only 5 16 total units were annexed over the past five years;therefore, that requirement was never triggered. There are many opportunities for redevelopment in Western Chula Vista and staff has been approached by developers inquiring about the status of the CFD No. 17-1 fee deferral program for their proposed projects., It has,become an essential tool for infill projects to be financially feasible and attract equity.In order to support continued redevelopment in Western Chula Vista,,staff proposes to extend the program for an additional five years,through March 2026.When the District was formed,it was anticipated that the annexation area could produce approximately 1,000 residential units. Since approximately 500 units have been annexed to-date, it is proposed that an additional 500 be authorized to annex over the next five years,and after an annexation is approved that puts the total number of units over 500, staff will schedule an action item to be discussed by City Council to address the impacts and the need to continue the annexation of properties into CFD No�. 17-1. In May 2020 the City Council adopted the COVID-19 Economic Recovery Plan which included the extension of the CFD No. 17-1 Fee Deferral Program for an additional 60 months as part of'an initiative to encourage a more business-friendly environment that would minimize additional costs and burdens to do business in Chula Vista.This action provides additional parameters in the resolution for the extension of CFD No�. 17-1 that were not included in the Economic Recovery Plan. To date�, the CFD No. 17-1 program has been successful as evidenced by the new development that has occurred which translates into increased assessed valuation,a positive impact on the neighboring property values, while also help�ing new residents and employees support the surrounding businesses located along the retail corridors,. DECISION,MAKER CONFLICT Staff has reviewed the decision contemplated by this action and has determined that potential individual projects/annexations are not site-specific and consequently, the real property holdings of the City Council members do not create a disqualifying real property-related financial conflict of interest under the Political Reform Ac�t(Cal. Govt Code§8710�0,etseq.). Staff is not independently aware, and has not been informed by any City Council member, of any other fact that may constitute a basis for a decision-maker conflict of interest in this matter. CURRENT-YEAR FISCAL IMPACT Development Impact Fees are enterprise funds and therefore there is no fiscal impact to the General Fund due to the fee deferrals.There are no new annexations in process as of this date and the developer is required to advance funds to the City to cover the costs incurred by the C�ity in undertaking the annexation P �3ge 13 2021-03-16 Agenda Packet Page 721 of 724, proceedings. Given the length of time, for project approval, annexation to the District and project construction,it is unlikely that there would be any fiscal impacts to the Development Impact Fee funds in the current fiscal year because there is not likely to be new units to pay the fees. Therefore, there is no current year fiscal impact as a result of this action. ONGOING FISCAL IMPACT" Development Impact Fees are enterprise funds and therefore there is no on-going fiscal impact to the General Fund.Developers will continue to pay for all costs associated with the annexation of properties into CFD No. 17-1. New development will continue to mitigate, impacts resulting from each respective project by paying Development Impact Fees; however, the deferred collection of these funds may delay the construction of some public facilities. Staff Contact:Kimberly Ellio�tt, Development Services Department P �3ge 4 2021-03-16 Agenda Packet Page 722 of 724, RESOLUTION NO. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA, ACTING IN ITS CAPACITY AS, THE LEGISLATIVE BODY OF COMMUNITY FACILITIES DISTRICT NO. 17-1 (WESTERN CHULA VISTA DIF FINANCING PROGRAM), EXTENDING THE TERM OF ANNEXATION OF PROPERTY INTO SUCH COMMUNITY FACILITIES DISTRICT AND TAKING CERTAIN OTHER ACTIONS RELATING THERETO WHEREAS, the City Council of the City of Chula Vista, California (the "City Council") has previously formed Community Facilities District No. 1.7-1 (the "Western Chula Vista DIF Financing Program") (CFD No. 17-1) pursuant to the Mello-Roos Community Facilities Act of 1982 (the "Act"), as amended, 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") for the purpose of financing the payment of certain development impact fee obligations; and WHEREASI acting pursuant to the Community Facilities District Law, the City Council also authorized by the adoption of Resolution No. 2016-051 (the "Resolution Authorizing Future Annexation") the annexation in the future of territory to CFD No. 17-1, such territory designated as the Future Annexation Area, Community Facilities, District No�. 17-1 (the "Future Annexation Area"); and WHEREAS, the City Council determined that annexation to CFD No. 17-1 would be available for a five-year window, unless the term was extended by the City Council; and WHEREAS, the City Council determined that in any one year, after a project was approved that put the number of units annexing into CFD No. 17-1 over 200, staff would schedule an action item to be discussed by the City Council to address the impacts and the need to continue the annexation of properties to CFD No. 17-1; and WHEREAS, financing challenges continue to exist for infill development projects in Western Chula Vista and allowing the continued deferral of fees for all high-density, commercial and industrial development in the Future Annexation Area will help incentivize future investment in Western Chula Vista. NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Chula Vista, acting in its capacity as the legislative body of Community Facilities District No. 174 (Western Chula Vista DIF Financing Program) that: Section 1. Recitals. The above recitals are true and correct. Section 2. Extension of Term. This legislative'body does hereby determine to extend the term of annexation into CFD No. 17-1 and allow property within the Future Annexation Area 60297.00044\33553027.1 2021-03-16 Agenda Packet Page 723 of 724, to annex to CFD No. 17-1 pursuant to the provisions of the Community Facilities District Law for an additional 60 months, until March 15, 2026. Section 3. Unit Limitation. This legislative body does hereby determine that after an annexation is approved that puts the total number of units annexing into CFD No. 17-1 during the March 15, 2021 — March 15, 2026 term over 500, staff will schedule an action item to be discussed by the City Council to address the impacts and the need to continue the annexation of properties to CFD No. 17-1. Section 4. Effective Date. This Resolution shall become effective upon its adoption. Presented by: Approved as to form by: Tiffany Allen Glen R. Googins Director of Development Services City Attorney 60297.00044\33553027.1 2021-03-16 Agenda Packet Page 724 of 724,