HomeMy WebLinkAboutReso 2022-201RESOLUTION NO. 2022-201
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA AUTHORIZING FORMATION OF THE
CALIFORNIA MUNICIPAL FINANCE AUTHORITY
COMMUNITY FACILITIES DISTRICT NO. 2022-12 (CITY OF
CHULA VISTA – OTAY RANCH VILLAGE 3 PHASE II)
THROUGH THE BOND OPPORTUNITIES FOR LAND
DEVELOPMENT (BOLD) PROGRAM PURSUANT TO THE
MELLO-ROOS COMMUNITY FACILITIES ACT OF 1982, AS
AMENDED; APPROVING A JOINT COMMUNITY
FACILITIES AGREEMENT AND AUTHORIZING RELATED
ACTIONS
WHEREAS, the City of Chula Vista (the “City”) is a municipal corporation and charter
city duly organized and existing under and pursuant to the Constitution and the laws of the State
of California (the “State”) and has previously authorized the use of the California Municipal
Finance Authority’s (CMFA) Bond Opportunities for Land Development Program (the “BOLD
Program”) to allow the owners of property to be developed within the City to participate in the
BOLD Program subject to the approval of the City Council; and
WHEREAS, the CMFA has established the BOLD Program to allow the financing of
certain public facilities and/or certain development impact fees that finance public facilities
(together, the “Improvements”) levied by local agencies in the State through the levy of special
taxes pursuant to the terms and provisions of the Mello-Roos Community Facilities Act of 1982,
as amended (the “Act”); and
WHEREAS, HomeFed Village III, LLC (HomeFed), the master developer of the Otay
Ranch Village 3 Phase II development project (the “Project”) has requested that the City allow
them to utilize the BOLD Program and to allow the CMFA to form California Municipal Finance
Authority Community Facilities District No. 2022-12 (City of Chula Vista – Otay Ranch Village
3 Phase II) (the “Village 3 Phase II CFD”) under the Act, to levy special taxes within the Village
3 Phase II CFD, and to issue bonds secured by such special taxes under the Act to finance the
Improvements, provided that HomeFed voluntarily agrees to participate and consent to the levy of
such special taxes and the issuance of such bonds; and
WHEREAS, the City Council has previously approved Council Policy Number 505-04
“Statement of Goals and Policies Regarding Establishment of Community Facilities Districts,”
(the “City’s Goals and Policies”) and with the exception of: (1) the prohibition on financing
development impact fees; (2) the prohibition on the escalation of the maximum special tax to pay
for public facilities; (3) the payment to the City of compensation equal to one percent (1%) of the
total authorized bonded indebtedness; (4) the requirement that an appraisal be coordinated by, done
under the direction of, and addressed to the City; and (5) the requirement that all consultants
including the appraiser, be selected and retained by the City, the Village 3 Phase II CFD shall be
formed in accordance with the City’s Goals and Policies attached hereto as Exhibit 1 and
incorporated herein by this reference; and
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Resolution No. 2022-201
Page No. 2
WHEREAS, the Village 3 Phase II CFD shall be authorized to finance City capital facilities
and related costs (the “City Infrastructure”) in satisfaction of certain City development impact fees
(the “City Fees”) authorized to be financed under the Act and certain City capital facilities to b e
constructed by or on behalf of HomeFed (“Acquisition Improvements” and with the City
Infrastructure and the City Fees, the “Facilities”); and
WHEREAS, the Acquisition Improvements shall be accepted and moneys shall be
disbursed in accordance with an Acquisition Funding Agreement to be entered into among the
CMFA, the City and HomeFed (the “Acquisition Agreement”); and
WHEREAS, the City Council has determined the Village 3 Phase II CFD will provide
benefit to the community at large as well as a benefit to the properties within the Village 3 Phase
II CFD of the types described in the City’s Goals and Policies; and
WHEREAS, the City Council has determined that the public facilities authorized to be
financed by the Village 3 Phase II CFD are of the types described in the City’s Goals and Policies;
and
WHEREAS, under Section 53316.2 of the Act, the CMFA may form the Village 3 Phase
II CFD to finance the Facilities in connection with the Project and issue bonds, the proceeds of
which are used by the City for City Infrastructure, provided the CMFA and the City enter into a
joint community facilities agreement; and
WHEREAS, the form of a Joint Community Facilities Agreement by and between the
CMFA and the City (the “JCFA”) setting forth the administration of the Village 3 Phase II CFD
has been presented to and considered for approval by the City and the City Council, and with the
aid of staff has reviewed and considered the JCFA, finds that it will be beneficial to residents of
the City and that it is suitable for approval, subject to the conditions set forth in this Resolution;
and
WHEREAS, following the adoption of this Resolution, all further proceedings with respect
to the formation of the Village 3 Phase II CFD and the issuance of special tax bonds and other debt
for the Village 3 Phase II CFD shall be undertaken by CMFA with the exception of the Acquisition
Agreement which shall be approved by the City Council prior to the issuance of special tax bonds
and/or other debt for the Village 3 Phase II CFD.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Chula Vista,
that:
SECTION 1. Recitals. Each of the above recitals are true and correct and are hereby
incorporated into this Resolution as though fully set forth herein.
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Resolution No. 2022-201
Page No. 3
SECTION 2. Goals and Policies. The formation of the Village 3 Phase II CFD is
hereby authorized provided, that the Village 3 Phase II CFD will be formed in accordance with
the City’s Goals and Policies with the following exceptions: (1) the prohibition on financing
development impact fees; (2) the prohibition on the escalation of the maximum special tax to pay
for public facilities; (3) the payment to the City of compensation equal to one percent (1%) of the
total authorized bonded indebtedness; (4) the requirement that an appraisal be coordinated by, done
under the direction of, and addressed to the City; and (5) the requirement that all consultants
including the appraiser, be selected and retained by the City.
SECTION 3. Approval of JCFA. The form of JCFA as presented to this City
Council and on file with the City Clerk is hereby approved. The City Manager and such other
official or officials of the City as may be designated in writing by this City Council (each, an
“Authorized Officer” and together, the “Authorized Officers”) are each authorized to execute the
JCFA for and on behalf of the City with such changes thereto as such Authorized Officer,
following consultation with the City Attorney and Best Best & Krieger LLP, deem to be in the
best interests of the City.
SECTION 4. Authorizations. The Authorized Officers and other officers,
employees and agents of the City, are hereby authorized and directed, jointly and severally, to do
any and all things which they may deem necessary or advisable in order to consummate the
transactions herein authorized and otherwise to carry out, give effect to and comply with the terms
and intent of this Resolution. All actions heretofore taken by the Authorized Officers and other
officers, employees and agents of the City with respect to the CMFA and the BOLD Program and
the matters described herein are hereby approved, confirmed and ratified.
SECTION 5. Effective Date. This Resolution shall take effect immediately upon
its adoption. The City Clerk is hereby authorized and directed to transmit a certified copy of this
Resolution to the Secretary of the CMFA.
[SIGNATURES ON THE FOLLOWING PAGE]
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Resolution No. 2022-201
Page No. 4
Presented by Approved as to form by
Laura C. Black, AICP Glen R. Googins
Interim Director of Development Services City Attorney
PASSED, APPROVED, and ADOPTED by the City Council of the City of Chula Vista,
California, this 23rd day of August 2022 by the following vote:
AYES: Councilmembers: Cardenas, Galvez, McCann, and Casillas Salas
NAYS: Councilmembers: None
ABSENT: Councilmembers: Padilla
Mary Casillas Salas, Mayor
ATTEST:
Kerry K. Bigelow, MMC, City Clerk
STATE OF CALIFORNIA )
COUNTY OF SAN DIEGO )
CITY OF CHULA VISTA )
I, Kerry K. Bigelow, City Clerk of Chula Vista, California, do hereby certify that the foregoing
Resolution No. 2022-201 was duly passed, approved, and adopted by the City Council at a regular
meeting of the Chula Vista City Council held on the 23rd day of August 2022.
Executed this 23rd day of August 2022.
Kerry K. Bigelow, MMC, City Clerk
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COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 1OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
BACKGROUND
The Mello-Roos CommunityFacilities Actof1982 (the “Mello-Roos Act”) andOrdinanceNo. 2730,
as amended fromtimetotimeandcodified inChapter 3.60 oftheChulaVista MunicipalCode (the
CFD Ordinance”) allowsforthecreationofCommunityFacilitiesDistricts (CFDs) tofinance certain
publiccapitalfacilities andservices, especially indeveloping areasandareasundergoing
rehabilitation. Asa prerequisite toformingCFDs pursuant totheMello-RoosAct, eachlocal
jurisdictionmust firstconsiderandadoptlocalgoals andpolicies asdescribed therein. TheCityfirst
adopted theCityofChulaVista Statement ofGoals and Policies Regarding theEstablishment of
CommunityFacilitiesDistricts (the “GoalsandPolicies”) onJanuary 13, 1998, via Resolution No.
18860. TheGoals andPoliciesweresubsequentlyamendedinJuly 1998, December1998, and
November 2013viaResolution Nos. 19103, 19300, and2013-225, respectively. Inclusion ofthe
GoalsandPolicies” intheCityCouncilPolicyManualisrecommended andareapplicable toCFDs
formedundertheMello-RoosActandtheCFDOrdinance.
PURPOSE
Thepurpose ofthisStatement ofGoalsand PoliciesistoprovidetheCitystaff, theresidents ofthe
City, andtheownersanddevelopers ofpropertylocatedwithintheCitywithguidanceinthe
applicationfor, andconsideration of, theestablishment ofcommunityfacilitiesdistricts for the
purpose offinancingorassistinginfinancingtheacquisition orconstructionofpublicinfrastructure
ortheprovisionofauthorizedpublic services tobenefit andserveeitherexistingornew development
oracombination thereof. Theunderlyingprincipalsbehind thispolicy arethe protection ofthepublic
interest, assuringfairness in theapplicationofspecialtaxesto current andfuture property owners,
assuring fulldisclosure oftheexistence of anyspecial taxliens, ensuringthecreditworthinessofany
community facilities districtspecial taxbonds, protectingtheCity's creditratingandfinancial
positionandassuringthatapplicants forallcommunity facilitiesdistrictproceedings otherthanCity
initiated proceedingspayallcostsassociated withtheformation ofany communityfacilities district.
POLICY
TheCityCouncil oftheCityofChula Vista (hereafter the “CityCouncil”) herebyestablishes and
statesitsgoalsandpolicies concerningtheuseofChapter 2.5ofPartIofDivision 2ofTitle5ofthe
Government Codeof theState ofCalifornia (hereafter the “Act”) inproviding adequate public
infrastructureimprovements andpublic servicesfortheCityofChula Vista (the “City”). The
following goalsand policiesshall applytoallcommunityfacilitiesdistricts hereafter formed or
proposedtobeformedbytheCity. Any policyorgoal statedherein maybesupplemented oramended
Exhibit 1 Resolution No. 2022-201
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COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 2OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
by resolution of the City Council.
The scope of thispolicy is limitedtotheproposed formationofcommunityfacilities districts forthe
limited purpose offinancingorassistinginfinancingtheacquisition orconstruction ofpublic
infrastructure and/or the provision ofauthorized public services.
Introductory Statement
The City will considerapplications initiated by owners or developers of vacant property proposed to
be developed, ownersof property within existing developed areas, registered votersresiding in
existing developed areas, orthe City itself for the establishment ofcommunity facilities districts to
financeauthorizedpublic improvements or to provide authorizedpublic services which benefit or
serveexisting or new development or a combinationthereof. A community facilities district or an
improvementarea within a community facilities district proposed to be established to finance public
improvements orauthorized services to serve new development may bereferred to as a “Development
Related CFD.”
Each application for theestablishment of a community facilities district mustcomply with the
applicable goals and policies contained herein unless theCity Councilexpressly grants an exception
to suchpolicy or policies asthey apply toa specificapplication.
Finding of Public Interest or Benefit
The City Councilmay authorize the initiation of proceedings toform a community facilities district to
finance authorized public improvements or to provide authorized public services if the City Council
determines that the public improvements to befinanced or public services to beprovided or, in the
caseof aDevelopmentRelated CFD, the attributesof the new development will provide, in the
opinion of the City Council, a public benefit to the community at large as well as the benefit to be
derived by the properties within the community facilities district.
Examples of public benefit to the community at largemay include, but arenot limitedto the
following:
1. Construction of a major public facilitywhich meets a community need including, but
not limited to, a major arterial which willprovide a vital roadway facility to alleviate congestion,
water storagefacilities which will remedy inadequatefire flow, and storm drainage facilities which
are a part of the storm drainage master plan.
2. Provision of public infrastructuresooner than would otherwise be required for a
Exhibit 1 Resolution No. 2022-201
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COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 3OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
particular developmentproject.
3. Construction of publicinfrastructure toservecommercial orindustrialprojects which
willexpand the City's employment and/or sales tax base.
4. Provision of maintenance or other authorized publicservicessuchaslandscaping,
lighting, storm drain, floodcontrol oropenspacemaintenancenecessary topromote ormaintain
quality oflifeandpublic safetywithin existing ordeveloping areasoftheCity.
Authorized Public Facilities
Improvementsproposed tobefinancedthroughacommunityfacilities districtmust bepublic
improvementswhich willbeowned, operatedormaintained bytheCityoranotherpublicagencyor
publicutility or to which the Cityisauthorized to contributerevenue. Thetypes of improvements
eligible to be financed must serve a whole neighborhood orcommercial orindustrial areaor greater.
Such improvements include:
1. Streets and highwayssatisfying one or moreof the following criteria:
A. identified in the Circulation Element ofthe City as collectors orarterials;
B. no direct access by abutting properties; or
C. minimum daily traffic volume of 3,500 ADT.
2. Sewer lines or other sewer facilities serving a minimum of 500 single family dwellings
or equivalent dwelling units or such other area of the community as the City Manager, or his orher
designee, may determine to otherwise be consistent with the intent of these goals and policies to be
located within authorized streets and highways or within otherpublicrights-of-way shown on the
master plan of sewerfacilities.
3. Water mains with a minimum diameter of 10" or otherwater facilities tobe located
within authorizedstreetsand highways or within otherpublicrights-of-way shown on themaster plan
of water facilities.
4. Drainage facilities serving a minimum of 100 acres or such other area of the
community asthe City Manager, orhis orher designee, may determine to otherwise be consistent
with the intent of thesegoals and policies or draining an eligible street.
5. Landscaping and irrigation facilities meeting one of the following criteria:
A. Located within the right-of-way of a street or highwayshown on the
Exhibit 1 Resolution No. 2022-201
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COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 4OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
Circulation Elementofthe City'sGeneral Plan;
B. Locatedadjacent toanadoptedscenic route; or
C. Locatedwithindedicatedopen space.
6. Reclaimedwaterfacilities serving anareawhichbenefits thearea withintheproposed
communityfacilities district.
7. Dry utilitiesservinga minimum of500 single familydwelling units orequivalent
dwellingunitsorsuchotherareaof thecommunity astheCityManager, orhisorherdesignee, may
determineto otherwise be consistent withthe intentofthesegoals andpolicies; provided, however,
theamountofspecial taxbondproceedsallocabletosuch dryutilitiesmaynot exceedthatamount
permitted underFederal taxlawandregulations toensurethetaxexemptstatusofintereston the
applicablespecial taxbonds.
8. Grading foreligiblepublic streets; provided, however, grading foraDevelopment
RelatedCFDmustmeetoneofthefollowingcriteria:
A. Grading withinthevertical planesoftheright-of-way;
B. Slopes toCity-ownedopen spaceoropen spaceeasement areas; or
C. Offsite roadwaygrading.
Ifthecutandfillwithin (A) and (B) donotbalance, thecostofexcavating, haulingand
compactingfillinthestreet isauthorized tobefinanced. Ifthere isexcess material in
thestreetright-of-way, onlythecostofexcavating andhauling toprivate property
withinthedevelopment projectiseligibletobefinanced. The determination ofbalance
willbemadeonatotaleligiblestreetgrading basis, notonanindividual street basis.
9. Such otherimprovements asmaybeauthorized bylaw andwhich theCityCouncil
determines areconsistentwith thepoliciesherein.
The CityCouncilshall havethefinaldeterminationastotheeligibility ofanyimprovement for
financing, aswellastheprioritization offinancingof suchimprovements. Generally, “in-tract” (e.g.,
local streets or utilities) improvements which serve residentialdevelopment willnotbeconsidered
eligible to be financed through a community facilities district unless requested bytheowners or
registered voters of an existing residential development toremedyathreat, foundtoexist bytheCity
Council, to the public health or safety resulting from an existing deficiency inpublicimprovements to
serve suchexisting development.
Exhibit 1 Resolution No. 2022-201
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COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 5OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
Any public improvements proposed tobefinanced throughacommunity facilitiesdistrict mustmeet
alldesign andconstruction requirements and standards asmaybeestablished by theCity. Anypublic
improvement, the construction of which iscompleted following theadoption of the resolution of
formation ofa community facilities district, proposed to beacquired by the Cityfrom the owner or
developer of property within a DevelopmentRelated CFD mustbe constructed as if such
improvements had been constructed under the directionand supervision, or under the authority of, the
City.
Public improvements proposed to be acquired from the proceeds ofspecial taxbonds orspecial taxes
shall not be acquired until all improvements for a particular Project (as defined below) are completed
and accepted by the City and the City Manager, or his or her designee, has certified thefinal cost of
such improvements. For purposes of this paragraph, a “Project” shall bedefined as all improvements
within aparticular street or easement including street improvements, sewer, drainage, utilities and
grading and whichare authorizedto beacquired by the community facilitiesdistrict pursuant to an
acquisition and financing agreement by andbetween the City, acting on behalf of itself andthe
community facilities district, and the propertyowner or developerwho is responsible for the
construction of the public improvements (the “'Acquisition/Financing Agreement”). If improvements
within morethan one (1) Project are authorized to be acquired through the community facilities
district, then the improvements within each Project may be acquired separately as all improvements
within such Project are completed and accepted by the Cityand the final costs certified. Each Project
establishedfor any community facilities district and all improvements included withineach such
Project must be described in the Acquisition/FinancingAgreement for suchcommunity facilities
district. If the Acquisition/FinancingAgreement has established more than one (1) Project for any
community facilities district, the Acquisition/FinancingAgreement may authorize the partial release
of funds to pay for the acquisition of each Project when such Projectis completed and acceptedby the
City.
The City Council may, in its sole discretion, elect to deviate from or waive the foregoing policyin its
consideration of theapproval of an Acquisition/FinancingAgreement for acommunity facilities
district to authorize the payment of the purchase price foreach discretecomponent of a Project, i.e.,
an individual improvement within a Project such asa sewer line withina Project which alsoincludes
street, water and drainageimprovements. In electing to deviate from orwaive the foregoing policy,
the City Councilmay condition the paymentof the purchase price for discrete componentsas the City
Council deems necessary to ensure the financial integrity of the community facilities district
financing.
Exhibit 1 Resolution No. 2022-201
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COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 6OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
Prioritization of PublicImprovements
It is the policy of the Cityto givefirstpriority totheprovisionofpublic improvementsbenefitingthe
Cityinany communityfacilities districtestablished by theCity. Itissecondarily thepolicyofthe
City, inanycommunity facilitiesdistrict established bytheCity, toassist inthe provisionofother
publicimprovements tobeowned, operated ormaintained byotherpublicagencies orpublicutilities.
AuthorizedPublicServices
Publicservicesproposed tobefinancedthroughacommunity facilities districtmayinclude:
1. Maintenance ofparkways, medians andopen space, including butnotlimitedto,
maintenanceof walls, fences, trailsystems, pedestrian access systemsandotherfacilitieswithin such
openspace, maintenance andpreservationofhabitatwithinsuchopenspace, andbiotaandother
formsof monitoringof plants, wildlife, useof wildlifecorridorsandhabitatquality asapartofany
suchopenspace maintenance program.
2. Maintenanceofnaturalized drainage andfloodcontrol facilitiesincluding, butnot
limitedto, channels and detentionanddesiltation basins.
3. Suchotherservicesasmay be authorized by theMello-RoosAct orbyordinance of
theCityadoptedpursuant tothecharter authority oftheCityandwhichtheCity Councildetermines
are consistent with the goalsandpolicies hereinandareinthebestinterest oftheCityandthe
residentsandproperty ownerswithinthecommunityfacilities district.
Incidental Costs
Eligible IncidentalCosts
Eligible incidental costs whichmaybefinancedfromtheproceeds ofspecial taxbondsissued fora
DevelopmentRelated CFDor thespecial taxlevied within a DevelopmentRelated CFDshall be
limitedtothoseincidentalcosts directly related totheimprovements financed fromtheproceedsof
suchspecial taxbondsorspecialtaxrevenuesandmayinclude:
1. Usual andcustomarydesignandengineeringcostsnotto exceedthe following
percentages:
A. Civilengineering - 7.5% ofthecost oftheimprovements forwhichthe
engineering was performed.
Exhibit 1 Resolution No. 2022-201
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COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 7OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
B. Soils engineering - 15% of thecost oftheapplicablegrading.
C. Landscape architecture - 10% ofthecostofthe applicable landscaping and
irrigation.
D. Surveyingandconstruction staking - 2% ofthecombinedcostofthecivil
engineeringimprovements andgradingfor theapplicable streetandwet
utilities.
E. Utility engineering/coordination - 3% ofthecostoftheapplicable dryutilities.
2. Construction administration and supervisionnottoexceed, inaggregate, 1.75% ofthe
total constructioncost of theapplicable publicimprovements.
3. Specialengineeringstudies related to "collector" or "transmission" facilities. Eligibility
of such studies must be reviewed and approved by the Directorof Development Services, or his orher
designee.
4. Plan check and inspectionfees (less any refunds).
5. Capacity or connection fees related solely to the public improvements beingacquired
or constructed aspermitted under the Mello-Roos Act.
6. Capitalizedinterest onanycommunity facilitiesdistrict specialtaxbondsasauthorized
bytheCityCouncilpursuant tothesegoals andpolicies.
7. Costs ofacquisition ofoff-siterights-of-wayand/oreasementsincluding thefollowing:
A. Appraisalcosts, including titlereports.
B. Costs ofpreparingacquisition plats.
C. Appraised valueoractualcostofright-of-wayoreasement, whichever isless.
D. Legalfeesand costrelatedtoeminent domain proceedings approvedbythe
City Attorney.
8. Reimbursement of funds advanced by the applicant to pay for (i) preformationcosts
and/or (ii) costs of issuance incurred by oron behalf of the City.
9. Costs of environmental review, permitting and mitigation limited to the specificpublic
improvements proposedto be financed through the community facilities district.
Unless specified otherwiseabove, the CityManager, or his orherdesignee, shall review allincidental
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 8OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
costs to ensure that suchcosts are customaryandreasonable.
Ineligible IncidentalCosts
Thefollowing costs arenoteligibletobefinanced from theproceedsofcommunityfacilities district
specialtaxbonds:
1. Development impact fees; provided, however, the CityCouncilmay, in itssole
discretion, grantcreditin anamountnottoexceedthe obligationforthe paymentofsuchfees if
improvementswhich would otherwise befinancedfromthe proceeds ofsuchfeesarefinancedfrom
the proceeds of community facilities district special tax bonds orspecial taxes.
2. Administrative or overhead expenses, financial orlegal feesincurred byan applicant
for theformation ofacommunity facilities district. Thislimitation doesnotapply toamounts
advanced by the applicant tothe City pursuant to theprovisions ofthispolicy topayforpreformation
costsincurred by the City. (See “Preformation Cost Deposits and Reimbursements” below.)
3. Land useplanning and subdivision costs and environmental review costs related to
such land use planning and subdivision.
4. PlanningStudies unless off-site.
5. Environmental impactreports unless off-site.
6. Construction loan interest.
7. Subdivision financial analysis.
8. Attorneys’ feesrelated to the land use entitlement or subdivision process unless off-
site.
9. On site right-of-way and easements.
10. Any compensation payable to the City as consideration for theCity's agreement to
provide the financing mechanism for the financing ofthe authorized improvements and eligible
incidental expenses and to acquire the authorized improvements pursuant to the terms and conditions
of an agreement with the City and the property owner or developer as appropriate.
11. Other overhead expenses incurred bythe applicant.
Required Value-To-Debt Ratio
It is the policy ofthe City thatthe value-to-debtratio for a community facilities districtmustbeat
Exhibit 1 Resolution No. 2022-201
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COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 9OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
least 4:1. The calculated value-to-debt ratioshallreflect thefullcash valueof thepropertiessubject
to the levy of special taxes, including the valueof the improvements tobefinanced fromtheproceeds
of the issue or series of specialtax bonds for which the value-to-debt ratio is being computed,
comparedto theaggregate amount of the special tax lien proposed to be created plusany priorfixed
assessment liens and/or special tax liens. The required value-to-debt ratio shall be determined with
respect to all taxable property within the community facilities district in the aggregate and with
respect toeach development areafor which no finalsubdivision map has been filed.
A community facilities district with a value-to-debt ratio of less than 4:1 but equalto or greater than
3:1 may be approved, in the sole discretion of the City Council, upon a determination bytheCity
Manager, after consultation with the Finance Director, the bond counsel, the underwriter and the
financial advisor, that a value-to-debt ratio of less than 4:1 is financially prudentunder the
circumstances of the particular community facilities district. Inaddition, the City Council may, in its
sole discretion, accept a form or forms of credit enhancement such as a letter of credit, bond insurance
or the escrow of bond proceeds to offset a deficiency in the required value-to-debt ratioasitappliesto
the taxable property within the community facilities district in the aggregate or with respect to any
development area.
The value-to-debt ratio shall be determined basedupon the full cash value ofthe propertiessubject to
the levy of the special tax as shown onthead valorem assessment roll or upon an appraisal of the
propertiesproposed to be assessed; provided, however, the City Manager may require thatthe value-
to-debt ratio be determined by an appraisal if, in his or her judgement, the assessed values of the
properties proposed to be assessed do not reflect thecurrent fullcash value of suchproperties. The
appraisal shall be coordinated by, doneunder the direction of, and addressed to the City. The
appraisal shall be undertaken by a state certified real estateappraiser, as defined in Business and
Professions Code Section 11340. The appraiser shall be selected and retained bythe City or theCity's
financial advisor. The costs associated with the preparation of the appraisal reportshall bepaid by the
applicant for the community facilities district and shall besubject to possible reimbursement as
provided for herein. The appraisal shall be conducted in accordance with assumptions and criteria
established by the City, based upon generally accepted appraisal standards or state recommended
standards forsimilar appraisals conducted for thesame purpose.
The City reserves the right to require a market absorption study for any Development Related CFD. In
any such case the City shallretain, at the applicant's sole expense but subject to reimbursement as
provided for herein, a consultant to prepare areport to verify or establish the projected market
absorption for and the projected sales prices of theproperties proposed to be included withinthe
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 10OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
community facilities district. If a market absorption study is conducted, theappraisershallutilize the
conclusionsofthemarketabsorptionstudyin conducting theappraisal oftheproperties within the
proposedcommunity facilities districtorshalljustify, tothesatisfaction oftheCityManager, why
suchconclusions werenot utilized inconductingsuchappraisal.
CriteriaforAppraisals
Definition ofAppraisal
Forpurposes ofthesegoals andpolicies, anappraisal shallmeanawritten statementindependently
and impartially prepared by aqualifiedappraisersettingforth anopinionofdefinedvalue ofan
adequatelydescribed property asofaspecificdate, supported bythepresentation andanalysisof
relevant market information.
Contents of the Appraisal
An appraisal should reflect nationally recognized appraisal standards, including, totheextent
appropriate, the Uniform Standards of Professional Appraisal Practice. An appraisal must contain
sufficient documentation, including valuation data and the appraiser's analysis of such data, to support
the appraiser'sopinion of value. At a minimum, the appraisal shallcontain the following:
1. Purpose of the Appraisal. This shouldinclude the reason for the appraisal, a definition
of all values required, and theproperty rights being appraised.
2. Area, City and Neighborhood Data. These data shouldinclude such informationas
directly affects the appraised property together withthe appraiser's conclusions astosignificant
trends.
3. Property Data. Thisshouldinclude a detailed physical description oftheproperty, its
size, shape, soilconditions, topography, improvements, andotherphysical characteristicswhich affect
the property being appraised. The availability, capacity of, and proximityto, utilities andother
infrastructure should also be discussed.
4. Title Condition. The condition of title to the property appraised should be discussed
based upon the appraiser’s examination ofa title report ofthe property appraised. The appraiser
should analyze and discuss those title issues whichare concluded to impact thevalue of the property
being appraised.
5. Improvement Condition.
A. The appraiser shall valuethe property within the community facilities district
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 11OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
on an “as-is” basis taking into considerationthevalue associatedwiththe
public improvements tobefundedfromtheproceeds oftheissueof bondsfor
which the appraisal is beingundertaken. The propertyinthecommunity
facilities district shall be valued as ifit were freeand clear of any special taxes
and assessments, if any, so that a proper comparison of value-to-debt can be
determined. In determining his or her conclusion of value, the appraiser may
considerthe value of the property in the community facilities district under
different market conditions. This may consist of valuing the property as ifit
were sold to a single purchaser in bulk or sold to several purchasers in portions
or pieces.
B. Land parcels which have beendeveloped with residences and subsequently sold
should at a minimumindicate land parcel size, number of lots, density, number
of plans, square footage, room counts, year construction wasinitiated, year of
completion, andwhen sales were initiated.
C. Land parcels with residential product under construction or with standing
inventory should be described as in A. above and include a summary of the
stage of development regarding thenumber of units completed, number of
models, status of units under construction, finishedlotsandmass-gradedor raw
lots. In addition, a comment on the marketability ofthe units (architecture, size,
etc.) isappropriate.
D. Landparcels whichhave beendeveloped with income-producing (or owner-
occupied) commercial/retail, industrial, hotels, apartments, offices, etc., should
be described as follows:
i. Commercial-Retail - Landparcel size; basicconstruction type; typical
tenantimprovements (and who is responsible fortheirconstruction);
leasable area, whenconstructionwasinitiated; anddateofcompletion.
ii. Industrial - Land parcel size; basic construction type, whethersingle or
multi-tenant; typicaloffice build-out as percentage of total area, when
construction wasinitiated; anddate of completion.
iii. Hotels – Land parcel size; basic construction type; numberof rooms;
dining, recreation, convention space, meeting rooms, and other
amenities.
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 12OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
iv. Apartments - Land parcel size; basic construction type; numberof
stories; number of units; unit mix; size; totalrentablearea, when
construction wasinitiated; anddate of completion.
v. Office - Land parcel size; basic construction type; typical tenant
improvements/allowance; net rentable area, when construction was
initiated; and date of completion.
6. General Plan Classification. Describe the General Plan classification ofthe subject and
comparable properties.
7. Zoning. Describe the zoning for the subject and comparable properties. Note any
discrepancy betweenGeneral Plan classification and zoning. If rezoning is imminent, discuss further
under Item 8 below.
8. Analysis of Highest and Best Use. Thereport should state and support the highest and
best use to which a propertycan be put and recognize thatland is appraised as though vacant and
available for development to its highest and bestuse, and the improvements arebased on their actual
contribution to the site.
9. Statementof Value. The appraiser's opinion of the value of the specified property
rights, prepared according to all relevant and reliable approaches to value consistentwith commonly
accepted professional appraisal practices. If a discountedcash flow analysisis used, it should be
supported by at leastone other valuation method suchas sales comparisonapproach utilizing sales of
properties that arein the same stage of development. If morethan one valuation approach is used, the
appraiser shall include an analysis and reconciliation of such approaches tosupport the appraiser's
opinion of value.
10. Certification. Certification of appraiser and permission to reproduce and use the
appraisal report as required for bond issuance.
Maximum AggregateTaxes and Assessments
It is the policy of the City that the maximum annualspecial tax installment applicable to any parcel
used forresidential purposes (not including motels, hotels, campsites, or othershort-term lodging, as
determined by theCity) shallnot exceed one percent (1%) of the sale price of newly developed
propertiessubject to thelevy of the special tax (the “Newly DevelopedProperties”) as of the date of
the close of escrow of the initial saleof any residential dwelling unit to such residential home owner.
Asa distinct and separate requirement, the total of the following taxes, assessments described in 4.
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 13OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
below and special taxes appearing onthepropertytaxbill, shallnotexceed two (2%) ofsuchinitial
salesprice ofNewlyDevelopedProperties:
1. Advaloremproperty taxes.
2. Voterapproved advaloremproperty taxes inexcess ofone percent (1%) of the
assessed value of the subjectproperties.
3. The maximum annualspecialtaxesleviedbythecommunity facilitiesdistrict under
consideration and anyother communityfacilities district orotherpublicagency excepting therefrom
specialtaxes leviedbyacommunityfacilities districtformedorunderconsideration forformation for
the purposeofprovidingservicessuchasopen spacemaintenance, landscape maintenanceand
preservemaintenance.
4. Theannualassessment installments, including anyadministrativesurcharge, forany
existingassessment district wheresuchassessment installments areutilizedtopay debtservice on
bondsissued for suchassessmentdistrict. Annual assessmentinstallments for maintenanceand
services shall notbeincluded inthe assessmentscalculated indetermining the aggregate tax,
assessment andspecialtaxobligationforaparcel.
Theapplicantfortheestablishment ofanyDevelopmentRelated CFD whichincludesresidential
development subjecttotheforegoing limitationsshallberequired to enter intoanagreement withthe
Cityorthecommunity facilities districtrequiringtheprepaymentbytheapplicantofthat portionof
thespecial tax obligation applicable toanyparcelused for residential purposes inorder toreduce the
annualmaximum special taxobligation sothatthemaximum annual specialtax installment shallnot
exceed1% ofthesalespriceforsuchparcelandthetotaltaxes, assessments andspecial taxesdoes
notexceed 2% ofsuchsalesprice.
SpecialTaxRequirements
Therateand methodofapportionment ofthespecial taxforanycommunity facilities district shall
adhere to thefollowingrequirements:
1. Themaximumspecial taxshall beadequate toinclude anamount necessarytopayfor
theexpenses incurredbysuchcommunity facilities district inthelevyand collection ofthespecial tax
andtheadministrationofthespecial taxbondsand thecommunityfacilitiesdistrict.
2. Themaximumprojectedannual specialtaxrevenues mustequal110% oftheprojected
annualgrossdebtserviceonany bondsofthecommunityfacilitiesdistrict.
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 14OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
3. A backupspecial tax shall be required for any DevelopmentRelated CFDto protect
against changes in density resulting in the generation of insufficient special tax revenues to pay
annual debt serviceand administrative expenses, unless the City Manager, orhisorherdesignee,
based onthe advice of the financialadvisor, special tax consultant or underwriter determines that a
backup special tax is not needed under the special tax formula for such DevelopmentRelated CFD.
The City Council may additionally or alternatively require that as a condition of approval of the
downsizing of the development ina Development Related CFDat therequest of the applicant or the
applicant's successor-in-interest, the applicant orthe applicant's successor-in-interest, asapplicable,
may be required toprepay such portion of the special tax obligation asmay be necessary in the
determinationof the City to ensurethat adequate debtservicecoverage existswithrespect toany
outstanding bonds orotherwiseprovides security in a formandamount deemednecessary bytheCity
Council to provide for the payment of debt service on the bonds.
4. All developed and undeveloped property within any community facilitiesdistrict
whichis nototherwise statutorilyexemptfromthelevyof specialtaxes shallbearitsappropriate
share of the community facilities district’s aggregate special tax obligation fromthe dateof formation
of the community facilities district consistent with the other goals and policies set forthherein.
5. A partial and/or total prepayment option shall be included in any rate and method of
apportionment ofspecial taxes topay forpublic facilities. No prepayment shall bepermitted ofa
special tax levied to financeauthorized services and/or maintenance.
6. The maximum special tax to pay for public facilitiesshallbelevied against anyparcel
used forprivate residential purposes in thefirst fiscal year following thefiscal yearin which the
building permit for the construction ofa residential dwelling unit on suchparcel isissued andsuch
maximum special tax may not escalateafter the first fiscal year in which such special tax is so levied.
7. The rate and method of apportionment of a special taxtopayforpublic facilitiesshall
specify afiscal year beyond whichthespecialtaxmay notbeleviedon anyparcelusedforprivate
residential purposes. Aspecialtax topayforpublicservices and/ormaintenanceshallhaveno
termination dateunless established bytheCityCouncil.
8. Therateand methodofapportionmentof aspecialtax topayforpublic servicesand/or
maintenanceshallinclude life-cyclereplacement costsformaintained facilities, as determined bythe
CityManager, orhis orherdesignee.
9. Therate andmethodof apportionmentofaspecialtax topayforpublic servicesand/or
maintenance shallauthorize annualinflationary adjustments to themaximum special tax. The
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 15OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
authorized adjustments shall be basedupon industry standard published indices, orsuchother dataas
may beapproved by theCity Manager, or his or her designee. In all instances, it shall be thepolicy of
the Cityto employ the most specific applicable index. Examples includeapplying theConsumer
Price Index for Urban Wage Earners andClericalWorkers tolaborcosts andapplying the
Construction Cost Index to assetreplacement costs.
Terms and ConditionsofSpecial TaxBonds
Alltermsandconditions ofanyspecial taxbonds issuedby theCityforanycommunity facilities
district, including, withoutlimitation, thesizing, timing, term, interestrates, discount, redemption
features, flow of funds, investment provisions and foreclosure covenants, shallbeestablished bythe
City. Each special taxbondissue shall bestructured toadequately protect bondowners andtoavoid
negatively impacting thebonding capacity orcreditworthiness oftheCity. Unlessotherwise
approved by the City Council, the following shall serve as minimum bond requirements:
1. Areserve fund shall be established for each bond issue to be funded out of the bond
proceeds in an amountequal to10% oftheoriginal proceeds of thebondsorsuch lesseramountas
may be required by federaltaxlaw.
2. Interest shall be capitalized fora bond issueonlysolongasnecessarytoplacethe
special tax installments onthe assessment roll; provided, however, interest maybecapitalizedfora
term to be established in the sole discretion of the City Council on a case-by-case basis, nottoexceed
an aggregate of 24 months, taking into consideration the value-to-debt ratio, theexpected timing of
initial occupancy dates for the private improvements being constructed, expected absorption and
buildout of the project, the expected construction and completion schedule for the public
improvements to be funded from the proceeds of the bond issue in question, the size of the bond issue,
the development pro formaandthe equity position of the applicant and such other factors as the City
Councilmay deem relevant.
3. In instances where multiple series of bondsare to be issued, the City shall determine
what improvements shall befinanced from the proceeds ofeach seriesof bonds.
4. Neither the faith, credit ortaxing power of the City shall be pledged to the payment of
the bonds. The sole source of revenue forthe payment of the bonds shall be the special taxes,
capitalized interest, if any, and moneys ondeposit in the reserve fund established for suchbonds.
Discharge of Special Tax Obligation
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 16OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
It is the policy of the City thatthe special tax obligation related to the financing of theacquisitionor
construction ofpublic improvements may be prepaid and dischargedin whole or in part at any time.
The applicant for the formationofaDevelopment Related CFD mustprovide noticeandopportunity
for the purchasers of property within suchcommunity facilities districttoprepay thespecial tax
obligation applicable to suchproperty at the time of the close of escrow.
The applicant for the formationof a Development Related CFD must prepare and present aplan,
satisfactory to the City Council, prior to the public hearing to consider the formation of such
community facilities districtdescribing how theprospective purchaser will be notified of the
existence of the special tax lien and the options which the prospective purchaser hasregarding the
prepayment and dischargeofthespecialtaxobligation.
Disclosure to Property PurchasersinDevelopmentRelated CFD's
Theapplicantfortheformation ofaDevelopmentRelatedCFDwillberequired todemonstrate tothe
satisfactionofthe CityManager (when thetermCity Managerisusedherein itshallmeanthe City
Manager orhisorherdesignee) thattherewillbe fulldisclosureofthespecialtaxobligation forsuch
community facilitiesdistrict andofanyandallotherspecial taxesorassessments onindividual
parcelsto prospective purchasers or lessees of propertywithin suchcommunityfacilities district,
including interimpurchasers, merchant builders, residential homeownersandcommercial orindustrial
purchasersorlessees.
Suchnoticemust includeallof thefollowing inaddition to suchotherprovisions asmay berequired
bytheMello-RoosAct, theMunicipalCodeoftheCityortheapplicant maydeemnecessary:
1. Provide forfulldisclosure oftheexistenceofthespecial taxlienandany other
assessment orspecial taxobligation applicable to theproperties withinthecommunity facilities
district (whether imposedbythe Cityoranyotherpublicagency), including the principalamount of
thespecialtaxobligation and anyotherapplicableassessment orspecial taxobligation, term ofeach
oftheassessment orspecial taxliensandtheamountoftheexpectedpayments ofthespecial taxes
andthemaximumauthorized special tax.
2. Disclosetheoptiontoprepaythespecial taxtopay forpublicfacilitiesorallowthe
specialtaxtopayforpublicfacilities tobepassedthroughto thepurchaserof suchpropertyand the
adjustment, ifany, inthe salespriceofthehomesorother property whichwill apply ifthe specialtax
lienispassedthrough. Provide theabilityfortheprospective purchasertoelecttoexercise theoption
eitherto prepaythe specialtax obligation forfacilitiesat thecloseof escrowor tohavethe special
taxesincluded intheproperty taxesfortheproperty. Suchdisclosure shallbeplaced inallsales
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 17OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
brochures, all other on-site advertising andallpurchasedocuments.
3. Specify inalldisclosure documents thename, title, telephonenumber andaddress ofa
representative oftheCityasprovided totheapplicantwhomaybecontacted byanyprospective
purchaserofproperty withinthecommunity facilitiesdistrictforfurtherinformation regarding the
community facilities districtandthespecialtaxliens.
The applicant mustagreetoprovideanoriginalcopy ofallapplicable disclosuredocuments tothe
Citypriortoinitiatingpropertysales.
Preformation Cost DepositsandReimbursements
Except forthoseapplications forcommunity facilities districtswhere theCity istheapplicant, allCity
and consultantcostsincurredintheevaluation ofapplications andthe proceedings toforma
communityfacilities districtand issue special taxbondsthereforwill be paidbytheapplicantby
advancedeposit withtheCityofmoneys sufficienttopayallsuchcosts.
Each application fortheformation ofacommunityfacilities district shall beaccompanied byaninitial
deposit inanamounttobedetermined bytheCityManagertobeadequate tofundtheevaluationof
theapplication andundertake the proceedingstoformthe communityfacilities districtandissuethe
specialtaxbonds therefor. TheCityManager may, inhisorhersolediscretion, permitanapplicant to
makeperiodicdeposits tocoversuch expensesrather thana single lumpsumdeposit; provided,
however, nopreformation costsshall beincurred bytheCityinexcess oftheamount thenon deposit
for suchpurposes. Ifadditionalfundsare required topayrequiredpreformation costs, theCity
Manager may make written demand upon theapplicant for suchadditional fundsandtheapplicant
shall depositsuchadditional funds with theCitywithin five (5) working daysofthe dateofreceipt of
suchdemand. Upon the depletionofthefundsdepositedbyapplicant forpreformationcosts, all
proceedings shall besuspended untilreceipt bytheCityofsuchadditional funds astheCityManager
maydemand.
Thedeposits shallbeusedbytheCitytopayforcostsandexpenses incurred bythe Cityincident to
theevaluationoftheapplication andtheproceedingsfortheformationofthecommunity facilities
district and theissuance ofthe specialtaxbondstherefor, including, butnot limited to, legal, special
taxconsultant, engineering, appraisal, market absorption, financialadvisor, administrative andstaff
costsandexpenses, required notifications, printing andpublicationcosts.
TheCityshallrefund anyunexpended portion ofthe deposits upontheoccurrence ofoneofthe
following events:
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 18OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
1. Theformation of thecommunity facilities districtortheissuanceof thespecial tax
bonds;
2. Theformation of thecommunity facilities district or theissuance of thespecial tax
bonds is disapproved by the CityCouncil;
3. The proceedings for the formation of the community facilities district and the issuance
of the special tax bonds are abandoned at the written request of the applicant; or
4. The City has determined thatthe special taxbonds will not be issued andsold.
Except as otherwise providedherein, the applicant shall be entitled, at theoptionoftheapplicant, to
reimbursement of, or creditagainst, specialtaxesfor allamountsdeposited withtheCitytopayfor
costs incident tothe evaluation of the application and the proceedings for theformation of the
community facilities district and the issuance of the special tax bonds thereforupon the formation of
thecommunity facilities district and the successful issuance and sale of the special tax bonds for the
community facilities district. Anysuch reimbursement shall be payable solely from theproceeds of
the special tax bonds.
The City shall not accrue or payinterest on anymoneysdeposited with the City.
Selection of Consultants
The City shall select and retain all consultants necessary for the evaluation of any application and the
proceedings for the formation of a community facilities district andthe issuance of the special tax
bonds therefor, including, but not limited to, special tax consultant, bondcounsel, financialadvisor,
underwriter, appraiser, and market absorption analyst afterconsultationwiththeapplicant.
Land UseApprovals
Propertiesproposed tobeincludedinaDevelopmentRelated CFDmusthave received such
discretionary landuse approvalsasmay, inthedeterminationof theCity Manager, orhisorher
designee, benecessary toenable theCitytoadequately evaluate thecommunityfacilities district
includingtheproperties to beincluded andtheimprovements proposedtobe financed. TheCitywill
issuebonds securedbythelevyofspecial taxes within a Development RelatedCFDwhen (i) the
properties included withinsuchcommunity facilities district havereceived thoseapplicable
discretionary landuseapprovalswhichwould permitthe development ofsuchproperties consistent
withtheassumptions utilizedinthedevelopment of therateandmethod ofapportionment ofthe
specialtaxesforsuchcommunityfacilities district; (ii) applicableenvironmental review has been
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 19OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
completed; and (iii) the City has determined that the other prerequisites toabondsale havebeen
satisfied.
It is the policy of the City Council in grantingapproval for development such as zoning, specific plan
or subdivision approval togrant suchapproval as a part of the City’s ongoing planningandlanduse
approvalprocess. In granting such approval, the City reserves such rights as may be permittedbylaw
to modify such approvals in the futureas the City Councildetermines the public health, safety,
welfare and interest may require. Such approval when granted is subject to aconditionthatthe
construction of any part of the development does not, standing alone, grantanyrightsto completethe
development of the remainder of such development. Constructionof public improvements to serve
undeveloped land financed through a community facilities district shall notvestanyrightstothe then
existing land use approvals forthe property assessedfor such improvements or to any particular level,
type or intensity of development or use. Applicants for a Development RelatedCFD must include an
express acknowledgment of this policy andshall expresslywaive on their behalf and on behalf of
theirsuccessors and assigns any cause of action at law or in equity including, but not limited to,
taking ordamaging ofproperty, for reassessment of property or denialof any right protected byUSC
Section 1983which might be applicable to theproperties to be assessed.
Application Procedure for Development Related CFD's
Any application for theestablishment of a community facilities district shallcontain such information
andbe submitted in such form as the City Manager may require. In addition to such information as
the City Manager may require, each application must contain:
1. Proof of authorization to submit the applicationon behalf ofthe owner of the property
for which the application is submitted if the applicant is not the owner of such property.
2. Evidencesatisfactory to theCity Manager thatthe applicantrepresents or has the
consent of the owners of not less than 67%, by area, of the property proposed to be subject to the levy
of the special tax.
3. For any Development Related CFDproposed to finance improvements to benefit new
development, a business plan for thedevelopment of the property withinthe proposed community
facilities district and suchadditionalfinancial information as the City Manager maydeem necessary
toadequately review the financial feasibility of thecommunity facilities district. For Development
RelatedCFD’s proposed tofinance improvements tobenefit new development, the applicant must
demonstrate to the satisfaction of the City Manager the ability of the owner of the property proposed
to bedeveloped to pay the special tax installments for the communityfacilities district and any other
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 20OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
assessments, special taxes and advalorem taxesonsuchpropertyuntilfullbuildoutoftheproperty.
Itis the intention of theCityCouncilthatapplicants fora community facilitiesdistrict haveanearly
opportunity to havethe application reviewedbyCity staffforcompliance with thispolicy. Inthat
regard, the City Council hereby directs the City Manager to create a communityfacilities district
application review committee composed of the City Attorney, Director of Public Works, City
Engineer, Director of DevelopmentServices, and Finance Director, or their designees, and such
additional persons as the City Manager may deem necessary. The committee may meet with the
applicantfor a community facilitiesdistrict for the purpose of reviewing anapplication toforma
community facilities districtfollowing the determination bythe City Manager, or hisor her designee,
that the information containedin the application for suchcommunity facilitiesdistrictcomplies with
therequirementsofthis policy. Following thereview of suchanapplication, the committee shall
prepareandsubmitareporttothe CityManager containing thefindingsandrecommendations ofthe
committeeregarding theapplication.
Following review ofthecommitteereport, theCityManagershallplacetheapplicationontheCity
Council agenda forreview. Afterreview of theapplication andconsideration of thecommittee report,
theCityCouncil shalldetermine whetherornottoapprove theinitiation ofproceedings toformthe
community facilitiesdistrict. Thedecisionof theCity Councilpertaining to theapplicationshallbe
final.
Theability ofa property owner ordeveloper toobtain financingof public improvements fromthe
proceeds oftax-exemptbondsprovidessubstantialeconomicbenefits tosuch ownerordeveloper not
theleastofwhich maybethefinancingof suchimprovementsat interestratessubstantially lowerthan
conventional financing interest rates, if such conventional financing isavailable, and/ortheability to
obtainfinancing withoutproviding equitycompensation tothelender. Inprovidingsuchfinancing for
aDevelopmentRelated CFDthe CityCouncilbelievesthattheCityisproviding valuable
considerationtotheproperty ownerordeveloper andshouldbereceiveconsideration inexchange. It
isthegoaloftheCityto ensurethatthe Cityand theremainder ofitsresidents, property owners and
taxpayers arecompensated fortheconsideration provided totheproperty ownerordeveloperof a
Development Related CFD and that suchcompensation should beone percent (1%) ofthe total
authorized bonded indebtedness for such a community facilities district. Prior to the issuance of
specialtax bonds for anyDevelopmentRelated CFD, the applicant shall pay to the City the pro rata
amount of any compensationpayable to the City as consideration for the City's agreement to provide
the financing mechanism for the financing of the authorized improvements and eligible incidental
expenses and to acquire the authorized improvements pursuant to the termsand conditions of an
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 21OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
agreement between theCity andthe property ownerordeveloper asappropriate. Forexample, ifthe
compensation payabletotheCityforsuchconsideration is $100,000foraDevelopment RelatedCFD
wherethetotalauthorizedbonded indebtedness is $10,000,000andtheseries ofspecial taxbonds to
beinitiallyissuedis $5,000,000, thecompensationpayable totheCity prior totheissuance ofthe
initialseries ofbondswillbetheprincipal amount ofthe initialbond issue ($5,000,000) divided by
the totalamountoftheauthorizedbonded indebtedness ($10,000,000) multiplied bythetotal
compensation forsuch Development Related CFD ($100,000). In this example, the compensation
payable prior to the issuance of thefirst series of bonds would be: 5,000,000 100,000=$50,00010,000,000
Community Facilities Districts for EnergyEfficiency, Water Conservation, and Renewable
Energy Improvements
Introductory Statement
Senate Bill No. 555 (Statutes 2011, Chapter 493) amended the Mello-Roos Act to authorize the useof
community facilities districts for financing energy efficiency, water conservation, and renewable
energy improvements to privately orpublicly owned real propertyand buildings.
Inparticular, Senate BillNo. 555 added section 53328.1 to the Mello-Roos Act, thereby authorizing
special taxesto be levied only with the unanimous consent of all owners of property to be taxed by
such a district.
In light of the legislative findings in section 8 of Senate Bill No. 555, the CityCouncil may determine
to establish one or more programs through which theCity may use section 53328.1 of theMello-Roos
Act and the relatedprovisions added to the Mello-Roos Act by Senate Bill No. 555 to provide special
tax financing for improvements and properties that meet thecriteria set forth in the hearing report
prepared in connection with theestablishment of any such program (each a “Program”). The City
will administereachProgram or contract witha third-party to administer suchprogram (a “Program
Administrator”).
With respect to financings done through a Program, the goals and policies set forth in this section, as
such goalsand policies may beamended from timeto time, supersede any other goalsand policies
adopted by theCity concerningthe use of theMello-Roos Act.
1. Eligible Improvements. A program may be used tofinance or refinance the
acquisition, installation, and improvement ofenergy efficiency, water conservation, and renewable
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 22OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
energy improvements on realpropertyand in or onbuildings, whether the real propertyorbuildings
areprivately or publiclyowned, subject to the following:
A. For privately owned real propertyand buildings, each owner mustconsent in
advance to the financing, in writing.
B. Financing through a Program is not available for the initial construction of
privately-owned residential buildings unless that initial construction is
undertaken by the intended owner or occupant.
TheCity is not establishing anypriorities with respect to thefinancing of Eligible Improvements.
Priority for financing shall be considered on a case by case basis as determined by the City or the
applicable Program Administrator in accordance with thehearing report prepared in connection with
the relatedProgram, as amended or modified from time to time (each a “Hearing Report”). No
services (as defined byGovernment Code Section 53313) will be financed through any Program.
1. Notice to Prospective Owners. To ensure that prospective purchasers ofproperty
subject to a special tax leviedthrough a Program are fully informed about the tax, the relatedProgram
Administrator will record a notice of special-tax lien for each participating property asrequired by the
Mello-Roos Act andwill provide the seller of each with a disclosure notice that satisfies section
53340.2 of the Mello-Roos Act and California Civil Code section 1102.6b.
2. Financing Limits. For each property. the minimum funding request and maximum
amount financed shall be determined in accordance with the Hearing Report. It is not expected that
the City will issue bonds inconnection with any Program. If the City issues bonds inconnection with
aProgram, the Citywill establish policies concerning thecredit quality ofsuch bonds on acase by
casebasis.
3. Underwriting Requirementsfor Financings. For each property, thefinancing of
Eligible Improvements on that propertymust meet the eligibility requirements set forth in the Hearing
Report. The Hearing Reportmay beamended or modified from timeto timeas specified therein or
the City Councilmay waive or modify any requirement in the Hearing Report on acase by case basis.
4. MaximumAnnual Special Tax. The total annual aggregate amount of property taxes
andassessments on each property that participates in a Program, including the special tax imposed
through such Program may notexceed five percent (5%) of the value of the property. The value of
theproperty will bederived from the assessedvalue, theappraised value, oran estimate of value
based upon data supplied by a reputable real estate information service. If appraisals are usedto
determine value for any purpose ofa Program, the definitions, standards, and assumptions to be used
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49
COUNCIL POLICY
CITY OF CHULAVISTA
SUBJECT: Statement of GoalsandPoliciesRegarding POLICY EFFECTIVE
Establishment of Community Facilities NUMBER DATE PAGE
Districts 505-04 4/9/2019 23OF23
ADOPTED BY: Resolution No. 2019-051 DATED: 4/9/2019
AMENDED BY:
in such appraisals shall be determined ona casebycasebasisby theCityortherelatedProgram
Administrator.
5. AdministrationCosts. The annualspecial taxfor each property thatparticipates ina
Program must be inan amount sufficient (i) to finance or refinance the Eligible Improvements for
such property and (ii) to pay the property’s pro-rata share ofthe City’s and the relatedProgram
Administrators costs to administer such Program.
6. MinimumStandards; Waiverand Amendment. The policies set forth inthis section
reflectthe minimum standards under which the City will makeuse of the Mello-Roos Act to finance
Eligible Improvements. The City may, in its discretion, require additional measures and procedures,
enhanced security and higher standards in particular cases. The City may, in its discretion and to the
extent permitted by law, waive any of the policies set forth herein. Suchwaivers are granted only by
action of the City Council. Thegoals and policies set forth inthis section may be amended at any
time and fromtime to time bythe City.
Exhibit 1 Resolution No. 2022-201
DocuSign Envelope ID: F3773CB1-C546-49C7-9FF2-B07A401F1E49