HomeMy WebLinkAboutAgenda Packet 2005/11/01
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~ CllY OF
CHUlA VISTA
Stephen C. Padilla, Mayor
Patty Davis, Councilmember David D. Rowlands, Jr., City Manager
John McCann, Councilmember Ann Moore, City Attorney
Jerry R. Rindone, Councilmember Susan Bigelow, City Clerk
Steve Castaneda, Councilmember
November 1,2005
4:00 P.M.
Council Chambers
Public Services Building
276 Fourth Avenue
CALL TO ORDER
ROLL CALL: Councilmembers Castaneda, Davis, McCann, Rindone, and Mayor Padilla
PLEDGE OF ALLEGIANCE TO THE FLAG, MOMENT OF SILENCE
SPECIAL ORDERS OF THE DAY
. OATH OF OFFICE
Jerome Sandoval, Child Care Connnission
· INTRODUCTION BY DAN BEINTEMA, DIRECTOR OF THE NATURE CENTER,
OF THE EMPLOYEE OF THE MONTH, JOYCE REMP, REGISTERED
VETERINARY TECHNICIAN
· INTRODUCTION BY POLICE CHIEF EMERSON OF NEWLY HIRED LATERAL
POLICE OFFICER ROBIN DOWNEY
· PRESENTATION OF "EXCELLENCE IN GIVING AWARD" TO THE CITY
COUNCIL BY DONALD EPPS, REPRESENTATIVE OF UNITED WAY OF SAN
DIEGO COUNTY
· VIDEO PRESENTATION OF 2005 MAYOR'S AWARDS FOR NEIGHBORHOOD
PRESERVATION
CONSENT CALENDAR
(Items I through 7)
The Council will enact the Consent Calendar staff recommendations by one motion,
without discussion, unless a Councilmember, a member of the public, or City staff
requests that an item be removed for discussion. If you wish to speak on one of these
items, please fill out a "Request to Speak" form (available in the lobby) and submit it to
the City Clerk prior to the meeting. Items pulled from the Consent Calendar will be
discussed immediately following the Consent Calendar.
1. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
DESIGNATING 470 "E" STREET AS A HISTORIC SITE AND PLACING 470 "E"
STREET, THE HORACE C. NELSON HOUSE, AS HISTORIC SITE NUMBER 69 ON
THE CITY OF CHULA VISTA LIST OF HISTORIC SITES IN ACCORDANCE WITH
MUNICIPAL CODE SECTION 2.32.070(A)
The property owners of 470 E Street have requested that their property be considered for
inclusion on Chula Vista's List of Historic Sites. The Resource Conservation
Commission considered the designation of the property at its September 19, 2005
meeting and recommends approval. (Planning and Building Director)
Staff recommendation: Council adopt the resolution.
2A. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
APPROVING THE ACQUISITIONIFINANCING AGREEMENT PERTAINING TO
COMMUNITY FACILITIES DISTRICT NO. 12-1 (MCMILLIN OTAY RANCH
VILLAGE SEVEN). AND AUTHORIZING THE MAYOR TO EXECUTE THE
AGREEMENT ON BEHALF OF THE CITY
B. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA.
ACTING IN ITS CAPACITY AS THE LEGISLATIVE BODY OF COMMUNITY
FACILITIES DISTRICT NO. 12-1 (MCMILLIN OTAY RANCH VILLAGE SEVEN),
AUTHORIZING AND PROVIDING FOR THE ISSUANCE OF SPECIAL TAX
BONDS OF THE 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
On August 23, 2005, the City Council held the public hearing forming and establishing
Community Facilities District No. 12-1 (CFD 12-1). The district was formed for the
purpose of providing for the financing and acquisition of certain authorized public
facilities. On September 13, 2005, the City Council heard the election results, which
declared that 100% of the votes cast were in favor of the authorization to issue bonds of
the district. The first reading of the ordinance to authorize the levy of a special tax was
also heard at that time. Adoption of the resolutions continues the formal proceedings
with regard to Community Facilities District No. 12-1. (City Engineer)
Staff recommendation: Council adopt the resolutions.
3. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ACCEPTING BIDS AND AWARDING CONTRACT FOR THE UPGRADE OF THE
TRAFFIC SIGNAL AT SECOND AVENUE AND H STREET PROJECT (TF-326/TF-
311) TO HMS CONSTRUCTION, INCORPORATED AND APPROPRIATING
FUNDS AS A LOAN FROM TRAFFIC SIGNAL FUNDS (4/5THS VOTE
REQUIRED)
Page 2 - Council Agenda
http://www .chulavistaca.gov
November I, 2005
On September 14, 2005, sealed bids were received for this project. The project provides
for the upgrade of the traffic signal at Second Avenue and H Street. Adoption of the
resolution awards the subject project to HMS Construction, Incorporated and
appropriates an additional $71,660 from the traffic signal fund for completing the project.
A reimbursement of up to $95,040 toward the total estimated project cost of $130,000
will be received from a Hazard Elimination Safety (HES) grant upon completion of the
project in early summer 2006. (City Engineer)
Staffrecommendation: Council adopt the resolution.
4A. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA TO
CREATE THE POSITION OF FIRE PREVENTION ENGINEER
B. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
AMENDING THE FISCAL YEAR 2006 FIRE DEPARTMENT BUDGET BY
APPROPRIATING $61,968 FROM THE AVAILABLE BALANCE OF THE
GENERAL FUND TO ADD ONE FIRE PREVENTION ENGINEER AND
APPROPRIATING $45,810 FROM THE AVAILABLE BALANCE OF THE PUBLIC
FACILITIES DEVELOPMENT IMPACT FUND TO PURCHASE AND OUTFIT ONE
PICK-UP TRUCK AND RELATED FURNISHINGS, UNIFORMS AND EQUIPMENT
(4/5THS VOTE REQUIRED)
The Fire Department recommends the addition of one Fire Prevention Engineer to the fire
prevention line of business. The addition of this position is necessary in order to ensure
that the current workload demands resulting from the current pace of growth are
addressed. (Fire Chief)
Staff recommendation: Adopt the resolutions.
5. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ACCEPTING $100,000 FROM THE OFFICE FOR DOMESTIC PREPAREDNESS
AND APPROPRIATING SAID FUNDS TO THE FISCAL YEAR 2005/2006 CAPITAL
BUDGET OF THE POLICE DEPARTMENT FOR THE BUFFER ZONE
PROTECTION PROGRAM (4/5THS VOTE REQUIRED)
The Office of Domestic Preparedness has allocated $100,000 to the Police Department to
address two sites identified as critical infrastructure sites in Chula Vista. Funds from the
Fiscal Year 2005 Buffer Zone Protection Program will allow the City to acquire
equipment necessary to implement protective measures that will reduce vulnerabilities
around the two identified sites. (Police Chief)
Staff recommendation: Council adopt the resolution.
Page 3 - Council Agenda
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November I, 2005
6. CONSIDERATION OF PROPOSED AMENDMENT TO THE OTAY VALLEY
REGIONAL PARK JOINT EXERCISE POWERS AGREEMENT TO ADD
LANGUAGE TO PROVIDE GUIDANCE FOR THE OPERATIONS AND
MArnTENANCE OF THE PARK
Over the past 15 years, the City of Chula Vista, the County of San Diego, and the City of
San Diego have worked successfully together to plan and acquire land for the Otay
Valley Regional Park. Over 750 acres of property have been acquired for public park
purposes, and it is now necessary to amend the joint exercise of powers agreement in
order to provide guidance for the operation and maintenance of the park as trails and
other recreation facilities are being established, as well as to care for the property now in
public ownership. The proposed resolution amends the joint agreement to add language
that will accomplish this. (Planning and Building Director)
Staff recommendation: Council adopt the following resolution:
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ADOPTrnG THE AMENDMENT TO OTAY VALLEY REGIONAL PARK
JOrnT EXERCISE POWERS AGREEMENT (JEPA) BETWEEN THE
COUNTY OF SAN DIEGO AND THE CITIES OF CHULA VISTA AND SAN
DIEGO AND AUTHORIZrnG THE MAYOR TO SIGN THE AMENDED
AGREEMENT
7. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
APPROVING REQUEST FROM THE CHULA VISTA HIGH SCHOOL BAND AND
PAGEANTRY CORPS AND THE CHULA VISTA SCHOOL FOR THE CREATIVE
AND PERFORMrnG ARTS TO CONDUCT THE NrnTH ANNUAL BAND REVIEW,
AUTHORIZrnO TEMPORARY STREET CLOSURES AND WAIVrnO CITY FEES
FOR POLICE SERVICES
Adoption of the resolution approves the request of the Chula Vista High School Band and
Pageantry Corps, in conjunction with the Chula Vista School for the Creative and
Performing Arts, to conduct an organized band review on Saturday, November 12, 2005.
(Chief of Police, Director of Human Resources, Director of Public Works)
Staff recommendation: Council adopt the resolution.
ITEMS REMOVED FROM THE CONSENT CALENDAR
PUBLIC COMMENTS
Persons speaking 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 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. Comments are limited to three minutes.
Page 4 - Council Agenda
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November 1, 2005
PUBLIC HEARINGS
The following items have been advertised as public hearings as required by law. If you
wish to speak on any item, please fill out a "Request to Speak" form (available in the
lobby) and submit it to the City Clerk prior to the meeting.
8. CONSIDERATION OF THE PROPOSED ASSESSMENT OF CERTAIN
DELINQUENT SEWER SERVICE CHARGES AS RECORDED LIENS UPON THE
RESPECTIVE OWNER-OCCUPIED PARCELS OF LAND AND PLACEMENT OF
DELINQUENT CHARGES ON THE NEXT REGULAR TAX BILL FOR
COLLECTION
In order to adequately protect the City's interest in delinquent sewer service charges and
ensure that collection efforts are directed towards the responsible property owner in the
event of a change in ownership, staff recommends approval for liens against affected
properties as a preliminary action to placing the delinquencies on the property tax rolls if
they remain unpaid. Adoption of the proposed resolutions enhances the collection
process for delinquent sewer service charges by ensuring that the correct property owners
are charged and that payment is received on a more timely basis. This is the identical
process approved by the Council since August 1998. (Finance Director)
Staff recommendation: Council conduct the public hearing and adopt the following
resolutions:
A. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ASSESSING CERTAIN DELINQUENT SEWER SERVICE CHARGES AS
RECORDED LIENS UPON THE RESPECTIVE OWNER-OCCUPIED
PARCELS OF LAND (GROUP "A") AND APPROVING PLACEMENT OF
THOSE CERTAIN DELINQUENT CHARGES ON THE NEXT REGULAR
TAX BILL
B. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ASSESSING CERTAIN DELINQUENT SEWER SERVICE CHARGES AS
RECORDED LIENS UPON THE RESPECTIVE OWNER-OCCUPIED
PARCELS OF LAND (GROUP "B") AND APPROVING PLACEMENT OF
THOSE CERTAIN DELINQUENT CHARGES ON THE NEXT REGULAR
TAX BILL
9. CONSIDERATION OF THE PROPOSED ASSESSMENT OF CERTAIN
DELINQUENT SOLID WASTE SERVICE CHARGES AS RECORDED LIENS UPON
THE RESPECTIVE PARCELS OF LAND AND PLACEMENT OF DELINQUENT
CHARGES ON THE NEXT REGULAR TAX BILL FOR COLLECTION
In order to adequately protect the City's interest in delinquent solid waste service charges
and ensure that collection efforts are directed towards the responsible property owner in
the event of a change in ownership, staff recommends approval for liens against affected
properties as a preliminary action to placing the delinquencies on the property tax rolls if
they remain unpaid. Adoption of the proposed resolutions enhances the collection
process for delinquent solid waste service charges by reducing the amount of
uncollectible losses and ensures that payment is received on a more timely basis. This is
the identical process approved by the Council on a regular basis since mid-200!.
(Finance Director)
Page 5 - Council Agenda
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November 1,2005
Staff recommendation: Council conduct the public hearing and adopt the following
resolutions:
A. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ASSESSING CERTAIN DELINQUENT SOLID WASTE SERVICE CHARGES
AS LIENS UPON THE RESPECTIVE PARCELS OF LAND (GROUP "A")
AND APPROVING PLACEMENT OF CERTAIN DELINQUENT CHARGES
ON THE NEXT REGULAR TAX BILL
B. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ASSESSING CERTAIN DELINQUENT SOLID WASTE SERVICE CHARGES
AS LIENS UPON THE RESPECTIVE PARCELS OF LAND (GROUP "B")
AND APPROVING PLACEMENT OF CERTAIN DELINQUENT CHARGES
ON THE NEXT REGULAR TAX BILL
C. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ASSESSING CERTAIN DELINQUENT SOLID WASTE SERVICE CHARGES
AS LIENS UPON THE RESPECTIVE PARCELS OF LAND (GROUP "C")
AND APPROVING PLACEMENT OF CERTAIN DELINQUENT CHARGES
ON THE NEXT REGULAR TAX BILL
10. CONSIDERATION OF PROPOSED AMENDMENTS TO CHULA VISTA
MUNICIPAL CODE SECTION 2.66.043 TO AUTHORIZE POSTING OF "NO
ALCOHOL" SIGNS AT MEMORIAL, EUCALYPTUS, FRIENDSHIP AND
LAUDERBACH PARKS, AND TO ALLOW AN EXCEPTION THAT PERMITS
POSSESSION AND CONSUMPTION UNDER THE TERMS OF A LEASE,
OPERATING AGREEMENT OR PERMIT ISSUED BY THE DIRECTOR OF
RECREATION, DIRECTOR OF PUBLIC WORKS, OR THE CITY MANAGER OR
THEIR DESIGNEE
In response to concerns by members of the community about safety in four City parks,
the Police Department, Public Works Operations, and Recreation Department
recommend the installation of signs prohibiting the possession and/or consumption of
alcoholic beverages as required by Municipal Code Section 2.66.043. They also
recommend the Municipal Code be amended to allow an exception which permits
possession and/or consumption under the terms of a lease, operating agreement or permit
issued by the Public Works Director, Recreation Director or City Manager or their
designee. (Police Chief /Public Works Operations DirectorlParks and Recreation Director)
Staff recommendation: Council open the public hearing and continue it to November 15,
2005.
ACTION ITEMS
The items 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 speak on
any item, please fill out a "Request to Speak" form (available in the lobby) and submit it
to the City Clerk prior to the meeting.
Page 6 - Council Agenda
http://www.chulavistaca.gov
November 1, 2005
11. REPORT; POTENTIAL EDITS TO THE DRAFT GENERAL PLAN UPDATE
REGARDING TRANSIT FOCUS AREAS
At the October 4, 2005 City Council meeting, the Mayor indicated his desire to have an
option before the Council for consideration as part of the General Plan Update (GPU) that
would provide for a maximum of mid-rise development for all of the property located
within the Transit Focus Area (TFA) at Third and H Street. Based on subsequent
direction from the City Manager's office, staff has developed draft potential GPU edits
that could accomplish this, and would further clarify design considerations for
development within all TFA designated areas. Staff has prepared these edits for Council
review as an option to consider at the GPU hearing in December. (Planoing and Building
Director)
Staff Recommendation: Council direct staff to bring back the proposed edits as another
GPU option to consider at the GPU hearing.
12. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ACCEPTING $1,125,000 FROM THE U.S. DEPARTMENT OF JUSTICE'S OFFICE
OF COMMUNITY ORIENTED POLICING SERVICES FOR THE UNIVERSAL
HIRING PROGRAM GRANT, ADDING ELEVEN PEACE OFFICERS TO THE
AUTHORIZED STAFFING LEVEL OF THE POLICE DEPARTMENT AND
APPROPRIATING FUNDS THEREFOR (4/5THS VOTE REQUIRED)
The Police Department has received funding from the U.S. Department of Justice's
Office of Community Oriented Policing Services to partially fund the hiring of 15
officers. The program will fund up to $75,000 per officer over a three-year grant period.
Appropriations for 11 officers are requested at this time, and the remaining four officers
will be addressed during the strategic plan implementation. (Police Chief)
Staffrecommendation: Council adopt the resolution.
OTHER BUSINESS
13. CITY MANAGER'S REPORTS
14. MAYOR'S REPORTS
15. COUNCIL COMMENTS
CLOSED SESSION
Announcements of actions taken in Closed Session shall be made available by noon on
Wednesday following the Council Meeting at the City Attorney's office in accordance
with the Ralph M. Brown Act (Government Code 54957. 7).
16. CONFERENCE WITH LEGAL COUNSEL REGARDING EXISTING LITIGATION
PURSUANT TO GOVERNMENT CODE SECTION 54956.9(a)
. Workers' Compensation Appeals Board, Case no. SDO 0195270
ADJOURNMENT to the Regular Meeting of November 15, 2005, at 6:00 p.m. in the Council
Chambers. (The Regular Meeting of November 8, 2005 has been
cancelled.)
Page 7 - Council Agenda
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November 1, 2005
In compliance with the
AMERICANS WITH DISABILITIES ACT
The City of Chula Vista requests individuals who require special accommodations to access,
attend, and/or participate in a City meeting, activity, or service request such accommodation at
least forty-eight hours in advance for meetings and five days for scheduled services and
activities. Please contact the City Clerk for specific information at (619) 691-5041 or
Telecommunications Devicesfor the Deaf (TDD) at (619) 585-5655. California Relay Service is
also available for the hearing impaired.
Page 8 - Council Agenda
http://www.chulavistaca.gov
November 1, 2005
COUNCIL AGENDA STATEMENT
Item No.: I
Meeting Date: 11/0112005
ITEM TITLE:
Consideration of request for designation of 470 "E' Street as Historic
Site #69- the Horace C. Nelson House.
SUBMITTED BY:
Resolution of the City Council of the City of Chu1a Vista designating
470 "E" Street as a Historic Site and placing 470 "E" Street, the Horace
C. Nelson House, as Historic Site Number 69 on the City of Chula Vista
List of Historic Sites in accordance with the Municipal Code Section
2.32.070(A).
n;reo,,, ofP1mmi", "'" Bui1d~
City Managert) (4/5ths Vote: Yes _ No-1U
REVIEWED BY:
The property owners, Donald Schaffhauser and Robyn Ogier, have requested that their
property at 470 "E" Street, be considered for inclusion on the Chula Vista List of Historic
Sites. (Attachment 1)
The Environmental Review Coordinator has determined that this project is exempt per the
California Environmental Quality Act (CEQA), Section 1533, Class 31, Historical Resources
Restoration and Rehabilitation.
RECOMMENDATION:
Staff recommends that the City Council [md that 470 "E" Street meets the local criteria for
designation of a historic site and designate 470 "E" Street, as the Horace C. Nelson House,
Historic site #69 on the City of Chula Vista List of Historic Sites.
BOARDS/COMMISSIONS RECOMMENDA nON:
The Resource Conservation Commission considered this request on September 19, 2005 and
voted 4-0 to recommend that the City Council designate 470 "E" Street for inclusion on the
Chula Vista List of Historic Sites. (Attachment 2)
DISCUSSION:
1. Municipal Code Authority
In accordance with Section 2.32.070 of the City Of Chula Vista Municipal Code, the Resource
Conservation Commission shall recommend to the City Council the designation of any site,
which it has found to meet the local criteria as a historical site.
1-1
Page 2, Item No.:
Meeting Date: 11/01/2005
The City has adopted criteria, which are used to determine if a particular property should be
included on the Historic Site List. (Attachment 3) A site must be found to meet at least one of
these criteria to be selected for designation.
2. Architectural Style
This house is best identified as a Brick Wall Cladding Tudor. Brick Tudor styles are most
commonly contrasted with stone, stucco, or wooden claddings and are more common in the
Eastern regions of the United States. This house is further unique because of the manner in
which the composition shingles bend over the rake boards at the gable ends simulate a
. "thatched roof" Tudor style which are rare a rare subtype but very distinctive.
Common Features of Tudors include:
. Steeply pitched roofs (usually side gabled)
· Facades dominated by one or more prominent cross gables, usually steeply pitched
. Decorative half-timbering
. Tall, narrow windows
· Massive Chimneys (commonly crowned by decorative chimney pots)
3. Historical Context
This home is located along one of the first paved streets in Chula Vista and in an area where
several other interesting Tudor style homes are located. Several surrounding homes, including
two Tudor style homes, have been designated as historic within the last few years. (Attachment
4) In addition, this home is one of very few homes in older Chula Vista that was constructed
entirely of brick.
4. Features of the site
According to the Historic Resources Inventory, 470 "En Street is a one and one-half story
Tudor style house, with a high, clapped cross-gable roof with exposed rafter ends built in
approximately 1933. The windows are generally multiple paned and double hung. There are
also five stained glass window panels in a harlequin diamond design. Other features include an
exterior brick chimney, staggered brick vents in the gable ends, and a unique brick archway
extending out from the east side of the house. The house sits at an angle on a corner lot and
still retains the original brick wall that enclosed the front garden terrace. In the rear of the
house is a second story wood deck, which does not appear to be an original feature of the
house. The deck does not affect the historic integrity of the house as it could be removed
without destroying essential features of home. The homeowners state that this deck was there
when they purchased the home in 1992. (Attachment 5)
5. Significance
In addition to the unique architectural style, this site is related to a person of significance to
Chula Vista. This house was constructed for Horace C. Nelson of the Nelson and Sloan
Company. Nelson and Sloan is one of the first and primary concrete/rock quarry companies in
1-2
Page 3, Item No.:
Meeting Date: 11/01/2005
Chula Vista and the region and was instrumental in the development of street infrastructure in
Chula Vista. One will [md that many of the sidewalks throughout Chula Vista have the Nelson
Sloan stamp.
6. Conclusion
To qualify for designation based upon distinctive architecture, Criteria #4, it must be
determined that a home is a true representation of its architectural style. This house appears to
meet this criterion because it is a true representation of a rare but very distinctive subtype of
Tudor architecture. Further, the site meets Criteria 2, for its relationship to an important
family in Chula Vista history. Therefore, staff and the Resource Conservation Commission
recommend that City Council designate 470 "E" Street as the Horace C. Nelson Number 69 on
the Chula Vista List of Historic Sites.
FISCAL IMPACT:
There is no fiscal impact associated with the inclusion of 470 "E" Street on the City of Chula
Vista List of Historic Sites. However, the owners may elect to participate in the Mills Act
Program at a later date, which will have a nominal fiscal impact on the City. The City only
receives $0.147 of each property tax dollar, therefore there will be minimal fiscal impact
associated with the reduction in property taxes as a result of the Mills Act Program.
Attachments:
1.) Application for Designation
2.) Resource Conservation Commission minutes/September 19,2005
3.) Criteria for Historic Designation
4.) Locator Map
5.) Historic Resources Inventory Worksheet
6.) Photos of the property
7.) Resolution
J:\Planning\Lynnette\historic designation\Council Reports\470 E Street Agenda Statement.doc
1-3
ATTACHMENT 1
CITY OF CHULA VlSTA
PLANNING & BUILDING DEPARTMENT
cnv Of 276 Fourth Avenue
CHUIA VISTA Chula Vista, CA 91910
Historic Designation
APPLICATION FORM
II
Staff Use
Case #: 'D-LJ~- -,) O?l
D8te Submitted: .:3, 3D ' CJS
RECEIVED
CITY OF CHULA VISTA
MAR 3 0 Z005
PLANNIM" r\1'iU DUILuli~G DEPT
BUILDING DIVISION
OWNER APPROVAL IS REQUIRED,
NAME~~'Xr NAME: R~ ~O:l\r'E '
SIGNA ,: 'I:. " SIGNATURE: b ilL- ,(' 'Q ~ ^
DATE: ,~ ~ __5 _ ~"'~ DATE: 3130!Qs,
II PROPERTY INFORMATION
Property Address: 410 "1::," S+n7J(t- C'hlda Vls+o,CA C)ICJID
Common name: __ Historic name: 1-\010(JL NILISrtJ/'\ HOUS~
Year Built: \ q 33 ApproXimate j-'roperty size (in feet) or approximate acreage
Ownership is: Private X or Public
Present Use: 'K"LS i cle:.n+k"\J Original Use: ~t.:) \ d~n+l('tI
Architectural Style: -rudC:;Y-
Assessor's Parcel Number (ReqUired): <=,("p, - 0 \ a, - 0 I Zone:
II
II HISTORIC/LANDMARK INFORMATION
Use the reverse side of this form or a separate piece of paper may be attached for questions 1-3,
1, Please describe, in detail, historical aspects of the site or structure as well as any other significant
factors which may determine the property as a historic sitellandmark (i.e, special aesthetics; cultural,
architectural, or engineering factors; and any dates, events, or persons associated with the site or
structure), See attached established criteria for designation, D..tl-acnc.cl
II
2, Has the site or structure 'been altered in any way from its original design?
Yes No Ii. (If yes, explain)
3, Briefly describe the present physical condition of the property include a rating of poor, fair, good, or
excellent. D..tTo.ched
/-4
DRAFT
MINUTES OF A REGULAR MEETING OF THE
RESOURCE CONSERVATION COMMISSION
September 19, 2005
Ken Lee Building Conference Room
430 'F' Street
MEETING CALLED TO ORDER by Chair Doug Reid at 6:03 p.m.
ROLL CALL/MOTION TO EXCUSE
MEMBERS PRESENT:
Chair Doug Reid, Vice-Chair Tracy Means, Commissioners
Teresa Thomas and Stanley Jasek
STAFF PRESENT:
Marilyn Ponseggi, Environmental Review Coordinator
Lynnette Tessitore-Lopez, Associate Planner
Linda Bond, Recording Secretary
APPROVAL OF MINUTES: August 1 and 29, 2005
August 1, 2005 Minutes
A question had previously come up regarding how minutes were to be acted on when members
of the Commission who attended the meeting were no longer members of the Commission and
therefore there was not a quorum to act on the minutes. Ms. Marilyn ponseggi (Environmental
Review Coordinator) discussed this with the City Attorney who advised that in such
circumstances the Commissioners that were present at the meeting (Thomas and Means) and
have read the minutes can make a statement that the minutes are accurate, and than the rest of
the Commissioners can vote to file the minutes.
Commissioner Thomas and Vice-Chair Means stated that the minutes were accurate.
MSC (Meansrrhomas) to approve filing the August 1, 2005 minutes. Vote: (4-0)
August 29, 2005 Minutes
Commissioner Thomas requested that the following sentence be inserted on page 2 before Mr.
Craig Keys' statement: "Commissioner Thomas stated that it wouid have been more informative
to do the noise study during the evening and early morning hours in order to determine the
impact due to the project vs. that due to the nearby road traffic."
MSC (Thomas/Reid) to include that statement as part of the minutes. Vote: (4-0)
MSC (Jasekrrhomas) to approve the August 29, 2005 minutes as amended. Vote: (4-0)
DRAFT
1-5
DRAFT
RCC Minutes
-2-
September 19. 2005
ORAL COMMUNICATIONS
Ms. Pamela Bensoussan (former RGG member) stated that it had been a pleasure to serve
several years on the Commission.
Mr. Juan Diaz (former RGG member) spoke favorably about his experience on the RCC.
NEW BUSINESS
1. Historic Designation, 470 "En Street (Horace Nelson House)
Ms. Lynnette Tessitore-Lopez (Associate Planner) presented the staff report.
Commission Comments
Vice-Chair Means asked what were the benefits to the City for a designation? Ms.
Tessitore-Lopez responded that preserving historic resources helps to preserve elements
from the past, and preservation helps with tourism, industry and economic benefits.
MSC (Thomas/Means) that the properly at 470 "E" Street receive historic
designation. Vote: (4-0)
ENVIRONMENTAL REVIEW COORDINATOR COMMENTS
Ms. ponseggi presented Commissioner Thomas, former RCC members Bensoussan and Diaz
with plaques in appreciation for their service on the Commission.
Ms. Bensoussan introduced Ms. Georgie Stillman who is scheduled to be sworn in as a new
RCC member by the City Council Tuesday night. She is very involved in historic preservation
and will be a great addition to the Commission. Ms. Stillman stated that she is looking forward
to being on the Commission.
Ms. Ponseggi announced that the Beautification Awards Banquet date of October 20th has been
changed, and she will advise the Commissioners when she finds out what the new date is.
CHAIR COMMENTS
Chair Reid asked about getting items from the CEQA conference. Ms. Ponseggi stated that the
information will be ordered after the workshop.
Chair Reid thanked Commission Thomas for serving on the Commission and providing a
detailed review of some items that have come before them.
DRAFT
1-6
DRAFT
RCC Minutes
- 3 -
September 19. 2005
COMMISSIONER COMMENTS
Vice-Chair Means and Commissioner Jasek stated that it had been a pleasure working with
Commissioner Thomas and former Commissioners Bensoussan and Diaz.
Commissioner Thomas displayed a second certificate from the owners of the EI Primero Hotel
to the Resource Conservation Commission. One had been placed in the Lee Building lobby,
and the second one was given to Ms. Bensoussan who agreed to be custodian of the certificate
until such time a place in the Public Services Building can be found for it.
Ms. Bensoussan praised Ms. Tessitore-Lopez for her work on the City's historic preservation
program.
Commissioner Jasek announced that, in conjunction with My Cup of Tea, the EI Primero Hotel is
doing a Titanic tea party that is limited to 20 people with reduced rates for staying in the hotel
that night. There will be a $5 ticket discount for those who come in period dress. Tickets and
information can be picked up at My Cup of Tea.
ADJOURNMENT: Chair Reid adjourned the meeting at 6:34 p.m. to a regular meeting on
Monday, October 3, 2005, at 6:00 p.m. in the Ken Lee Building Conference Room, 430 "F"
Street, Chula Vista, CA 91910.
Prepared by:
Linda Bond
Recording Secretary
(J:IPlanningIRCC\2005\RCC091905Mins.doc)
DRAFT
1-7
~~~
~
~~~--=
- - ~-
(llY OF
CHUlA VISTA
In order to qualify for designation a site must be found to meet at least one
of the following criteria:
1.) Associated with events that have made a significant contribution to the broad
patterns of history at the local, state or national level; or
2.) That are associated with the lives of significant persons in the past; or
3.) That embody the distinctive characteristics of a type, period, or method of
construction, or that represent the work of a master, or that possess high
artistic values, or that represent a significant and distinguishable entity
whose components may lack individual distinction; or
4.) That have yielded or may be likely to yield, information important in history
or prehistory.
1-8
ATmACIlMEN1l1 2
I..--"""
~
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"4
C HULA VISTA PLANNING AND BUILDING DEPARTMENT
LOCATOR PROJECT PROJECT DESCRIPTION:
C) APPLlCAN"r. Historic Designation & Mills Act
~~~~~~: 470 E St.
SCALE: FILE NUMBER:
NORTH No Scale
J:\planning\carlos\Jocators\e st 470.cdr 07.22.05
1-9
HISTORIC RESOURCES INVENTORY
HABS_ HAER_
UTM: A 491800
C
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3611300 oc_
Sta1:e of C.<;:ifo'Tlia - Thl!' R~::curC'll~ Ag.mcy
DE?ARTMENT DF ?ARKS AND RECREATION
Set. I~Q.
IDENTIFICATION Thomas Tuchscher House
1. Common name:
2. Historic name:
HoraCe Nelson House
470 "E" .Street
3. Street or rural address:
City Chula vista
4. Parcel number: 568-'012-01
5. Present Owne'r: Thomas J. Tuchscher
CitY Chula Vista Zip
6. Present Use: residential
Zip
92010
CountY
San Diego
Address:
470 "E" Street
9 2 0 10 Ownership is: Public
residential
Private
x
Original use:
DESCRIPTION
7a. Architectural style: Tudor
7b. Briefly describe the present physical description of the site or structure and describe any major alterations from its
original condition:
Legal: Smailes Pk, Blk B, Lot 1
This 1 1/2 story house, one of..the few brick residences in Chula
Vista, features a high, clipped, cross gable roof with exposed
rafter ends. Composition shingles bend over the rake boards at
the gable ends to simulate thatch. Windows in the house are
generally multiple pane and double hung; some have protective
metal grillwork. Other features include an interior brick chimney,
staggered brick vents in the gable ends and a unique brick archway
extending out from the left side of the house. The home stands
on a corner lot and a low brick wall partly encloses an entrance
terrace.
.--
~~--
8. Construction date:
Estimated 1933 Factual
.-
9. Architect unknown
10. Builder unknown
11. Approx. proper'Of' size (in fe!ltl
Frontago S 1 no Depth 1 4n g 7
- or approx. acreage
12. Date(,) of enclosed photogriJllh(,1
1985
~.,~,--,~,_~,">~;Rfd-~.'~~~Ftw&~~~~~~~ffili~ji~1\l1lll
13.
Condition:
E:ccallent --;.;....Good _ Fair _ beteriorated _ No longer in existenca _
14.
Alterations:
none apparent
15. Surroundings: ICheclo, more than one it necessary) Open land _Scattered building:l_ Oensaly built-up ~
Residential ~lndlJstrial ~CDmmercial_ Other:
16. Threats to site: . None known-2:.Private development_ Zoning _ Vandalism
Public Works project _ Other:
17. Is the structUre:
On its orig!nal site?
x
Moved ?
Unknown? .
18. Related featUr..:
palm trees, shrubs
SIGNIFICANCE
19. Briefly state historical and lor ard1itectural importance (include dates. events. and persons associated with the site.)
Nelson & Sloan purchased this property from the Security Trust
& Savings Bank on July 2, 1929. In 1932 or 1933, Horace C. Nelson,
a shovel operator, and his wife, Olive, had this house built. H. C.
Nelson had the water connected to the property in June 27, 1932. This
house is an interesting and unaltered example of the Tudor style,
and is one of the few brick residences in Chula Vista.
Locational sketch map (draw and label site and
surrounding streets, roads, and prominent landmarks);
ANORTH
~
20. Main theme of the histOric resource: (If more than one is
checked. number in order of importance.)
Arch itectUre:x Arts & Leisure
E-:onomic/lndu.striaJ _ ExplomionlSettlement
Government MiJitary
R.ligion Soci~I/Education
21. Sources {List bocks., documents. SlJrYeys. personal intervie'N5
and their dates I.
Water records
City directories
CV Tax Assessment Rolls
22 Date fomn prepared R-l ~-R~
By (name) w tv~nc::;:t'PT
Organization ri +-y nr r'hnl;:1 Vi :::t:n
Address: p () ~nv 1 0 ~ 7
CitY ('1",1 ". vi "t- " Zip 92012
Phone: ~ q 1 - ~ 1 n 1
(
1- 1
HOR.
:;E NELSON HOUSE 20(
HOR. :E NELSON HOUSE 20
.....
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2005-03-30
RESOLUTION NO.
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA
VISTA DESIGNATING 470 "E" STREET AS A HISTORlC SITE
AND PLACING 470 "E" STREET, THE HORACE C. NELSON
HOUSE, AS HISTORlC SITE NUMBER 69 ON THE CITY OF
CHULA VISTA LIST OF HISTORlC SITES IN ACCORDANCE
WITH THE MUNICIPAL CODE SECTION 2.32.070(A).
WHEREAS, the 470 "E" Street is a house of Tudor architecture located in the
City OfChula Vista (APN 568-012-01-00) constructed in 1933; and,
WHEREAS, staff received communication from the property owners, Donald
Schaffhauser and Robyn Ogier, requesting that 470 "E" Street be designated as a historical site on
the City ofChula Vista List of Historic Sites; and,
WHEREAS, the Resource Conservation Commission determined that 470 "E"
Street meets one of the local criterion for designation based upon its distinctive architecture; and,
WHEREAS, the Resource Conservation Commission determined that 470 "En
Street meets on:ofthe local criterion for designation for its relationship to a family of significance
to Chula Vista, and;
WHEREAS, the Resource Conservation Commission at their regular meeting on
September 19, 2005 voted 4-0-0-0 to recommend that the City Council place 470 "E" Street on
the City ofChula Vista List of Historic Sites; and
WHEREAS, the Environmental Review Coordinator has determined that this
project is exempt per the California Environmental Quality Act (CEQA), Section 15331, Class
31, Historical Resources Restoration and Rehabilitation.
NOW, THEREFORE, BE IT RESOLVED that the City Council does hereby
approve the designation of 470 "E" Street, the Horace C. Nelson house and that it is hereby
placed on the City ofChula Vista List of Historic Sites as Historic Site Number 69.
Presented by:
Approved as to form by:
JhA/lhtz
. Moore
City Attorney
-,
James D. Sandoval
Director of Planning & Building
1-15
COUNCIL AGENDA STATEMENT
"
J--
Item
Meeting Date 11-01-05
ITEM TITLE:
A) Resolution of the City Council of the City of Chula Vista,
California, approving a form of the AcquisitionlFinancing Agreement
pertaining to Community Facilities District No. 12-1 (McMillin Otay Ranch
Village Seven).
B) Resolution ofthe City Council of the City of Chula Vista,
acting in its capacity as the legislative body of Community Facilities District
No. 12-1 (McMillin Otay Ranch Village Seven), Authorizing and providing
for the issuance of special tax bonds of the district, Approving the form of
Bond Indenture, Bond Purchase Contract Preliminary Official Statement and
other documents related thereto and authorizing certain actions in connection
with the issuance of such bonds.
SUBMITTED BY: City Engineer r:)< .
Director of Finance ,..t r Me
REVIEWED BY: City Manager ,,!tl
(4/5ths Vote: Yes_NoX)
On August 23, 2005 the Council held the public hearing forming and establishing Community
Facilities District No. 12-1 (CFD No.12-I). The district was formed for the purpose of providing for
the financing and acquisition for certain authorized public facilities. On September 13, 2005 Council
heard the election results, which declared that 100% of the votes cast were in favor for the
authorization to issue bonds of the district. Also, the first reading of the ordinance to authorize the
Levy of a Special Tax occurred.
Tonight, Council will consider approving the AcquisitionlFinance Agreement with McMillin Otay
Ranch, LLC that establishes the procedure for acquiring the improvements from the developer, and
which requires each individual component of the projects to be 100% completed before acquisition
and reimbursement. In addition, Council will consider the authorization of the issuance of special
tax bonds of CFD N 0.12- 1 in the amount of approximately $22,000,000 and the approval of theform
of certain documents related to the issuance of the bonds including a Bond Indenture, Bond Purchase
Agreement and Preliminary Official Statement.
RECOMMENDATION: That Council:
· Approve the Resolution (A) approving the AcquisitionlFinancing Agreement that (i)
establishes the terms and conditions pursuant to which the City will acquire the authorized
public improvements, (ii) establishes the terms and conditions pursuant to which the district
will agree to issue special tax bonds to finance the acquisition of such improvements and (iii)
establishes the procedure for acquiring the improvements from the developer within CFD
No. 12-1, and
~-I
Page 2, Item :2-
Meeting Date 11-01-05
· Approve the Resolution (B) authorizing the issuance of Bonds, approving the form of the
Bond Indenture, Bond Purchase Agreement, and other documents for CFD No. 12-1 and
authorizing certain actions in connection therewith.
BOARDS/COMMISSIONS RECOMMENDATION: Not applicable.
DISCUSSION:
Backeround
On August 23, 2005 a public hearing was held which formed and established CFD No. 12-1. On
September 13, 2005 Council heard the election results, which declared that 100% of the votes cast
were in favor. On September 20, 2005 Council heard the second reading of the ordinance
authorizing the Levy of a Special Tax. The Mello-Roos Community Facilities Act of 1982 is a
financing mechanism for funding the acquisition or construction of public infrastructure
improvements from the proceeds of Community Facilities Districts (CFD) bonds, which are repaid
from an annual special tax, collected from the property owners within the district. There is no direct
cost to the City. CFD No. 12-1 is primarily an acquisition district wherein the developer constructs
the public improvements and the City acquires them upon completion with funds derived solely from
the sale of bonds.
District Boundaries
Exhibit 1 presents the recorded boundaries of the district that include all parcels located within
McMillin Village Seven owned by the McMillin Land Development. At buildout, McMillin Village
Seven will contain approximately 541 single-family residences, 218 multi-family residences, an
elementary and a high school site, a public park and a Community Public Facility (CPF-l). As
reflected in Exhibit 1, the elementary (S-3) and high school (S-l) parcels along with the public park
(P-l) parcel have been excluded from the proposed boundaries of CFD No. 12-1. Per the Rate and
Method of Apportionment for CFD No. 12-1 (approved by Council on July 12,2(05), publicly owned
properties are exempt from assessment. As these properties will not generate assessment revenue,
they have been excluded from the district boundaries. Total gross acreage is estimated at
approximately 120 acres with an estimated 58 acres to be taxable residential property and the
remaining 62 acres comprised of roads, sidewalks, open space and Property Association Property.
The ImDrovements
The developer is proposing the financing of backbone streets and associated improvements (I.e.,
grading, sewer, streets, landscaping, and utilities) and public facilities. Following is a general
description of the proposed facilities including, but not limited to:
. Magdalena Avenue
. Wolf Canyon Loop
. Bob Pletcher Way
. Santa Luna Way
. Birch Road
d ;" :J--
Page 3, Item 1-
Meeting Date 11-01-05
. Rock Mountain Road
In addition to the above improvements, this CFD's bonding capacity may be used for offsite facilities
to be financed by Transportation Development Impact Fees (TDIF), Public Facilities Development
Impact Fees (PFDIF) and Salt Creek Sewer Fees.
Preliminary estimates show that the maximum tax revenue (using the proposed taxes) from all the
taxable properties would support a total bonded indebtedness of approximately $22 million
(assuming a 6.5% interest rate and a 30-year term on the bonds). A bond sale amount of $22 million
will finance approximately $18.8 million in facilities (i.e., grading, landscaping, streets, utilities,
drainage, sewer, etc). The balance provided would provide for a reserve fund, capitalized interest and
pay district formation and bond issuance costs.
As noted above, it is currently estimated that only $22 million will be available for funding by this
district. However, the district's authorization will be set at $25 million to give the City flexibility in
sizing the bonds and to take advantage of lower interest rates should they occur.
Special Tax Report
A copy of the Special Tax Report for CFD No. 12-1 for McMillin Village Seven prepared by the
Special Tax Consultant, McGill Martin Self, Inc., is on file and available for public review in the
City Clerk's Office. Said report incorporates the "Rate and Method of Apportionment" (RMA)
(approved by Council on July 12, 2005).
City Financial Criteria
Value to Lien Ratio: The City's Statement of Goals and Policies for Community Facilities Districts
requires a minimum value to lien ratio of 4: 1. In addition, the policy establishes the following
criteria:
"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 to
each development area for which no final subdivision map has been filed. A
community facilities district with a value-to-debt ratio of less than 4: 1 but equal to or
greater than 3:1 may be approved, in the sole discretion of the City Council, upon a
determination by the City 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 prudent under the circumstances of the particular
community facilities district. "
A final subdivision map has been recorded for all of the planning areas in this CFD No. 12-1. On
August 15, 2005 Bruce W. Hull & Associates conducted an appraisal on the property, which
indicates a value of $98,800,000. Exhibit 2 illustrates a bond sale of $22,000,000, which will
result in an overall lien ratio of 4.49: 1, thereby meeting the City financial criteria for value to lien.
/)-3
Page 4, Item 7-
Meeting Date 11-01-05
Resolutions
There are two resolutions on tonight's agenda that, if adopted, will accomplish the following:
(A) The RESOLUTION APPROVING AN ACQUISITION/FINANCING AGREEMENT for CFD
No. 12-1 (McMillin Otay Ranch Village Seven) is the formal action approving the
AcquisitionlFinance Agreement (APIA), (Exhibit 3) that establishes the procedure for acquiring the
improvements from the developer requiring the project be fully completed and accepted by the City
prior to acquisition.
· The APIA provides that the City may reimburse 75% of the total cost of the grading,
drainage, paving, utilities, and landscaping improvements upon the determination by the City
Engineer that those improvements have been installed per approved plans with required City
Inspection. Those facilities may not be functional at that time, and certain activities (i.e.,
testing, completion of punch list, preparation of as-built drawings) may still be pending. The
25% final payment may be made once all projects within a phase are fully complete and
accepted by the City.
· The APIA also conditions the purchase of said improvements to developer's compliance with
all the applicable conditions and obligations imposed on the property within CFD No.12-I
pursuant to the land use entitlements approved by the City, including but not limited to,
payment of all applicable fees, dedication of right-of-ways or other property (Le., parks, open
space, etc), payment of assessments installments or special taxes, and construction of all
applicable public improvements.
· Staff has reviewed the proposed agreement and believes that the 25% payment retention, and
the condition requiring compliance with approved land use entitlement will provide enough
security to guarantee completion of the improvements while ensuring the financial health of
CFD No.1 2-1.
· The City retained the firm of Best, Best and Krieger, LLP as Bond Counsel for CFD No.12- I.
Bond Counsel drafted this agreement for and on behalf of the City with input and review by
City staff, developer legal council, developer and financial team.
(B) THE RESOLUTION AUTHORIZING THE ISSUANCE OF BONDS AND APPROVING THE
FORM OF CERTAIN RELATED DOCUMENTS authorizes the issuance of limited obligation
bonds, pursuant to the Mello-Roos Act in a principal amount not to exceed $25,000,000. The final
bond sale amount will be known once the interest on the bonds is determined at bond sale. In
addition, the resolution approves the form of the following documents:
· The Preliminary Official Statement (Exhibit 4) describing the CFD and type of bonds,
including terms and conditions thereof, for the bondholders.
· The Bond Indenture (Exhibit 5) between the City and the Fiscal Agent, U.S. Bank Trust
National Association, that sets forth the terms and conditions relating to the issuance and sale
;2-4
Page 5, Item 2-
Meeting Date 11-01-05
of the bonds. The Indenture also establishes the Escrow Account and the conditions to be
met for releasing the funds deposited in said Escrow Account.
· The Bond Purchase Agreement (Exhibit 6) authorizes the sale of bonds to the designated
underwriter (Stone & Youngberg, LLC). The underwriter's discount for this negotiated sale
is not to exceed 1.5% of the total bond amount, which translates into a fee not to exceed
$330,000.
· Continuing Disclosure Agreement between the City and U.S. Bank Trust National
Association, as dissemination agent, pursuant to whom the City is required to disclose certain
financial information on an annual basis regarding the CFD and certain significant events.
These disclosures include but are not limited to:
Special tax delinquencies
Bond calls
Events reducing density or causing modifications
Other events reflecting financial difficulties of CFD No. 12-1
It should be noted that Council would only be approving the form of the aforementioned documents.
The proposed resolution authorizes the Director of Finance to approve the final form and to execute
such documents on behalf of the City following review by and consultation with the City Attorney,
Bond Counsel, and Financial Consultant. No additions or changes in the documents that would
result in the annual interest rate on the bonds to exceed 6.50 % are permitted.
Future Actions
Adoptions of tonight's Resolutions will approve the AcquisitionlFinancing Agreement for CFD
No.12-I and authorize the issuance of bonds, and approve the form of related documents. The
issuance of the bonds is anticipated in November of 2005. The acquisition of selected public
improvements will be audited only after 100% of the project is deemed complete.
FISCAL IMPACT:
The City's General Fund receives 1 % of the bond sale amount in accordance with the CFD Policy for
the use of the City's bonding capacity. The developer will pay all formation costs and has deposited
money to fund initial consultant costs and City costs in accordance with the approved
Reimbursement Agreement. The City will recover the full cost of staff time expended in district
formation and administration activities. Staff anticipates that most of the CFD No. 12-1
administration will be contracted out.
Attachments:
Exhibit 1: Recorded Boundary Map for CFD No.12-I
Exhibit 2: Estimated Value to Lien Ratios Based on Appraisal
Exhibit 3: AcquisitionlFinancing Agreement for CFD No.12-I
Exhibit 4: Preliminary Official Statement for CFD No.l2-I
Exhibit 5: Bond Indenture for CFD No.12-I
Exhibit 6: Bond Purchase Agreement for CFD No.12-I
J:lEngineerIAGENDA\CAS2005\11.01-05\CFD12nCAs 11-01-05 clean.doc
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EXHIBIT ~
ACQUISITION/FINANCING AGREEMENT
COMMUNITY FACILITIES DISTRICT NO. 12-1
(MCMILLIN - OTAY RANCH - VILLAGE SEVEN)
TIllS AGREEMENT, dated as of , 2005 (the "Agreement"), is made
and entered into by and between the CITY OF CHULA VISTA, a charter city duly organized and
validly existing under the Constitution and laws of the State of California, (the "City"),
COMMUNITY FACILITIES DISTRICT NO. 12-1 (MCMILLIN - OTAY RANCH - VILLAGE
SEVEN), a community facilities district formed and existing pursuant to the laws of the State of
California (the "CFD No. 12-1"), and MCMILLIN OTAY RANCH, LLC, a California limited
liability company (the "Developer").
WHEREAS, the Developer is the master developer of certain property within that portion
of the City known as the Village Seven of the Otay Ranch described in Exhibit F attached hereto
and incorporated herein by this reference (the "Development Project") and Developer has
obtained certain land use entitlements from the City which permit the development of the
Development Project; and
WHEREAS, as a part of the development of the Development Project, the Developer will
be constructing certain public improvements to serve the Development Project including the
improvements identified as Improvements Nos. _ through _ in Exhibit A attached hereto and
incorporated herein by this reference (the "Improvements") ; and
WHEREAS, in order to mitigate the impact that the Development Project will have on
the City's existing transportation facilities, the Development Project will be responsible for
financing its proportionate share of the cost of construction of those transportation facilities
identified in Section 3.54.030 of the Chula Vista Municipal Code and as Improvement Nos. _ in
Exhibit A hereto (the "Transportation Facilities"); and
WHEREAS, the City and the Developer desire that the Agreement provide that CFD No.
12-1 finance the acquisition or construction of Transportation Facilities in an amount equal to the
development impact fee obligation imposed pursuant to Chapter 3.54 of the Chula Vista
. Municipal Code (the "Municipal Code") for the development throughout CFD No. 12-1 (the
"Aggregate TDIF Obligation") and, if and to the extent that the Purchase Price for Transportation
Facilities to be constructed by the Developer and acquired by the City'pursuant to the provisions
of the Agreement is less than the Aggregate TDIF Obligation, to provide that funds in an amount
equal to the balance of the Aggregate TDIF Obligation be set aside from the proceeds of Bonds
issued by the Community Facilities District to enable the City to utilize such funds to acquire or
construct other Transportation Facilities; and
WHEREAS, in order to mitigate the impact that the Development Project will have on the
City's existing public facilities other than transportation facilities, the Development Project will be
responsible for financing its proportionate share of the cost of the construction of those public
1
WBD\319563.1
.;;-g
facilities identified in Section 3.50.030 of the Municipal Code and as Improvement No. _ in
Exhibit A hereto (the "Public Facilities"); and
WHEREAS, the City and the Developer further desire that the Agreement provide that
CFD No. 12-1 finance the acquisition or construction of Public Facilities in an amount equal to the
development impact fee obligation imposed pursuant to Chapter 3.50 of the Municipal Code for
the development throughout CFD No. 12-1 (the "Aggregate PFDIF Obligation") and to provide
that funds in an amount equal to the Aggregate PFDIF Obligation be set aside from the proceeds
of Bonds issued by CFD No. 12-1 to enable the City to utilize such funds to acquire .or construct
Public Facilities; and
WHEREAS, the Developer requested that the City consider and the City did consider and
form CFD No. 12-1 under the terms and conditions of the "Mello-Roos Connunity Facilities Act
of 1982," as amended (Government Code Section 53311 and following) (the "Act"), for the
purpose of financing the acquisition or construction of the Improvements and all or a portion of
the cost of the construction of the Transportation Facilities and the Public Facilities allocable to
the Development Project; and,
WHEREAS, Developer, in order to proceed in a timely way with development of the
Development Project, desires to construct certain of the Improvements that will, following the
completion of the construction thereof, be acquired, owned, operated and maintained by the City;
and,
WHEREAS, the City, CFD No. 12-1 and Developer agree that the Improvements to be
constructed by the Developer may, upon the completion of the construction thereof, be acquired
by the City through financing provided by CFD No. 12-1 at prices determined pursuant to and in
accordance with the provisions of this Agreement; and,
WHEREAS, the City and the Developer further agree that payment by the City for the
acquisition of the Improvements shall be funded solely from the proceeds of bonds which shall be
issued by CFD No. 12-1 and which shall be secured by the levy of special taxes witbin CFD No.
12-1; and,
WHEREAS, it is the intent of this Agreement that Developer shall be entitled pursuant to
the provisions of this Agreement to be paid for each of the Improvements constructed by the
Developer at the prices as determined by the City pursuant to this Agreement upon: (a) the sale
and delivery of bonds by CFD No. 12-1 the proceeds of which shall be authorized and designated
to make the payments to acquire such Improvements and (b) the completion of the construction
of each such Improvement; and,
WHEREAS, the City and CFD No. 12-1 are willing to have CFD No. 12-1 finance the
acquisition of the Improvements to be constructed by the Developer and all or a portion of the
cost of the construction of the Transportation Facilities and the Public Facilities allocable to the
Development Project, the City of Chula Vista Statement of Goals and Policies Regarding the
Establishment of Connunity Facilities Districts adopted by the City Council (the "Goals and
2
WBD\319563.1
;)-9
Policies"), this Agreement and Developer desires that CFD No. 12-1 so finance the acquisition of
such Improvements and a portion of the cost of the construction of the Public Facilities allocable
to the Development Project.
NOW, THEREFORE, IT IS MUTUALLY AGREED between the respective parties as follows:
SECTION I. Recitals. The above recitals are all true and correct.
SECTION 2. Plans and Specifications. All plans, specifications and bid documents for the
Improvements (the "Plans and Specifications") and all changes in the Plans and Specifications
necessitated by change orders shall be prepared by the Developer at the Developer's initial
expense, subject to City approval. The costs of acquisition of such Improvements shall include
costs of the preparation of the Plans and Specifications and all related documentation as set forth
in Section 7 below.
Developer shall not award bids for construction, connence construction or cause
connencement of construction of any Improvement until the Plans and Specifications for such
Improvement have been approved by the City.
SECTION 3. Design, Bid and Construction of Improvements. With the exception of the
Completed Improvements (defined below) the construction of which was completed prior to
August 23, 2005, the date of formation of CFD No. 12-1, Developer covenants and agrees that
each Improvement to be acquired from Developer pursuant to this Agreement shall be designed,
bid and constructed:
(a) in substantial compliance with the approved Plans and Specifications for such
Improvement;
(b) in a good and workmanlike manner by well-trained adequately supervised workers;
( c) in strict compliance with all governmental and quasi-governmental rules,
regulations, laws, building codes and all requirements of Developer's insurers and lenders;
(d) free of any known design flaws and defects; and
(e) except as provided below, in substantial compliance with the requirements of
Exhibit C hereto which is incorporated herein by this reference.
[The Improvements identified as Improvement Nos. in Exhibit A hereto are the
"Completed Improvements." Developer certifies that Developer solicited bids for the construction
of the each of the Completed Improvements from not less than three (3) contractors and that
Developer, awarded the construction contract for each of the Completed Improvements to that
contractor submitting the lowest responsible bid for such work and that the design and the
construction of each of the Completed Improvements was undertaken in conformity with (a)
through (d) above in the preceding paragraph. The City agrees to acquire the Completed
3
WBD\319563.1
d~/{)
Improvements notwithstanding the fact that such Improvements may not have been bid and the
award of the construction contracts may not have been made in accordance with all of the
requirements of Exhibit C hereto.]
In the event of a protest by a bidder to the award of a contract for the construction of an
Improvement or Improvements to the apparent low bidder, the Developer may, in its sole
discretion, elect to:
(a) award the contract to the apparent low bidder pursuant to the provisions of Exhibit
C hereto if the Developer has determined that the bid of the apparent low bidder was, in
fact, responsive and that the irregularity upon which the protest is based was minor in
nature, i.e., the irregularity did not create an unfair competitive advantage for the apparent
low bidder;
(b) reject the bid of the apparent low bidder if the Developer determines that the
irregularity upon which the protest is based did create an unfair competitive advantage for
the apparent low bidder and the bid of the apparent low bidder was, therefore, not
responsive and award the contract to the lowest responsive bidder; or
(c) reject all bids and solicit new bids for the construction of the applicable
Improvement or Improvements.
Should a legal action be filed challenging the validity of the Developer's decision regarding any
such bid protest and/or the award of any contract for the construction of any Improvement,
including any Completed Improvement, the Developer shall, at Developer's sole expense, defend
such action and shall defend, indemnif'y, and hold harmless the City, its officers, directors,
employees and agents and CFD No.7, its officers, directors, employees and agents (each, an
"Indemnified Party" and collectively, the "Indemnified Parties").
SECTION 4. Inspection and Acceptance of the Improvements. The construction activities
relating to the Improvements to be constructed by the Developer shall be subject at all reasonable
times to inspection by authorized representatives of City. Once an Improvement to be acquired
by City is substantially completed in accordance with the approved Plans and Specifications, then
such Improvement shall be eligible for payment of the Base Increment of the Purchase Price (as
defined in Section 7 below) therefor.
Prior to acceptance by the City of any Improvement constructed by the Developer for
purposes of paying the Retained Increment (as defined in Section 7 below) of the Purchase Price,
the Developer shall provide to the City Engineer of the City, or his or her designee (the "City
Engineer"), the documentation set forth in this Section 4 and Section 7(c)(ii) below and obtain
approval of as-built drawings for the Improvement in accordance with the process described
below in this Section 4. The engineer of record for any such Improvement ("Engineer of
Record") shall file form PW-E-I06 (Request for Release of Bonds) with the City Engineer.
Within 20 working days of such filing, the field inspector of the City or his or her designee ("Field
Inspector") shall issue and transmit to the Engineer of Record a letter requesting (i) as-built
4
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ytBD\319563.1
drawings and soils reports (when applicable) and (ii) a punchlist of work to be completed or
corrections to work to be completed before such Improvement will be eligible for payment of the
Retained Increment. Within 20 working days of receipt of the Field Inspector's letter, the
Engineer of Record shall prepare redline as-built drawings and submit them, together with any
necessary soils reports, to the Field Inspector and the Developer shall complete the items of work
and/or corrections specified in the punchlist. Within 10 working days of the Engineer of Record's
submittal of the red lined as-built drawings, the Field Inspector shall review such drawings and
provide comments. The Engineer of Record shall revise the redline as-built drawings per the Field
Inspector's comments and resubmit within 10 working days. The Field Inspector shall make his
final review within 5 working days of the Engineer of Record's resubmittal and notifY the
Engineer of Record to prepare mylar as-built drawings and a microfiche copy and submit both to
the City Engineer or his designee and notifY the Developer of any punchlist items which remain to
be completed. The City and Developer shall make best efforts to perform within the time periods
described above. The inability of City or Developer to perform within each time period,
notwithstanding its best efforts, shall not constitute a breach of this Agreement.
SECTION 5. Warranty of Improvements Constructed by the Developer. At all times prior
to the City's acceptance of any Improvement constructed by the Developer, the Developer shall
be responsible for maintaining such Improvement at the Developer's expense. The Developer
shall be obligated for the period of twelve (12) months immediately following the City's
acceptance of such an Improvement to repair or replace, at Developer's expense, any defects or
failures resulting from the work of Developer, its contractors or agents. Upon the expiration of
such twelve (12) month period, Developer shall assign to City and CFD No. 12-1 its rights in and
to any warranties, guarantees or other evidence of contingent obligations of third persons with
respect to such Improvement. As a condition precedent to the payment of the Retained Increment
(as defined in Section 7 below) of the Purchase Price, Developer shall post a maintenance bond in
a form reasonably approved by the City, cause such a maintenance bond to be posted, or assign
Developer's rights under such a maintenance bond naming City and/or CFD No. 12-1 as
beneficiary in an amount equal to fifteen percent (15%) of the Purchase Price of such
Improvement in order to secure Developer's obligations pursuant to this Section. Upon posting
of such maintenance bond, the City shall release any performance, labor and material bonds for
such Improvement.
SECTION 6. Notice of Completion and Lien Releases. Upon completion of the construction
of an Improvement, Developer shall notifY the City Engineer in writing of such completion and
shall prepare and execute a Notice of Completion for such Improvement in the form prescribed by
Section 3093 of the California Civil Code and shall record such notice in the Official Records of
the County of San Diego. Developer shall cause its contractors to provide unconditional lien
releases for such Improvement in accordance with Section 3262 of the Civil Code.
Notwithstanding the foregoing, City may waive the requirement for a Notice of Completion and
lien releases if City determines that as of the date of payment of the Retained Increment of the
Purchase Price for an Improvement, title to such Improvement or portion thereof satisfies the
requirements for Acceptable Title (as hereinafter defined).
SECTION 7. Payment of Purchase Price.
5
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WBD\319563.1
(a) Amount of Purchase Price. The amount to be paid by City for the Improvements to be
constructed by and acquired from Developer (the "Purchase Price") shall, as to each such
Improvement, (i) be determined by City in accordance with the provisions of this Section 7, (ii)
equal the lesser of the cost or the value thereof, (iii) include the reasonable cost or value of
eligible appurtenant public facilities, (iv) include the costs of the title insurance policy described in
Section II (a), and (v) include all other costs of construction and incidental costs eligible under
the Act and the Goals and Policies as a part of the cost of the Improvements.
Incidental costs eligible to be included in the Purchase Price of any Improvement shall
include the following:
(i) Usual and customary design and engineering costs not to exceed the following
percentages:
a. Civil engineering - 7.5% of the cost of the construction of the
Improvement for which the service was performed.
b. Soils engineering - 15% of the cost of the grading for the Improvement.
c. Landscape architecture - 10% of the cost of applicable landscaping and
irrigation relating to the Improvement.
d. Survey and construction staking - 2% of the combined cost of the
construction and grading for the Improvement.
e. Utility engineering/coordination - 3% of the cost of the construction of the
applicable dry utilities.
(ii) Construction administration and supervision not to exceed, in aggregate, 1.75% of
the total construction cost of the Improvement.
(iii) Special engineering studies related to "collector" or "transmission" facilities as
reviewed and approved by the City Engineer.
(iv) Plan check and inspection fees (less any refunds).
(v) Capacity or connection fees related solely to the Improvement.
(vi) Costs of acquisition of off-site rights-of-way and/or easements including the
following:
a. Appraisal and title insurance costs.
b. Costs of preparing acquisition plats.
6
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WBD\319563.!
c. The appraised value or actual cost of right-of-way or easement, wmCIlt:Vt"
is less.
d. Legal fees and costs related to eminent domain proceedings approved by
the City Attorney.
(vii) Costs of environmental review, permitting and mitigation related to the
Improvement.
In no event shall the cost or value of the construction of the Improvements be deemed to
exceed the construction contract prices set forth in the contracts and change orders approved by
City ("Approved Change Orders") pursuant to the applicable provisions of Exhibit C hereto,
which is incorporated herein by this reference, or otherwise authorized pursuant to this
Agreement.
Notwithstanding the foregoing, the aggregate Purchase Price of the acquisition of all new utilities
to be owned by a public utility or public utilities may not exceed 5% of the proceeds of the series
of the Bonds to be utilized to pay such Purchase Price less that portion of the reserve fund, costs
of issuance and other ~~cf~ntal costs allocable to such amount.
(b) Increme at P~ ~~e of an. The Purchase Price for any Improvement
constructed the Developer shall be payable in not to exceed two increments: (i) the "Base
Increment" hich shall be an amount equal to 75% of the audited, eligible costs as reflected in the
written req st for payment of the Base Increment submitted by the Developer and as approved
by the DiHlEtvl ufPiili"- "'@rks and shall not exceed 75% of the cost estimate set forth in Exhibit
A for such Improvement; and (ii) the "Retained Increment" which shall be an amount not to
exceed the remaining, unpaid portion of the Purchase Price for such Improvement determined
pursuant to the provisions of (a) above.
(c) Requisition for Incremental Payment of Purchase Price of an Improvement.
(i) Base Increment. The Developer may submit only one (1) written request to the
City Engineer for the payment of the Base Increment for an Improvement constructed by
the Developer upon the substantial completion of the construction of such Improvement in
accordance with the approved Plans and Specifications. The criteria for determining
"substantial completion" of each such Improvement is described in Exhibit B and shall
mean generally that construction, or work with respect to such Improvement has
progressed to the point where it is sufficiently complete so that such Improvement can be
utilized for the purpose for which it was intended. Substantial completion of such an
Improvement shall also mean that all components of such Improvement are substantially
complete, e.g., in the case ofImprovement including streets (other than streets included in
the Traffic Enhancement Improvements), the components are described in footnote 1 to
Exhibit A. Each Base Increment payment request must be in the form attached hereto as
Exhibit D, which is incorporated herein by this reference, and conform to the requirements
7
cJ- - If
WBD\319563.1
of (f) below. The request for payment of the Base Increment for an Improvement shall be
accompanied by a copy of the following documents related to the construction of such
Improvement: (1) each construction contract and copy of bid notice for such contract, (2)
each change order, (3) each invoice submitted pursuant to such construction contracts, (4)
evidence of payment of each such invoice such as copies of cancelled checks or other
evidence of payment satisfactory to the City Engineer, and (5) written conditional lien
releases executed by each applicable contractor, subcontractor and materialman in a form
satisfactory to the City Attorney of the City (the "City Attorney") for such Improvement.
(ii) Retained Increment. The Developer may submit only one (1) written request to the
City Engineer for the payment of the Retained Increment for an Improvement in the form
attached hereto as Exhibit E, which is incorporated herein by this reference, upon the
submission to the City Engineer of (1) as-built drawings or other equivalent plans and
specifications for such Improvement in a form reasonably acceptable to the City, (2)
evidence that the Developer has posted a maintenance bond for such Improvement as
required by Section 5 hereinabove, (3) evidence of the satisfaction of the requirements of
Section 10 hereinbelow directly related to such Improvement and (4) written
unconditional lien releases from all contractors, subcontractors and materialmen
satisfactory to the City Attorney for such Improvement. For any costs not included in the
Developer's written request for payment of the Base Increment but requested for payment
in the Retained Increment the request shall conform to the requirements of (f) below and
also be accompanied by the following documents related to such additional costs of the
construction of such Improvement if not done so with the written request for payment of
the Base Increment: (1) each construction contract, (2) each change order, (3) each
invoice submitted pursuant to such construction contracts, and (4) evidence of payment of
each such invoice such as copies of cancelled checks or other evidence of payment
satisfactory to the City Engineer.
(d) Documentation. Any payment request submitted by Developer shall be properly executed
and shall include copies of all supporting documents required by subsection (c )(i) or (c )(ii), as
applicable.
(e) Review ofPavment Request for an Imorovement. The City Engineer or his designee shall
review each payment request and the supporting documentation accompanying such payment
request. If the City Engineer finds that any such payment request is incomplete, improper or
otherwise not suitable for approval, the City Engineer shall inform Developer in writing within
twenty (20) working days after receipt thereof, the reasons for his finding. Developer shall have
the right to respond to this finding by submitting further documentation after receipt of the denial.
The City Engineer shall review any further documentation received from the Developer in support
of a payment request and inform Developer of his approval or denial of the payment request as
supplemented in accordance with this Section within ten (10) working days after receipt of the
supplemental documentation. A resubmittal of a payment request shall be deemed a new payment
request for purposes of this Section.
8
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WBD\319563.1
Subject to the limitations set forth herein, costs incurred under a construction contract for an
Improvement entered into pursuant to the requirements of this Agreement and Approved Change
Orders shall be deemed to be reasonable and, subject to the other provisions of this Agreement,
shall be included in the Purchase Price for such Improvement.
The City Engineer shall, after the sale of the Bonds (defined in Section _ below) pursuant to
Section _ the proceeds of which are intended to be used to acquire the subject Improvements
and after his or her approval of a payment request, immediately forward a request to the Director
of Finance of the City notifying the Director of Finance of his or her approval of the payment
request and requesting that such payment be made to the appropriate payee. The Director of
Finance shall process any such request of the City Engineer pursuant to the applicable procedures
of the Finance Department and shall make or authorize such payment pursuant to such procedures
and subsection (h) below.
(f) Pavrnent.
(i) Priority of Payment of Cost of Construction or Purchase Price for Improvements. The
City and the Developer acknowledge and agree that the cost of acquisition or construction
of all Improvements may exceed the aggregate amount of the Bond proceeds which will
be available for the payment of that portion of cost of construction or the Purchase Price,
as applicable, for all of such Improvements eligible to be paid from the proceeds of the
Bonds. As a result the City and Developer agree that the payment of the cost of
construction or the Purchase Price, as applicable, for Improvements shall be prioritized as
follows:
Priority 1:
Priority 2:
Improvement No. _ in Exhibit A.
Improvement Nos. in Exhibit A.
The cost of construction or Purchase Price for any lower priority Improvement shall not
be paid unless the cost of construction or Purchase Price for all higher priority
Improvements has been paid or the City Engineer has reasonably determined that sufficient
proceeds of the Bonds are available to fully fund the cost of construction or Purchase
Price of the higher priority Improvements, e.g., such funds have been deposited in a
separate account or sub-account and the use of such funds has been restricted to funding
the cost of construction or the Purchase Price of such higher priority Improvements, based
upon the estimates of the cost of construction or the estimates or approved Purchase
Prices, as applicable, for such higher priority Improvements on Exhibit A.
(ii) Timing of the Pavment of the Purchase Price for an Improvement. Subject to the
limitations contained in (i) above and (iii) and (iv) below, the increment of the Purchase
Price for each Improvement shall be paid to Developer within thirty (30) days after the
date of the City Engineer's approval of the payment request for any such increment;
provided, however, no Retained Increment for any Improvement shall be paid earlier than
thirty-five (35) days after the recording of a Notice of Completion for such Improvement.
9
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WBD\319563.1
(iii) Source of Payment. The Purchase Price or any increment thereof for an Improvement
shall be payable to the Developer solely from those proceeds ("Eligible Improvement
Proceeds") of the sale of Bonds as provided in Section 20 hereof authorized and
designated for the payment for such Improvement, after all costs off ormation ofCFD No.
12-1 and all costs of issuance of such Bonds have been paid or proceeds set aside for such
purpose and deposits of accrued and capitalized interest to the redemption fund, deposits
of amounts equal to the Aggregate TDIF Obligation and the Aggregate PFDIF Obligation
to the Traffic Facilities Account (defined in Section _ below) and the Public Facilities
Account (defined in Section _ below), respectively, of the Project Fund (defined in
Section _ below) and the initial deposit to the reserve fund have been made.
(iv) Withholding ofPavrnent. In addition to the foregoing, the City shall have the right to
withhold payment of the Purchase Price or any increment thereof of any Improvement if
(a) the Developer is delinquent in the payment of any assessment installments or special
taxes levied by the City or a community facilities district established by the City on
properties then owned by the Developer within CFD No. 12-1, (b) the City Engineer
reasonably determines that the Developer is not then in substantial compliance with all
applicable conditions and obligations imposed upon the Developer hereunder or upon the
Development pursuant to the land use entitlements approved by the City for the
Development, including but not limited to, payment of all applicable fees, dedication of all
applicable rights-of-way or other property and construction of all applicable public
improvements. The City Engineer shall provide written notice to the Developer of the
decision to withhold any such payment and shall specifY the reason for such decision. If
the payment is withheld as a result of the delinquency in the payment of assessment
installments or special taxes, the notice shall identifY the delinquent parcels and the amount
of such delinquency. If the payment is withheld as a result of substantial non-compliance
with a condition or obligation, the notice shall specifY such condition or obligation and
what action will be necessary by the Developer to substantially comply with such
condition or obligation. Upon receipt by the City Engineer of evidence reasonably
satisfactory to the City Engineer of the payment of the delinquent special taxes or
assessments or upon the determination by the City Engineer that the Developer has
substantially complied with the subject condition or obligation, the City shall forthwith
make any payment which has been withheld pursuant to the provisions of this paragraph.
SECTION 8. Audit. The authorized representatives of City shall have the right, upon two (2)
days prior written notice to Developer and during normal business hours, to review all books and
records of Developer pertaining to costs and expenses incurred by Developer in construction of
the Improvements.
SECTION 9. Ownership and Transfer of Improvements. The conveyance of the
Improvements by Developer to City shall be in accordance with the following procedures:
(a) Improvements Constructed on Land not Owned by Citv. As a condition to the payment of
the Retained Increment of the Purchase Price, Developer shall cause an irrevocable offer
of dedication to be made to City or an outright grant of a fee interest or easement interest
10
;2- /'7
WBD1319563.1
as appropriate, in the sole discretion of the City of the appropriate right, title and interest
in and to the portion of the applicable property owned by the Developer related to the
applicable Improvement, including any temporary construction or access easements.
Developer, whether or not it is the entity constructing the Improvements, agrees to
execute and deliver to the City the documents required to complete the transfer of
Acceptable Title for property owned by the Developer upon or within which such
Improvements are to be located. For purposes of this Agreement, the term "Acceptable
Title" shall mean title to the portion of the property to be conveyed free and clear of all
taxes, liens, encumbrances, assessments, easements, leases, whether any such item is
recorded or umecorded, except (i) non-delinquent taxes and assessments and (ii) those
non-monetary encumbrances and easements which are reasonably determined by the City
not to interfere with the intended use of the portion of the property. As a further
condition to the payment of the Retained Increment of the Purchase Price for any
Improvement, Developer at its sole initial cost and expense, subject to reimbursement
pursuant to Section 7, shall cause to be issued a policy of title insurance for such portion
of the property in an amount not to exceed the Purchase Price and in the form normally
required by City in connection with the dedication of land for subdivision improvements
and containing such title endorsements as may be reasonably requested by City. City's
final acceptance of the portion of the property and the Improvements constructed thereon
shall not be umeasonably withheld or delayed.
(b) Improvements Constructed on Land Owned bv Citv. If Developer is authorized to
construct an Improvement on land owned in fee by City or on land over which the City
owns an easement Developer shall obtain the necessary encroachment permits to enter
such land for purposes of constructing such Improvement. City shall cooperate with
Developer in issuing such encroachment permits. The Improvements shall be inspected by
City on an ongoing basis.
SECTION 10. Grading and Subdivision Improvement Bonds. Except as provided below,
Developer shall be required to post or cause the posting of bonds or other security acceptable to
the City to guarantee completion of the Improvements in accordance with City's standard
subdivision requirements and conditions of approval of the Development (the "Conditions of
Approval"). Labor and materials bonds shall also be required to be provided by the Developer's
contractor for all Improvements to be constructed under this agreement. Such bonds shall name
the City of Chula Vista as additional obligee and shall remain in effect until the final acceptance of
the Improvements by the City Engineer. The presence of Bond proceeds shall not relieve the
Developer of requiring this obligation of the Developer's contractor.
Performance and labor and material bonds for specific Improvements shall not be required
or may be released if: (1) such Improvements constitute a portion of the required subdivision
improvements, (2) Bond proceeds equal to 125% of the estimated cost to construct or acquire
such Improvements are available and set aside for such purpose, and (3) the Improvements are to
be constructed or acquired entirely with the proceeds of the Bonds. Provided that conditions (1)
and (2) are satisfied, if an Improvement is to be constructed or acquired only in part with the
proceeds of the Bonds, performance and labor and material bonds shall not be required for that
11
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portion of the Improvements to be so constructed or acquired except with respect to the portion
that will not be acquired or constructed with Bond proceeds. In the event that the Bond proceeds
that are available and may be set aside to fund the cost to construct or acquire an Improvement
are less than 125% of the estimated cost thereof, the Developer shall be required to provide a
performance and labor and material bond or other security satisfactory to the City Engineer and
the City Attorney in the amount of such deficiency. City will cooperate with Developer in the
termination or exoneration of any performance and labor and material bonds assuring completion
of Improvements for which bonds have been sold. The City Engineer shall be the sole judge of
determining release of such bonds.
SECTION 11. Indemnification by Developer. Developer shall defend, indemnifY and hold
harmless all Indemnified Parties from and against any and all claims, losses, liabilities, damages,
including court costs and reasonable attorneys' fees by reason of, or resulting from, or arising out
of the design, engineering, solicitation of bids, award of contracts, administration of contracts and
construction of the Improvements by the Developer, its employees, agents, independent
contractors and/or representatives; provided that any claims for personal injury or property
damage which relate to the Improvements shall be limited to those arising out of personal injury
or property damage caused by actions or omissions by Developer or Developer's employees,
agents, independent contractors or representatives which occurred during the period prior to the
transfer of title to the Improvements by City, whether or not a claim is filed prior to the date of
acceptance of the Improvements. Nothing in this Section 11 shall limit in any manner the rights of
the City and/or CFD No. 12-1 against any of the architects, engineers, contractors or other
consultants employed by the Developer which has performed work in connection with
construction or financing of the Improvements. Notwithstanding the foregoing, Developer shall
have no obligation to defend, indemnifY or hold harmless the Indemnified Parties from and against
any claims, liabilities, losses or damages (including court costs and attorneys' fees) which result
from or arise out of the sole negligence or willful misconduct of an Indemnified Party.
Except as set forth in this Section 11, no provision of this Agreement shall in any way limit
the extent of the responsibility of Developer for payment of damages resulting from the operations
of the Developer, its agents, employees or contractors.
SECTION 12. Obligation of City. Neither the City nor CFD No. 12-1 has a legal or financial
obligation to construct or finance the actual construction of the Improvements. All costs incurred
for actual construction of the Improvements, including all incidentals thereto, shall be borne by
Developer, and the obligations of the City and Community Facilities District are limited to the
acquisition of the Improvements pursuant to the provisions of this Agreement.
SECTION 13. Failure by Developer to Construct Improvements. At any time following
commencement of the construction of any Improvements, other than Traffic Enhancement
Improvements, by Developer City determines that such construction is not progressing within a
reasonable time in accordance with the Conditions of Approval or the Developer fails to
demonstrate a continuing ability to complete the construction of such Improvement in accordance
with the Conditions of Approval, the City may give written notice of such failure of performance
to the Developer. Developer shall have sixty (60) days from the date of receipt of such notice to
12
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WBD\319563.1
either (i) cure such failure of performance by demonstrating to the satisfaction of the City during
such cure period reasonable progress in the construction of the Improvement and a continuing
ability to complete the construction of such Improvement in accordance with the Conditions of
Approval or (ii) reasonably demonstrate that such failure of performance is due to circumstances
or conditions beyond Developer's reasonable control ("Force Majeure") including, without
limitation, the City's actions, omissions or inaction which result in a delay of performance by
Developer, labor disputes, acts of God, war, riots, insurrections, civil commotions, moratoriums,
inability to obtain labor or materials or reasonable substitutes for either, fire, unusual delay in
transportation, and adverse weather conditions. Should Developer fail to reasonably demonstrate
such reasonable progress or such continuing ability to complete the construction of such
Improvement or Force Majeure, the obligation of the City to pay the Purchase Price for the
acquisition of such Improvement pursuant to this agreement may be terminated by the City by
providing ten (10) days written notice to the Developer. Upon termination, the City may in its
sole discretion then proceed to advertise and bid the balance of the construction of such
Improvement, and there will be no further obligation on the part of the City for payment of the
Purchase Price for such Improvement due to Developer pursuant to this Agreement.
In the event that the City chooses not to advertise and bid the balance of the construction
of any such Improvement following such a termination, any monies remaining in the Facilities
Improvement Account and set aside for the acquisition of such Improvement shall be transferred
to the redemption fund established by the Bond Indenture and used to call outstanding Bonds.
SECTION 14. Agreement Contingent. As a precondition to the sale of each series of the Bonds
of CFD No. 12-1, Developer shall pay in cash to City an origination charge of 1.0% of the amount
of the principal amount of such series of the Bonds ("Origination Payment"). Each such
Origination Payment shall be at Developer's own expense and not recoverable from the proceeds
of the special taxes or from the proceeds of the Bonds. In the event that any series of the Bonds
are, for any reason, not sold, the amount of the Origination Payment made for such series of the
Bonds shall be returned to the Developer.
This Agreement is contingent upon the successful sale of Bonds, and it shall be null and
void if the first series of Bonds are not sold within a three (3) year period following the date of
this Agreement, or any mutually agreed extension; however, this time can be extended by request
of the Developer and concurrence of the legislative body.
The City may, at its option, suspend the performance of its obligations under this
Agreement if any legal challenge is filed relating to the validity or enforceability of this
Agreement, CFD No. 12-1 proceedings or the issuance of the Bonds. The obligations of the City
and CFD No. 12-1 hereunder shall be reinstated upon the entry of a final judgment in any such
proceedings upholding the validity and enforceability of the Agreement, CFD No. 12-1
proceedings and the issuance of the Bonds. In the event that a final judgment or other final and
non-appealable resolution is entered invalidating or declaring unenforceable this Agreement, CFD
No. 12-1 proceedings or the issuance of the Bonds, the City and CFD No. 12-1 may, at their
option, terminate this Agreement.
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SECTION IS. Notice of Special Tax. Developer, or the successor or assigns of the Developer,
including but not limited to all Merchant Builders (as such term is defined in Section 16 below),
shall provide written notice to all potential purchasers of lots in the form required pursuant to
Government Code Section 53341.5 and/or such additional requirements as may be established by
the City so advising the potential owner of the fact of CFD No. 12-1, with said document being
executed by the potential purchaser. Such notice shall be provided to the potential purchaser a
reasonable time before the potential purchaser becomes contractually committed to purchase the
lot so that the potential purchaser may knowingly consider the impact of the special tax in the
decision to purchase the lot. A copy of all such notices executed by actual purchasers shall be
sent to the City Engineer.
SECTION 16. Limitation of Aggregate Taxes and Assessments. Developer agrees to include
in any future agreement to sell all or any portion of the property to any person or entity for the
purpose of constructing and marketing owner-occupied residential dwelling units (each, a
"Merchant Builder") provisions requiring the inclusion of the following "escrow instructions" in
all sales by such Merchant Builder to residential home owners agrees to the inclusion of such
escrow instructions in all sales by each such Merchant Builder to residential home owners:
(a). At or prior to the close of each such escrow with a residential homeowner, the escrow
company shall apply a "calculation formula" previously approved by the City Engineer and
deposited with the escrow company by the Merchant Builder to determine the aggregate of all
annual ad valorem property taxes, all special taxes authorized to be levied to finance the
construction or acquisition of public facilities and all assessment installments authorized to be
levied to finance the construction or acquisition of public facilities (the "Total Annual Taxes and
Assessments") applicable to the parcel subject to such escrow (the "Applicable Parcel").
(b). If the Total Annual Taxes and Assessments exceed 2% of the sales price of the Applicable
Parcel, the Escrow Company will make immediate written demand upon the Merchant Builder for
deposit into the escrow of the funds necessary to partially prepay the special tax obligation for
CFD No. 12-1 or any other co=unity facilities district so that the Total Annual Taxes and
Assessments will thereafter be equal to or less than 2% of the sales price of the Applicable Parcel.
Such funds must be received by the escrow company prior to the close of escrow of the sale of
the Applicable Parcel. The calculation of the prepayment amount for CFD No. 12-1 shall be in
accordance with the method of prepayment of special tax as set forth in the rate and method of
apportionment of special taxes approved by the qualified electors of CFD No. 12-1. Upon closing
of such escrow, the amount so deposited by the Merchant Builder pursuant to this escrow
instruction shall be sent by the escrow company to the Director of Finance, together with written
instructions that such amount is to be used to partially prepay the special tax obligation of the
Applicable Parcel for CFD No. 12-1 or shall be sent to the other co=unity facilities district for
which the special tax obligation has been prepaid with similar written instructions.
The provisions of this Section 16 related to sales by Merchant Builders to residential
homeowners shall also apply to any sale by Developer of a parcel to a residential home owner.
14
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WBD1319563.1
In addition to any other remedy provided for by law or in equity, the City may enforce the
provisions of this Section 16 by an action for specific performance or injunctive relief or both.
SECTION 17. Relationship to Public Works. This Agreement is for the construction and
acquisition of certain Improvements by City and the sale of the Bonds for the payment of
construction and acquisition costs for such Improvements and such other amounts as are herein
provided, and is not intended to be a public works contract. In performing its obligations under
this Agreement, Developer is an independent contractor and not the agent of City. City shall have
no responsibility for payment to any contractor or supplier of Developer. Notwithstanding the
foregoing, Developer may be subject to certain public contract requirements as provided in
Section 3 of this Agreement.
SECTION 18. Sale of Bonds. The City shall, immediately upon execution of this Agreement by
the parties hereto, proceed with the issuance and sale of an initial series of bonds secured by the
levy of special taxes within CFD No. 12-1 (the "Bonds") to be issued pursuant to the Act. The
Bonds shall be issued in one or more series and each series shall be sized so that as of the date of
issuance of such series of the Bonds the aggregate appraised value of all taxable properties within
CFD No. 12-1 for which such Bonds are being issued shall comply with the value-to-lien
standards set forth in the Goals and Policies or as otherwise approved by the City Council
pursuant to the Goals and Policies. In addition, as to any subsequent series of Bonds, the issuance
of such Bonds shall comply with such parity bonds test as may be set forth in the Bond Indenture.
The appraised value of taxable property for purposes of this paragraph shall be determined by an
independent appraisal undertaken for the City utilizing appraisal assumptions approved by the City
and, as to each subsequent series of the Bonds, consistent with the applicable parity bonds
requirements.
The proceeds of each series of the Bonds shall be used in the following priority to (i) fund
a reserve fund for the payment of principal and interest with respect to such Bonds; (ii) fund
capitalized interest on such Bonds in an amount not to exceed the amount required to pay interest
on such Bonds until sufficient special taxes may be placed on the tax roll to pay the scheduled
debt service on such Bonds; (iii) pay for costs of issuance of such Bonds including, without
limitation, underwriter's discount, bond counsel fees, printing, and paying agent fees; (iv) as to
the first series of the Bonds, pay for the costs offorming CFD No. 12-1, including reimbursement
of advances of funds to the City by Developer to pay for the City's legal, engineering, financial,
special tax, appraisal and market absorption consulting expenses incurred relating to the formation
of CFD No. 12-1 and issuance of the Bonds; (v) pay the costs of the acquisition or construction
the Transportation Facilities and Public Facilities be financed from the proceeds of the Bonds, and
(vi) pay the costs ofthe acquisition or construction of the Improvements.
The timing of the issuance and sale of each series of the Bonds, the terms and conditions
upon which such Bonds shall be issued and sold, the method of sale of such Bonds and the pricing
thereof shall be determined solely by the City and shall conform to the Goals and Policies and this
Agreement. The sale of each series of the Bonds shall be subject to receipt by the City of a
competitively bid or negotiated bond purchase agreement which is acceptable to the City. The sale
of each series of the Bonds shall also be conditional upon the preparation of an official statement
15
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that is, in the sole judgment of the City, "deemed final" as such term is used in Rule 15c2-12 of
the Securities and Exchange Commission (the "Rule").
The principal amount of each series of the Bonds to be issued shall be determined in
accordance with the Goals and Policies such that the maximum projected annual special tax
revenues securing such Bonds and all outstanding parity Bonds, equals at least 110% of the
projected annual gross debt service on all of the Bonds following the issuance of such series of the
Bonds.
Developer, on behalf of itself, any affiliates of the Developer and any successor or assign
of the Developer including but not limited to all Merchant Builders, agrees (a) to provide all
information regarding the development of the property within CFD No. 12-1, including the
financing plan for such development, which are necessary to ensure that the official statement for
each series of the Bonds complies with the requirements of the Rule and all other applicable
federal and state securities laws; (b) to enter into a continuing disclosure agreement to provide
such continuing disclosure pertaining to CFD No. 12-1, the development thereof and the
Developer as necessary to ensure ongoing compliance with the continuing disclosure requirements
of the Rule and (c) to cause its counsel to provide an opinion of such counsel in a form
satisfactory to the underwriter of such series of the Bonds and underwriter's counselor disclosure
counsel, as applicable.
SECTION 21. Development Impact Fee Credit, Payment and Reimbursement. Proceeds of
the Bonds (the "TDIF Bond Proceeds") in an amount equal to the estimated Aggregate TDIF
Obligation shall be deposited and set aside in a separate account of the Project Fund (the
"Transportation Facilities Account") to be established by the Bond Indenture by and between the
District and U. S. Bank National Association, as fiscal agent (the "Indenture"). Except as
otherwise provided in this paragraph, the use of such proceeds shall be restricted to payment of
the Purchase Price for Transportation Facilities to be constructed by the Developers and/or the
costs incurred by the City for the acquisition or construction of other Transportation Facilities.
Upon the deposit of the TDIF Bond Proceeds in the Transportation Facilities Account, such
amount shall be credited against the Aggregate TDIF Obligation. If and to the extent that the
actual Aggregate TDIF Obligation exceeds the amount of the TDIF Deposit, the balance of the
Aggregate TDIF Obligation shall be payable pursuant to the provisions of Chapter 3.54. If and to
the extent that the actual Aggregate TDIF Obligation is less than the TDIF Bond Proceeds, such
surplus shall be transferred to the Project Fund and used pursuant to the Indenture.
Proceeds of the Bonds (the "PFDIF Bond Proceeds") in an amount equal to the estimated
Aggregate PFDIF Obligation shall be deposited and set aside in a separate account of the Project
Fund (the "Public Facilities Account") to be established by the Indenture. Except as otherwise
provided in this paragraph, the use of such proceeds shall be restricted to payment of costs
incurred by the City for the acquisition or construction of Public Facilities. Upon the deposit of
the PFDIF Bond Proceeds in the Public Facilities Account, such amount shall be credited against
the Aggregate PFDIF Obligation. If and to the extent that the actual Aggregate PFDIF Obligation
exceeds the amount of the PFDIF Bond Proceeds, the balance of the Aggregate PFDIF Obligation
shall be payable pursuant to the provisions of Chapter 3.54. If and to the extent that the actual
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WBD\319563.1
Aggregate PFDIF Obligation is less than the PFDIF Bond Proceeds, such surplus shall be
transferred to the Project Fund and used pursuant to the Indenture.
SECTION 22. Conflict with Other Agreements. Except as specifically provided herein, nothing
contained herein shall be construed as releasing Developer or the Merchant Builders from any
condition of development or requirement imposed by any other agreement with City.
SECTION 23. General Standard of Reasonableness. Any provision of this Agreement which
requires the consent, approval, discretion or acceptance of any party hereto or any of their
respective employees, officers or agents shall be deemed to require that such consent, approval or
acceptance not be unreasonably withheld or delayed, unless such provision expressly incorporates
a different standard.
SECTION 24. Entire Agreement; Amendment. This Agreement and the agreements expressly
referred to herein contains all of the agreements of the parties hereto with respect to the matters
contained herein and no prior or contemporaneous agreement or understandings, oral or written,
pertaining to any such matters shall be effective for any purpose. No provision of this Agreement
may be modified, waiver, amended or added to except by a writing signed by the party against
which the enforcement of such modification, waiver, amendment or addition is or may be sought.
SECTION 25. Notices. Any notice, payment or instrument required or permitted by this
Agreement to be given or delivered to either party shall be deemed to have been received when
personally delivered or seventy-two (72) hours following deposit of the same in any United States
Post Office in California, registered or certified, postage prepaid, addressed as follows:
Developer:
City:
City of Chula Vista
276 Fourth Avenue
Chula Vista, CA 91910
Attn: City Manager
Each party may change its address for delivery of notice by delivering written notice of such
change of address to the other party.
SECTION 26. Severability. If any prOViSion of this Agreement is held to be illegal or
unenforceable by a court of competent jurisdiction, the remainder of this Agreement shall be given
effect to the fullest extent reasonably possible.
SECTION 27. Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the successors and assigns of the parties hereto. Developer may not assign its rights or
obligations hereunder except upon written notice to City within ten (10) days of the date of such
assignment indicating the name and address of the assignee. Upon such notice and the
assumption by the assignee of the rights, duties and obligations of the Developer arising under or
from this Agreement, Developer shall be released by City from all future duties or obligations
17
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rising under or from this Agreement. Notwithstanding the preceding sentence, Developer may
assign its rights and obligations hereunder as security to lenders for the purpose of obtaining loans
to finance development within CFD No. 12-1, but no such assignment shall release Developer
from its obligations hereunder to City.
SECTION 28. Governing Law. This Agreement and any dispute arising hereunder shall be
governed by and interpreted in accordance with the laws of the State of California, Additionally,
this Agreement and the construction of the Improvements shall be subject to all City ordinances
and regulations relating to the requirement of improvement agreements, land division,
improvement security or other applicable development requirements.
SECTION 29. Waiver. Failure by a party to insist upon the strict performance of any of the
provisions of this Agreement by any other party, or the failure by a party to exercise its rights
under the default of any other party, shall not constitute a waiver of such party's right to insist
and demand strict compliance by any other party with the terms of this Agreement thereafter.
SECTION 30. Singular and Plural; Gender. As used herein, the singular of any work includes
the plural, and terms in the masculine gender shall include the feminine.
SECTION 31. Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original.
SECTION 32. Construction of Agreement. This Agreement has been reviewed by legal counsel
for both the City and the Developer and shall be deemed for all purposes to have been jointly
drafted by the City and the Developer. No presumption or rule that ambiguities shall be construed
against the drafting party shall apply to the interpretation or enforcement of this Agreement. The
language in all parts of this Agreement, in all cases, shall be construed as a whole and in
accordance with its fair meaning and not strictly for or against any party and consistent with the
provisions hereof, in order to achieve the objectives of the parties hereunder. The captions of the
sections and subsections of this Agreement are for convenience only and shall not be considered
or referred to in resolving questions of construction.
SECTION 33. Recitals; Exhibits. Any recitals set forth above and any attached exhibits are
incorporated by reference into this Agreement.
SECTION 34. Authority 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.
SECTION 34. Recordation. The parties shall execute, acknowledge and cause this Agreement,
or a memorandum of this Agreement in a form satisfactory to the parties hereto, to be recorded
against the Development Project in the Official Records of San Diego County.
[End of page. Next page is signature page.]
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WBD\319563.!
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Signature Page to
Acquisition/Financing Agreement by and between
the City of Chula Vista and
EXECUTED by and between the parties hereto on the day and year first hereinabove written.
"CITY"
CITY OF CHULA VISTA
MAYOR
CITY OF CHULA VISTA
STATE OF CALIFORNIA
ATTEST:
APPROVED AS TO FORM:
CITY CLERK
CITY OF CHULA VISTA
STATE OF CALIFORNIA
ANN MOORE, CITY ATTORNEY
CITY OF CHULA VISTA
STATE OF CALIFORNIA
S - 1
WBD\319563.1
;)-;;.7
"DEVELOPER"
By:
Name:
Title:
By:
Name:
Title:
S-2
WBD\319563.1
,;2 ~<;;2 ?!
WBD\319563.1
ExmBIT "A"
ACQUISITION AND FINANCING AGREEMENT
FOR CFD 12-1 (McMILLIN - OTAY RANCH - VILLAGE SEVEN)
IMPROVEMENT DESCRIPTION AND ESTIMATED COSTS
A-l
;2-,;29
Exhibit" A"
Ar.ql1i"ition and Finandnr Aereement For rFTl No. 12~I fMrMTLLTN OTA Y RANrH VII I A.CF. ~F.VF.NI
Imorovement DescriDtion and Estimated Costs
Improvement Improvement Description' Cost Estimate1
Number
1 Birch Road Phase 1 & 2 Street Improvements -TDIF Eliaible $4,441,043.00
2 Birch Road Phase 1 & 2landscaoina -TDIF Eliaible $587,001.80
3 Birch Road Phase 1 & 2 Street Improvements -Non- TDIF $373,395.50
. 1/2 Width Rock Mountain Road Street 1m rovements - TOIF Eligible $1,134,075.10
. 1/2 Width Rock Mountain Road Landsca in -TDIF Eli ible $83,648.40
. 1/2 Width Rock Mountain Road Street 1m rovements - Non-TOIF $11,661.00
7 Birch Road Phase 3 Street Improvements - TDIF Eliaible $2,293,216.00
8 Birch Road Phase 3 landscaoina TDIF Eliaibla $523,776.00
9 Birch Road Phase 3 Non- TDIF $262,850.00
10 Ma dalena Avenue Phase 3 SPA II Street 1m rovements - Non-TDIF $288,353.00
11 Maadalena Avenue SPA III Street 1m rovements - Non-TDIF $5,316,833.90
12 Ma dalena Avenue SPA III Landscaoino - Non-TDIF $804,656.00
13 Woltean n Loo Street 1m rovements - Non- TDIF $2,425,404.08
1. Wolf Can on Loa Landsca in - Non-TDIF $543,200.00
,. Bob Pletcher Way Street 1m rovaments - Non-TDIF $451,748.08
,. Bob Pletcher Way Landscaoino - Non- TDIF $94,820.00
17 Facilities to be financed from the proceeds of the Public Facilities Development Impact Fee $4,116,125.00
TOTAL $23,751,807
.N!!!.al
11
The description of the Improvements set forth in this Exhibit' A" is preliminary and general. The final plans and specifications may show substitutes or
modifications to the proposed hnprovements and proposed Improvements may be added or deleted with the ooDSent of Developer and the City Engineer.
Components of all street improvements eligible for funding shall include (i) grnding, (ii) wet and dry utilities within the right-of-way, (iii) stonn dlllin facilities, (iv)
paving, (v) cum, guller, sidewalk, medians, (vi) traffic signals, (vii) lighting, (viii) and all other appurtenant improvements.
21
Cost estimates are preliminary and may be modified from time to time with the comenl of Developer and the City Engineer. The Purchase Price of an Improvement
shaU be based on actual costs
31
PFDIF Facilities may be financed upon the request Oflhe Developer only jfand to the eltlent the Director of Finance detennines that the amount disbuBed is
reasonably expected tobe expended by the City within three (3) years following the issu anceoftheapplicablesericsofBonds.
<;:"",.,.....
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EXHIBIT "B"
SUBSTANTIAL COMPLETION CRiTERIA FOR IMPROVEMENTs
General:
1. Substantial completion of an Improvement for purposes of determining the eligibility of such
Improvement for the payment of the "Base Increment" therefore shall mean that the
construction or work with respect to such Improvement, including each component of such
Improvement, has progressed to the point where it is sufficiently complete so that it can be
utilized for the purpose for which it was intended. Substantial completion criteria for each
Improvement or component of an Improvement is further described below.
2. Payment for the "Retained Increment" of the Purchase Price for an Improvement shall be in
accordance with Section 7, paragraph (c)(ii) and shall be made after submittal of a payment
request form, as-built plans and such other documentation as is required pursuant to Section 7
paragraph (c )(ii), posting of maintenance bonds, and submittal of lien release evidence.
Substantial Comoletion Criteria:
A. Grading: Grading shall be deemed to be complete upon (1) completion of all preliminary
grading work (mobilization, site clearing, remedial grading, overexcavation, installation of
subdrainage systems) (2) certification of compaction by the geotechnical engineer, quantity
verification by the civil engineer, and confirmation by the City inspector and (3) installation of
all surface grading improvements (brow ditches, retaining walls, slope protection and similar
improvements) and the certification thereof by the geotechnical engineer and confirmation by
the City inspector.
B. Sewer: Sewer construction shall be deemed substantially complete upon the installation,
flushing, and testing of sewer main line, laterals, cleanouts, manholes, and all other
appurtenances of the sewer system as shown on the approved plans and specifications
therefore and in accordance with the City standard plans and specifications and the verification
of such installation by the civil engineer and confirmation of such installation by the City
inspector.
C. Storm Drain: Box culverts and headwall structures shall be deemed substantially complete
upon installation as shown on the approved plans and specifications therefore and in
accordance with the City standard plans and specifications and verification of such installation
by the civil engineer, and confirmation of such installation by the City inspector.
D. Drainage Facilities: Drainage structures including energy dissipation devices (rip-rap, drop
structures, cut-off walls, etc), drainage diversion structures, facilities required as part of the
environmental mitigation measures, and other drainage channel appurtenances including
drainage pipes connecting the brow ditches to the channel, shall be deemed substantially
complete for payment of the Base Increment upon the installation thereof as shown on the
B-1
WBD\319563.1
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approved plans and specifications therefore and in accordance with City standard plans and
specifications and the verification of such installation by the civil engineer and confirmation of
such installation by the City inspector.
E. Dry Utility Backbone Svstem: Dry utilities (electric, gas, telephone, CATV) shall be deemed
substantially complete upon the installation of the conduits, junction boxes, payment of utility
fees, and written acceptance of the facilities by the utility companies.
F. Roadway Pavement and Roadway Drainage System: Roadway pavement and drainage
improvements shall be deemed substantially complete upon the installation thereof as shown
on the approved improvement plans therefore and in accordance with City standard plans and
specifications and confirmation of such installation by the City inspector of all storm drain
pipes, catch basins, drainage inlets and cleanouts for the roadway storm drain system,
installation of roadway base material, concrete curb and gutter, and AC pavement including
the preparation of the subgrade and base material.
G. Other Street Surface Improvements: Street surface improvements including street lights,
traffic signals and conduits, signal interconnect, street name signs, roadway signing and
striping, and appurtenances shall be deemed substantially complete when installed as shown on
the improvement plans and in accordance with City standard plans and specifications and upon
confirmation of such installation by the City inspector.
H. Street Landscape Irrigation and Planting: Parkway landscaping within the roadway right of
way including planting, irrigation, concrete sidewalks, median maintenance strip, pedestrian
ramps, channel maintenance roads and all associated subgrade and base material preparation
shall be deemed substantially complete upon installation thereof as shown on the approved
improvement plans therefore and in accordance with City standard plans and specifications
and confirmation of such installation by the City inspector.
1. Slope Landscaping: Landscape planting and irrigation improvements for the slopes outside of
the roadway and channel right of way and the regional trail (DG) and fencing shall be deemed
substantially complete upon installation thereof as shown on the approved improvement plans
therefore and in accordance with City standard plans and specifications and confirmation of
such installation by the City inspector.
B-2
<-J-3,:;L
WBD\319563.!
EXlllBIT "C"
DESIGN, BID, CONTRACT AND CHANGE ORDER REQUIREMENTS
1. General
These requirements shall be applied to all improvements proposed to be constructed by
the Developer and subsequently acquired by the City through CFD No. 12-1. Except as
expressly provided otherwise in the body of this Agreement itself, anv deviation from
these requirements must be approved in writinl! in advance bv the City Engineer.
References to the City Engineer means the City Engineer or his or her designee.
The City reserves the right to make the final determination of cost of the Improvements to
be acquired in accordance with this Agreement.
2. Design Phase
A Only design costs directly related to the public improvements to be acquired are
eligible for inclusion.
B. Bidding Documents. Two complete sets of bidding documents, including
improvement plans, general provisions, and bid proposal forms shall be submitted to the
Engineering Division for review and approval within 15 working days of submittal.
Advertising for bids shall not take place until the bidding documents are approved in
writing by the City. This procedure shall be followed for each contract proposed to be
advertised. Unless otherwise noted, the bidding documents shall conform to the following
minimum requirements:
I. Unless impractical due to the nature of the improvement, the bid proposal
shall be unit priced rather than lump sum. AC. pavement, base and sub-base shall
be bid on a square foot per inch thickness basis.
2. The bidding documents shall require the bidder/contractor to provide the
following bonds:
a. Bid Bond - 10% ofthe amount of the bid.
b. Material and Labor Bond - 50% of the contract amount.
c. Performance Bond - 100% of the contract amount.
The Contractor shall post performance and labor and material bonds for all
improvements as part of the bid. The City of Chula Vista shall be named as
additional obligee with the right to call such bonds if needed. Such bonds shall
C - I
:2~33
WBD\319563.!
remain in effect until such time as all improvements are completed and accepted by
the City Engineer. The City Engineer shall be the sole judge in determining the
release of such bonds.
3. The bidding documentg ghall require the gucceggful bidder to provide
evidence of comprehensive or commercial general public liability insurance in the
amount of at least $1,000,000 prior to the award of the contract.
4. Unless otherwise required by the City, the contractor is not required to pay
prevailing wages.
5. The bidding documents must clearly state the time, date, and place where
bids are to be submitted and opened.
6. The bidding documents shall clearly state the amount of time to complete
the work. The time allowed must be reasonable for the amount of work.
Accelerated construction time allowances must be supplementally bid, and are not
eligible for public finance unless previously approved by the City Engineer.
3. Bidding Phase
A. The Notice inviting Sealed Bids shall be published in the Chula Vista Star News
and the San Diego Daily Transcript. The notice inviting bids shall state where
bidding documents are available.
B. The bidding period following the advertisement of the Notice Inviting Sealed Bids
shall be a minimum of 14 calendar days.
C. Developer shall provide complete sets of bidding documents to all contractors,
subcontractors, or suppliers requesting them. A reasonable price may be charged
for bidding documents.
D. Developer shall keep a log of all persons obtaining bidding documents, and their
mailing address.
E. Addenda shall be mailed by first class mail to all bidding document holders and the
City Engineer. If an addendum is required within five working days of the noticed
bid opening date, the bid opening date shall be extended.
F. Submitted bids shall be in sealed envelopes.
G. Bids shall not be accepted after the stated time for submission.
H. Bid opening shall be conducted by the Developer at the Developer's place of
business or other site mutually acceptable to the Developer and City Engineer.
C - 2
;)- 3'1-
WBD\319563.1
E. Sealed bids shall be opened and read aloud immediately following the submission
time. A City representative shall be invited to attend the bid opening.
1. Conditioned bids, unless the bid proposal lists them for all to bid on, shall not be
accepted.
K. The bid proposals shall conform to all state and local laws governing the listing of
subcontractors and suppliers.
L. The arithmetic of the two lowest bid proposals received shall immediately be
checked for errors.
M. A tabulation of all bids received shall be provided to the City Engineer within five
working days of the bid opening.
N. Award shall be made to the lowest responsible bidder within a reasonable period of
time following approval by the City Engineer.
O. A preconstruction meeting shall be held with the contractor prior to beginning the
work. A City representative shall be invited to attend the meeting.
P. The Notice to Proceed shall be issued within a reasonable period of time following
the contract execution.
4. Construction Phase
A. The City shall be provided a copy of the construction schedule.
B. Developer shall require the contractor to conduct weekly construction status
meetings to which a City representative shall be invited.
C. Any additional costs incurred for the benefit of the Developer, such as accelerating
the construction schedule, shall not be eligible for public financing unless
previously approved by the City Engineer.
D. Any additional construction costs incurred due solely to delays caused by the
Developer shall not be eligible for public financing.
E. All contracts and construction related records shall be available to the City as and
when required for the final determination of eligible costs for the public financing.
This shall include trip tickets and other confirmations of material delivered to the
Improvement.
C - 3
WBDI3!9563.!
;2~ 3-5<
5. Change Orders
A No single change order for a TDIF Improvement shall be eligible for inclusion in
the Purchase Price for such Improvement that increases or decreases the original
contract amount for the construction of such Improvement by more than $50,000
without City Council approval.
B. All change orders shall be fully documented and be in a format consistent and be in
a format consistent with the original bid items (i.e., show units, unit costs,
extensions and total costs). The City Engineer, in his/her sole discretion shall
determine the eligibility of each change order for inclusion in the Purchase Price
for an Improvement.
C. The aggregate of all change orders for TDIF Improvements, including those for
differences between estimated and actual quantities shall not increase the contract
amount by more than the amount specified below without City Council approval:
Original Contract Range Maximum Aggregate Increase
Up to $100,000 10%
$100,001 to $1,000,000 $10,000 plus 7% of amount over $100,000
More than $1,000,000 $73,000 plus 5% of amount over $1,000,000
The aggregate of all change orders for any non-TDIF Improvement shall not
increase the Purchase Price thereof so as to cause such Purchase Price to exceed
the cost estimate for such Improvement as set forth in Exhibit A by more than 25%
without City Council approval.
D. All change orders involving changes in scope of the project, or increases of
contract amounts greater than outlined in C. above shall be submitted to the City
Council for approval after the construction of the Improvement is completed, but
before the payment of any portion of the Purchase Price for such Improvement is
authorized by the City Engineer. Change orders that the Developer does not wish
to include in the Purchase Price for an Improvement do not need to go to City
Council for approval.
E. Negotiated set price change orders are acceptable where most of the items of work
in the change order have unit prices from the bids. Where change orders are for
work that does not have unit prices for a substantial portion of the work contained
within the bids, time and materials change orders are preferred.
C-4
WBD\319563.1
;2- 3r;,
Exhibit "D"
City of Chula Vista
Community Facilities District No. 12-1
(McMillin - Otay Ranch - Village Seven)
Base Increment
Payment Request No.
The undersigned (the "Developer") hereby requests payment in the total amount of
$ for the Base Increment for the Improvements (as defined in the
Acquisition/Financing Agreement by and among the City of Chula Vista (the "City") and
Developer and described in Exhibit A to that Agreement), all as more fully described in
Attachment 1 hereto. In connection with this Payment Request, the undersigned hereby certifies,
represents and warrants to the City as follows:
A. He( she) is a duly authorized representative or signatory of Developer, qualified to
execute this Payment Request for payment on behalf of Developer and is knowledgeable
as to the matters set forth herein.
B. The Improvements that are the subject of this Payment Request have been
substantially completed in accordance with Exhibits B and C.
C. This request for payment of the Base Increment for the improvements has been
calculated in conformance with the terms of the Agreement. All costs for which payment
is requested hereby are eligible costs (as permitted in the Agreement) and have not been
inflated in any respect. The Base Increment for which payment is requested has not been
the subject of any prior payment request paid by the City.
D. All items have been clearly delineated as DIF/Non-DIF eligible (all DIF's) and
detailed backup and cost breakdown is provided supporting each item.
E. Supporting documentation (such as third party invoices, change orders and
checks) is attached with respect to each cost for which payment is requested.
F. The Improvements for which payment is requested were constructed in accordance
with the requirements of the Agreement.
G. Developer is in compliance with the terms and provisions of the Agreement.
H. No mechanics liens or other encumbrances have attached, or to the best
knowledge of Developer, after due inquiry, will attach to the Improvements.
D -1
WBD\319563.1
~~3'7
1. A cop(ies) of the letter( s) of unconditional lien release for the Improvements for
which payment is requested is included this request. Alternatively, a copy of a letter of
conditional lien release for the Improvements for which payment is requested together
with a letter from the contractor(s) stating that they have been paid in full by the
Developer for the Improvements for which payment is requested is also included in this
request.
I hereby declare under penalty of perjury that the above representations and warranties are
true and correct.
DEVELOPER:
Dated:
CITY
Payment Request Approved for Submission to
Director of Finance
Director of Engineering
Dated:
"
D -2
c:2-3f
WBD\319563.1
ATTACHlVlENT I
SUMMARY OF IMPROVEl\1ENTS
TO BE ACQUIRED AS PART OF P A Yl\1ENT REQUEST NO. _
Imorovement Cost Estimate Base Increment Disbursement
Reouested
[List here all Improvements for which payment is requested,
and attach supporting documentation]
D - 3
.;:2 - 39
WBD\319563.1
Exhibit "E"
City of Chula Vista
Community Facilities District No. 12-1
(McMillin - Otay Ranch - Village Seven)
Retained Increment
Payment Request No.
The undersigned (the "Developer") hereby requests payment in the total amount of $
for the Retained Increment of the Purchase Price of the Improvements (as defined in the
AcquisitionlFinancing Agreement by and among the City of Chula Vista (the "City") and
Developer and described in Exhibit A to that Agreement), all as more fully described in
Attachment I hereto. In connection with this Payment Request, the undersigned hereby certifies,
represents and warrants to the City as follows:
A. He(she) is a duly authorized representative or signatory of Developer, qualified to
execute this Payment Request for payment on behalf of Developer and is
knowledgeable as to the matters set forth herein.
B. Developer has submitted or submits herein to the City, if applicable, as-built
drawings or similar plans and specifications for the Improvements and such
drawings or plans and specifications, as applicable, are true, correct and complete.
C. The Purchase Price for the Improvements has been calculated in conformance with
the terms of the Agreement. All costs for which payment is requested hereby are
eligible costs (as permitted in the Agreement) and have not been inflated in any
respect. The Retained Increment for which payment is requested has not been the
subject of any prior payment request paid by the City.
D. All items have been clearly delineated as DIFlNon-DIF eligible (all DIF's) and
detailed backup and cost breakdown is provided supporting each item.
E. Supporting documentation (such as third party invoices, change orders, lien
releases and checks) is attached with respect to each cost for which payment is
requested.
F. The Improvements for which payment is requested were constructed in accordance
with the requirements of the Agreement.
G. Developer is in compliance with the terms and provisions of the Agreement.
H. No mechanics liens or other encumbrances have attached, or to the best
knowledge of Developer, after one inquiry, will attach to the Improvements.
E - I
,;2 -'10
WBD1319563.1
I hereby declare under penalty of perjury that the above representations and warranties are
true and correct.
DEVELOPER:
Dated:
CITY
Payment Request Approved for Submission to
Director of Finance
City Engineer
Dated:
E - 2
;2 - If/
WBD\319563.1
ATTACHMENT I
SUMMARY OF IMPROVEMENTS
TO BE ACQUIRED AS PART OF PAYMENT REQUEST NO._
ImDrovement Purchase Drice Base Increment Retained Disbursement
Increment Reouested
(List here all Improvements for which payment is requested,
and attach supporting documentation]
E - 3
,;2- Lf;2.
WBD\319563.1
EXHIBIT "F"
LEGAL DESCRIPTION OF PROJECT
WBD\319563.1
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!)(1-1181T -1-
Stradling Yocca Carlson & Rauth
Draft of October H;~ 2005
PRELIMINARY OFFICIAL STATEMENT DATED NOVEMBER-, 2005
NEW ISSUE - BOOK-ENTRY-ONL Y NO RATING
In the opinion of Best Best & Krieger LLP, Bond Counsel, hased on an analysis of existing law.;', regylations, rulings and court decisions,
and assuming, among other matters, compliance with certain covenant.I', interest on the Bond~' is excluded from gross income for federal
income tax purposes under SectionI03 of the Internal Revenue Code of 1986 and is exempt from State of California per.\'Onal income taxes. In
the further opinion of Bond Counsel, interest on the Bondy is not a specific preference item for purposes of federal individual or corporate
alternative minimum taxes, although Bond Counsel observes that such interest is included in adjusted current earnings in calculating Jederal
corporate alternative minimum taxable income. Bond Counsel expresses no opinion regarding any other [,ederal or state income tax
consequences relating to the ownership or disposition of, or the accrual or receipt olinterest on, the Bond\'. See' TAX MA TTERS" herein.
$22,000,000'
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 12-1
(McMILLIN OTAY RANCH VILLAGE SEVEN)
2005 SPECIAL TAX BONDS
Dated: Date of Delivery Due: September 1, as shown on the inside cover page
The City ofChula Vista Community Facilities District No. 12-1 (McMillin Otay Ranch Village Seven) 2005 Special Tax Bonds (the
"Bonds") are being issued and delivered to finance various public improvements needed to develop property located within Community
Facilities District No. 12-1 (McMillin Otay Ranch Village Seven) (the "District "). The District has been formed by and is located in the City
ofChula Vista (the "City"), County of San Diego, California.
The Bonds are authorized to be issued pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (Sections 53311 fil
~. of the Government Code of the State of California), and pursuant to a Bond Indenture (the "Indenture"). dated as of November 1, 2005, by
and between the District and U.s. Bank National Association, as fiscal agent (the "Fiscal Agent"). The Bonds are special obligations of the
District and are payable solely from revenues derived from certain annual Special Taxes (as defined herein) to be levied on certain taxable land
within the District and from certain other funds pledged under the Indenture, all as further described herein. The Special Taxes are to be levied
according to the aml!Rded rate and method of apportionment approved by the City Council of the City and the qualified electors within the
District. See "SOURCES OF PAYMENT FOR THE BONDS-Rate and Method of Apportionment." The City Council of the City is the
legislative body of the District.
The Bonds are issuable in fully registered form 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 may be made in principal amounts of$5,000 and integral
multiples thereof and 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. The Bonds will not be transferable or exchangeable
except for transfer to another nominee of DTC or as otherwise described herein. Interest on the Bonds will be payable on March 1, 2006 and
semiannually thereafter on each September 1 and March 1. Principal of and interest on the Bonds will be paid by the Fiscal Agent to DTC for
subsequent disbursement to DTe Participants who are obligated to remit such payments to the beneficial owners of the Bonds. See "THE
BONDS-Description of the Bonds" herein.
Neither the faith and credit nor the taxing power of the City. the County of San Diego, the State of California or any political
subdivi\'ion thereof is pledged to the payment of the Bonds. Except for the Special Taxes, no other taxe,\' (we pledged to the payment of the
Bond\'. The Bonds are special tax obligations of the District payable solely from Np.t Special ~'IilX.....Rp.vp.nup... and other amounts held
under the Indenture as more fully descrihed herein.
The Bonds are subject to optional redemption, extraordinary mandatory redemption and mandatory sinking fund redemption prior to
maturity as set forth herein. See "THE BONDS-Redemption of Bonds" herein.
CERTAL'I EVENTS COULD AFFECT THE ABILITY OF THE DISTRICT TO PAY THE PRINCIPAL OF AND
INTEREST ON THE BONDS WHEN DUE. THE PURCHASE OF THE BONDS INVOLVES SIGNIFICANT RISKS, AND THE
BONDS ARE NOT SUITABLE INVESTMENTS FOR ALL INVESTORS. 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. Investors are advised to read the entire Official Statement to obtain information essential to the making of an informed investment
decision.
MATURITY SCHEDULE
(See IIlBide 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, Bond Counsel, and subject to certain other conditions. Certain legal matters will be passed on for the City and the District by the
City Attorney and for the Underwriter by Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California, as counsel
to the Underwriter. It is anticipated that the Bonds in book.entry form will be available for delivery to DTC in New York, New York, on or
about _ -' 2005.
Stone & Youngberg LLC
Dated: November _,2005
. Preliminary, subject to change.
DOCSOC1l127107v4g/022245-0161
d - !-pI
MATURITY SCHEDULE
(Base CUSIP: )1
Maturity Maturity
Date Principal Interest Date Principal Interest
(September 1) Amount Rate Price CUSlpt (September 1) Amount Rate Price CUSlpt
$ % $ %
$ % Term Bonds due September 1, _Price: _% - CUSIP1':
$ _% Term Bonds due September 1,-2n'IiPrice: _%-CUSIPt:_
Copyright 2()()5. American Bankers As:mciation. CUSIP data herein L~ provided hy Standard & Poor's, CUSIP Service Bureau. a divi.~ion
a/The McGraw-Hili Companies, Inc. Neither che Underwriter nor the District takes any responsibility jOr the accuracy o/such data.
DOCSOC/1127107v4gl022245-0161
~- Lf-S"
CITY OF CHULA VISTA, CALIFORNIA
CITY COUNCIL
Stephen C. Padilla, Mayor
Patty Davis, Deputy Mayor
Steve Castaneda, Councilmember
John McCann, Councilmember
Jerry Rindone, Councilmember
CITY STAFF
David D. Rowlands, Jr., City Manager
Dana Smith. Assistant Citv Manaper
Ann Moore, City Attorney
Maria Kachadoorian, Director of Finance
Susan Bigelow, City Clerk
Alex Al-Agha, City Engineer
BOND COUNSEL
Best Best & Krieger LLP
San Diego, California
FINANCIAL ADVISOR TO THE CITY
Fieldman, Rolapp & Associates
Irvine, California
SPECIAL TAX CONSULTANT
REAL ESTATE APPRAISER
McGill Martin Self, Inc.
Chula Vista, California
Bruce W. Hull & Associates, Inc.
Ventura, California
MARKET ABSORPTION CONSULTANT
FISCAL AGENT
Sullivan Group Real Estate Advisors
San Diego, California
U.S. Bank National Association
Los Angeles, California
DOCSOC/1127107v4f!1022245-0161
0-2 - Lf~
Except where otherwise indicated, all information contained in this Official Statement has
been provided by the District. No dealer, broker, salesperson or other person has been authorized by
the District, the City, the Fiscal Agent 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 herein
and, if given or made, such other information or representations must not be relied upon as having
been authorized by the District, the City, the Fiscal Agent or the Underwriter. This Official
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 any jurisdiction 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 herein, are intended solely as such and are
not to be construed as representations of fact. This Official Statement, including any supplement or
amendment hereto, is intended to be deposited with a nationally recognized municipal securities
depository.
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 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.
The information set forth herein which has been obtained from third party sources is believed
to be reliable but is not guaranteed as to accuracy or completeness by the District or the City. The
information and expressions of opinion herein 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 District, the City or any
other parties described herein since the date hereof. 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 hereby made to such
documents on file with the District for further information in connection therewith.
All information considered material to the making of an informed investment decision with
respect to the Bonds is contained in this Official Statement. While the City maintains an internet
website for various purposes, none of the information on its website is incorporated by reference into
this Official Statement. Any such information that is inconsistent with the information set forth in
this Official Statement should be disregarded.
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 21E of the United States Securities Exchange Act of 1934, as amended,
and Section 27 A of the United States Securities Act of 1933, as amended. Such statements are
generally identifiable by the terminology used such as "plan," "expect," "estimate," "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 "THE COMMUNITY
FACILITIES DISTRICT" and "THE DEVELOPMENT AND PROPERTY OWNERSHIP."
DOCSOC1l127107v4W022245-0161
~;2 - '-17
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 STATEMENT SET FORTH IN THIS OFFICIAL
STATEMENT.
IN CONNECTION WITH THE OFFERING OF THE BONDS, THE UNDERWRITER
MAY OVERALLOT OR EFFECT TRANSACTIONS WmCH STABILIZE OR MAINTAIN
THE MARKET PRICE OF SUCH BONDS AT A LEVEL ABOVE THAT WmCH 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.
DOCSOC/1127107v4I!f022245-0161
.~ - Lf~
TABLE OF CONTENTS
Page
INTRODUCTION ...................................................... .............................................. ............................................ 1
General..................... .......... ............................................................................................................................ 1
The District ........................ ............................................................................................................................ 1
Sources ofpayment for the Bonds ......... ................. ............ ................... ........................................... ............. 3
Description of the Bonds....... ...... ................................................ ................................................................... 4
Tax Matters ........ ..................................................... .............. ................. ...... ........... .................................. ..... 4
Professionals Involved in the OITering ..... ................................................ ........................................... .......... 4
Continuing Disclosure...... ........... .................... ........... .................... ................................................................ 5
Bond Owners' Risks............. .......................................................... ............................................................... 5
Forward Looking Statements ... ................................................................................... ........ .................... ....... 5
Other Information... ... ....................................................... ................ ......... ........ .............. ....................... ....... 6
ESTIMATED SOURCES AND USES OF FUNDS ............................................................................................6
THE BONDS .................................................................... ................................................ .................................... 7
Authority for Issuance..................... .......... ...... ............................................................... ............. ... ................ 7
Purpose of the Bonds............................................................... .............. ......... ............................................... 7
Description of the Bonds.................................................................................... ......... ........ ... ..... ......... ... ....... 7
Redemption of Bonds. ................................................................. ......................................................... .......... 8
Notice and Selection of Bonds for Redemption.............................................................................................9
Notice of Redemption ................................... ........................ ...... ................................................................. 10
Effect of Redemption.......... ..... ....................................................................... ........... .................................. 11
Transfer and Exchange of Bonds .................................................................................................................11
Debt Service Schedule for the Bonds...........................................................................................................12
SOURCES OF PAYMENT FOR THE BONDS ................................................................................................ 13
Limited Obligations .......................................................................... ..... ........................................ .............. 13
Special Taxes........................................................................... ... .................................. ... ............................ 13
Reserve Fund .... ......................................... .......... ........................................... ............................................. 18
Issuance of Parity Bonds........................ ............................... ................. .................................. ............... ..... 18
THE COMMUNITY FACILITIES DISTRICT .................................................................................................19
General Description of the District ........................................................ .................................. .................... 19
Description of Authorized Facilities ................................ ................................................ .................... ........ 19
Status of Facilities...... ..................................... ......................... ....................... ........... .............................. ~21
Proiected Principal Taxpayers ......................................................... ,..............n ...................................... ~21
Estimated Direct and Overlapping Indebtedness .....................................................................................2+ll
Expected Tax Burden.... ........... ... ........................................................... ....................... ........................... ~24
Estimated V alue-to- Lien Ratios.............................................................................. .......................... ....... i!4lS
Permitted Land Use.......... ............................. .......... ........................................ ............................... ... ....... ~2Jl
THE DEVELOPMENT AND PROPERTY OWNERSHIP ...........................................................................~2Jl
General Description and Location of the District ............... ..................................................................... ~2Jl
The Developer................................ ..... ............................................... .... ............ ...................................... ;!&2.2
Development Plan..................................... ............................................................................................... ;!&2.2
Merchant Builders....................... ............................................................................ ... .............................. ;)93Jl
Financing Plan........................................................ ................. ......................................................... ....... 31)3.1
Merchant Builder Financing.................. ... ...................................... ....... ... ...... ......................................... M,ll
Status of Entitlement Approvals............... ................................................ ......... ........... ........................... ~;H
Environmental Constraints. ,........................................ .............. ,................ ..... ... ............................ '.,.,..... ~3..4
Infrastructure Requirements and Construction Status........... ............... .................................................... 3-335
Potential Limitations on Development...... ... ................................................. ........... ................................ 3-335
Appraisal................. ................................................................................................... .......................... .... ~31
Market Absorption Study......................................................... ................................................... ......... .... ;638
DOCSOC/l127107v41ij022245-0161
;2-'11
TABLE OF CONTENTS
Page
SPECIAL RISK FACTORS ............................ .......................... .............. ................. ...................................... ;';:3Jl
Concentration of Ownership.................................................................................................................... ;';:3.2
Limited Obligations ................................................. ..................................................... ........................... ;';:3.2
Insufficiency of Special Taxes................................................................................................................. 'lll3.2
Special Tax Delinquencies........................................................................ ...............................................~
Failure to Develop Properties ..................................................... ............................... ..............................~
Future Land Use Regulations and Growth Control Initiatives.................................................................~
Endangered Species ................................................................................................................................. 4Q42.
Water Availability............................................................................. ....................................................... 4M3.
Natural Disasters ................................................... ................ .................................................... ............... 4M3.
Hazardous Substances................................................. .............................................................. ........... .... 4M3.
Parity Taxes, Special Assessments and Land Development Costs ..........................................................4~4!!
Disclosures to Future Purchasers ................................................................. ............................... ............. 434S
Non-Cash Payments of Special Taxes .............................................. ........... ............................................ 444Ii
Payment of the Special Tax is not a Personal Obligation of the Owners................................................. 444Ii
Land Values ............................................................................................................................................. 444Ii
FDIC/Federal Government Interests in Properties ............................ ........ ............................................... 4M1
Bankruptcy and Foreclosure...................................................................................... ............ .................. 464l!
No Acceleration Provision....... ...... ........................................................... ......... ........ n.................. '......... 4+42
Loss of Tax Exemption. ......... ........ .......................................................................................................... 4142
Limitations on Remedies........................................ ................................................................................. 4842
Limited Secondary Market...................................... ................................................................................. 48Sll
Proposition 218 ............. ........................................................................................................... ................ 48~
Ballot Initiatives........................................... .................................................................... ........................ 49Sl
CONTINUING DISCLOSURE.......................... ............................... ............................................................. 5GSl
TAX MATTERS................................... ................................................................. ......................................... ~52
LEGAL MATTERS....... ................................................................. ................................................... ............. ~53.
LITIGATION ................................................................................................................................................. ~~
NO RATING ..................................................................................................................................................~~
UNDERWRITING .........................................................................................................................................~~
FINANCIAL INTERESTS.. ............................................................................ ............................................... ~~
PENDING LEGISLATION. ................................................................. .......................................................... BSS
ADDITIONAL INFORMATION...................................................................................................................~
APPENDIX A
APPENDIX B
APPENDIX C
APPENDIX D
APPENDIX E
APPENDIX F
APPENDIX G
APPENDIX H
APPENDIX I
RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX.............................A-I
SUMMARY OF MARKET ABSORPTION STUDy....................................................... B-1
APPRAISAL REPORT....................................... ......... ........... ........................................... C-I
INFORMATION REGARDING THE CITY OF CHULA VISTA...................................D-I
SUMMARY OF INDENTURE .......................... ................. .............................................. E-I
CONTINUING DISCLOSURE AGREEMENT OF THE DISTRICT ...............................F-I
CONTINUING DISCLOSURE AGREEMENT OF THE DEVELOPER......................... G-I
FORM OF OPINION OF BOND COUNSEL...................................................................H-I
DTC AND THE BOOK ENTRY SySTEM....................................................................... I-I
11
DOCSOCIl127107v4g1022245-0161
;2-50
DOCSOCIl127J07v4W022245-0161
[AERIAL PHOTO]
;J-5!
DOCSOCIl127107v4W022245-0161
[REGIONAL LOCA nON MAP]
:J - 5<-~
'-~
$22,000,000'
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 12-1
(McMILLIN OTAY RANCH VILLAGE SEVEN)
2005 SPECIAL TAX BONDS
INTRODUCTION
General
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 A-"AMENDED RATE AND
METHOD OF APPORTIONMENT OF SPECIAL TAX" or in Appendix E-"SUMMARY OF
INDENTURE" herein.
The purpose of this Official Statement, which includes the cover page, the table of contents
and the attached appendices (collectively, the "Official Statement"), is to provide certain information
concerning the issuance of the $22,000,000' City of Chula Vista Community Facilities District
No. 12-1 (McMillin Otay Ranch Village Seven), 2005 Special Tax Bonds (the "Bonds''). The
proceeds of the Bonds will be used to construct and acquire various public improvements needed
with respect to the proposed development within Community Facilities District No. 12-1 (McMillin
Otay Ranch Village Seven) (the "District"), to fund the Reserve Fund securing the Bonds, to pay
costs of issuance of the Bonds and to capitalize interest on the Bonds through September 1,2006.
The Bonds are authorized to be issued pursuant to the Act (as defmed herein) and a Bond
Indenture (the "Indenture"), dated as of November 1, 2005, by and between the District and U.S.
Bank National Association (the "Fiscal Agent"). The Bonds are secured under the Indenture by a
pledge of and lien upon Net Special Tax Revenues and all moneys in the funds and accounts under
the Indenture other than the Rebate Fund, the Project Fund and the Administrative Expense Fund.
The District
Formation Proceedings. The District has been formed by the City of Chula Vista (the
"City'') 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"), and the City of Chula Vista
Community Facilities District Ordinance.
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 fmance 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. Subj ect to approval by two-thirds of the votes cast at an election and compliance
. Preliminary, suhjecl to change.
noc:snc./11271 07v6!O?1.'''';;;_Ol li1
d2 - 5:?
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 to repay such
indebtedness. The City Council of the City acts as the legislative body of the District.
Pursuant to the Act, the City Council adopted the necessary resolutions stating its intent to
establish the District, to authorize the levy of Special Taxes (defined herein) on taxable property
within the boundaries of the District, and to have the District incur bonded indebtedness. Following
public hearings conducted pursuant to the provisions of the Act, the City Council adopted resolutions
establishing the District and calling special elections to submit the levy of the Special Taxes and the
incurring of bonded indebtedness to the qualified voters of each of the improvement areas. On
August 30, 2005, at an election held pursuant to the Act, the landowners who comprised the qualified
voters of the District authorized the District to incur bonded indebtedness in the aggregate principal
amount not to exceed $25,000,000 to be secured by the levy of Special Taxes on taxable property
within the District. On that same date, the landowners within the District approved the rate and
method of apportionment of the Special Taxes on land within the District to pay the principal of and
interest on the bonds of the District issued for the District. The Rate and Method of Apportionment
of Special Tax (the "Rate and Method") is set forth in Appendix A hereto. The facilities authorized
to be financed by the District are referenced herein as the "Facilities." See "THE COMMUNITY
FACILITIES DISTRICT-Description of Authorized Facilities."
Description and Development. The District encompasses approximately 97 ftel-acres-Df
whieh annroximatelv 57.88 will he develoned and is located east of Interstate 805 approximately
seven miles southeast of downtown San Diego.
The land use entitlements for the District permit development in sub-areas known as
"planning areas." Based on current land use approvals and projections, the land within the District is
expected to be developed into 759 residential units. See "THE DEVELOPMENT AND PROPERTY
OWNERSHIP-Potential Limitations on Development."
As of September I, 2005, grading of the land within the District had commenced and
construction of infrastructure (utilities, roads, sidewalks, etc.) is expected to be completed in
April 2006. Model homes within certain planning areas of the District are expected to be in place by
the end of February 2006 with the sale of homes to commence shortly thereafter. For a more detailed
description of development activity within the District, see "THE COMMUNITY FACILITIES
DISTRICT-Status of Public Improvements."
Developer. The master developer of the property in the District is McMillin Otay Ranch,
LLC, a Delaware limited liability company (the "Developer"). For certain information concerning
the Developer, see "THE DEVELOPMENT AND PROPERTY OWNERSHIP-The Developer."
The Developer currently owns five planning areas consisting of approximately
9-151J1l! taxable acres within the District. The Developer expects to complete the sales of five
planning areas to various merchant builders. three of which are related entities of the Develoner.
in early 2006, all as described under "THE DEVELOPMENT AND PROPERTY OWNERSHIP-
Development Plan" and "-Merchant Builders."
Appraisal. Bruce W. Hull & Associates, Inc. (the "Appraiser") has conducted an appraisal
(the "Appraisal") of land within the District and has concluded, based upon the assumptions and
limiting conditions contained in the Appraisal that as of August 15, 2005, the aggregate value of such
~
nOc.~Oc.111 '-71 07vfil022241:i_01 61
;;2-51
land was $98,800,000. The Sullivan Group Real Estate Advisors (the "Market Absorption
Consultant") has prepared a Market Analysis and Absorption Projection report (the "Market
Absorption Study") for the purpose of developing a build out projection for the 759 for-sale
residential units planned, but not yet sold, in the District dated September 9, 2005. The Market
Absorption Study concludes that the residential units within the District should be built out in the
2006-2008 period assuming continued development with no stops due to unanticipated market or
business factors and assuminQ" that the City's buildinf! oermit allocation nrocedures are not a
constraint on the schedule of develonment. See "THE DEVELOPMENT AND PROPERTY
OWNERSHIP-Appraisal" and "-Market Absorption Study," Appendix B-"SUMMARY OF
MARKET ABSORPTION STUDY" and Appendix C-"APPRAISAL REPORT."
Sources of Payment for the Bonds
Special Taxes. As used in this Official Statement, the term "Special Tax" is that tax which
has been authorized pursuant to the Act to be levied against certain land within the District pursuant
to the Act and in accordance with the Rate and Method. See "SOURCES OF PAYMENT FOR THE
BONDS-Special Taxes" and AppendixA-"RATE AND METHOD OF APPORTIONMENT OF
SPECIAL TAX." Under the Indenture, the District has pledged to repay the Bonds from the Special
Tax Revenues remaining after the funding of the annual Administrative Expense Requirement of
$75,000 ("Net Snecial Tax Revenues") and amounts on deposit in the funds and accounts
established under the Indenture other than the Project Fund, the Rebate Fund and the Administrative
Expense Fund. Special Tax Revenues are defined in the Indenture to include the proceeds of the
Special Taxes received by the District, including any scheduled payments and prepayments thereof,
interest and penalties thereon and the proceeds of the redemption or sale of property sold as a result
of foreclosure of the lien of the delinquent Special Taxes in the amount of said lien and interest and
penalties thereon.
The Special Taxes are the primary security for the repayment of the 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 are amounts held by the Fiscal Agent, including amounts held in the Reserve Fund.
See "SOURCES OF PAYMENT FOR THE BONDS-Reserve Fund."
Foreclosure Proceeds. The District has covenanted for the benefit of the owners of the
Bonds that it will commence, and diligently pursue to completion, judicial foreclosure proceedings
against Assessor's Parcels under common ownership with delinquent Special Taxes in the aggregate
in excess of $5,000 by the October I following the close of the fiscal year in which such Special
Taxes were due, and it will commence and diligently pursue to completion judicial foreclosure
proceedings against all Assessor's Parcels under common ownership with delinquent Special Taxes
in the aggregate in excess of $2,500 by the October I following the close of any fiscal year if the
amount in the Reserve Fund is less than the Reserve Requirement. See "SOURCES OF PAYMENT
FOR THE BONDS-Proceeds of Foreclosure Sales" herein. There is no assurance that the property
within the District can be sold for the appraised value or assessed values 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 or future landowners within the District. See "SPECIAL RISK
FACTORS-Land Values" and Appendix C-"SUMMARY APPRAISAL REPORT' herein.
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
~
nocsnC/1127107vfiI022'24.c;:_0161
/-.55
<7'"
ARE SPECIAL OBLIGATIONS OF THE DISTRICT PAYABLE SOLELY FROM !"lEI
SPECIAL Tf_'CESTAX REVENUES AND CERTAIN AMOUNTS HELD UNDER THE
INDENTURE AS MORE FULLY DESCRIBED 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 I-"DTC AND THE
BOOK ENTRY SYSTEM."
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 herein. See "BOOK-ENTRY-ONL Y SYSTEM" herein.
The Bonds are subject to optional redemption, extraordinary mandatory redemption and
mandatory sinking fund redemption as described herein. 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 INDENTURE" herein.
Tax Matters
In the opinion of Bond Counsel, based on an analysis of existing laws, regulations, rulings
and court decisions, and assuming, among other matters, compliance with certain covenants, interest
on the Bonds is excluded from gross income for federal income tax purposes under Section 103 of
the Internal Revenue Code of 1986 and is exempt from State of California personal income taxes. In
the further opinion of Bond Counsel, interest on the Bonds is not a specific preference item for
purposes of federal individual or corporate alternative minimum taxes, although Bond Counsel
observes that such interest is included in adjusted current eamings in calculating federal corporate
alternative minimum taxable income. Bond Counsel expresses no opinion regarding any other
federal or state income tax consequences relating to the ownership or disposition of, or the accrual or
receipt of interest on, the Bonds. See "TAX MATTERS" herein.
Professionals Involved in the Offering
u.S. Bank National Association will act as Fiscal Agent under the Indenture and as the initial
Dissemination Agent under the Developer Continuing Disclosure Agreements. See Appendix G.
Stone & Youngberg LLC is the Underwriter of the Bonds. All proceedings in connection with the
issuance and delivery of the Bonds are subject to the approval of Best Best & Krieger LLP, San
Diego, Bond Counsel. Fieldman, Rolapp & Associates is acting as Financial Advisor to the City in
connection with the Bonds. Certain legal matters will be passed on for the City and the District by
;!
nOc.~Or!11 2'71 07vtil02224.l;j~01111
(;2-50
the City Attorney, and for the Underwriter by Stradling Y occa Carlson & Rauth, a Professional
Corporation, Newport Beach, California, as Underwriter's Counsel. Oilier professional services have
been performed by McGill Martin Self, Inc. as Special Tax Consultant, Bruce W. Hull & Associates,
Inc. as Appraiser, and Sullivan Group Real Estate Advisors, as Market Absorption Consultant.
For information concerning the respects in which certain of the above-mentioned
professionals, advisors, counsel and agents may have a financial or other interest in the offering of
the Bonds, see "FINANCIAL INTERESTS" herein.
Continuing Disclosure
Each of the District and the Developer has agreed to provide, or cause to be provided, to each
nationally recognized municipal securities information repository and any public or private
repository or entity designated by the State as a state repository for purposes of Rule l5c2-l2(b)(5)
adopted by the Securities and Exchange Commission certain financial information and operating
data. The District has further agreed to provide notice of certain material events. These covenants
have been made in order to assist the Underwriter in complying with Rule l5c2-l2(b)(5). See
"CONTINUING DISCLOSURE" herein, Appendix F and Appendix G hereto for a description of the
specific nature of the reports to be filed by the District and the Developer and notices of material
events to be provided by each.
Bond Owners' Risks
Certain events could affect the timely repayment of 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 suitable
investments for all investors. See "SPECIAL RISK FACTORS" herein.
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
Reform Act of 1995, Section 21 E 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 "plan," "expect," "estimate," "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 "THE COMMUNITY
FACILITIES DISTRICT" and "THE DEVELOPMENT AND PROPERTY OWNERSHIP."
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
~
nnc.~nC:f11271 07vii!02224~_Ol Ii 1
e2 -57
REVISIONS TO THE FORWARD-LOOKING STATEMENTS SET FORTH IN THIS OFFICIAL
STATEMENT.
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 shall have the meanings
set forth in the Indenture.
Copies of the Indenture and other documents and information referred to herein are available
for inspection and (upon request and payment to the City of a charge for copying, mailing and
handling) for delivery from the City at 276 Fourth Avenue, Chula Vista, CA 91910, Attention:
Director of Finance.
ESTIMATED SOURCES AND USES OF FUNDS
The following table sets forth the expected uses of Bond proceeds:
Sources of Funds
Principal Amount of Bonds
Less: Original Issue Discount
TOTAL SOURCES
$
$
Uses of Funds
Proj ect Fund
Capitalized Interest Sub-Account of the Interest
Account(l)
Reserve Fund
Cost ofIssuance Fund
Underwriter's Discount
Administrative Expense Fund
TOTAL USES
$
$
(I) Represents gross funded capitalized interest on the Bonds through September 1, 2006.
{i
nOCSOC/l11.71 07vti/02224-';.Ol ti 1
c2 -~-)J7
THE BONDS
Authority for Issuance
The Bonds in the aggregate principal amount of $22,000,000' are authorized to be issued by
the District under and subject to the terms of the Indenture, the Act and other applicable laws of the
State of California.
Purpose of the Bonds
The Bonds are being issued to provide funds to: (i) fmance the costs of constructing and
acquiring certain public facilities related to the proposed development within the District (See "THE
COMMUNITY FACILITIES DISTRICT-Description of Authorized Facilities"); (ii) pay costs
related to the formation of the District and the issuance of the Bonds; (iii) fund the Reserve Fund for
the Bonds in the initial amount of $ ; and (iv) gross fund capitalized interest on the Bonds
through September 1,2006. See "ESTIMATED SOURCES AND USES OF FUNDS."
Description of the Bonds
The Bonds will be issued as fully registered bonds without coupons in denominations of
$5,000 and any integral multiple thereof and shall be dated the date of delivery thereof. The Bonds
will be issued in book-entry only form and The Depository Trust Company, New York, New York
("DTC") will act as securities depository for the Bonds. So long as the Bonds are held in book-entry
only form, principal of, premium, if any, and interest on the Bonds will be paid directly to DTC for
distribution to the beneficial OwnerS of the Bonds in accordance with the procedures adopted by
DTC. See AppendixI-"DTC AND THE BOOK ENTRY ONLY SYSTEM." The Bonds will
mature on September I, in the principal amounts and years, and bearing rates of interest, as shown on
the inside cover of this Official Statement.
Interest on the Bonds will be payable semiannually on March I and September I of each
year, commencing March I, 2006 (each, an "Interest Payment Date") and will be computed on the
basis of a 360-day year comprised of twelve 30-day months. Each Bond will bear interest from the
Interest Payment Date next preceding the date of authentication, thereof, 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 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 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 or, upon the
request in writing prior to the Record Date of a Bondowner of at least $1,000,000 in aggregate
. Preliminary, subject to change.
z
nOc.~or./l1 171 07vM02224.l:i_Ol fil
;2 ~ 51
principal amount of Bonds, by wire transfer in immediately available funds to an account in the
United States designated by such Owner.
Redemption of Bonds
Optional Redemption. The Bonds maturing on and after September I, 20_ 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, 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
September I, 20_ and March I, 20_
September 1,20_ and March 1,20_
September I, 20_ and thereafter
Redemption Price
%
Extraordinary Mandatory Redemption from Special Tax Prepayment. The Bonds are subject
to redemption on any Interest Payment Date, prior to maturity, as a whole or in part on a pro rata
basis among maturities from the proceeds of the prepayment of Special Taxes pursuant to the Rate
and Method. 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
ScptemeerMan:h I, ;!G----2.IIllii through
March 1,20_
September I, 20_ and March I, 20_
September I, 20_ and March I, 20_
September I, 20_ and thereafter
Redemption Price
%
See "SOURCES OF PAYMENT FOR THE BONDS-Special Taxes-Prepayment of Special
Taxes" and Appendix A for a description of how a property owner may prepay, or will be required to
prepay, Special Taxes.
J!
nOCSOCI11?'71 n7vfi/01:?:?4~_Ol 61
c2~~O
Mandatory Sinking Fund Redemption. The Bonds maturing on September I, 20_ are
subj ect to mandatory sinking fund redemption, in part, by lot, on September 1 in each year
conunencing September I, 20 ~ at a redemption price equal to the principal amount of the 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 on the following redemption
schedule.
Redemption Date
(September 1)
Principal
Amount
$
1
t Final Maturity
The Bonds maturing on September I, 20_ are subject to mandatory sinking fund
redemption, in part, by lot, on September I in each year conunencing September I, 20_, at a
redemption price equal to the principal amount of the 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 on the following redemption schedule.
Redemption Date
(September 1)
Principal
Amount
$
1
t Final Maturity
In the event of a partial optional redemption or special mandatory redemption of the Bonds,
each of the remaining mandatory sinking fund payments for such Bonds, as applicable, will be
reduced, as nearly as practicable, on a pro rata basis.
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 accrued interest to the purchase date.
Notice and Selection of Bonds for Redemption
In the event the District shall elect to redeem Bonds as provided in the Indenture, the District
shall give written notice to the Fiscal Agent of its election to so redeem, the redemption date, the
2
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principal amount of the Bonds to be redeemed, 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 Bonds
or portions thereof to be selected for redemption.
The notice to the Fiscal Agent shall be given not less than 60 days prior to the redemption
date or such shorter period as shall be acceptable to the Fiscal Agent. 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.
Notice of Redemption
Notice by Mail to Registered Owners. The Fiscal Agent shall mail, at least 30 days but not
more than 45 days prior to the date of redemption, notice of intended redemption, by first-class mail,
postage prepaid, to the original purchasers 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 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 ofa 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.
Further Notice. Further notice of redemption shall be sent at least two days before the notice
of redemption is mailed to the Bondholders, as described above, by registered or certified mail or
overnight delivery service to the registered securities depositories and to the national information
services listed in the Indenture or, in accordance with the then-current guidelines of the Securities
and Exchange Commission, such other securities depositories and services providing information on
called bonds, or such other securities depositories and services, as the District may determine in its
sole discretion.
Failure to Receive Notice. So long as notice by first class mail has been provided as set forth
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.
Certificate of Giving Notice. The notice or notices described above 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 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.
1JI
noc~or./l1 271 07viilO?:?:?<1J:;_0161
d-~;L
Notice from DTG to Beneficial Owners. So long as the Bonds are held in book-entry-form,
notice of redemption will be sent by the Fiscal Agent only to DTC or its nominee. Conveyance of
redemption notice by DTC to Beneficial Owners is determined by DTC and its participants and is not
the responsibility of the District. See Appendix I-"DTC AND THE BOOK ENTRY SYSTEM."
Effect of Redemption
When notice of redemption has been given, and when the amount necessary for the
redemption of the Bonds called for redemption is set aside for that purpose in the Redemption Fund,
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, with the form of assignment endorsed thereon executed in blank, said Bonds shall be
redeemed and paid at the redemption price out of 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 said Redemption Fund.
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.
Transfer and Exchange of Bonds
There shall be kept by the Fiscal Agent, sufficient books for the registration and transfer of
the Bonds and, upon presentation for such purpose, the Fiscal Agent shall, under such reasonable
regnlations as it may prescribe, register or transfer or cause to be registered or transferred, on said
register, the Bonds. 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 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.
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 the 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.
The transfer of any Bond may be registered only upon such books of registration 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
11
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;2.-&3
transferee, of any denomination or denominations authorized by the 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 the 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.
Debt Service Schedule for the Bonds
Period Ending Principal Interest Total Debt Service
(September I) on Bonds on Bonds on Bonds
2006 $ $ $ (1)
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2JIJ1i
Total $ $ $
(I) To be paid from capitalized interest.
11
nOCSOC/l11.7107vii/0?224,,_0161
.;2 -& 1
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.
The Special Taxes are the primary security for the repayment of the Bonds. Under the
Indenture, the District has pledged to repay the Bonds from the NdSpecial Tax Revenues remaining
after !lie funEiiBg sf !lie annlial f.aministmtiye E)(jlense ReEjllirement sf $75,QQQ and from amounts
held in the funds and accounts under the Indenture, other than amounts held in the Project Fund, the
Rebate Fund and the Administrative Expense Fund. Net Snecial Tax Revenlles are the Snecial Tax
Revenues remaininl! after the fundin~ of the annual Administrative Exoense Reouirement in
an amollnt not to exceed $75.000. Special Tax Revenues are defIned in the Indenture to include the
proceeds of the Special Taxes received by the District, including any scheduled payments and
prepayments thereof, interest and penalties thereon, the proceeds of the redemption of delinquent
Special Taxes or sale of property sold as a result of foreclosure of the lien of delinquent Special
Taxes in the amount of said lien, and interest and penalties thereon.
In the event that the Special Tax Revenues are not received when due, the only sources of
funds available to pay the debt service on the Bonds are amounts held by the Fiscal Agent, including
amounts held in the Reserve Fund, for the exclusive benefIt of the Owners of the Bonds.
NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE CITY,
THE COUNTY OF SAN DIEGO, THE STATE OF CALIFORNIA OR ANY POLITICAL
SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT 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 THE ,NELSPECIAL
T}~'(ESTAX REVENUES AND OTHER AMOUNTS PLEDGED UNDER THE INDENTURE
AS MORE FULLY DESCRIBED HEREIN.
Special Taxes
Authorization and Pledge. In accordance with the provisions of the Act, the City Council
established the District on August 23, 2005 for the purpose of fInancing the acquisition, construction
and installation of various public improvements to ser/enecessarv to meet increased demands
nlaced unon the Citv as a result of develonment within the District. At a special election held on
August 30, 2005, the owners of the property within the District authorized the District to incur
indebtedness secured by Special Taxes levied on property in the District in an amount not to exceed
$25,000,000, and approved a rate and method or apportionment which authorized the Special Tax to
be levied to repay District indebtedness for the District, including the Bonds.
The District has covenanted in the Indenture that by July I of each year (or such later date as
may be authorized by the Act) it will levy Special Taxes within the District up to the maximum rates
permitted under the Rate and Method in the amount required for the payment of principal of and
interest on any Outstanding Bonds becoming due and payable during the ensuing calendar year,
13.
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c2 -tP5
including any necessary replenishment or expenditure of the Reserve Fund and the amount estimated
to be sufficient to pay the Administrative Expenses during such calendar year.
The Special Taxes levied in any fiscal year may not exceed the maximum rates authorized
pursuant to the Rate and Method. See AppendixA-"RATE AND METHOD OF
APPORTIONMENT OF SPECIAL TAX" hereto. There is no assurance that the l"ll:LSpecial Tax
JlreeeedaRevenues will, in all circumstances, be adequate to pay the principal of and interest on the
Bonds when due. See "SPECIAL RISK FACTORS-Insufficiency of Special Taxes" herein.
Rate and Method. Under the Rate and Method, all Taxable Property within the District shall
be classified as Developed Property or Undeveloped Property and shall be subject to the levy of
annual Special Taxes as described below. All Taxable Property shall be categorized as being located
in either Zone A or Zone B. All Developed Property shall be further classified as Residential
Property or Commercial Property.
The Maximum Annual Special Tax for each Assessor's Parcel of Residential Property or
CeHlffierei!>1Non-Residential Property shall be the greater of (1) the Assigned Special Tax described
below or (2) the Backup Special Tax computed as described below.
The Assigned Special Tax for each Assessor's Parcel of Developed Property is shown in the
tables below.
Assigned Annual Special Tax for Developed Property
Land Use Class
I
Description
Residential Property
Assigned Annual Special Tax
$890.00 per unit plus $0.79
per square foot of Residential
Floor Area
$6,000 per Acre
2
CeHlffiereialNon-Res
idential Property
When a Final Subdivision Map is recorded within Zone A or Zone B, the Backup Special
Tax for Assessor's Parcels classified as Residential Property or CemmereialNon-Residential
Property shall be determined as follows:
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
Subdivision Map area, the Backup Special Tax shall be the rate per Lot calculated according to the
following formula:
Zone A
$24,383 x A
B=
L
14
nO{'~OC'/11171 07v6102224.l;j:.Ol 61
c2 -4> r;,
Zone B
$41,621 xA
B;
L
The terms above have the following meanings:
B ; Backup Special Tax per Lot in each Fiscal Year.
A ; Acreage classified or to be classified as Residential Property in such Final
Subdivision Map.
L ; Lots in the Final Subdivision Map which are classified or to be classified as
Residential Property.
For each Assessor's Parcel of CammereialNon-Residential Property or for each Assessor's
Parcel of Undeveloped Property to be classified as CammcrcialNon-Residential Property within the
Final Subdivision Map area, the Backup Special Tax shall be determined by multiplying $24,383
Zone A and $41,621 for Zone B by the total Acreage of each Assessor's parcels of the
CemmereialNon-Residential and Undeveloped Property to be classified as
CemmereialNon-Residential Property within the Final Subdivision Map area.
Notwithstanding the foregoing, if Assessor's Parcels of Residential Property,
CemmereialNon-Residential Property or Undeveloped Property for which the Backup Special Tax
has been determined are subsequently changed or modified by recordation of a new or amended Final
Subdivision Map, then the Backup Special Tax applicable to such Assessor's Parcels shall be
recalculated to equal the amount of Backup Special Tax that would have been generated if such
change did not take place.
The Maximum Annual Special Tax for each Assessor's Parcel classified as Undeveloped
Property shall be $24,383 per acre for Zone A and $41,621 per acre for Zone B.
Commencing with Fiscal Year ~2006-ll61l1 and for each following Fiscal Year, the City
Council shall determine the Special Tax Requirement Cas defined in the Rate and Method) and shall
levy the Special Tax until the amount of Special Taxes equals the Special Tax Requirement. The
Special Tax shall be levied each Fiscal Year as follows:
First: The Special Tax shall be levied Proportionately on each Assessor's Parcel of
Developed Property within Zone A and Zone B at a rate up to 100% of the applicable Assigned
Special Tax to satisfy the Special Tax Requirement.
Second: If additional monies are needed to satisfy the Special Tax Requirement after the first
step has been completed, the Special Tax shall be levied Proportionately on each Assessor's Parcel of
Undeveloped Property within Zone A and Zone B, excluding any Assessor's Parcels classified as
Undeveloped Property pursuant to Section E of the Rate and Method, at a rate up to 100% of the
Maximum Annual Special Tax for Undeveloped Property.
Third: If additional monies are needed to satisfy the Special Tax Requirement after the first
two steps have been completed, the Special Tax to be levied on each Assessor's Parcel of Developed
15
nOc.~nC'/l1 1.71 07vIi102224;_0161
;2 -& 7
Property whose Maximum Annual Special Tax is derived by the application of the Backup Special
Tax shall be increased Proportionately from the Assigned Special Tax up to the Maximum Annual
Special Tax for each such Assessor's Parcel.
Fourth: If additional monies are needed to satisfy the Special Tax Requirement after the first
three steps have been completed, then the Special Tax shall be levied Proportionately on eaeh
f.ssesser's Parecl classified as Uade':elejled PrepeHy jl\lfoeaet Ie geefieR E ef the Rate and
MethedContinvent Taxable Pronertv at a rate up to 100% of the Maximum Annual Special Tax for
Undeveloped Property.
Notwithstanding the above, under no circumstances will the Special Tax levied against any
Assessor's Parcel of Residential Property be increased by more than ten percent per year as a
consequence of delinquency or default in the payment of Special Taxes by the owner of any other
Assessor's Parcel.
Prepayment of Special Taxes. There are certain events that will result in a required
prepayment of Special Taxes as described in the following paragraph. In addition, under the Rate
and Method, the owner of a parcel of Developed Property, the owner of a parcel of Undeveloped
Property for which a building permit has been issued, or the owner of any Public Property may
prepay the Special Tax obligation for a parcel in whole or in part. Any required or voluntary
prepayment of Special Taxes will result in an extraordinary redemption of Bonds. See "THE
BONDS - Redemption-Extraordinary Mandatory Redemptionfrom Special Tax Prepayment."
A required prepayment of Special Taxes or the oreoavrneot of another soecial tax
authorized to he levied on a narcel or a fixed lien assessment levied on such narcel will occur on
a parcel to the extent necessary to comply with the City's policy that the total annual taxes and
assessments on a parcel, exclusive of special taxes for services, will not exceed two percent (2%) of
the sales price of a parcel to a residential homeowner. Pursuant to the Acquisition/Financing
Agreement, the Developer has agreed to comply with the policy and the Developer and the City
expect that the current merchant builders will also agree to comply with the policy. The Developer
has agreed with the City to require all additional merchant builders to comply with this policy.
Based on estimated retail home sales prices, the Developer and the Merchant Builders (hereinafter
defined) do not anticipate that the total taxes and assessments, exclusive of special taxes for services,
will exceed 2% of the sales price. As shown in Table 6 under the caption "THE COMMUNITY
FACILITIES DISTRICT -Expected Tax Burden," the expected tax burden (excluding taxes
allocable to City maintenance community facilities districts) on a typical single family detached unit
will be -h+6L1l1% and the expected tax burden (excluding taxes allocable to City maintenance
community facility districts) on a typical multi family attached unit will be h+91.80%. Under the
policy, prior to the closing of an escrow for the sale of a residential unit, the merchant builder is to
deposit into escrow the amount needed to partially prepay the Special Taxes or other special taxes or
assessments so that following such prepayment the parcel will be in compliance with the policy.
Upon the closing of the escrow, any prepayment of Special Taxes will be paid to the Director of
Finance of the City and will be sent to the Fiscal Agent to redeem Bonds.
Col/ection and Application of Special Taxes. The Special Taxes are to be levied and
collected by the Treasurer-Tax Collector of the County of San Diego in the same manner and at the
same time as ad valorem property taxes; provided, however, that the District may directly bill the
Special Tax or collect Special Taxes at a different time or in a different manner if necessary to meet
its financial obligations.
16
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.;J-t:?Y
The District has made 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 Expenses when due. The District has covenanted that, to the extent
it is legally permitted to do so, it will not reduce the maxiroum Special Tax rates and will oppose the
reduction of maximum Special Tax rates by legal action where such reduction would reduce the
maximum Special Taxes payable from parcels on which a completed structure is located to less than
110% of Maximum Annual Debt Service on the Outstanding Bonds or where any reduction would
adversely affect the interest Owners of the Bonds. The District has also covenanted not to permit the
tender of Bonds in payment of any Special Taxes except upon receipt of a certificate of a Special Tax
Consultant that to accept such tender will not result in the District having insufficient Special Tax
Revenues to pay the principal of and interest when due on the Bonds remaining Outstanding
following such tender. See "SPECIAL RISK F ACTORS-Non-Cash Payment of Special Taxes."
Although the Special Taxes constitute liens on taxed parcels within the District, they do not
constitute a personal indebtedness of the owners of such property within the District. Moreover,
other liens for taxes and assessments already exist on the property located within the District and
other such liens could come into existence in the future in certain situations without the consent or
knowledge of the City or the landowners therein. See "SPECIAL RISK FACTORS-Parity Taxes,
Special Assessments and Land Development Costs" herein. There is no assurance that property
owners will be frnancially 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."
Under the terms of the Indenture, not later than the tenth Business Day after receipt, all
Special Tax Revenues received by the District are to be deposited in the Special Tax Fund. Special
Tax Revenues (with the exception of Special Tax Revenues representing Prepayments) are to be
applied by the Fiscal Agent under the Indenture in the following order of priority: (I) to deposit
annually up to $75,000 to the Administrative Expense Fund, (2) to pay the principal of and interest
on the Bonds when due, (3) to replenish the Reserve Fund to the Reserve Requirement, (4) to make
any required transfers to the Rebate Fund and (5) to pay Administrative Expenses of the District
above the $75,000 referenced in (I) above. See AppendixE-"SUMMARY OF INDENTURE."
Special Tax Revenues representing Prepayments shall be transferred to the Bond Service Fund as
provided for in the Indenture and used to redeem Bonds. See "THE BONDS-Redemption of
Bonds-Extraordinary Mandatory Redemption from Prepayment."
Proceeds of Foreclosure Sales. The net proceeds received following a judicial foreclosure
sale of land within the District resulting from a landowner's failure to pay the Special Taxes when
due are included within the Special Tax Revenues pledged to the payment of principal of and interest
on the Bonds 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, 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 following the nonpayment of a
Special Tax is not mandatory. However, the District has covenanted for the benefit of the owners of
the Bonds that it will commence and diligently pursue to completion, judicial foreclosure
11
nOCSOC/11171 07v6/02224~_01 fi 1
c;?- ft, 9
proceedings against (i) properties under common ownership with delinquent Special Taxes in the
aggregate of $5,000 or more by the October 1 following the close of the Fiscal Year in which such
Special Taxes were due, and (ii) against all properties with delinquent Special Taxes in the aggregate
of $2,500 or more by the October I following the close of any fiscal year if the amount in the
Reserve Fund is less than the Reserve Requirement. See Appendix E-"SUMMARY OF
INDENTURE-0ther Covenants of the District" herein.
If foreclosure is necessary and other funds (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-Land 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. However, the City does have the ability to use the
foreclosure judgment to purchase property by credit bid at a foreclosure sale, in which case the City
would have no obligation to pay such credit bid for 24 months. The Act provides that, in the case of
a delinquency, the Special Tax will have the same lien priority as is provided for ad valorem taxes.
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 and thereafter to maintain the
Reserve Fund at an amount equal to the Reserve Requirement. The Indenture provides that the
amount in the Reserve Fund shall, as of any date of calculation, equal the lesser of (i) 10% of the sale
proceeds of the Bonds, (ii) the maximum annual debt service of the Bonds, or (iii) one hundred
twenty-five percent (125%) of the average annual debt service on the proceeds of the Bonds (the
"Reserve Requirement").
Subject to the limits on the maximum annual Special Tax which may be levied within the
District, as described in Appendix A, the District has covenanted 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 monies are not available
therefore, (ii) redeem the Bonds in whole or in part, and (iii) pay the principal and interest due in the
final year of maturity of the Bonds. In the event of a prepayment of Special Taxes, under certain
circumstances, a portion of the Reserve Fund will be added to the amount being prepaid. As
described in the Rate and Method, the Reserve Fund Credit will be equal to the lesser of: (a) the
expected reduction in the Reserve Requirement, if any, as a result of prepayment, or (b) the amount
derived by subtracting the new Reserve Requirement in effect after the redemption from the balance
in the Reserve Fund, but in no event shall such amount be less than zero. See Appendix E-
"SUMMARY OF INDENTURE" herein.
18
nOC!iO:OC/l11.'71 07vfil02224.lij~01 ttl
cJ-70
Issuance of Parity Bonds
The District has covenanted in the Indenture not to issue any other obligations to finance
additional public improvements which are payable from the Special Taxes levied on land within the
District and which have, or purport to have, any lien upon the Special Taxes superior to or on a parity
with the lien of the Bonds. Nothing in the Indenture prevents the District from issuing and selling,
pursuant to law, refunding bonds or other refunding obligations payable from and having a first lien
upon the Special Taxes on a parity with the Outstanding Bonds so long as the issuance of such
refunding bonds or other refunding obligations results in a reduction in the Annual Debt Service on
the Bonds and such refunding bonds or other refunding obligations taken together.
THE COMMUNITY FACILITIES DISTRICT
General Description of the District
The District consists of approximately 97 ftCt-acres and is located in the easterly portion of
the City, approximately seven miles southeast of downtown San Diego. The District is expected to
be developed into 759 residential units. The residential areas planned for the District are divided into
five residential "planning areas" which, at buildout, are expected to be developed into 541 single
family detached residential units and 218 multifamily attached residential units.
The Developer currently owns all five planning areas within the District. The Developer
plans to sell such planning areas for the development of 759 residential units to four merchant
builders. See "THE DEVELOPMENT AND PROPERTY OWNERSHIP-Development Plan."
Description of Authorized Facilities
The facilities authorized to be acquired or constructed by the District with the proceeds of the
Bonds consist of various public improvements, described in Table 1 below, to serve property within
the District. In addition to or in substitution for the Facilities listed below, the City and the
Developer may agree to finance additional or different eligible Facilities.
1.2
1l0CSOC./11271 07v6/O?:?:?4J:O;_01 III
u2-rJ1
TABLE I
ESTIMATED COSTS OF PUBLIC FACILITIES
Costs shown may not represent total cost of improvement and soft costs. Thp Ar.nllhlitinnlFinanrinO' Aurppmpnt for thp
nidrirt dpcc-rih",c th.. ""#lntv Drthp PrnipC'tl:
Preliminary, subject to change.
TOTF I~ 9n Drrnnvrn for Tran!innl'fatinn Of'Vl"lonmf'nt TmnaC':t Ff'f'o whil.'h i!O D fpl' baid WhPh nrrmih. arp nllllPrl to
"#lnidru... (,,'tv of Chul9 Vida IInnrnvpd TrllD!lmnrt:dinn FlIrilitip!Il to 1I('('omTl'lnd9tr inrrPD!Ilpd rlevelnnmpnt Thplr.p
TnTii' hnnrnvpmpnh. {Rirrh Road RO(,K Mnnnt9in Rmllln rnd!ll: ('liD hp UCPrlll!ll ....prlit tnwl'll'rI!Ii: th.. 'TnTii' fePll: at hermit
liml:.
Thp """hoCI'd 1I11nl'lItinn "flh.. honde (('ondrurtinn nrnrpf'i'h:) for thp!Ilp f9rilitiPll ('ollld ('haRP''' and wi1l he nrinrtorberl
Projects
Birch Road (TDIFf'>
Birch Road (Non-TDIF)
Rock Mountain Road (TDIF)
Rock Mountain Road (Non-TDIF)
Magdalena Avenue
Wolf Canyon Loop
Bob Pletcher Way
Enviroamental MitigatieRThose
Facilities to he financed hv the Salt
Creek Develooment Imoact Fee(4)
Those Facilities~ fmanced by the
Public Facilities Development Impact
Fe~
TOTf.L TOT A LS
(I)
(2)
(')
(4)
Portion to be
peid&iJl b
_ !Y
Cost Portion to be paid Developer and
Estimate(I) from Bonds(2) Other Sources
$ $
5,7511,5111~ 2,1l91,533~
$ 7,845,037 222 ill
636,246 636,246 0
1,217,724 1,217,724 0
11,661 11,661 0
0
~ ~
ID ID
727,6361.095.3 2,2111,968!.1!ZJ.
2,968,604 51 25.1
546,568 0 546,568
~196.284 ll196.284 ~!!
4.116.1254.083. 4.1161253.973.
ill 1ll.8 ll109 603
1 $ ] 8 869 739 1
23 793 8ll823.9 1 921ll695.066.
~ ill
anrl rlh:l'lm::M in thp Al'nuidtionfFinanl'P Aurppmpnt for thp Oidril't
Sources: Developer and McGill Martin Self, Inc.
nnc:snC/11271 07vllf022241:i_01 61
2JI
;2 -1P-
Status of Facilities
The status of certain of the Facilities servmg the District as of September 1, 2005 is
summarized in Table 2 below.
Public Improvement
Birch Road (TDIF)
Birch Road (Non-TDIF)
Rock Mountain Road (TDIF)
Rock Mountain Road (Non-TDIF)
Magdalena Avenue
Wolf Canyon Loop
Bob Pletcher Way
Eavffel'lffientll1 MitigfrlienThose
Facilities to be financed bv the Salt
Creek Develonment Imnset Fee
~Facilities~ fmanced by the
Public Facilities Development Impact
Fee
TOTAL
Source: Developer
Projected Principal Taxpayers
TABLE 2
STATUS OF FACILITIES
(As of September I, 2005)
Total Budget
$ 7,845,037
636,246
1,217,724
11,661
6, HI9,813MJ!!,
&U
2,968,604
546,568
~196.284
1.116.1251.083.
ill
~
23 793 RQR23.9
~
Spent to Date
% Complete
-1-0015%
$
7,815,(l37~
TIll
636,246
791,520
7,580
100
65
65
60
3,815,9Q5~
SJlfl
1,187,441
218,627
40
40
~
100
o
$11 571 356
---1!
~%
Table 3 below sets forth the percentage of the Special Taxes that the merchant builders that
are exuected to be the property owners in the District ",ewe. ]lay in Fiscal Year 2006-07 would Dav
in that Fiscal Year based on a projected Special Tax levy of $1,570,288 and the
oVlflcrshijlldevelopment status of land within the District as of August 15, 2005, the date of value
used in the Appraisal. All of the land in the District is currentlv owned bv the Oeveloner and
there can he no assnrance that the exnected merchant huilden will acollire any of the nlanninp"
areas bv the bevinninp of Fiscal Year 2006-07.
norsor 111271 07vtl!02224;_0161
21
(J-7~3
TABLE 3
PROJECTED PRINCIPAL TAXPAYERS FOR
FISCAL YEAR 2006-07
R-IA
R-IB
R-5
R-6n
OwnerlMerchant Buildel1)
McMillin Indigo, LLC
McMillin Jacaranda, LLC
McMillin Terracotta, LLC
Shea Homes, LP
TOTALPl
Fi.fcal Year
1006-07 Special Tax(2}
$ 369,239
365,009
422,352
413.688
$ 1 570.288
% of Total
23.51%
23.24
26.90
26.34
1.lli1..OO0/0
Planning Area
(I) Proposed ownership for 2006-2007 tax year, information received from Developer. H~1ilJ.in~' RaBea, LlC~
npvp!nnPT currently owns all of the Planning f.d'ea5nlannina 9TP9<l.
(2) Estimated Special Tax Levy for Fiscal Year 2006-07 based on Undeveloped Property Special Tax.
Source: McGill Martin Self, Inc.
Estimated Direct and Overlapping Indebtedness
Within the District's boundaries, numerous local agencies provide public services. Some of
these local agencies have outstanding bonds or other forms of indebtedness which are secured by
taxes and assessments on the parcels within the District and others have authorized but unissued
bonds which, if issued, will also be secured by taxes and assessments levied on parcels within the
District. The approximate amount of the direct and overlapping debt secured by such taxes and
assessments on the parcels within the District for fiscal year 2005-06 is shown in Table 4 below (the
"Debt Report").
The Debt Report has been derived from data assembled and reported to the District by
California Municipal Statistics, Inc. Neither the District, the City nor the Underwriter has
independently verified the information in the Debt Report and do not guarantee its completeness or
accuracy.
22
noc.~oC' /11271 07vt1!02224~~01 fi1
~~71
TABLE 4
DIRECTORnTRECT AND OVERLAPPING DEBT SUMMARY
CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 12-1
(McMILLIN OTAY RANCH VILLAGE SEVEN)
2005-06 Local Secured Assessed Valuation: $1,273,856
DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT:
Metropolitan Water District
Southwestern Community College District
Sweetwater Union High School District
Chula Vista City School District
City of Chula Vista Community Facilities District No. 12-1
TOTAL DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT
OVERLAPPING GENERAL FUND DEBT:
San Diego County Certificates of Participation
Sao Diego Couoty Peosion Obligations
Sao Diego Couoty Superiotendent of Schools Obligations
Southwestern Community College District General Fuod Obligations
Sweetwater Union High School District Certificates of Participation
Chula Vista City School District General Fuod Obligations
City ofChula Vista Certificates of Participation
City of Chula Vista Peosion Obligations
Otay Municipal Water District Certificates of Participation
TOTAL GROSS OVERLAPPING GENERAL FUND DEBT
Less: Otay Municipal Water District Certificates of Participation
TOTAL NET OVERLAPPING GENERAL FUND DEBT
GROSS COMBINED TOTAL DEBT
NET COMBINED TOTAL DEBT
Ratios to 2005-06 Assessed Valuation:
Direct Debt ................................................................................... ..172.7: I
Total Direct aod Overlapping Tax aod Assessment Deb!............... 172.8: I
Gross Combined Total Deb!........................................................... 173.0: I
Net Combined Total Debt............................................................... 173.0: 1
STATE SCHOOL BUILDING AID REPAYABLE AS OF 6/30/05: $0
% Aoolicable (L)
0.0001%
0.004
0.005
0.007
100.
0.0005%
0.0005
0.0005
0.005
0.005
0.007
0.009
0.009
0.008
Debt 8/15/05
$ 419
3,623
4,131
6,284
22.000.000 (2)
$22,014,457
$ 2,298
6,156
64
134
914
7,841
11,380
1,062
2.054
$31,903
2.054
$29,849
$22,046,360('l1l
$22,044,306
(II Based on 2004-05 ratios.
(2} Pr"limimu'V ~lIhiP<'t tn rh",no..
(3) Fxcludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation bonds and non-bonded capital lease
obligations.
23
nOCSOC!11271 f17vfilO?:?:1.da:;_OlIl1
d-15'
The authorized but unissued debt of existing community facilities districts with boundaries
overlapping the District as of August 15, 2005 is summarized in Table 5 below. In addition, other
local agencies whose boundaries encompass all or a portion of the District may form other
community facilities districts or assessment districts.
TABLE 5
SUMMARY OF OVERLAPPING COMMUNITY FACILITIES DISTRICTS
Di'itnct
Purpo."ie
Elementary Schools
High Schools
Undeveloped
Land
SpeciDJ Tax
Per Acre
Final
Map
Property
Special
Tax
Chula Vista Elementary CFD No. 11 (II
Sweetwater High School CFD No. 11(1)
$
$
N/A
N/A
Developed
Residential
Specuu
Tax Per
Sq.Ft
$ O.2988~
$
~
m(l) -
Non-
Re.'iidentiaJ
Spedol Tax
Per Acre
Authorized
Debt
1250,000,000
~50,OOO,OOO
(1) On July 1 of each year, the maximum special tax rates shall be increased prior to development of a parcel by the greater of (i) the annual
percentage change in the Engineering News Record building cost index for the City of Los Angeles determined every May 31 for the prior
12.month period, or (ii) two percent per fiscal year, and after development of a parcel at the rate of 2% per annum. The Developer is
currently in discussion with the Sweetwater Union High School District to establish a new community facilities district encompassing the
land within the District. If established, the new CeB18.1:Ifti.1j fB.sitia.e.s :Distri -~ nmn111nitv fDl'illtllP!I dldril't would be authorized to levy a
greater special tax than that authorized by CFD No. 11 in lieu of the CFD No. 11 special tax. The Developer expects the total tax burden on
residential units within the District, taking into account any such new special tax, would remain less than 2% of the initial sales price of the
units. .
(2) C'1:lH'lilfl.t Be prspssd. Me, B.e:tl:lill SI:lfflilfl.t fateRdimDtlPrI nlPw 11""11111 !I"lPl'illl tllY IInrll'lITrlPnt IInnnlll !lned:al t:a'l" is $03680 per square
foot.
Source: McGill Martin Self, Inc.
Expected Tax Burden
It is expected that the total tax burden on residential units in the District will be slightly less
than 2% of the initial base sales price of the units. Table 6 below sets forth an estimated property tax
bill for a typical single family detached unit of 1,916 square feet and a typical multi family attached
unit of 1,310 square feet (such square footage being the weighted average of expected unit sizes).
The estimated total effective tax rate for ~a single family detached unit is estimated to be
+,:/41.711% and the estimated total effective tax rate for ~a multi family attached unit is estimated
to be -h+&I.IIO%.
nOC:SOC:/11271 07viil02224.c;;_01 "1
24
cJ--1~
TABLE 6
SAMPLE PROPERTY TAX BILL
PROJECTED FOR FISCAL YEAR 200fi 072005-06
TYPICAL SINGLE FAMILY DETACHED AND ATTACHED UNITS
Percent of
Total A.~.';e.f.'Ied
Valuation
Mulri Family
Attached Unir
Single Family
Detached Unit
House Square Footage (Weighted Average)
Base Sales Price
Total Assessed Value
1,310
$407,160.00
$400,160.00
1,916
$558,054.00
$551,054.00
Basic Levy
MWD
Chula Vista Elementary School District G.O. Bond
Sweetwater High School District G.O. Bond
Southwestern Community College G.O. Bond
Total Taxes Based on Assessed Value
1.0000 $ 4,001.60 $ 5,510.54
0.0052 20.81 28.65
0.0281 112.48 154.90
0.0182 72.75 100.18
0.0130 52.06 71.69
1.0645% $ 4,259.70 $ 5,865.97
$ 391.43 $ 572.50
(112.48) (154.90)
~7956 1,195.15,!,JJ!
~ 3.18
(72.75) (100.18)
18.60 27.21
1,924.90 2,403.64
641.90 938.84
2.29 2.29
11.50 11.50
10.00 10.00
10.00 10.00
$ $
3,589.99J.g 4,g2{i.91A RR
lJ!J! MZ
.$. .$.
7Jn9,7Q7.R8 19.692.9110.7
lI..1lI ~
-h%l.21% h94195%
-h'791J1l1% h+fi I 78%
Chula Vista Elementary CFD No. llf!l
Chula Vista Elementary CFD No. 11 G.O. Credit
Sweetwater Union High School CFD No. II (L)(2)
Sweetwater Union High School CFD No. 11 G.O. Credit
Chula Vista Preserve CFD No. 97-2
City of Chula Vista CFD No. 12-1
City ofChula Vista CFD No. l2-M(')
Mosquito/Rat Control
MWD Water Standby Charge
Otay Water Availability
CWA Water Availability
Total Assessments and Parcel Charges
Total All Property Taxes
Total All Property Taxes
Total Effective Tax Rate
(I)
The Developer is currently in discussion with the Sweetwater Union High School District to establish a new community
facilities district encompassing the land within the District If established, the new community facilities District would be
authorized to levy a greater special tax than that cUrTpntlv authorized by CFD No. 11 in lieu of the CFD No. 11 special tax.
The Developer expects the total tax burden on residential units within the District, taking into account any such new special
tax, would remain less than 2% of the initial sales price of the units.
(2) Amount reflects current proposed special tax rate of$.5768 per house square foot. The current special tax rate is $.3680 per
house square foot.
{J) Amount reflects current proposed special tax rate of $.49 per house square foot which begins fiscal year 2006-07.
2S
noc.~n(" /111.71 07vfi/02224.c;_01 ill
.;2 -17
Estimated Value-to-Lien Ratios
The value of the land within the District is significant because in the event of a delinquency
in the payment of Special Taxes the District may foreclose only against delinquent parcels in the
District. Table 7 summarizes the estimated appraised value-to-lien ratios for property in the District
based on the principal amount of the Bonds and the projected Special Tax levy for fiscal year
2005-06 based on the land use and status of development as of August IS, 2005.
The appraised value of the land within the District, based on the assumptions and limiting
conditions contained in the Appraisal, was $98,800,000 as of August IS, 2005. The estimated
appraised value-to-lien ratio for the property within the District currently subject to the levy of the
Special Tax, based upon land values and property ownership described in the Appraisal, is
approximately 4.49' to I as shown in Table 7 below. Table 7 does not include the overlapping debt
which is payable from taxes and assessments on land within the District, which, as set forth in
Table 4 above, was estimated at $14,457' for fiscal year 2005-06, not including the anticipated
amount of the Bonds. If the overlapping debt payable from taxes and assessments were included, the
estimated appraised value-to-lien ratio for the District as a whole would beT.main at 4.49' to I.
In the Annual Report filed pursuant to the Continuing Disclosure Agreement, the District will
estimate the value-to-lien ratios for property within the District subject to the Special Tax based on
the assessed value of the taxable property within the District, but not based on the appraised value of
the property within the District. The information in the Anoual Report for the estimated assessed
value-to-lien ratios will follow the format of Table 7. The assessed value of the land within the
District subject to the Special Tax levy for fiscal year 2005-06 is $1,273,856. Dividing this assessed
value by the principal amount of the Bonds results in an estimated assessed value-to-lien ratio for the
District as a whole of 0.057' to 1.
. Preliminary, subject to change.
nOc.~O{",fl1 1.71 07vit/O???..i.c;_0161
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Permitted Land Use
Table 8 below describes the currently approved land uses within the District.
TABLE 8
LAND USE SUMMARY OF
COMMUNITY FACILITIES DISTRICT NO. 12-1
Use
Residential
Acres
Dwelling
Units
9-751..8ll
759
THE DEVELOPMENT AND PROPERTY OWNERSffiP
Except for the information under the captions "-Appraisal" and "-Market Absorption
Study, " the Developer and the Merchant Builders provided the information in this section.
The information herein regarding ownership of property in the District has been included
because it is considered relevant to an informed evaluation of the Bonds. The inclusion in this
Official Statement of information related to existing owners of property should not be construed to
suggest that the Bonds, or the Special Taxes that will be used to pay the Bonds, are recourse
obligations of the property owners. A property owner may sell or otherwise dispose of land within
the District or a development or any interest therein at any time.
No assurance can be given that the proposed development within the District will occur as
described below. As the proposed land development progresses and parcels are sold, it is expected
that the ownership of the land within the District will become more diversified. Although planning
for the development of the District is at an advanced stage, actual construction of improvements is as
described below under the caption "Infrastructure Requirements and Construction Status." No
assurance can be given that fUrther development of the land within the District will occur, or that it
will occur in a timely manner or in the configuration or intensity described herein, or that any
landowner described herein will obtain or retain ownership of any of the land within the District.
The Bonds and the Special Taxes are not personal obligations of any landowners and, in the event
that a landowner defaults in the payment of the Special Taxes, the District may proceed with judicial
foreclosure but has no direct recourse to the assets of any landowner. As a result, other than as
provided herein, no financial statements or information is, or will be, provided about the Developer,
the Merchant Builders or other landowners. The Bonds are secured solely by the Special Taxes and
other amounts pledged under the Indenture. See "SOURCES OF PAYMENT FOR THE BONDS"
and "SPECIAL RISK FACTORS."
General Description and Location of the District
The District comprises approximately 97 aet-acres in the City of Chula Vista of which
aooroximatelv 57.88 acres will be develooed. It is generally located within the Otay Ranch Village
Seven Sectional Planning Area ("Otay Ranch Village Seven"). The District is located east of
Interstate 805, along the south side of Birch Road between Magdalena Avenue and SR125. Current
28
DOCSOCIl127107v4f!!022245-0161
;2 -go
residential developments in the vicinity of Otay Ranch Village Seven and the District include Lomas
Verdes, Rancho Del Rey, Sunbow, Eastlake, Rolling Hills Ranch and San Miguel Ranch.
The Developer
MeMillin Olay RaneR Village Se':en, LLC, a Delaware limited liability eampanyIhl:
Develooer was formed 00 AIII'lIst 14 1998 and currently is the owner of all five planning areas in
the District and was fe_ed an f,lIguGt 11, 1998. MeMilliR pllfehased the praperty iR SSfltemeer
~, The two members of the Developer are McMillin Companies, LLC and Merced Partners,
L.P., a Delaware limited partnership. The managing member of McMillin Otay Ranch, LLC is the
McMillin Companies, LLC. The Manager is McMillin Management Services, L.P., the general
partner of which is Corky McMillin Construction Services, Inc., a California corporation.
McMillin Companies, LLC is a privately held entity beneficially owned entirely by the
McMillin family. Macev L. "Corky:; McMillin started the McMillin organization in 1960 as a real
estate development and construction company. Today, the McMillin organization operates in five
areas including land development, home building, commercial, realty and mortgage. The home
building segment has included the construction of town houses, condominiums, detached homes and
also developed master planned communities. The McMillin organization is San Diego's largest and
oldest privately-owned locally based developer of mixed use projects. For Fiscal Year 2004, total
home closings exceeded 1,909 units. Local projects include, Otay Ranch SPA I & II, Vista Pacifica
(formerly Robinhood Ridge), Rancho Del Rey, Bonita Long Canyon, Scripps Ranch, Scripps Ranch
North, Sycamore Estates, Calavera Hills I & II, and Liberty Station.
The other member of the Developer, Merced Partners, L.P., is an investment fund managed
by EBF and Associates. EBF and Associates is an investment management firm based in Minnesota.
Merced Partners, L.P. has already invested the equity that will be required of it to develop the
property initially acquired by the Developer in the District and all of this equity has been repaid by
the Developer.
Development Plan
The approved tentative tract map applicable to the District allows for the development of 759
dwelling units. Upon buildout, development within the District is anticipated to include 541 single
family detached homes and 218 multifamily attached units.
The Developer is in escrow to sell the five planning areas in the District to four merchant
builders. The escrows are scheduled to close in earlywith resnect to Plannin" Areas R-l A. R-l B
and R-5 in Februarv 2006 and with resnect to Plannin" Areas R-6/7 in Januarv 2006 but there
can be no assurance that such escrows will close as scheduled or to the merchant builders currently
contemplated. Lots are expected to be delivered to the merchant builders in a finished condition.
29
DOCSOC/11271 07v4gl022245-0 161
~-g/
Table 9 below summarizes proposed development within the District subject to the Special
Taxes.
TABLE 9
SUMMARY OF PROPOSED DEVELOPMENT
R-IA
R-1B
R-5
R-6
R-7
Product Type!
LotShe
4,250
3,600
2,912
Detached Condo
Attached
Proposed Merchant Builder
Propm;ed
Number of
Units
151
160
132
98
218
Proposed Squ4Te
Footllgl! Range
2,100-2,500
1,850-2,150
1,350-1,650
1,820-2,244
1,189-1,613
Projected
Home Price.,
Planning Area.f
McMillin Indigo, LLC
McMillin Jacaranda, LLC
McMillin Tcrracotta, LLC
Shea Homes
Shea Homes
$610,990-655,990
$580,990-605,990
$415,990-510,990
$505,000-540,000
$390,000-450,000
Merchant Builders
The merchant builders within the District that are expected to be responsible for at least 10%
of the proj ected fIScal year ~2JllI(i-ll6ll1 Special Tax levy are discussed in greater detail below.
The Developer intends to complete the land development process and sell all of the developable land
within the District to merchant builders.
McMillin Vi!!ageEntitie.. Planning Areas R-IA, R-IB and R-5 are expected to be sold in
Februarv 2006 bv the Develooer to McMillin Indigo, LLC ("McMillin Indigo"), McMillin
Jacaranda, LLC ("McMillin Jacaranda'') and McMillin Terracotta, LLC ("McMillin Terracotta"),
respectively. Each of these entities is a related entity of McMillin Companies, LLC. See "THE
DEVELOPMENT AND PROPERTY OWNERSHIP-The Developer" above for a description of
McMillin Companies, LLC.
Each of McMillin Tndivo and McMillin .Jacaranda is a Delaware limited liahilitv
comnanv with McMillin Comnanies. LLC and Merced Partner!iil. L.P. 9.'iil members. McMillin
Terracotta is a Delaware limited liahilitv comnanv with McMillin Comnanie!i. I.I.C as its sole
member.
Each of McMillin Indi~o~ McMillin .Jacaranda and McMillin Terracotta has entered
into a Purchase Agreement and Rscrow Instructions each dated March 23. 2005 with the
Develooer to ourchase their resoective nlannint! areas at a Durchase orice of $38&805~51 0 for
McMillin Indigo. a nurchase nrice of $38.721.600 for McMillin .Jacaranda and a nurchase nrice
of $28.653.504 for McMillin Terracotta
Construction of model homes in Planning Area R-IA is expected to commence in
JilffiIaryFehruarv 2006 with homes being offered for sale shortly thereafter. At buildout, Planning
Area R-IA is expected to consist of 151 detached residential units on 4,250 square foot lots. Such
units are expected to range in size from 2, I 00 square feet to 2,500 square feet and range in price from
$610,990 to $655,990.
Construction of model homes in Planning AreaR-IB is expected to commence in February
2006 with homes offered for sale shortly thereafter. At buildout, Planning Area R-IB is expected to
consist of 160 detached residential units on 3,600 square foot lots. Such units are expected to range
in size from 1,850 square feet to 2,150 square feet and range in price from $580,990 to $605,990.
30
DOCSOCI1127107v4g!022245-0161
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Construction of model homes in Planning Area R-5 is also expected to commence in
February 2006 with homes being offered for sale shortly thereafter. At buildout, Planning Area R-5
is expected to consist of 132 4-pack cluster single family units on 2,912 square foot lots. Such units
are expected to range in size from 1,350 square feet to 1,650 square feet and range in price from
$415,990 to $510,990.
Shea Homes. Planning Areas R-;6 aRd R i7 are expected to be eV;Red By.old in .Januarv
2006 to Shea Homes Limited Partnership, a California limited partnership ("Shea Homes"). Shea
Homes and related entities have eight operating divisions throughout California, Arizona, North
Carolina and Denver, Colorado. These divisions construct townhouses, condominiums, detached
homes and also develop master planned communities. The general partner of Shea Homes is J.F.
Shea LLC, a Delaware limited liability company, which is majority owned by J.F. Shea Co., Inc., a
Nevada corporation ("Shea Company"). Shea Company also has an interest in Shea Financial
Services, Reed Manufactnring, Redding Construction, Shea Properties, Shasta Electric, and J.F. Shea
Construction Inc. Shea Homes and its related entities are privately held and have been operating for
over 100 years. Management of Shea Homes is directed by members of the Shea family.
Shea Homes has entered into a Purchase Ap"reement and Escrow Instructions dated
November 29 2004 with the Develoner to nnrchase Planninp' Areas R-6/7 for a nllrchase nrice
of $40.1 1111.111111.
Construction of the model homes in Planning AreaAreas R-;6a is expected to commence in
January 2006 with homes being offered shortly thereafter. At buildout, Planning Area R 6
isAreas R-6/7 are expected to consist of 98 detached residential units~ and 21 R multi-familv
attached residential units. The detached residential units are expected to range in size from
1,820 square feet to 2,244 square feet and range in price from $505,000 to $510,9gO.CeaslrneaeR ef
the medel homes in PlalHliRg Area R 7 is m'pected 10 commeRce in JaRu"")' 20lle with hemes 1leiag
offered shortl-y thereafter. f.t Bllildo\ll, PlilflRiftg faea R 7 is eJ')leeted Ie eeRsist ef 218 fIlIIIa
540.11110 and the multi-family attached residential IIIMtS. SlIeh units are expected to range in size
from 1,189 square feet to 1,613 square feet and range in price from $390,000 to $450,000.
McMillin Indipo. McMillin .Jacaranda. McMillin Terracotta and Shea Homes are
collectivelv referred to herein as the "Merchant Builders."
Financing Plan
The development of McMillin Otay Ranch Village Seven will require a large expenditure of
funds to fully develop the property and all of the attendant infrastructure. Roughly -lL.S% of the
total development funds indicated in the table below will be spent within the District boundaries. All
of the funds will be spent to benefit the District property. While the necessary debt and equity
sources outside of the Bond proceeds are in place or expected to be in place, the desire and the ability
of the Developer to develop the entire project is dependent upon a number of external factors,
including the general and local economy and the health of the local real estate market. While the
table below represents the Developer's current estimate of the sources and uses of funds there can be
no assurance there will not be substantial changes to the sources and uses of funds.
The Developer has financed the development of the property in the District with an
acquisition and development loan (the "Developer Loan") in the stated principal amount of
$80,000,000 from Bank of America. The Developer Loan is secured by a first lien deed of trust on
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DOCSOCIl127107v4W'022245-0161
t-:) - g :'5
the Developer's property within the District. The interest rate on the Developer Loan is variable at a
rate of the Wall Street Journal Prime Rate plus 0.25%. The term of the Developer Loan expires on
May 24,2006. As of JURe I,Sentemher 30. 2005, the outstanding principal balance of the Developer
Loan was $19,9llll,llllll.26.342.147.46.
Other than certain third party debt shown on Table 10 below, the property is not subject to
third party debt or equity, and the repayment of debt, payment of interest and return of equity is
expected to be paid out of excess sources over uses.
To the extent that actual revenues are less than projected in Table 10 or are received more
slowly than projected in Table 10, other needed frnancing mechanisms are not put into place, other
property owners do not contribute funds as projected, or actual expenses are greater than or occur
earlier than projected above, there could be a shortfall in the cash required to complete the
development as projected above.
32
DOCSOC/1127107v'W022245-0161
;)-%f
TABLE 10
THE DEVELOPER'S SOURCES AND USES OF FUNDS
(in thousands)
Through
~ Rpmaininv
Z!Iflj 2005 2006 2007 Total
SOURCES OF CASH
Land Sales and ReimbursementsfB $G~ $~!! $153,651 $ 2,709 $
H&;#I~
!HZ
Loan Proceeds 6,404 0 57,693
iH;94+i!!. ~!!!.
m !I2l
Net Bond Proceeds for Public Improvements 0 0 4.388
~!.'!. fr.44;! 1 R R6
ID 2.
Total Sources of Cash $ $ $ $ 7,098 $
iH;94+~ ~!!!. ~11 ~~
m !I2l ~ /ill;!
USES OF CASH
Land Development CostsID $ $ $ (20,863) $ (4,669) $
(~ (~ll (~
ll62) ~ 1Il)
Loan Repayment (}(11.650) (1l,65Q)!! (46,043) 0 (57,693)
Overhead (TaxeslMan./LegaIlG&A) (907) (13515)
11.4245.1 14,<1941.1 1~5Ji
~ W g)
Total Uses of Cash $ $ $ $ $
(~ (~ll (+#%12 (-l,l88~ (H4;G491J
m) .mJ ~ 'lJJ ~)
CONTRIBUTIONS FROM PARTNERS $ 0 $ 0 $ 0 $ 0 $ 0
DISTRIBUTIONS TO PARTNERS $ $~!! $ $ 8,910 $
~W ~~ -l-J..7i7'W.!1.!.
ll.1 5SS. 1.61
WORKING CAPITAL ACTMTY $ $Gwm $~ $
'l;OO(l~ ('l;OO(l:z.J
2. M)
WORKING CAPITAL BALANCE $ $ 3,000 $ $ 0
'l;OO(l~ 'l;OO(lU!!
2. 2.
(I) Includes $15, 111, 7€l71 H R6fJ .,"1) for-the District's authorized Public Improvements.
Merchant Builder Financing
McMillin Indigo. As of September I, 2005, McMillin Indigo expects t-he remaiIliBg ilffiaet,
home construction, carrying, marketing and miscellaneous costs to complete Planning Area R-IA to
be approximately $90.9 million. McMillin Indigo plans to finance its proposed acouisition and
development of Planning Area R-IA through a combination of equity, construction loan proceeds,
33
DOCSOC/11271 07v4gl022245-0161
,;)~g5
and home sales. McMillin Indigo expects to obtain a revolving construction loan in the approximate
principal amount of $20.2 million in NevemberDecemher 2005 (the "Indigo Construction Loan'').
Terms of the Indigo Construction Loan and the lendin" hank are to be determined. McMillin
Tndipo exned~ to finance the remainim}' costs of construction. 8DnroximateJv $70.7 million.
throuph home sales.
Additionally, McMillin Indigo expects to obtain an acquisition and development loan from
thell construction lender in the approximate principal amount of $24.7 million in
NevemeerDecemher 2005 (the "Indigo A&D Loan") to acouire Plannin" Area R-tA. Terms of
the Indigo A&D Loan and the Iendin!! hank are to be determined.
In addition to the above leansloan, the planned eenstruetieeacoui.ition of Plannin!! Area R-
IA is expected to also be financed by equity contributions received from Merced Partners. T, P. in
the total amount approximating $19.2 million. As of November 1,2005, the equity contributions
funded total $2,630,000 with an additional approximately $16.5 million to be funded by the ene. ef
tile Erst half ef 2996.orior to the acouisition of Plannin" Area R-tA. No further equity
contributions are anticipated for the remaining construction period.
McMillin Jacaranda. As of September I, 2005, McMillin Jacaranda expects the remaining
intraot, home construction, carrying, marketing and miscellaneous costs for Planning Area R~IB to
be approximately $90.4 million. McMillin Jacaranda plans to finance its proposed acouisition and
development of Planning Area R-IB through a combination of equity, construction loan proceeds,
and home sales. McMillin Indigo expects to obtain a revolving construction loan in the approximate
principal amount of $19.0 million in November 2005 (the "Jacaranda Construction Loan"). Terms of
the Jacaranda Construction Loan aDd the lendin" hank are to be determined. McMillin Jacaranda
exoects to finance the remaininp' costs of construction. 3oDroximatelv $71.4 million. throu!!h
home sales.
Additionally, McMillin Jacaranda expects to obtain an acquisition and development loan in
the approximate principal amount of $24.6 million in NeyemberDecemher 2005 (the "Jacaranda
A&D Loan") to acouire Plannin" Area R-tR. Terms of the Jacaranda A&D Loan and the lendin"
hank..are to be determined.
In addition to the above leansloan, the planned eeastruetieeacouisition of Plannin" Area R-
IB is expected to also be financed by equity contributions received from Merced Partners. L.P. in
the total amount approximating ~19.5 million. As of November I, 2005, the equity contributions
funded total $2,209,000 with an additional approximately $17.3 million to be funded lly the cae. of
the fmt half ef 2996.orior to the acouisition of Plannin" Area R-tB. No further equity
contributions are anticipated for the remaining construction period.
McMillin Terracotla. As of September I, 2005, McMillin Terracotta expects the remaifting
intfaet, home construction, carrying, marketing and miscellaneous costs for Planning Area R,;5 to be
approximately $64.7 million. McMillin Terracotta plans to finance its proposed aeoui.ition and
development of Planning Area R-5 through a combination of equity, construction loan proceeds, and
home sales. McMillin Terracotta expects to obtain a revolving construction loan in the amount of
$17.0 million in November 2005 (the "Terracotta Construction Loan"). Terms of the Terracotta
Construction Loan and the lendin" bank are to be determined. McMillin Terraeo!!a exoeets to
finance the remaininp costs of construction. annroximatelv $47.7 million. throllP'h home sales.
34
DOCSOC/I127107v4{!"022245-0161
;J--8 "
Additionally, McMillin Terracotta expects to obtain an acquisition and development loan
from the construction lender in the approximate amount of $18.0 million in NovemllerDecember
2005 (the "Terracotta A&D Loan'') to finance the acouisition of Planninl' Area R-5. Terms of the
Terracotta A&D Loan and the lendinl' bank are to be determined.
In addition to the above leaftslnan, the planned eonstruetionacouisition of Planninl' Area R-
~ is expected to also be financed by equity contributions in the total amount approximating $14.0
million. As of November 1, 2005, McMillin Terracotta had not received any equity contributions but
expects to receive approximately $14.0 million to be funded BY the end oethe first hulf ef2QQe.f.mm
a vet to be determined entitv orior to the acauisition of Planninl! Area R-5. No further equity
contributions are anticipated for the remaining construction period.
Shea Homes. As of September 1, 2005, Shea Homes expects the remaining intract, home
construction, carrying, marketing and miscellaneous costs for Planning Areas R-;;6 alid R L7 to be
approximately $ lJWI million. Shea Homes plans to finance its proposed development of Planning
Areas R (; aRd R "M7 with a combination of equity and existing lines of credit ili the !lJl!lro,dmate
amolllll of ](l.8 million.
Notwithstanding the current financing plans of the Merchant Builders, there could be a
shortfall in the cash required to complete the development operations being undertaken by the
Merchant Builders. No assurance can be given that the Merchant Builders will have access to funds
under its eJdstingtbeir exnected loans or will have sufficient internal funds to finance tlstheir
development. Neither Merchant Builder has any legal obligation to obtain additional loans or
otherwise advance funds for the remaining development costs.
Status of Entitlement Approvals
Otay Ranch Village Seven was pre-zoned Planned Community ("PC") as part of the General
Development Plan ("GDP") planning process. The PC zone required a multi-phase planning process
beginning with a GDP, followed by the preparation of a Sectional Planning Area ("SPA") Plan. The
SPA Plan is to be used as a supplement to other existing City regulations, and supersedes those
established in the City Zoning Ordinance. Incorporated into the SPA Plan is the Site Utilization
Plan, which designates the zoning designations for the portion of Otay Ranch Village Seven within
the District ("McMillin Otay Ranch Village Seven"). The SPA Plan was adopted by the City on
October 12, 2004 by Resolution No. 2004-330. Under the SPA Plan, Otay Ranch Village Seven is
designated for residential development, public uses (school, parks), open space lands and both major
circulation and internal streets.
The Final "A" Map for McMillin Otay Ranch Village Seven was approved by the City
Council March 2005 and recorded in May 2005. The Final "B" Map for t'he DistrietMcMillin Otav
Ranch Villal'e Seven was approved by the City Council on August 23, 2005 and was recorded in
September 2005.
The Developer believes that all discretionary approvals required for the development of
McMillin Otay Ranch Village Seven have been obtained.
35
DOCSOC/1127107v~022245-0161
)-11
Environmental Constraints
The development at McMillin Otay Ranch Village Seven as currently planned has undergone
extensive environmental and biological review and the necessary environmental approvals for the
development of the entire property covered by the tentative map has been obtained. These include all
applicable wetland permits from the Army Corp of Engineers and California Department of Fish and
Game and a water quality certification from the Regional Water Quality Control Board. The
Environmental Impact Report prepared for lheMcMiIlin Otav Ranch Village Seven project was
certified by the City Council on October 12,2004.
Infrastructure Requirements and Construction Status
The infrastructure requirements for McMillin Otay Ranch Village Seven can be broken into
three categories as follows:
Major Backbone Infrastructure. The major roads which form the primary access to the
community are Birch Road, Magdelena Avenue, Wolf Canyon Loop Road, Rock Mountain Road and
Bob Pletcher Way. These major roads are currently under construction with grading complete for
each of the maj or roads. The Developer expects to complete construction for all of these major roads
by ,2QQ Aoril 2006.
Minor Backbone Infrastructure. The secondary backbone infrastructure consists of the
neighborhood streets into the residential project and utilities that serve the residential project.
Grading on the neighborhood roads is complete and the Developer expects to complete construction
of these improvements by , 2Q_.Mav 2006.
Intract Infrastructure. Single-family lots in the community are planned to be delivered to
merchant builders mapped, rough graded and in finished condition with the intract streets completed.
Wet and dry utilities will be stubbed to each lot. The Merchant Builders will be responsible for
completing intract street improvements, utilities and slope landscaping.
Potential Limitations on Development
Growth Management Oversight Commission ("GMOC"). The City has established a
Threshold Standards Policy (the "Threshold Policy") through the adoption of a Growth Management
Ordinance, which established eleven public facility and service area "quality of life" measures. The
eleven public facility and service thresholds include police, fire and emergency medical services,
traffic, schools, parks and recreation, libraries, sewer, drainage, fiscal impact, air quality and water.
The Threshold Policy established goals, objectives, standards or thresholds and applicable
implementation measures for the eleven services. The GMOC was created to provide an annual
independent review for compliance with the Threshold Policy.
The GMOC review for compliance occurs on a fiscal year cycle. The Threshold Policy calls
for preparation of short-range, 12 to 18 month, and mid-range, five to seven year, development
forecasts. These forecasts are utilized by City staff and external service agencies to evaluate
projected service levels, identif'y any potential threshold problems and address implementation
measures to avoid level of service problems.
36
;) -~f
DOCSOC/1127107v4gl022245-0161
As a condition to developing property within the District, a developer must, prior to final
map approval for a parcel, enter into an agreement with the City acknowledging that building permits
may be withheld if any of the required development threshold limits set in the City transportation
planning phase are exceeded. The tentative map conditions for the land within the District subject
the land to the provisions of the GMOC.
The Threshold Policy includes traffic thresholds which require that level of service "c" be
maintained on the arterial street system except level of service "D" can occur for no more than two
hours of the day. The level of service is a descriptive and qualitative measure of the degree of traffic
congestion experienced by motorists. There are six levels of congestion, assigned letters 'A' through
'F.' Levels of service 'A' Through 'D' represent generally acceptable levels of service with level of
service 'A' corresponding to no congestion and level of service 'c' represents a range in which the
ability of vehicles to maneuver is affected by the presence of other vehicles and speeds begin to show
some reduction. Level of service 'D' is approaching roadway capacity with the ability to maneuver
being severely restricted and traffic is subject to speed reductions. Level of service 'E' is at roadway
capacity with unstable speeds. Level of service 'F' occurs when roadway capacity is exceeded,
excessive delays are experienced and stop-and-go traffic conditions exist. Should the traffic
threshold standard be exceeded, the Growth Management Ordinance calls for a building permit
moratorium to be considered by the City Council until the threshold problem can be mitigated. There
can be no guarantee that any such moratorium would exclude the District, even if the traffic
congestion leading to such moratorium occurs outside of the District area.
Throughout the fall of2002 and the spring of 2003, the City monitored the traffic conditions
on the major east-west arterials east of 1-805 to measure compliance with the levels of service
described in the GMOC. (UPDATE]
In response to the conclusions in the most recent traffic study, the City has implemented a
building permit monitoring program (the "Monitoring Program") for a number of projects within the
City pursuant to an agreement with the developers of other projects (the "Monitoring Agreement").
Release of certain permits depends upon the construction of certain roadway improvements. If a
roadway improvement is not completed by the date set forth in the Monitoring Agreement, then, until
it is completed, the corresponding number of building permits attributed to such improvement will be
deducted from the total number of permits to be issued for the last 12 months of the Monitoring
Program. The amount deducted will be prorated against all developers included within the
Monitoring Program on a proportionate basis. The McMillin Otay Ranch Village Seven project is
not included in the current Monitoring Agreement but it is expected to be included in an amendment
to the Monitoring Agreement or 8 new monitorin17 817reement to be considered by the City Council
on ,2005.
Should the City determine that the standards of the Threshold Policy are not being met, it
could impose further limitations or a moratorium on the issuance of building permits within the
District. The City does not currently anticipate that it will need to further restrict or prohibit the
issuance of building permits within the District; however, currently unforeseen events could result in
further action by the City under the GMOC.
One of the conditions of approval of development ofOtay Ranch Village Seven limits to 350
the total number of residential building permits that can be issued by the City within Otay Ranch
Village Seven prior to the completion of two backbone roads serving Otay Ranch Village Seven - La
Media Road and Santa Luna (the "Village Seven Road Condition"). In addition, the subdivision
37
DOCSOC/1127107v4W022245-0161
J-~t}
improvement agreement entered into by the City and Developer limits to a total of 400 the tetaI
number of residential building permits that can be issued by the City within Otay Ranch Village
Seven prior to the completion of State Route 125 to the international border (the "SR 125
Condition"). State Route 125 i~ an 11 mile toll road between Otav Me~a Road and State Route
54 and will rnn "araUe) with Interstate R05. State Route 125 i!i exnecterl to he comnleted in late
2006. La Media Road and Santa Luna are currently under construction by the tOtay Raaeft
Compli!lyJProiect. L.P., the other developer within Otay Ranch Village Seven, and are expected to
be completed by ,November 2006. The Developer and tOlay Raaeft
COffifJli!lYJProiect. L.P. have entered into an agreement which allocates the fIrst 350 building
permits to be issued to them prior to completion of La Media Road and Santa Luna, 235 to the
Developer and 115 to tOtay RSlleft CempaayJProiect. {"P.. Pursuant to that same agreement, the
Developer and [Otay Ranch Company] have agreed that the additional 50 building permits that may
be issued following satisfaction of the Village Seven Road Condition but prior to the satisfaction of
the SRI25 Condition, shall be allocated 10 to the Developer and 40 to tOtay RaaeR Cempli!lYJ.
Proiect. L.P.. The Developer [and City] expect that the SR 125 Condition will be superseded when
MeMiHaaMcMillin Otay Ranch Village Seven is included in the amelldedl1lM Monitoring
Agreement which will allocate all remaining building permits for that project.
A development slowdown beyond or a moratorium on development could adversely impact
the rate of development in the District and presents certain risks to the owners of the Bonds. See
"SPECIAL RISK FACTORS-Failure to Develop Properties" and "-Future Land Use Regulations
and Growth Control Initiatives."
Investors should note that, in particular, the City may amend its Growth Management
Ordinance from time to time and no assurance can be given that its terms will not be more restrictive
on development than those currently in effect.
Appraisal
The information regarding ownership of property in the District included in the Appraisal is
relevant to an informed evaluation of the Bonds. The inclusion in this OffIcial Statement of
information related to existing owners of property should not be construed to suggest that the Bonds,
or the Special Taxes that will be used to pay the Bonds, are recourse obligations of the property
owners. A property owner may sell or otherwise dispose ofland within the District or a development
or any interest therein at any time. Development may also be abandoned at any time.
The Appraiser valued certain property within the District, taking into consideration the lien of
the Special Taxes, based upon a number of assumptions and limiting conditions contained in the
Appraisal as set forth in Appendix C. In appraising the property in the District, the Appraiser utilized
the sales comparison approach to value and discounted cash flow analyses. Under the sales
comparison approach to value, the Appraisal takes in to account the development status of the
residential lots and the commercial land in the District, analyzes the market for similar properties and
compares these properties to the properties in the District. Under a discounted cash flow analyses,
the Appraisal takes into account an absorption period, costs of development, sales, marketing and
carrying costs and a discount rate which will consider the risk associated with the development and a
profIt due to the Developer. The Appraiser is of the opinion that the aggregate "as is" value of the
land within the District as of August 15, 2005, assuming the completion of all improvements to be
financed with proceeds of the Bonds was $98,800,000.
38
DOCSOCIl1271 07v4gl022245-0 161
eJ--q(j
In arriving at its statement of value, the Appraiser assumes that there are no hidden or
unapparent conditions of the property or subsoil that render it more or less valuable, that all required
licenses, certificates of occupancy or other legislative or administrative authorizations from
governmental agencies or private entities or organizations have been or can be obtained, that no
hazardous waste and/or toxic materials are located on the property within the District that would
affect the development process, that the improvements to be funded with the Bonds are completed,
that the costs of development provided by the Developer are accurate and that the proposed
development is constructed in a timely manner with no adverse delays (Le., construction will proceed
as proposed with no limitations on development occurring). See "-Potential Limitations on
Development" above.
The Annraisal merelv indicates the Annraiser's "ninion as to the market value of the
oronertv referred to therein as of the date and under the conditions snecified therein. The
Aooraiser's "ninion reflects conditions orevailinv in the annlicahle market as of the date of
value. As set forth in the AnnraisaL those market conditions inr.lude a ranid escalation in the
nrices oaid for develooahle land in the County. The Annraiser's "ninion does not oredict the
future value of the subiect nrODertv. and there can he no assurance that market conditions will
not chamJe adverselv in the future.
No assurance can be given that the assumptions made by the Appraiser will, in fact, be
realized, and, as a result, no assurance can be given that the property within the District could be sold
at the appraised values included in the Appraisal. For a complete list of the Appraiser's assumptions
and limiting conditions, see Appendix C-"APPRAISAL REPORT."
Market Absorption Study
The Market Absorption Study dated September 9, 2005 for the District has been prepared by
the Market Absorption Consultant. A synopsis and summary of the Market Absorption Study is
included herein as Appendix B. The Market Absorption Consultant has estimated, based upon the
analysis of relevant demographic and economic conditions in the Chula Vista area, the number and
proportion of housing units in the District that can be expected to be marketed annually using the
estimated absorption schedules for each of the product types. The Market Absorption Study
concludes that the residential units should be built out by the end of 2008 with most of the sales
occurring in 2006, and with fInal absorption occurring in late 2008. The Market Absorption Study
projects that, of the 541 single family detached units within the District that are subject to the Special
Tax, 222 will be absorbed in 2006, 239 in 2007 and 80 will be absorbed in 2008 and of the 218 multi
family attached units within the District that are subject to the Special Tax, 72 will be absorbed in
2006,96 will be absorbed in 2007 and 50 will be absorbed in 2008.
The Market Absorption Study assumes that all required governmental approvals will be
obtained, that there are no physical impediments to construction such as earthquakes and hazardous
waste, that the public infrastructure necessary to develop will be provided in a timely manner, that
the developers and merchant builders in the District will respond to market conditions with products
that are competitively priced and have the features and amenities desired by purchasers, that the
developers and merchant builders and their lenders have sufficient financial strength to fund
adequately the projects and that they have sufficient cash flow reserves to supplement their cash flow
positions in the event that adverse economic or market conditions occur. The actual absorption of
units could be adversely affected if one or more of the foregoing assumptions are not realized. See
Appendix B-"SUMMARY OF MARKET ABSORPTION STUDY."
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DOCSOC/1 127107v4f!!022245-0 161
;} -9/
SPECIAL RISK FACTORS
The purchase of the Bonds involves a significant degree of investment risk and, therefore, the
Bonds are not appropriate investments for many types of 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. This discussion does not purport to be
comprehensive or definitive. The occurrence of one or more of the events discussed herein could
adversely affect the ability or willingness of property owners in the District 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 the District.
See "Land Values" and "Limited Secondary Market" below.
Concentration of Ownership
As of the date of the Appraisal, all of the land within the District remaining subject to the
Special Tax levy was owned or controlled by the Developer. Based on the land use status as of the
date of the Appraisal, assuming no further land sales, approximately 100% of the projected fiscal
year 2006-2007 Special Tax levy would be paid by the Developer. Furthermore. assum;n" that
the nronosed sales to the Merchant Builders are comnleted as nlanned. D/n of the Snecial
Tax will he assumed hv the McMillin related entities and the remaininp' % of the Snecial
Tax will be assumed bv Shea Homes. See "THE COMMUNITY FACILITIES DISTRICT-
Principal Taxpayers." This concentration of ownership presents a risk to Bondowners. Until the
completion and sale of additional parcels, the receipt of the Special Taxes is dependent on the
willingness and the ability of such landowners to pay the Special Taxes when due. Failure of the
current landowners, or any successor, to pay the annual Special Taxes when due could result in a
default in payments of the principal of, and interest on, the Bonds, when due. See "-Failure to
Develop Properties" below.
No assurance can be made that such landowners, or their successors, will complete the
intended construction and development in the District. See "-Failure to Develop Properties" below.
As a result, no assurance can be given that such landowners will continue to 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 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 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, lien 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 Special Taxes and other amounts pledged under
the Indenture.
40
DOCSOC/1127107v4gl022245-0161
,,) J} d--
Insufficiency of Special Taxes
Under the Rate and Method, the annual amount of Special Tax to be levied on each taxable
parcel in the District will generally be based on whether such parcel is categorized as Undeveloped
Property or as Developed Property and on the zone and land use class to which a parcel of property is
assigned. See AppendixA-"AMENDED RATE AND METHOD OF APPORTIONMENT OF
SPECIAL TAXES" and "SOURCES OF PAYMENT FOR THE BONDS-Special Taxes."
The Rate and Method governing the levy of the Special Tax expressly exempts property
owned by public agencies or a property owners association and certain other public or quasi-public
uses, provided that no such exemption shall reduce the sum of all taxable property to less than
32.98 acres in Zone A and 22.0 acres in Zone B.
If a substantial portion of land within the District became exempt from the Special Tax
because of public ownership, or otherwise, the maximum Special Tax which could be levied
upon the remaining property within the District 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.
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, are customarily billed to the properties within
the District on the ad valorem property tax bills sent to owners of such properties. 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 "SOURCES OF
PAYMENT FOR THE BONDS-Special Taxes," for a discussion of the provisions which apply,
and procedures which the District is obligated to follow under the Fiscal Agent Agreement, in the
event of delinquencies in the payment of Special Taxes. See "- Bankruptcy and Foreclosure" below,
for a discussion of the policy of the Federal Deposit Insurance Corporation (the "FDIC'') 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.
Neither the Developer nor the Merchant Builders are currently delinquent or have been
delinquent in the past in the payment of any special taxes or assessments levied on property owned
by it.
Failure to Develop Properties
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 such
land due to the nonpayment of Special Taxes. The failure to complete development of the required
infrastructure and development in the District as planned, or substantial delays in the completion of
the planned infrastructure and development due to litigation or other causes may reduce the value of
the property within the District 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 such
undeveloped property within the District to pay the Special Taxes when due.
41
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DOCSOC/1127107v4gi022245-0161
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. Finally, development ofland is subject to economic considerations.
Additionally, the Developer and the Merchant Builders may need to obtain financing to
complete their development activities within the District. No assurance can be given that the
required funding will be secured or that the proposed development will be partially or fully
completed, and it is possible that cost overruns will be incurred which will require additional funding
beyond what the Developer and the Merchant Builders have projected, which mayor may not be
available. See "THE DEVELOPMENT AND PROPERTY OWNERSHIP-Finance Plan" herein.
The future development of the land within the District may be adversely affected by existing
or future governmental policies, or both, restricting or controlling the development of land in the
District. See "THE DEVELOPMENT AND PROPERTY OWNERSHIP-Potential Limitations on
Development" for a discussion of certain potential limitations on the ability of the Developer and
Merchant Builders to complete the projected development of the District. Specifically, investors
should consider the broad power of the City to halt or delay the issuance of building permits under its
Growth Management Ordinance. There can be no assurance that the owners of the land in the
District will be able to secure all of the necessary land use approvals to develop their properties. See
also "-Future Land Use Regulations and Growth Control Initiatives" below.
There can be no assurance that land development operations within the District will not be
adversely affected by a future deterioration of the real estate market and economic conditions or
future local, State and federal governmental policies relating to real estate development, the income
tax treatment of real property ownership, or the national economy, or the direct or indirect
consequences of military and/or terrorist activities in this country or abroad. 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. In addition to the
forep"oinl!. a substantial nor.ion of nroiects within the Citv are historicallv occunied bv
commuters to emnlovment centers in other cities throllP'hout the County. and such nroiects
may he adverselv affected bv circumstances affectinv such commuters. includinv hut not
limited to risinp" p"asoJine nrices.
Bondowners should assume that any event that significantly impacts the ability to develop
land in the District would cause the property values within the District to decrease substantially from
those estimated by the Appraiser and could affect the willingness and ability of the owners of land
within the District to pay the Special Taxes when due.
The payment of the principal of and interest on the Bonds currently depends upon the receipt
of Special Taxes levied on undeveloped property. Undeveloped property is less valuable per unit of
area than developed land, 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 Bondowners 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 the
42
DOCSOC1l127107v4gl022245-0161
)-11
District as currently proposed will make the Bondowners dependent upon timely payment of the
Special Taxes levied on undeveloped property for a longer period of time than projected. Because all
of the land within the District is currently owned or controlled by just three owners, the timely
payment of the Bonds depends upon the willingness and ability of such owners to pay the Special
Taxes levied on the undeveloped property when due. See "-Concentration of Ownership" above.
A slowdown or stoppage in the continued development of the District could reduce the willingness
and ability of such owners 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 "-Land Values"
below.
Future Land Use Regulations and Growth Control Initiatives
The City currently has the authority under its Growth Management Ordinance to limit or halt
development within the District if certain quality of life standards are not met within the City. See
'THE DEVELOPMENT AND PROPERTY OWNERSHIP-Potential Limitations on
Development."
In addition, it is possible that future growth control initiatives could be enacted by the voters
or future local, state or federal land use regulations could be adopted by governmental agencies and
be made applicable to the development of the vacant land within the District with the effect of
negatively impacting the ability of the owners of such land to complete the development of such land
if they should desire to develop it. Development could also be delayed or prohibited under the City's
existing Growth Management Ordinance. See "-Endangered Species" below. This possibility
presents a risk to prospective purchasers of the Bonds in that an inability to complete desired
development increases the risk that the Bonds will not be repaid when due. The owners of the Bonds
should assume that any reduction in the permitted density, significant increase in the cost of
development of the land within the District or substantial delay in development caused by growth and
building permit restrictions or more restrictive land use regulations would cause the values of the
land within the District to decrease. A reduction in land values increases the likelihood that in the
event of a delinquency in payment of Special Taxes a foreclosure action will result in inadequate
funds to repay the Bonds when due.
Completion of construction of any proposed structures on the land within the District is
subject to the receipt of approvals from a number of public agencies concerning the layout and
design of such structures, land use, health and safety requirements and other matters. The failure to
obtain any such approval could adversely affect the planned development of such land.
Under current State law, it is generally accepted that proposed development is not exempt
from future land use regulations until building permits have been issued and substantial work has
been performed and substantial liabilities have been incurred in good faith reliance on the permits.
Because future development of the property in the District could occur over several years, if at all,
the application of future land use regulations to the development of the land could cause significant
delays and cost increases not currently anticipated, thereby reducing the development potential of the
land and the ability or willingness of owners of such land to pay Special Taxes when due or causing
the value of such land within the District to decrease substantially from that contained in the
Appraisal.
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Endangered Species
All of the land currently proposed to be developed in the District has been graded. In recent
years, however, there has been an increase in activity at the State and federal levels related to the
possible listing of certain plant and animal species found in the southern San Diego County Area as
endangered species. An increase in the number of endangered species could curtail development in
the southern San Diego County area. Any action by the State or federal governments to protect
species located on or adjacent to the property within the District could negatively impact the ability
of the owners of that land to develop it. This, in turn, could reduce the likelihood of timely payment
of the Special Taxes levied against such that land and would likely reduce the value of such land and
the potential revenues available at the foreclosure sale for delinquent Special Taxes. See "-Failure
to Develop Land" above.
Water Availability
The development of the land within the District is dependent upon the availability of water
for the planned units. The Otay Water District (the "Water District ") is the agency responsible for
providing water to the District. The Water District receives a significant portion of its water from the
Metropolitan Water District ("MWD"), which is the primary supplier of wholesale water in Southern
California. MWD's major source of water is the State Water Project operated by the California
Department of Water Resources. MWD is also apportioned the use of a certain amount of water
delivered to the State from the Colorado River. In addition to this apportionment, MWD is also
entitled to surplus water from the Colorado River. On December 31, 2002, the federal government
suspended the delivery of surplus water from the Colorado River to MWD as a result of the failure of
certain water agencies in the State to reach agreement on the transfer of water rights from the
Imperial Irrigation District to coastal San Diego County. Reinstatement of surplus water deliveries to
MWD can occur if such agreement is executed or if the State takes other actions required by the
federal government. Additionally, the availability of water depends upon the weather, the rate of
development and other factors.
Based on the Water Supply Assessment and Verification Report adopted by the Water
District with respect to McMillin Otay Ranch Village Seven in March 2004, the Developer and the
City believe that the Water District will be able to provide water to the District to permit the
construction of the planned units. No assurance can be given, however, that water service will be
available at the time that building permits are applied for, and the lack of water availability could
adversely affect the planned development in the District. A slowdown or stoppage in the continued
development of the District could reduce the willingness and ability of such owners 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 "-Land Values" below.
Natural Disasters
The District, like all California commuml1es, may be subject to unpredictable seismic
activity, fires, flood, or other natural disasters. Southern California is a seismically active area.
Seismic activity represents a potential risk for damage to buildings, roads, bridges and property
within the District. In addition, land susceptible to seismic activity may be subj ect to liquefaction
during the occurrence of such event. Portions of Southern California are subject to wildfrres. In
October 2003, over 200,000 acres and over two thousand homes were destroyed in wildfrres in San
Diego County. The land within the District was not affected by these wildfires.
44
DOCSOC11127107v4gl022245-0161
cJ.--9v
In the event of a severe earthquake, fire, flood or other natural disaster, there may be
significant damage to both property and infrastructure in the District. As a result, a substaotial
portion of the property owners may be unable or unwilling to pay the Special Taxes when due. In
addition, the value of laod in the District 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.
Hazardous Substances
The presence of a hazardous substaoce on a parcel may result in a reduction in its value. In
general, the owners aod operators of a parcel may be required by law to remedy conditions of the
parcel relating to releases or threatened releases of hazardous substaoces. The Federal
Comprehensive Environmental Response, Compensation aod Liability Act of 1980, sometimes
referred to as "CERCLA" or the "Superfund Act," is the most well-known aod widely applicable of
these laws, but California laws with regard to hazardous substaoces are also stringent aod similar.
Under maoy of these laws, the owner or operator is obligated to remedy a hazardous substaoce
condition of property whether or not the owner or operator has anything to do with creating or
haodling the hazardous substaoce. The effect, therefore, should any of the taxed parcels be affected
by a hazardous substaoce, is to reduce the marketability and value of the parcel by the costs of
remedying the condition, because the purchaser, upon becoming 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 substaoce 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 existence, currently on the parcel of a substaoce 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 haodling it. All of these
possibilities could significaotly affect the value of a parcel that is realizable upon a delinquency.
Since at least 1928, the property in the District was historically used for agricultural
purposes. Pesticides were commonly used in connection with agricultural activities conducted on the
laod within the District. Sampling in Otay Ranch Village Seven conducted by the Developer and by
others revealed elevated levels of various pesticides in surface aod near-surface soils at various
locations throughout the area.
Pursuaot to a plao of remediation approved by the County of Sao Diego Department of
Environmental Health, the Developer removed surface aod near-surface soils impacted with
pesticides at concentrations above federally-established residential remedial guidelines aod placed
those soils as deep fill material at various locations throughout the McMillin Otay Ranch Village
Seven property, including beneath street beds, open space aod some residential lots. All such
impacted soils were placed a minimum of ten feet below final grade aod covered with cleao fill
material at least ten feet in thickness. All work was conducted under the oversight of the County of
San Diego Department of Environmental Health, aod final placement of impacted soils was
accomplished in a fashion determined by the County of Sao Diego Department of Environmental
Health to pose no threat to human health or to the environment.
Neither the City nor the Developer has knowledge of aoy hazardous substances being located
on the property within the District.
45
DOCSOC1l127107v4gf022245-0161
,;2-1;7
Parity Taxes, Special Assessments and Land Development Costs
Property within the District is subject to the lien of taxes and assessments imposed by public
agencies aod several overlapping districts also having jurisdiction over the laod within the District.
See "THE COMMUNITY FACILITIES DISTRICT-Estimated Direct aod Overlapping
Indebtedoess." The Developer is currently in discussions with Sweetwater Union High School
District regarding a community facilities district that would encompass McMillin Otay Ranch
Village Seven to finaoce school facilities. If the new community facilities district is formed, it is
expected the special taxes of the existing Sweetwater Union High School District No. II would be
caoceled aod replaced with higRhil'her special taxes. The Developer does not expect that the total
tax burden on residential units within McMillin Otay Raoch Village Seven will exceed 2% of the
initial sale prices of those units, taking into account the new special taxes.
The Special Taxes and aoy penalties thereon will constitute a lien against the lots aod parcels
of land on which they will be aonually imposed untii they are paid. Such lien is on a parity with all
special taxes aod special assessments levied by the City aod other agencies aod is co-equal to aod
independent of the lien for general property taxes regardless of when they are imposed. 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 Federal Deposit Insurance Corporation. See "-
Baokruptcyaod Foreclosure" below.
Development of laod within the District is contingent upon construction or acquisition of
maj or public improvements such as arterial streets, water distribution facilities, sewage collection
and traosmission facilities, drainage aod flood protection facilities, gas, telephone aod electrical
facilities, schools, parks aod street lighting, as well as local in-tract improvements aod on-site
grading aod related improvements. Certain of these improvements have been acquired and/or
completed; however, there cao be no assuraoce that the remaining improvements will be constructed
or will be constructed in time for development to proceed as currently expected. The cost of these
additional improvements plus the public and private in-tract, on-site aod off-site improvements could
increase the public aod private debt for which the laod within the District is security. This increased
debt coul4 reduce the ability or desire of the property owners to pay the aonual Special Taxes levied
against the property. In that event there could be a default in the payment of principal of, aod interest
on, the Bonds when due.
Neither the City nor the District has control over the ability of other entities and
districts to issue indebtedness secured by taxes or assessments payable from all or a portion of
the property within the District. In addition, the landowners within the District may, without
the consent or knowledge of the City, petition other public agencies to issue public indebtedness
secured by taxes or assessments. Any such 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 property within the District described herein.
Disclosures to Future Purchasers
The willingness or ability of ao owner of a parcel to pay the Special Tax 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 at the maximum rate. The City has
caused a notice of the Special Tax lien to be recorded in the Office of the Recorder for the County
46
DOCSOC/l127107v4W022245-0161
;2-Cjf
against each patcel within the District. While title companies normally refer to such notices in title
reports, there can be no guatantee 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 the
District 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, patcel, or unit subject to a Mello-Roos special
tax of the existence and maximum amount of such special tax using a statutorily prescribed form.
California Civil Code Section II02.6b requires that in the case of transfers other than those covered
by the above requirement, the seller must 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.
N on-Cash Payments of Special Taxes
Under the Act, the City Council as the legislative body of the District may reserve to itself
the right and authority to allow the owner of any taxable parcel to tender a Bond in full or pattial
payment of any installment of the Special Taxes or the interest or penalties thereon. A Bond so
tendered is to be accepted at pat and credit is to be given for any interest accrued thereon to the date
of the tender. Thus, if Bonds can be purchased in the secondaty matket at a discount, it may be to
the advantage of an owner of a taxable patcel to pay the Special Taxes applicable thereto by
tendering a Bond. Such a practice would decrease the cash flow available to the District to make
payments with respect to other Bonds then outstanding; and, unless the practice was limited by the
District, the Special Taxes paid in cash could be insufficient to pay the debt service due with respect
to such other Bonds. In order to provide some protection against the potential adverse impact on
cash flows which might be caused by the tender of Bonds in payment of Special Taxes, the Indenture
includes a covenant pursuant to which the District will not authorize owners of taxable patcels to
satisfy Special Tax obligations by the tender of Bonds unless the District shall have first obtained a
report of a Special Tax Consultant certifying that doing so would not result in the District having
insufficient Special Tax Revenues to pay the principal of and interest on all Outstanding Bonds and
any Patity Bonds when due.
Payment of the Special Tax is not a Personal Obligation of the Owners
An owner of a taxable patce1 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 patce1. If the value of
a taxable patcel 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 owner.
Land Values
The value of the property within the District 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
District's only remedy is to commence foreclosure proceedings in an attempt to obtain funds to pay
the Special Taxes. Reductions in property values due to a downturn in the economy, the direct or
indirect consequences of militaty and/or terrorist actions in this country or abroad, physical events
such as earthquakes, fires or floods, stricter land use regulations, delays in development or other
47
DOCSOCIl127107v4gl022245-0161
c?- -qq
events will adversely impact the security underlying the Special Taxes. See "THE COMMUNITY
FACILITIES DISTRICT-Estimated Value-to-Lien Ratios" herein.
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 San Diego County Assessor, 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.
The Appraiser has estimated, on the basis of certain definitions, assumptions and limiting
conditions contained in the Appraisal, that as of August 15, 2005 the value of the land within the
District was $98,800,000. The Appraisal is based on the assumptions as stated in Appendix C-
"APPRAISAL REPORT." The Appraisal does not reflect any possible negative impact which could
occur by reason of future slow or no growth voter initiatives, any potential limitations on
development occurring due to time delays, an inability of the Developer or the Merchant Builders to
obtain any needed development approval or permit, the presence of hazardous substances within the
District, the listing of endangered species or the determination that habitat for endangered or
threatened species exists within the District, or other similar situations. The Appraiser has
conditioned the Appraisal on a specific condition in addition to the typical list of assumptions and
limiting conditions which is that there are no environmental issues which would slow or thwart
development of the District to its highest and best use. See "THE DEVELOPMENT AND
PROPERTY OWNERSHIP-Potential Limitations on Development."
Prospective purchasers of the Bonds should not assume that the land within the District could
be sold for the appraised amount described above at a foreclosure sale for delinquent Special Taxes.
In arriving at the estimates of value, the Appraiser assumes that any sale will be unaffected by undue
stimulus and will occur following a reasonable marketing period, which is not always present in a
foreclosure sale. See Appendix C for a description of other assumptions made by the Appraiser and
for the definitions and limiting conditions used by the Appraiser.
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 "SOURCES OF PAYMENT FOR THE BONDS-Special Tax-
Proceeds of Foreclosure Sales."
FDIC/Federal Government Interests in Properties
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") has an interest. In the event that any financial institution making any loan which is secured
by real property within the District is taken over by the FDIC, and prior thereto or thereafter the loan
or loans go into default, 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
48
DOCSOC/1127107v"W022245-0161
d-~ I ()f)
,
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 Mello-Roos Act and a special tax formula which determines the special tax due
each year are specifically identified in the Policy Statement as being imposed each year and therefore
covered by the FDIC's federal immunity.
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 the District in
which the FDIC has or obtains an interest, although prohibiting the lien of the FDIC 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, a default in payment on the Bonds.
Bankruptcy and Foreclosure
Bankruptcy, insolvency and other laws generally affecting creditor's 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. 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 funds and accounts
created under the Indenture from being applied to pay interest on the Bonds and/or to redeem Bonds
if bankruptcy proceedings were brought by or against the Developer or a Merchant Builder and if the
court found that the Developer or a Merchant Builder had an interest in such moneys within the
meaning of Section 541(a)(I) 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
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DOCSOCIl1271 07v4gl022245-0 161
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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 Glasolv 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 valorem property tax imposed by . . . a political subdivision of a state if such tax comes
due after the fJling of the petition [by a debtor in bankruptcy court]." This amendment effectively
makes the Glasolv holding inoperative as it relates to ad valorem real property taxes. However, it is
possible that the original rationale of the Glasolv 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.
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 fJling of a petition in
bankruptcy. Glasply 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.
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 Bonds or the Indenture.
Loss of Tax Exemption
As discussed under the caption "TAX MATTERS," the interest on the Bonds could become
includable in gross income for federal income tax purposes retroactive to the date of issuance of the
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DOCSOC/I127107v4Bf022245-0161
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Bonds as a result of a failure of the District to comply with certain provisions of the Internal Revenue
Code of 1986, as amended. Should such an event of taxability occur, the Bonds are not subject to
early redemption and will remain outstanding to maturity or until redeemed under the optional
redemption provisions of the Indenture.
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 banIcruptcy, insolvency, reorganization,
fraudulent conveyance or transfer, moratorium, or other similar laws affecting generally the
enforcement of creditors' rights, by equitable principles and by the exercise of judicial discretion.
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 of the Bonds.
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 the Bonds can be sold for any particular price. Although the District,
the Developer and the Merchant Builders have committed to provide certain financial and operating
information on an annual basis, there can be no assurance that such information will be available to
Bondowners on a timely basis. See "CONTINUING DISCLOSURE." The failure to provide the
required annual financial information does not give rise to monetary damages but merely an action
for specific performance. Occasionally, because of general market conditions, lack of current
information, 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, 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 of California 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." Certain provisions of the Initiative have been interpreted by the
courts, although it is expected that various aspects of the Initiative will be the subject oflitigation for
a number of years. 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 XIII 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
51
DOCSOC11127107v4!!1022245-0161
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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 pr 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. The provisions of the initiative relating to the
exercise of the initiative power have not been interpreted by the courts and no assurance can be given
as to the outcome of any such litigation.
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. Furthermore, 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 has covenanted that it will not initiate proceedings under the Act to reduce the
maximum Special Tax rates on parcels within the District to less than an amount equal to 110% of
Maximum Annual Debt Service on the Outstanding Bonds. In connection with the foregoing
covenant, the District has made a legislative finding and determination that any elimination or
reduction of Special Taxes below the foregoing level would interfere with the timely retirement of
the Bonds. The District also has covenanted 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 the Initiative 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."
Ballot Initiatives
Article XIII A, Article XIII B and Proposition 218 were adopted pursuant to measures
. qualified for the ballot pursuant to California's constitutional initiative process. From time to time,
other initiative measures could be adopted by California voters. The adoption of any such initiative
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 the landowners within the District to complete the
remaining proposed development. See "SPECIAL RISK FACTORS-Failure to Develop
Properties" herein.
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CONTINUING DISCLOSURE
Pursuant to a Continuing Disclosure Agreement with the Fiscal Agent, as dissemination
agent (the "Disclosure Agreement"), the District, has agreed to provide, or cause to be provided, to
each nationally recognized municipal securities information repository and any public or private
repository or entity designated by the State as a state repository for purposes of Rule 15c2-12(b)(5)
adopted by the Securities and Exchange Commission (each, a "Repository") certain annual financial
information and operating data concerning the District. The Annual Report to be filed by the District
is to be filed not later than February 1 of each year, beginning February 1, 2006, and is to include
audited financial statements of the City. The requirement that the City file its audited financial
statements as a part of the Annual Report has been included in the Disclosure Agreement solely to
satisfY the provisions of Rule 15c2-12. The iBclllsisa sf this iafarmatisRTt i. exnected that the
City's ohlivation to file the Annual Renort bv Fehruarv 1. 2006 will be satisfied with the filinJJ
of the City's audited financial statements and this Official Statement. The inclusion of the
City's audited financial statements does not mean that the Bonds are secured by any resources or
property of the City. See "SOURCES OF PAYMENT FOR THE BONDS-Limited Obligations"
and "SPECIAL RISK FACTORS-Limited Obligations." The City has never failed to comply in all
material respects with any previous undertakings with regard to Rule 15c2-12 to provide annual
reports or notices of material events. The District has never failed to comply in all material respects
with any undertaking under Rule 15c2-12. The full text of the Disclosure Agreement is set forth in
Appendix G.
To assist the Underwriter in complying with Rule 15c2-12(b)(5), the Developer will enter
into a Continuing Disclosure Agreement (the "Developer Disclosure Agreement") covenanting to
provide Semi-Annual Reports not later than May 1 and November 1 of each year beginning May 1,
2006. The Semi-Annual Reports provided by the Developer are to contain the financial and
operating data outlined in Section 4 of form of the Developer Disclosure Agreement attached in
Appendix G and the Semi-Annual Report due in May of each year is to confirm the audited financial
statements for the prior calendar year if audited financial statements are prepared. The Developer
has not failed to comply in all material respects with any undertaking under Rule 15c12-12.
Cornerstone has not previously entered into an undertaking under Rule 15c2-12.
The obligations of the Developer under its Developer Disclosure Agreement will terminate
upon the earliest to occur of: (a) the legal defeasance, prior redemption or payment in full of all the
Bonds; (b) the date on which such landowner (and all its affiliates) is no longer responsible for the
payment of more than 20 percent of the annual Special Tax levy; or (c) the date on which such
landowner delivers to the City an opinion of nationally-recognized bond counsel to the effect that the
continuing disclosure is no longer required under the Rule. The Developer has also agreed that if it
sells or transfers an ownership interest in any properly in the District which will result in the
transferee becoming responsible for the payment of 20 percent of the annual Special Tax levy in the
fiscal year following such transfer, such landowner will cause any such transferee to enter into a
disclosure agreement as described in Section 12 of the form of Developer Disclosure Agreement
attached hereto in Appendix G.
The Developer Disclosure Agreement will inure solely to the benefit of the District, any
Dissemination Agent, the Underwriter and owners or beneficial owners from time to time of the
Bonds.
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TAX MATTERS
In the opinion of Best Best & Krieger LLP ("Bond Counsel"), based upon an analysis of
existing laws, regulations, rulings and court decisions, and assuming, among other matters,
compliance with certain covenants, interest on the Bonds is excluded from gross income for federal
income tax purposes under Section 103 of the Internal Revenue Code of 1986 (the "Code") and is
exempt from State of California personal income taxes. Bond Counsel is of the further opinion that
interest on the Bonds is not a specific preference item for purposes of the federal individual or
corporate alternative minimum taxes, although Bond Counsel observes that such interest is included
in adjusted current earnings when calculating federal corporate alternative minimum taxable income.
A complete copy of the proposed form of opinion of Bond Counsel is set forth in Appendix H hereto.
The Code imposes various restrictions, conditions and requirements relating to the exclusion
from gross income for federal income tax purposes of interest on obligations such as the Bonds. The
District has covenanted to comply with certain restrictions designed to insure that interest on the
Bonds will not be included in federal gross income. Failure to comply with these covenants may
result in interest on the Bonds being included in federal gross income, possibly from the date of
original issuance of the Bonds. The opinion of Bond Counsel assumes compliance with these
covenants. Bond Counsel has not undertaken to determine (or to inform any person) whether any
actions taken (or not taken) or events occurring (or not occurring) after the date of issuance of the
Bonds may adversely affect the value of, or the tax status of interest on, the Bonds. Further, no
assurance can be given that pending or future legislation or amendments to the Code, if enacted into
law, or any proposed legislation or amendments to the Code, will not adversely affect the value of, or
the tax status of interest on, the Bonds. Prospective Bondholders are urged to consult their own tax
advisors with respect to proposals to restructure the federal income tax.
Certain requirements and procedures contained or referred to in the Indenture, the Tax
Certificate, and other relevant documents may be changed and certain actions (including, without
limitation, defeasance of the Bonds) may be taken or omitted under the circumstances and subject to
the terms and conditions set forth in such documents. Bond Counsel expresses no opinion as to any
Bond or the interest thereon if any such change occurs or action is taken or omitted upon the advice
or approval of counsel other than Best, Best & Krieger LLP.
Although Bond Counsel is of the opinion that interest on the Bonds is excluded from gross
income for federal income tax purposes and is exempt from State of California personal income
taxes, the ownership or disposition of, or the accrual or receipt of interest on, the Bonds may
otherwise affect a Bondholder's federal or state tax liability. The nature and extent of these other tax
consequences will depend upon the particular tax status of the Bondholder or the Bondholder's other
items of income or deduction, and Bond Counsel expresses no opinion regarding any such other tax
consequences.
LEGAL MATTERS
Certain legal matters incident to the issuance of the Bonds are subject to the approving legal
opinion of Best Best & Krieger LLP ("Bond Counsel"). A copy of the proposed form of opinion of
Bond Counsel is set forth in Appendix H hereto. The opinion of Bond Counsel will be qualified as to
the enforceability of certain of the proceedings by limitations imposed by bankruptcy, insolvency,
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moratoria and other similar laws affecting creditors' rights, heretofore or hereafter enacted, and by
the exercise of judicial discretion in accordance with general principles of equity.
Bond Counsel has reviewed the cover page of this Official Statement and the portions hereof
under the captions "INTRODUCTION," "THE BONDS," "SOURCES OF PAYMENT FOR THE
BONDS" "TAX MATTERS" and in Appendices E and H, insofar as such portions purport to
summarize certain provisions of the Bonds, the Indenture, the legal procedures required for the
authorization of the Bonds, and the opinion of Bond Counsel concerning the exclusion of interest on
the Bonds from gross income, but Bond Counsel has not assisted in the preparation of or reviewed
the remainder of this Official Statement, and accordingly Bond Counsel expresses no opinion as to
the accuracy or sufficiency of any statements, material or [mancial information contained in the
remainder of this Official Statement.
Certain legal matters will be passed upon for the City and the District by the City Attorney
and for the Underwriter by its counsel, Stradling Y occa Carlson & Rauth, a Professional Corporation,
Newport Beach, California {"Stradling"). Although it serves as counsel to the Underwriter in
connection with the issuance and sale of the Bonds, Stradling represents the City in connection with
other financings. Stradling undertakes no responsibility to the purchasers of the Bonds for the
accuracy, completeness or fairness of the information in this Official Statement and expressly
disclaims any duty to do so.
LITIGATION
No litigation is pending or threatened concerning the validity of the Bonds or the pledge of
Special Taxes to repay 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. The District is not aware of any
litigation pending or threatened which questions the existence of the District 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 of the Bonds.
UNDERWRITING
The Bonds are being purchased by Stone & Youngberg LLC (the "Underwriter"). The
Underwriter has agreed to purchase the Bonds at a price of$ (being $ aggregate
principal amount thereof, less an original issue discount of $ and less Underwriter's
discount of $ ). The purchase agreement relating to the Bonds provides that the
Underwriter will purchase all of the Bonds if any are purchased. The obligation to make such
purchase is subject to certain tenns and conditions set forth in such purchase agreement, the approval
of certain legal matters by counsel and certain other conditions.
The Underwriter may offer and sell the Bonds to certain dealers and others at prices lower
than the offering price stated on the cover page hereof. The offering price may be changed from time
to time by the Underwriter.
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FINANCLALINTERESTS
The fees being paid to the Financial Advisor, the Underwriter, Underwriter's Counsel and
Bond Counsel are contingent upon the issuance and delivery of the Bonds. From time to time, Bond
Counsel represents the Underwriter on matters unrelated to the Bonds and Underwriter's Counsel
represents the City 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.
The execution and delivery of this Official Statement by the Director of Finance of the City
has been duly authorized by the City Council acting in its capacity as the legislative body of the
District.
CHULA VISTA COMMUNITY FACILITIES
DISTRICT NO. 12-1 (McMILLIN OTA Y
RANCH VILLAGE SEVEN)
By:
Assistant Director of Finance
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APPENDIX A
RATE AND METHOD OF APPORTIONMENT
FOR CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 12-1
(McMiUin Otay Ranch ViUage Seven)
A Special Tax as hereinafter defined shall be levied on each Assessor's Parcel of Taxable Property
within the City of Chula Vista Community Facilities District No. 12-1 (CFD No. 12-1) and collected
each Fiscal Year commencing in Fiscal Year 2006-2007 in an amount determined by the City
Council through the application of the appropriate Special Tax for "Developed Property",
"Undeveloped Property" and "Contingent Taxable Property" as described below. All of the Taxable
Property CFD No. 12-1, unless exempted by law or by the provisions hereof, shall be taxed for the
purposes, to the extent and in the manner herein provided.
A. DEFINITIONS
The terms hereinafter set forth have the following meaning:
"Acre or Acreage" means the land area of an Assessor's Parcel as shown on an Assessor's
Parcel Map, or if the land area is not shown on an Assessor's Parcel Map, the land area
shown on the applicable Final Subdivision Map, parcel map, condominium plan, record of
survey, or other recorded document creating or describing the parcel. If the preceding maps
for a land area are not available, the Acreage of such land area shall be determined by the
City Engineer.
"Act" means the Mello-Roos Community Facilities Act of 1982, as amended, being
Chapter 2.5, Division 2 of Title 5 of the Government Code of the State ofCalifomia.
"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 Special Taxes
received each Fiscal Year for the payment of Administrative Expenses.
"Administrative Expenses" means the actual or reasonably estimated costs directly related
to the administration of CFD No. 12-1 including, but not limited to, the following: the costs
of computing the Special Taxes and preparing the annual Special Tax collection schedules
(whether by the City or designee thereof or both); the costs of collecting the Special Taxes
(whether by the County, the City, or otherwise); the costs ofremitting the Special Taxes to
the Trustee; the costs of the Trustee (including its legal counsel) in the discharge of the duties
required of it under the Indenture; the costs to the City, CFD No. 12-1 or any designee thereof
of complying with arbitrage rebate requirements; the costs to the City, CFD No. 12-1 or any
designee thereof of providing continuing disclosure; the costs associated with preparing
Special Tax disclosure statements and responding to public inquiries regarding the Special
Taxes; the costs of the City, CFD No. 12-1 or any designee thereof related to any appeal of
the levy or application of the Special Tax; and the costs associated with the release of funds
from an escrow account, if any. Administrative Expenses shan also include amounts
estimated or advanced by the City or CFD No. 12-1 for any other administrative purposes,
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DOCSOC/1127107v4g1022245-0161
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including, but not limited to, attorney's fees and other costs related to commencing and
pursuing to completion any foreclosure of delinquent Special Taxes.
"Assessor's Parcel" means a lot or parcel shown in an Assessor's Parcel Map with an
assigned Assessor's Parcel number.
"Assessor's Parcel Map" means an official map of the County Assessor of the County
designating parcels by an Assessor's Parcel number.
"Assigned Special Tax" means the Special Tax for each Land Use Category of Developed
Property as determined in accordance with Section C.I.a.
"Available Funds" means the balance in the reserve fund established pursuant to the terms
of any Indenture in excess of the reserve requirement as defined in such Indenture, delinquent
Special Tax payments not required to fund the Special Tax Requirement for any preceding
Fiscal Year, Special Tax prepayments collected to pay interest on Bonds, and other sources
of funds available as a credit to the Special Tax Requirement as specified in such bond
indenture.
"Backup Special Tax" means the Backup Special Tax amount set forth in Section C.I.b.
"Bonds" means any bonds or other debt (as defined in the Act), whether in one or more
series, issued by CFD No. 12-1 under the Act.
"Bond Year" means a one-year period beginning on September 2nd in each year and ending
on September 1st in the following year, unless defined differently in the applicable Indenture.
"CFD Administrator" means an official of the City, or designee thereof, responsible for
determining the Special Tax Requirement and providing for the levy and collection of the
Special Taxes.
"CFD No. 12-1" means City ofChula Vista, Community Facilities District No. 12-1.
"City" means the City of Chula Vista.
"Contingent Taxable Property" means all Assessor's Parcels of Public Property, Property
Owner Association Property, Open Space or other property that would otherwise be
classified as Exempt Property pursuant to the provisions of Section E, but cannot be
classified as Exempt Property because to do so would reduce the Acreage of all Taxable
Property below the required minimum acreage as set forth in Section E.l for Zone A or Zone
B as applicable.
"Council" means the City Council of the City, acting as the legislative body of CFD
No. 12-1.
"County" means the County of San Diego.
"Developed Property" means all Assessor's Parcels of Taxable Property for which a
building permit has been issued prior to March 1st preceding the Fiscal Year in which the
Special Tax is being levied.
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~Exempt Property" means all Assessors' Parcels that are exempt from the Special Tax
pursuant to Section E.!.
~Final Subdivision Map" means a subdivision of property, created by recordation of a final
subdivision map, parcel map or lot line adjustment, approved by the City pursuant to the
Subdivision Map Act (California Government Code Section 66410 et seq.) or recordation of
a condominium plan pursuant to California Civil Code 1352, that creates individual lots for
which residential building permits may be issued without further subdivision of such
property.
~Fiscal Year" means the period starting July I and ending on the following June 30.
~Indenture" means the indenture, fiscal agent agreement, trust agreement, resolution or
other instrument pursuant to which Bonds are issued, as modified, amended and/or
supplemented from time to time, and any instrument replacing or supplementing the same.
~Land Use Class" means any of the classes listed in Table I of Section C.!.a
~Lot(s)" means an individual legal lot created by a Final Subdivision Map for which a
building permit for residential construction has been or could be issued. Notwithstanding the
foregoing, in the case of an individual legal lot created by such a Final Subdivision Map upon
which condominium units are entitled to be developed but for which a condominium plan has
not been recorded, the number of Lots allocable to such legal lot for purposes of calculating
the Backup Special Tax applicable to such Final Subdivision Map sball equal the number of
condominium units which are permitted to be constructed on such legal lot as shown on such
Final Subdivision Map.
~Maximum Annual Special Tax" means the maximum annual Special Tax, determined in
accordance with the provisions of Section C, which may be levied in any Fiscal Year on any
Assessor's Parcel of Taxable Property.
~Non-Residential Property" means all Assessor's Parcels of Developed Property, for which
a building permit(s) has been issued to allow the construction of one or more buildings or
structures for a non-residential use.
~Occupied Residential Property" means all Assessors' Parcels of Residential Property for
which title is owned by an end user (homeowner).
~Open Space" means property within the boundaries of CFD No. 12-1 which (a) has been
designated with specific boundaries and acreage on a Final Subdivision Map as open space
(b) is classified by the County Assessor as open space (c) has been irrevocably offered for
dedication as open space to the federal government, the State of California, the County, the
City, any other public agency or (d) is encumbered by an easement or other restriction
required by the City limiting the use of such property to open space.
~Outstanding Bonds" mean all Bonds, which remain outstanding as defined III the
Indenture.
"Property Owner Association Property" means any property within the boundaries of
CFD No. 12-1 which is (a) owned by a property owner association or (b) designated with
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DOCSOC1I127107v4f!1022245-0161
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specific boundaries and acreage on a Final Subdivision Map as property owner association
property. As used in this definition, a property owner association includes any master or sub-
association.
"Proportionately" means for Developed Property that the ratio of the Special Tax levy to
the Assigned Special Tax or the Backup Special Tax is equal for all Assessors' Parcels of
Developed Property within CFD No. 12-1. For Undeveloped Property or Contingent Taxable
Property "Proportionately" means that the ratio of the actual Special Tax levy per Acre to the
Maximum Annual Special Tax per Acre is equal for all Assessor's Parcels of Undeveloped
Property and equal for all Assessor's Parcels of Contingent Taxable Property within CFD
No. 12-1.
"Public Property" means any property within the boundaries of CFD No. 12-1 that which
(a) is owned by a public agency, (b) has been irrevocably offered for dedication to a public
agency or (c) is designated with specific boundaries and acreage on a Final Subdivision Map
as property which will be owned by a public agency. For purposes of this definition, a public
agency includes the federal government, the State of California, the County, the City or any
other public agency.
"Residential Property" means all Assessor's Parcels of Developed Property for which a
building permit has been issued for purposes of constructing one or more residential dwelling
units.
"Residential Floor Area" means all of the square footage ofliving area within the perimeter
of a residential structure, not including any carport, walkway, garage, overhang, patio,
enclosed patio, or similar area. The determination of Residential Floor Area shall be made
by the CFD Administrator by reference to appropriate records kept by the City's Building
Department. Residential Floor Area for a residential structure will be based on the building
permit(s) issued for such structure prior to it being classified as Occupied Residential
Property, and shall not change as a result of additions or modifications made to such structure
after such classification as Occupied Residential Property.
"Special Tax" means the annual special tax to be levied in each Fiscal Year on each
Assessor's Parcel of Taxable Property to fund the Special Tax Requirement.
"Special Tax Requirement" means that amount of Special Tax revenue required in any
Fiscal Year for CFD No. 12-1 to: (i) Pay Administrative Expenses in an amount equal to
Administrative Expense Requirement or such other amount as may be designated by the City
(ii) pay annual debt service on all Outstanding Bonds (as defined in Section A) due in the
Bond Year beginning in such Fiscal Year; (iii) pay" other periodic costs on Outstanding
Bonds, including but not limited to, credit enhancement and rebate payments on Outstanding
Bonds; (iv) pay any amounts required to establish or replenish any reserve funds for all
Outstanding Bonds in accordance with the Indenture; and (v) pay directly for acquisition
and/or construction of public improvements which are authorized to be fmanced by CFD
No. 12-1 provided that the inclusion of such amount does not cause an increase in the levy of
Special Tax on the Undeveloped Property for CFD No. 12-1; less (vi) a credit for Available
Funds.
"State" means the State of California.
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DOCSOC/t 1271 07v4W'022245-0 161
;)-11)-
"Taxable Property" means all of the Assessor's Parcels within the boundaries of CFD
No. 12-1 that are not exempt from the Special Tax pursuant to law or Section E below.
"Trustee" means the trustee, fiscal agent, or paying agent under the bond indenture.
"Undeveloped Property" means, for each Fiscal year, all Taxable Property not classified as
Developed Property or Contingent Taxable Property.
"Zone A" means the specific geographic area designated as such and as depicted in Exhibit
A attached hereto.
"Zone B" means the specific geographic area designated as such and as depicted in Exhibit
A attached hereto.
B. ASSIGNMENT TO LAND USE CATEGORIES
.
Each Fiscal Year, all Assessor's Parcels of Taxable Property within CFD No. 12-1 shall be
(a) categorized as being located in either Tax Zone A or Zone B, (b) classified as Developed
Property, Undeveloped Property or Contingent Taxable Property and (c) shall be subject to
the levy of annual Special Taxes determined pursuant to Sections C and D below.
Furthermore, all Developed Property shall then be classified as Residential or Non-
Residential Property.
C. MAXIMUM ANNUAL SPECIAL TAX RATE
1. Developed Property
The Maximum Annual Special Tax for each Assessor's Parcel of Residential
Property or Non-Residential Property shall be the greater of (1) the Assigned Special
Tax described in Table 1 or (2) the Backup Special Tax computed pursuant to b. on
next page.
a. Assilmed Special Tax
The Assigned Special Tax for each Assessor's Parcel of Developed Property
is shown in Table 1.
TABLE 1
Assigned Special Tax for Developed Property
within Zone A and Zone B
Land Use
Class Description Assigned Special Tax
$890 per Unit Plus $0.79 per
1 Residential Property square foot of Residential Floor
Area
2 Non-Residential $6,000 per Acre
Property
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c;L -11-3
b. Backup Special Tax
When a Final Subdivision 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 or Non-Residential
Property shall be determined as follows:
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 Subdivision Map area, the Backup Special
Tax shall be the rate per Lot calculated according to the following formula:
Zone A
$24,383 x A
B;
L
Zone B
$41,621 xA
B;
L
The terms have the following meanings:
B ; Backup Special Tax per Lot in each Fiscal Year.
A ; Acreage classified or to be classified as Residential Property
in such Final Subdivision Map.
L; For a Final Subdivision Map, the number of Lots which are
classified or to be classified as Residential Property.
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 Subdivision Map
area, the Backup Special Tax shall be determined by multiplying $24,383 for
Zone A and $41,621 for Zone B 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 Subdivision 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.
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DOCSOC/1127107v4gr022245-0161
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2. Undeveloped Property and Contingent Taxable Property
The Maximum Annual Special Tax for each Assessor's Parcel of Undeveloped
Property and Contingent Taxable Property shall be $24,383 per Acre for Zone A and
$41,621 per Acre for Zone B.
D. METHOD OF APPORTIONMENT OF THE SPECIAL TAX
Commencing with Fiscal Year 2006-07 and for each following Fiscal Year, the Council shall
determine the Special Tax Requirement and shall levy the Special Tax until the amount of
Special Taxes equals the Special Tax Requirement. The Special Tax shall be levied each
Fiscal Year as follows:
First: The Special Tax shall be levied Proportionately on each Assessor's Parcel of
Developed Property within Zone A and Zone B at a rate up to 100% of the applicable
Assigned Special Tax to satisfy the Special Tax Requirement.
Second: If additional monies are needed to satisfy the Special Tax Requirement after the first
step has been completed, the Special Tax shall be levied Proportionately on all Undeveloped
Property within Zone A and Zone B, at a rate up to 100% of the Maximum Annual Special
Tax for Undeveloped Property. In determining the Acreage of an Assessor's Parcel of
Undeveloped Property for purposes of determining the annual Special Tax to be levied on
such Assessor's Parcels of Undeveloped Property, the CFD Administrator shall not include
any Acreage shown on any applicable tentative subdivision map or other land use
entitlements approved by the City that designates such Acreage for a use that would be
classified as Open Space, Property Owner Association Property or Public Property.
Third: If additional monies are needed to satisfy the Special Tax Requirement after the first
two steps have been completed, the Special Tax to be levied on each Assessor's Parcel of
Developed Property whose Maximum Annual Special Tax is derived by the application of
the Backup Special Tax then the Annual Special Tax shall be increased at the same
percentage from the Assigned Special Tax up to the Maximum Annual Special Tax for each
such Assessor's Parcel.
Fourth: If additional monies are needed to satisfy the Special Tax Requirement after the first
three steps have been completed, then the Special Tax shall be levied Proportionately on all
Contingent Taxable Property at a rate up to 100% of the Maximum Annual Special Tax for
Undeveloped Property.
Notwithstanding the above, under no circumstances will the Special Tax levied against any
Assessor's Parcel of Residential Property be increased by more than ten percent per year as a
consequence of delinquency or default in the payment of Special Taxes by the owner of any
other Assessor's Parcel.
E. EXEMPTIONS
I. The CFD Administrator shall classify the following as Exempt Property: (i) Public
Property, (ii) Property Owner Association Property, (iii) Open Space and
(iv) Assessor's Parcels with public or utility easements making impractical their
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DOCSOC/l1271 07v4W022245-0 161
:J- ~I/S'
utilization for other than the purposes set forth in the easement; provided, however,
that no such classification shall reduce the sum of all Taxable Property to less than
32.98 Acres for Zone A and 22.00 Acres for Zone B. Assessor's Parcels which
cannot be classified as Exempt Property because such classification would reduce the
Acreage of all Taxable Property to less than 32.98 Acres for Zone A and 22.00 Acres
for Zone B will be classified as Contingent Taxable Property and shall be taxed
pursuant to the fourth step of Section O. Exempt status for purposes of this paragraph
will be assigned by the CFO Administrator in the chronological order in which
property becomes Exempt Property.
2. The Maximum Annual Special Tax obligation for any property which would be
classified as Public Property upon its transfer or dedication to a public agency but
which is classified as Contingent Taxable Property pursuant to E.I above shall be
prepaid in full by the seller pursuant to Section H.I, prior to the transfer/dedication of
such property to such public agency. Until the Maximum Annual Special Tax
obligation for any such Public Property is prepaid, the property shall continue to be
subject to the levy of the Special Tax as Contingent Taxable Property.
3. 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 E.l. 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.
F. REVIEW/APPEAL COMMITTEE
Any landowner or resident who feels that the amount of the Special Tax levied on their
Assessor's Parcel is in error shall first consult with the CFO Administrator regarding such
error. If following such consultation, the CFO Administrator determines that an error has
occurred; the CFD Administrator may amend the amount of the Special Tax levied on such
Assessor's Parcel. If following such consultation and action (if any by the CFO
Administrator), the landowner or resident believes such error still exists, such person may file
a written notice with the City Clerk of the City appealing the amount of the Special Tax
levied on such Assessor's Parcel. Upon the receipt of any such notice, the City Clerk shall
forward a copy of such notice to the City Manager who shall establish as part of the
proceedings and administration ofCFO No. 12-1 and a special three-member Review/Appeal
Committee. The Review/Appeal Committee may establish such procedures, as it deems
necessary to undertake the review of any such appeal. The Review/Appeal Committee shall
interpret this Rate and Method of Apportionment and make determinations relative to the
annual administration of the Special Tax and any landowner or resident appeals, as herein
specified. The decision of the Review/Appeal Committee shall be final and binding as to all
persons.
G. MANNER OF COLLECTION
The annual Special Tax shall be collected in the same manner and at the same time as
ordinary ad valorem property taxes; provided, however, that CFD No. 12-1, may directly bill
the Special Tax, may collect Special Taxes at a different time or in a different manner if
necessary to meet its frnancial obligations, and may covenant to foreclose and may actually
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DOCSOC/1127107v'W022245-0161
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...
foreclose on Assessor's Parcels of Taxable Property that are delinquent in the payment of
Special Taxes.
Tenders of Bonds may be accepted for payment of Special Taxes upon the terms and
conditions established by the Council pursuant to the Act. However, the use of Bond tenders
shall only be allowed on a case-by-case basis as specifically approved by the Council.
H. PREPAYMENT OF SPECIAL TAX
The following definition applies to this Section H:
"CFD Public Facilities" means those public facilities authorized to be financed by CFD
No. 12-1.
"CFD Public Facilities Costs" means either $ 17.1 million, or such lower number as shall
be determined either by (a) the CFD Administrator as sufficient to finance the CFD Public
Facilities, or (b) the Council concurrently with a covenant that it will not issue any more
Bonds to be secured by Special Taxes levied under this Rate and Method of Apportionment.
"Construction Fund" means an account specifically identified in the Indenture to hold funds
which are currently available for expenditure to acquire or construct the CFD Public
Facilities.
"Future Facilities Costs" means the CFD Public Facilities Costs minus that (a) portion of
the CFD Public Facilities Costs previously funded (i) from the proceeds of all previously
issued Bonds, (ii) from interest earnings on the Construction Fund actually earned prior to the
date of prepayment and (iii) directly from Special Tax revenues and (b) the amount of the
proceeds of all previously issued Bonds then on deposit in the Construction Fund.
"Outstanding Bonds" means all previously issued Bonds which will remain outstanding
after the first interest and/or principal payment date following the current Fiscal Year,
excluding Bonds to be redeemed at a later date with the proceeds of prior prepayments of
Maximum Annual Special Taxes.
1. Prepayment in Full
The Maximum Annual Special Tax obligation may only be prepaid and permanently
satisfied for an Assessor's Parcel of Developed Property, Undeveloped Property for
which a building permit has been issued, or Contingent Taxable Property. The
Maximum Annual Special Tax obligation applicable to such Assessor's Parcel may
be fully prepaid and the obligation of the Assessor's Parcel to pay the Special Tax
permanently satisfied as described herein; provided, however that a prepayment may
be made only if there are no delinquent Special Taxes with respect to such Assessor's
Parcel at the time of prepayment. An owner of an Assessor's Parcel intending to
prepay the Maximum Annual Special Tax obligation shall provide the CFD
Administrator with written notice of intent to prepay. Within 30 days of receipt of
such written notice, the CFD Administrator shall notify such owner of the
prepayment amount of such Assessor's Parcel. The CFD Administrator may charge a
reasonable fee for providing this figure.
A-9
DOCSOCIl1271 07v4gJ022245-0 161
:)~II'7
,
The Prepayment Amount (defined below) shaH be calculated as summarized below
(capitalized terms as defined below):
Bond Redemption Amount
plus
plus
plus
plus
less
less
Total: equals
Redemption Premium
Future Facilities Amount
Defeasance Amount
Prepayment Fees and Expenses
Reserve Fund Credit
Caoitalized Interest Credit
Prepayment Amount
As of the proposed date of prepayment, the Prepayment Amount (defined below) shall be
calculated as foHows:
Step No.:
1. For Developed Property, compute the Maximum Annual Special Tax for the
Assessor's Parcel to be prepaid. For Assessor's Parcels of Undeveloped Property for
which a building permit has been issued to be prepaid, compute the Maximum Annual
Special Tax for that Assessor's Parcel as though it was already designated as
Developed Property, based upon the building permit issued for that Assessor's Parcel.
For Assessor's Parcels of Contingent Taxable Property to be prepaid, compute the
Maximum Annual Special Tax for that Assessor's Parcel using the Maximum Annual
Special Tax for Undeveloped Property.
2. Divide the Maximum Annual Special Tax computed pursuant to step I by the sum of
the total expected Maximum Annual Special Tax revenues which may be levied
within CFD No. 12-1 excluding any Assessors Parcels for which the Maximum
Annual Special Tax obligation has been previously prepaid.
3. Multiply the quotient computed pursuant to step 2 by the principal amount of the
Outstanding Bonds to compute the amount of Outstanding Bonds to be retired and
prepaid (the "Bond Redemption Amount").
4. Multiply the Bond Redemption Amount computed pursuant to step 3 by the applicable
redemption premium on the next possible Bond call date, if any, on the Outstanding
Bonds to be redeemed (the "Redemption Premium ').
5. If all the Bonds authorized to be issued for CFD No. 12-1 have not been issued, then
compute the Future Facilities Costs.
6. Multiply the quotient computed pursuant to step 2 by the amount determined pursuant
to step 5 to compute the amount of Future Facilities Costs to be allocated to such
Assessor's Parcel (the "Future Facilities Amount'~.
7. Compute the amount needed to pay interest on the Bond Redemption Amount from
the first bond interest and/or principal payment date following the current Fiscal Year
until the earliest redemption date for the Outstanding Bonds.
A-IO
DOCSOClI127107v'W022245-0161
/).-llt
8. Confirm that no Special Tax delinquencies apply to such Assessor's Parcel.
9. Determine the Special Taxes levied on the Assessor's Parcel in the current Fiscal
Year, which have not yet been paid.
10. Determine the fees and expenses of CFD No. 12-1, including but not limited to, the
costs of computation of the prepayment, the costs to invest the prepayment proceeds,
the costs of redeeming Bonds from the proceeds of such prepayment, and the cost of
recording any notices to evidence the prepayment and the redemption (the
"Prepayment Fees and Expenses'').
II. Compute the amount the CFD Administrator reasonably expects to derive from the
reinvestment of the prepayment amount less the Prepayment Fees and Expenses, as
determined pursuant to step 10, from the date of prepayment until the redemption date
for the Outstanding Bonds to be redeemed with the prepayment.
12. Add the amounts computed pursuant to steps 7 and 9 and subtract the amount
computed pursuant to step II (the "Defeasance Amount'').
13. The reserve fund credit (the "Reserve Fund Credit'') shall equal the lesser of: (a) the
expected reduction in the reserve requirement (as defined in the Indenture), if any,
associated with the redemption of Outstanding Bonds as a result of the prepayment, or
(b) the amount derived by subtracting the new reserve requirement (as defined in the
Indenture) in effect after the redemption of Outstanding Bonds as a result of the
prepayment from the balance in the reserve fund on the prepayment date, but in no
event shall such amount be less than zero.
14. If any capitalized interest for the Outstanding Bonds will not have been expended at
the time of the first interest payment following the current Fiscal Year, a capitalized
interest credit shall be calculated by multiplying the quotient computed pursuant to
step 2 by the expected balance in the capitalized interest fund after such first interest
payment (the "Capitalized Interest Credit'').
15. The Maximum Annual Special Tax prepayment is equal to the sum of the amounts
computed pursuant to steps 3, 4, 6, 10, and 12, less the amounts computed pursuant to
steps 13 and 14 (the "Prepayment Amount'').
16. From the Prepayment Amount, the amounts computed pursuant to steps 3, 4, 12, 13,
and 14 shall be deposited into the appropriate fund as established under the Indenture
and be used to retire Outstanding Bonds or make debt service payments. The amount
computed pursuant to step shall be retained by CFD No. 12-1. The amount computed
pursuant to step 6 shall be deposited in the Construction Fund.
The Prepayment Amount may be sufficient to redeem other than a $5,000 increment of
Bonds. In such cases, the increment above $5,000 or integral multiple thereof will be
retained in the appropriate fund established under the Indenture to be used with the next
prepayment of bonds or to make debt service payments.
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DOCSOC1l127107v4!!1022245-0161
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As a result of the payment of the current Fiscal Year's Special Tax levy as determined under
step 9 above, the CFD Administrator shall remove the current Fiscal Year's Special Tax levy
for such Assessor's Parcel from the County tax rolls. With respect to any Assessor's Parcel
that is prepaid, the Council shall cause a suitable notice to be recorded in compliance with the
Act, to indicate the prepayment of Special Taxes and the release of the Special Tax lien on
such Assessor's Parcel, and the obligation of such Assessor's Parcel to pay the Special Tax
shall cease.
Notwithstanding the foregoing, no Special Tax prepayment shall be allowed unless the
amount of Maximum Annual Special Taxes that may be levied on Taxable Property within
CFD No. 12-1 prior to and after the proposed prepayment is at least 1.1 times the maximum
annual debt service on all Outstanding Bonds.
2. Prepayment in Part
The Maximum Annual Special Tax on an Assessor's Parcel of Developed Property or
an Assessor's Parcel of Undeveloped Property for which a building permit has been
issued may be partially prepaid. The amount of the prepayment shall be calculated as
in Section R 1; except that a partial prepayment shall be calculated according to the
following formula:
PP = (PE-Ax F) + A
These terms have the following meaning:
PP = the partial prepayment
PE = the Prepayment Amount calculated according to Section R.l, minus
Prepayment Fees and Expenses determined pursuant to Step 10.
F = the percent by which the owner of the Assessor's Parcel(s) is partially
prepaying the Maximum Annual Special Tax.
A= the Prepayment Fees and Expenses determined pursuant to Step 10.
The owner of an Assessor's Parcel who desires to partially prepay the Maximum
Annual Special Tax shall notify the CFD Administrator of (i) such owner's intent to
partially prepay the Maximum Annual Special Tax, (ii) the percentage by which the
Maximum Annual Special Tax shall be prepaid, and (iii) the company or agency that
will be acting as the escrow agent, if applicable. The CFD Administrator shall
provide the owner with a statement of the amount required for the partial prepayment
of the Maximum Annual Special Tax for an Assessor's Parcel within 30 days of the
request and may charge a reasonable fee for providing this service.
With respect to any Assessor's Parcel that is partially prepaid, the City shall
(i) distribute the funds remitted to it according to Step 16 of Section R.l, and
(ii) indicate in the records of CFD No. 12-1, that there has been a partial prepayment
of the Maximum Annual Special Tax and that a portion of the Maximum Annual
Special Tax equal to the outstanding percentage (1.00 - F) of the remaining
Maximum Annual Special Tax shall continue to be authorized to be levied on such
Assessor's Parcel pursuant to Section D.
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DOCSOC/1127107v'W022245-0161
,;1 ~ /c?-O
I. TERM OF MAXIMUM ANNUAL SPECIAL TAX
The Maximum Annual Special Tax shall be levied commencing in Fiscal Year 2006-2007 to
the extent necessary to fully satisfy the Special Tax Requirement and shall be levied for a
period no longer than the 2046-2047 Fiscal Year.
A-13
DOCSOC1l127107v41!f022245-0161
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APPENDIX B
SUMMARY OF MARKET ABSORPTION STUDY
B-1
DOCSOCII1271 07v4gl022245-0 161
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c
DOCSOCIl127107v4g1022245-0161
APPENDIX C
APPRAISAL REPORT
C-!
c+ ~ /d-3
APPENDIX D
INFORMATION REGARDING THE CITY OF CHULA VISTA
GENERAL INFORMATION
This appendix sets forth general information about the City of Chula Vista ("Chula Vista")
includinfT information with revnect to itf; financev. The following information concerning Chu/a
Vista, the County of San Diego (the "County"),.JllJJi the State of California (the "State") Bl'ld the
United Slates 8/.1"'8I'i83 (the "United SlBtes ") C/lTJM included only for general background purposes.
General Description
Chula Vista is located on Sao Diego Bay in Southern California, 8 miles south of the City of
San Diego aod 7 miles north of the Mexico border, in the area generally known as "South Bay."
Chula Vista's city limits cover approximately 50 square miles. Chula Vista was incorporated
March 17, 1911 aod became a chartered city in 1949. Chula Vista operates under a Council-Maoager
form of government aod provides the following services: public safety, community services,
engineering services, plaoning services, public works, general administrative services aod capital
improvements. With a Jaouary ~2JillS estimated population of 199,799,217.543. Chula Vista is
the second largest city in the County.
Population
The historic population of Chula Vista, the County aod the State is shown below.
City of Chula Vista, County of San Diego and State of California
Population Estimates
Year
City of Chula Vista
161,290
171,799
181,990181.453
199,399191.033
199,799200.378
208 51 0
217.543
+999
;WOO
2001
2002
2003
2.lI.lI4
2JillS
County of San Diego
2,751,900
2,&95,999
2,&56,9002.863.657
2,998,5992.920.010
2,% 1 ,6992.971.805
3.013.014
3.051.280
State of California
33,119,990
33,753,999
31,367,99034.441.561
35,999,99935.088.671
35,591,99035.691.442
36.271 091
36.810.358
Source: ~tatp of California-Statet Department of Finance, E-4 REf'"nseel UistsFleal C~', CeuRt)" ami 81&ti! PSflwatlsR Hs1ilmates,
1991 lOgO, ".ill!. 1'::'9Q B:fl.El2ggg CeR5liS Csuffis ana B 1 Population Estimates for sHies, i!eantiesCitip.!!. c.nllntip~ and
the State, 2001~~ with 2000 DRU Benchmark:. SIIr.T:nnpnto ClIlifnrnill MlIv 20M
DOCSOC/11271 07v'W022245-0 161
0-1
,;2 ~!c7 i
Building Activity
Residential building activity for the past five calendar years for Chula Vista is shown in the
following tables.
City of Chula Vista
New Housing Units Building Permits
J-91J9
2000
1,776
864
2,640
2001
2,184
1,341
3,525
2002
1,749
501
2,250
2003
2,137
1,006
3,143
ZJlJM
~
~
~
Single Family Units
Multifamily Units
Total Units
.J.,1%
+.w
~
Source: Construction IndustIy Research Board.
City of Chula Vista
Building Permit Valuations
~ 2000 2001 2002 2003 2JlfM
Residential
New Single Family $ 307,653,358 $ 319,085,986 $ 433,850,821 $ 413,647,842 $ 498,045,931 ~ .tu 7l)l:\ 71)6
New Multifamily 53,170,818 74,634,324 107,731,702 47,388,930 118,687,194 1 69 7Q~ 649
Res. Alt. & Adds 5 085 049 4.862.879 7987049 10.301.301 13.277.257 16 7l)oC;; 727
Total Residential 366,200,225 398,583,189 549,569,572 471,338,073 630,010,382 6l:il U71'72
Nonresidential
New Commercial n,213,UO 17,916,085 22,139,245 20,926,638 54,744,910 42 176 .c;;Xl)
New Industrial 7,909,58: 17,418,207 2,139,313 737,651 7,071,470 4'''1 nXl)
New Other(l) 5,840,339 17,890,100 11,112,335 22,761,223 28,063,492 27 617 1111
Alters. & Adds. ]] 552 628 10527193 13 091 600 19367574 16290492 11) filii 46'
Total Non- 28,516,412 63,751,585 48,482,493 63,793,086 106,170,157 Q41Rl qn
Residential
Total All Building $ 101,:25,658 $ 462,334,774 $ 598,052,065 $ 535,131,159 $ 736,180,539 ~ 74:; -'jiit) 144
(I) Includes churches and religious buildings, hospitals and institutional buildings, schools and educational buildings,
residential garages, public works and utilities buildings and no-residential alterations and additions.
Note: "Total All Building" is the sum of Residential and Nonresidential Building Pennit Valuations. Totals may not add to
sums because of independent rounding.
Source: Construction Industry Research Board.
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DOCSOC/I1271 07v4gl022245-0161
c:2 -/.;25
Employment
The following table summarizes the labor force, employment and unemployment figures over
the period +9992lliill through ~2JIllil for Chula Vista, the County, the State and the United States.
Chula Vista, San Diego County, State of California and United States
Labor Force, Employment and Unemployment Yearly Average
Civilian Civilian Civilian CiYilian
Year and Area Labor Force Employmenl') Unemploymenl2j Unemployment Rate(J)
-1-999
2.IIillI
Chuta Vista +G,eOOZM!!J! ~~ ;!,300~ 3.3.1..2%
San Diego County 1,31 g,3 90lJ 1,306,700~ 4l-;eOO~ H3.2"1o
~ 100
California 16,375,600lJi 15,522,300MJ! ~~ '>';!5.JI%
R69 700 ~
United Stateaf4t 139,368,000 133,188,000 5,8g0,OOO 4-,;!!j{,
=
Ck1:11-a Vista ~ ~ ~ ~
San Diege CelHltj' 1,391,100 1,319,100 4+;700 ~
CaJ;femia 16,g~2.999 16,056,500 ~ W%
United States(4) 142,583,000 136,891,000 5,692,000 4.0%
2001
Chula Vista +4,UG~ '7+,Wl~ ~U!!!! ~%
San Diego County 1,117,700,u 1,371,gOO~ #;900~ ].2~%
~ 8lIJl
California 17,171,60011 16,219,100J,Y ~m.!i!!!! 5.4%
150100 ~
United States 143,734,000 136,933,000 6,801,000 4.7%
2002
Chula Vista +6;400~ ~~ ~~ +.55.5%
San Diego County 1,158,OOO,u 1,395,OOO~ 9;l,4OO~ 4d.s.J.%
~ ~
California 17,375,00011 16,211,900~ 1,160,900J..!,W 6.7%
.326.900 ~ !!!l
United States 144,863,000 136,485,000 8,378,000 5.8%
2003
Chula Vista ~ ~~ ~ +.55..6%
San Diego County ~~ 1,119,100~ Q,lOO~ +';;5..2%
m SlIll
California 17,160,00011 16,282,700J,Y 1,177,300~ ~%
414000 ~ ill!
United States(4) 146,510,000 137,736,000 8,774,000 6.0%
2ill!;!
t:bnla Vista WI!!!! ~ M!!!! 51%
San nie~rn t:ountv 1.493.200 1 422.500 :z!!.Z!!!l ~
California 17552.300 16459.900 1.092.400 ~
lTnited State,,(4) 147.401.000 139 252.000 137.020000 5.5%
") Includes persons involved in labor-management trade disputes.
(2) Includes all persons without jobs who are actively seeking work.
(3) 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
D-3
DOCSOC/1127107v~022245-{)161
;2 -/;;Z~
Source: State sf California Employment Development Department, Lal3sr ~1arket InfsF.matisR Di! .iftiSB, based on March
~2illl4 benchIlUU'k,. and U.S. Department of Labor, Bureau of Labor Statistics.
0-4
DOCSOCIl127107v'W022245-0161
/) --/ d-- 7
v
San Diego-Carlsbad-San Marcos Metropolitan Statistical Area ("MSA"), which includes
Chula Vista, civilian labor force and wage and salary employment figures for calendar years
-t9992llllil through 'Wm2Jlll4 are shown in the following table. These figures are county-wide
statistics and may not necessarily accurately reflect employment trends in Chula Vista.
San Diego-Carlsbad-San Marcos MSA
Civilian Labor Force, Employment and Unemployment
Annual Averages, March Wll!2004 Benchmark
:f<Ile
-
I,J 18,JgO
Civilian Labor Force
Civilian Employment
I,Jg6,7g0
Civilian Unemployment
4-1-;900
Civilian Unemployment Rate
H%
Total Farm
Total Nonfarm
++;=
1,15:l,9g0
Total Private
~
Goods Producing
~
Natural Resources and Mining
Construction
:>00
e+,ooG
Manufacturing
m,9OO
Onr:ahlr ("'..(loth:
NnnrluJ'9hlp ~nndll
Service Providing
9Q,+OO
PrivatI' ~ervf('t" Prndul'ino
Trade, Transportation and Utilities
-l94;:>oo
Wholesale Trade
~
Retail Trade
~
Transportation,
Warehousing and Utilities
Utitities
Information
~
3,900
~
Financial Activities
'7G,4OO
Professional and Business Services
~
Educational and Health Services
~
Leisure and Hospitality
H4,4OO
DOCSOCIl127107v4W'022245-0161
1000
I,J91,lg
G~
an
1,319,1g
G~
an
4+,+OO5!I
.MIl
3-:Gll%
11,400
1,193,800
987,200
192,600
300
69,700
122,600
WM
~
1,001,200
~
202,600
39,100
133,800
29,800
1001
1,117,7g
G!&!!JJ!
Q
1,371,8g
G~
g
~
~
3-:U.2%
II ,400
1,218,400
1,004,700
194,400
300
75,100
119,000
~
~
1,024,000
mMl!!
209,000
41,500
135,600
32,000
~
39,200 38,800
71,200 72,000
195,200 198,200
115,300 116,000
129,000 131,400
D-5
d) -/d8'
1001
1,158,gO
G~
Q
~
G~
Q
Q,4001!I
~
M.5...1 %
11,000
1,230,700
1,011,000
189,000
300
76,400
112,300
~
~
1,041,700
m.!!M
208,600
41,300
138,000
29,300
e,9OO
37,700
75,000
201,700
119,700
133,800
1003
1,182,29
G~
Q
1,119,lg
G~
g
~1Ji
.JJ!!!
~.5..2.%
11,200
1,211,9g
G~
Q
1,922,19
G~
l!
~!
~
300
~8lI
4!!!!
l%,4OO1
~
~
~
1,93'6,79
G~
Q
~
~~
~
4l,:>oofi
,@j\
~!
~
27,300
6;300
~3li
~
~12
~
~~
!!.!..J!!!!
-rn;ooG!
~
-89;9001
1fIM.
1 4(n 2nD
1 422 .:;:00
:l!I.Zllll
47%
!!.JJ!J!
1 2';:R "on
1 114~ Qno
~
!Iilll
~
~
:u.:lJ!!!
~
1 "fili 60n
~
~
~
JM.1!!!!
~
6;HlG
~
l!!.@!!
~
JJ.!J!!!!
ill.JJ!!!
~
Other Services 4ll;9OO 42,200 44,900 45,600 ~;16 !!l.W!!
~
Government ~ 206,600 213,800 219,700 ~~ ~
JJ.1!!j!
Total, All Industries 1,161,000 1,205,200 1,229,800 1,241,700 1,25],10 12111)700
0W!.l!!
g
Note:
Source:
The "Total, All Industries" data is not directly comparable to the employment data found herein.
State of California, Employment Development Department, Labor Market Information Division, San Diego_l'arli;hllrl.
San MIITCO!li MSA Annual Average Labor Force and IndustIy Employment, March ;wo;2..Dllil Benchmark.
The following listings set forth Chula Vista's principal employers for fiscal year ending
June 30, ~2004:
Chula Vista's Principal Employers
Business Industrial/Office
Name
BFB.E. Goodrich Aerospace
}..erestn:l.ewres Crsl:Ifl
crt) sf Ciulla Vista
Sharp Chula Vista Medical Center
Scripps Memorial Hospital
Ces EJi.fl8SmSR SSf\iess. me.
United Parcel Service
WoIMort
R.....II) Tempe",,) Se" ises, llC
Ra)theen S) stems CSffit:'SftJ
Cestoe "iliel.s.l.. Ce,!, #1.0
Sears Roebuck & Co.
ATe Vancom of California 1. P
Coden Wholesale Corn# 405
Casteo V,'helesslerWholesale Corp
#4GHlill
Wal~Mart Store #3516
Home Denot#658
Bayview Behavioral Health Campus
-~~
~^.merieQfl Fasfl.isa lae.Federated
Wedern Pron
GeE IndHs-tfiBS lne.Raytheon SvdemiiO
Comnanv
ATC Vanstl.l'R BfCalifBmi~
!U8.lS
Target #204
MDI IntBn is ,;i:ag Ssn'iess,Hitachi
Home Flectronirs: Inc.
Knotts Soak Citv USA
Fredericka Manor
Source: City ofChula Vista Finance Department
DOCSOCll127107v41!1022245-0161
Type of Bu.vine.f.V
Aerospace
MamLfaat1:tfsrM anufactnrinp
U1:Hrieiflalitj'
Hospital
Hospital
Ceatraeter Sflseialty
Parcel Delivery Service
Cenere.l ~lerehaRdi5e
~mfllejmeat SeF.1.ess
Ce1B.ffil:t:fHeatiens
CeRefa-l },lereltaBelisB
D8f3artfaeffiGeneral
8tafeMerrbandise
Trans:it Comnanv
General M ercbandise
General Merchandise
General Merchandise
Rnilding Snnnlif!sfHardware
Hospital
Btl.:ilr:tmI2"General
StlpflliesfHarei" ftfeM ercbandise
~
Manl:Lfaettu:iagStm:..e
~itgiReeriRf?"Communications
~Gp.np.ral
CSffipafij M prchandise
&etailGeneral Merchandise
MaFltstiftgHome Rlectronics
Rntertainment - Theme Park
Retirement Communitv
D-6
,,;2 ~ /J.--1
No.o/Employee..
~l.m
~
-I-;-HGl.m
lH-SlI65
~
4Mfi49.
~
m
m
~
~
1M
ill
~lli
ill
ill
2]6
~2Jll
229
=2Jll!
:H4124
;!G4l8Jl
~lIi,1
llill
llill
Effective Buying Income
"Effective Buying Income" is defined as personal income less personal tax and nontax
payments, a number often referred to as "disposable" or "after-tax" income. Personal income is the
aggregate of wages and salaries, other than labor-related income (such as employer contributions to
private pension funds), proprietor's income, rental income (which includes imputed rental income of
owner-occupants of non-farm dwellings), dividends paid by corporations, interest income from all
sources and transfer payments (such as pensions and welfare assistance). Deducted from this total
are personal taxes (federal, state and local, nontax payments, fInes, fees, penalties, etc.) and personal
contributions to social insurance. According to U.S. government defInitions, the resultant fIgure is
commonly known as "disposable personal income."
D-7
DOCSOCII1271 07v4gl022245-0 161
,-~-/30
The following table summarizes the total effective buying income, the per capita effective
buying income, the median household effective buying income and percent of households over
$50,000 for Chula Vista, the County and the State between +99&1JIllil and ~2004.
Chula Vista, San Diego County and California
Effective Buying Income(l)
Median
Per Capita Hou...hold Percent of
Effective Buying Effective Buying Effective Buying Hou.~ehold.~
Incomt!'! Income Income over $50,000
~
Ch1:ila"'f/ista. $ 2,198,888 ~ W,9H- =
San Diege CeURty 16,956,113 ~ ~ ;l;!,&
CalifuFffia 551,999,317 ~ ~ ;+.6
W99
Otala Vista $ 2,629,899 w,m ~ ~
San Diege C61filt) 19,997,828 -i-7;Hll ~ '>'/.,4
CaHiCmia 599,]76,663 ~ ~ ~
2000
Chula Vista $ 2,959,674 $17,268 $42,550 41.6%
San Diego County 54,337,662 19,150 44,292 43.7
California 652,190,282 19,081 44,464 44.3
2001
Chula Vista $ 2,917,494 $16,128 $42,229 39.1%
San Diego County 55,210,119 19,092 44,146 42.0
California 650,521,407 18,652 43,532 41.9
2002
Chula Vista $ . 2,864,900 $15,231 $40,578 37.0%
San Diego County 54,831,958 18,524 42,315 39.7
California . 647,879,427 17,737 42,484 40.5
2JIlIJ.
Chula Vista S 3.420.253 ~ ~ 39 gOft,
S:;m nipgo COllntv <,7 6RO RRO lM!!Z ~ Ud
California 674.721.020 JJm ~ ll2.
2.lIll4
Chills Vista S 3.671.403 ~ ~ 4.16%
San Die90 COllntv 60 <'78.879 ~ ~ ;l2Jl
California 70.108.410 ~ ~ US
(I) Not comparable with prior years. Effective Buying Income is now based on money income (which does not take into
account sale of property, taxes and social security paid, receipt of food stamps, etc.) versus personal income.
(2) Dollars in thousands.
Source: "Survey of Buying Power," Sales & Marketing Management Magazine, dated 1999', 2999, 2001, ~100?: 100~ 2004
and :lOO;,2lllI5.
D-8
DOCSOC/11271 07v4g1022245-0161
~-/31
<
Sales Taxes
The following table shows taxable transactions in Chula Vista by type of business during
calendar years +998l.2.2.2 through ~2003. As indicated below, total retail sales for Chula Vista in
1~99 iBereasea by BfljlfeJ[imately HI.30% aver the l~n le'fcl, in 2000 increased by approximately
10.44% over the 1999 level, in 2001 increased approximately 4.98% over the 2000 level, aatl-in 2002
increased approximately 2.42% over the 2001 level. and in 2003 increased annroximatelv 7.41%
over the 2002 level.
A summary of historic taxable transactions for Chula Vista is shown in the following table.
City of Chula Vista
Taxable Transactions
(Dollars in thousands)
M9-8 1999 2000 2001 2002 2flfll
Apparel Stores Group $ 63,111 $ 61,758 $ 66,598 $ 61,937 $ 67,035 ~ "7114
General Merchandise Stores 382,911 439,731 495,679 524,942 525,423 5~~. 979
Food Stores Group 81,006 85,662 90,487 92,224 99,897 103.155
Eating and Drinking Group 131,661 142,329 155,583 164,417 169,892 1 fiR 67~
Household Group/Home Furn. 55,856 61,923 66,365 67,827 74,255 ~
Appli.
Building Material Group 75,812 87,902 102,370 97,827 91,235 100 504
Automotive Group 1Q7,8Q8 126,304 145,923 151,812 156,872 17M 7~l
Service Stations 88,570 95,546 121,244 119,050 123,636 148 ~18
Other Retail Stores 133.163 139 837 157.152 183.303 205564 22J.R50
Retail Stores Total $ 1,120,531 $ 1,240,992 $ 1,401,401 $ 1,463,409 $1,513,809 s. 1 642 RR9
All Other Outlets 199.661 215.396 206.889 225.256 215.349 214344
Total All Outlets $ 1 320 195 $1456388 $ 1 60R 290 $ 1 688 665 $172915R ~1 Xol\7211
Note: Drugs stores are grouped with the General Merchandise Stores and package liquor stores are grouped with the Eating
and Drinking Group.
Source: State Board of Equalization.
Education
Public educational instruction from kindergarten through high school is provided by the
Chula Vista Elementary School District and Sweetwater Union High School District. These districts
administer twenty-six elementary schools, nine junior high schools and eight senior high schools.
Southwestern College, a two year Community College, has an enrollment of more than 15,000.
There are also four adult education schools and twelve private schools. There are seven universities
or colleges within 30 minutes commuting distance from Chula Vista in the San Diego Metropolitan
Area. Chula Vista has proposed a University of California campus in Chula Vista, to be located on a
400 acre site adjoining the Olympic Training Center.
CommuDity Faeilities
There are twe aeute eare hesjlitaiG, two jlsyehi&trie heBflitala aREl three eeU'f-a!eseeftt
hes~itals, aREl mere !hall 199 meElieal Eleeters aREl alliea ~refesGiaDals iD ChIIla 'liata.
D-9
DOCSOC/1127107v'W022245-0161
.1 - /3<:J-..
<
There are two aaily, one weekly ana one semi weekly ne'l:spapers publiohea ana eimllatea
in Clmla Vista. Cffilla Vista hao one main publie lierory ..nd IY,'o Braneli libraries.
Reereational facilities within or near ClnIla Viola taemae twenly fOllf parks, rellr eel'lllllooity
eenters, six "lot lols," I\ve Bell fielEls, !wealy eight tenllis eollflo, Ihree golf eellrses, f"\If muaieijlal
s'<<immiag pools, 1\','e gyHlfIaoillms ana Boat ll>\llichi"g facilities. ChlIIa Vista's Bayfroat lIfea
eeatnias a mariaa weieli houses 552 Boats ana miles of publie Be""hes. Cellla Viola also pro'liaes
many trails fer Bieyeliag, hikiag and jeggiag.
Chllla Viota is ..lse the heme oHhe Uaitea Stales Ol)'ffi!lie Tmiaiag Center. Thio is the third
slice traiaiag eenter ia tee aatiea and the eely year rellaa traiaiag faeilily. The eenter io locatea ea a
150 ..ere site doaated ily EaotLak" Deyelopment Company ..dj..ee"t to the Ot..y Lake reseF','eir.
Chul.. Viota has more than siJ(-Iy effilrches and "early 100 service, fraternal and e,y,e
erganizatieas.
Transportation
U.S. Highways 5 (along the coast) and 805 (inland) provide full freeway access from Chula
Vista north to San Diego and south to the Mexican boarder. Commuter rail service is provided by
the San Diego Trolley, a light rail system started in 1981 and eleven bus routes serve Chula Vista.
Daily BloiS eonnectioas seITe Cffilla Vista, ana SOlolthem Pacific Railway and San Diego's
LiaElbcrgh IBtematioa",lf,irpert are lilteen minllles 10 the nerth ef Cbula Vista.
Utilities
Electric power and natural gas are provided by San Diego Gas and Electric. Pacific Bell
provides telephone service to the area. Otay Water District and Sweetwater Water District provide
water service and Chula Vista provides sewer service.
0-10
DOCSOC/1127107v4&022245-0161
~-/33
APPENDIX E
SUMMARY OF INDENTURE
The following is a summary of certain provisions of the Bond indenture (the "indenture'~ not
otherwise summarized in the text of this Official Statement. This summary is not intended to be
definitive, and reference is made to the complete text of each of such documents for the complete
terms thereof
E-l
DOCSOC/11271 07v4W022245-0 161
;2 -/31
APPENDIX F
CONTINUING DISCLOSURE AGREEMENT OF THE DISTRICT
This Continuing Disclosure Agreement dated as of November 1, 2005 (the "Disclosure
Agreement") is executed and delivered by Community Facilities District No. 12-I (McMillin Otay
Ranch Village Seven) (the "Issuer") and MuniFinancia1 as dissemination agent (the "Dissemination
Agent"), in connection with the issuance and delivery by the Issuer of its $ 2005 Special
Tax Bonds (the "Bonds"). The Bonds are being issued pursuant to an Indenture, dated as of
November 1,2005 (the "Indenture"), by and between the Issuer and U.S. Bank National Association,
as fiscal agent (the "Fiscal Agent"). The Issuer and the Dissemination Agent covenant as follows:
SECTION I. Purpose of the Disclosure Al!feement. This Disclosure Agreement is being
executed and delivered by the Issuer and the Dissemination Agent, 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.
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 Issuer pursuant to, and as
described in, Sections 3 and 4 of this Disclosure Agreement.
"Beneficial Owner" shall mean any person which (a) 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), or (b) is treated as the owner of any
Bonds for federal income purposes.
"Central Post Office" shall mean the Disclosure USA wehsite maintained bv the
Municinal Advisorv Council of Texas or any successor thereto. or any other orp"anization or
method aonroved bv the staff or members of the Securities and Exchanve Commission as an
intermediary throU!:rh which issuers may. comnliance with the Rule. make filinps relluired bv
this Disclosure Apreement.
"Disclosure Representative" shall mean the Director of Finance of the City of Chula Vista or
his or her designee, or such other officer or employee as the Issuer shall designate in writing to the
Dissemination Agent from time to time.
"Dissemination Agent" shall mean, initially, MuniFinancial, acting in its capacity as
Dissemination Agent hereunder, or any successor Dissemination Agent designed in writing by the
Issuer and which has been filed with the then current Dissemination Agent a written acceptance of
such designation.
"District" shall mean Community Facilities District No. 12-I (McMillin Otay Ranch Village
Seven).
"Listed Events" shall mean any of the events listed m Section 5(a) of this Disclosure
Agreement.
F-I
DOCSOC/1127107v4W022245-0161
d ~ /3/7
"National Repository" shall mean any Nationally Recognized Municipal Securities
Information Repository for purpose of the Rule.
"Official Statement" shall mean the Official Statement, dated
Bonds.
, 2005 relating to the
"Participating Underwriter" shall mean Stone & Youngberg LLC, whose address for
purposes of this Agreement is One Ferry Building, San Francisco, California 94111, Attention:
Research Department.
"Repository" shall mean each National Repository and each State Repository.
''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 Repository" shall mean any public or private repository or entity designated by the
State of California as a state repository for the purpose of the Rule and recognized as such by the
Securities and Exchange Commission. As of the date of this Disclosure Agreement, there is no State
Repository.
"Tax-exempt" shall mean that interest on the Bonds is excluded from gross income for
federal income tax purposes, whether or not such interest is includable as an item of tax preferences
or otherwise includable directly or indirectly for purposes of calculating any other tax liability,
including any alternative minimum tax or environmental tax.
SECTION 3. Provision of Annual Reoorts.
(a) The Issuer shall, or shall cause the Dissemination Agent by written direction to such
Dissemination Agent to, not later than February I after the end of the Issuer's fiscal year (which
currently ends on June 30), commencing with the report due by February I, 2006, provide to each
Repository and the Participating Underwriter 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 include by reference other
information as provided in Section 4 of this Disclosure Agreement; provided that the audited
financial statements of the Issuer may be submitted separately from and later than the balance of the
Annual Report if they are not available by the date required above for the fJling of the Annual
Report.
An Annual Report shall be provided at least annually notwithstanding any fiscal year
longer than 12 calendar months. The Issuer's fiscal year is currently effective from July 1 to the
immediately succeeding June 30 of the following year. The Issuer will promptly notify each
Repository or the Municipal Securities Rulemaking Board and, in either case, the Fiscal Agent and
the Dissemination Agent of a change in the fiscal year dates.
(b) Not later than fifteen (15) Business Days prior to the date specified in subsection (a)
for providing the Annual Report to Repositories, the Issuer shall provide the Annual Report to the
Dissemination Agent. If by fifteen (15) Business Days prior to such date the Dissemination Agent
has not received a copy of the Annual Report, the Dissemination Agent shall contact the Issuer to
determine if the Issuer is in compliance with subsection (a). The Issuer shall provide a written
F-2
DOCSOC/1127107v4W022245-0161
;2-/3~
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 Issuer and shall have no
duty or obligation to review such Annual Report.
(c) If the Dissemination Agent is unable to verify that an Annual Report has been
provided to Repositories by the date required in subsection (a), the Dissemination Agent shall send a
notice to each Repository, in substantially the form attached as Exhibit A.
(d) The Dissemination Agent shall:
(i) determine each year prior to the date for providing the Annual Report the
name and address of each National Repository and each State Repository, if any; and
(ii) promptly after receipt of the Annual Report, file a report with the Issuer and
(if the Dissemination Agent is not the Fiscal Agent) the Fiscal Agent certifying that the
Annual Report has been provided pursuant to this Disclosure Agreement, stating the date it
was provided and listing all the Repositories to which it was provided.
fe) Notwithstandim:r anv other nrovision of thi~ Disclosure Ap'reement. the hsner
and the Dissemination A!!ent reserve the rip-hi to make anv of the aforementioned filinl!s
through the Central Post Office.
SECTION 4. Content of Annual Reoorts. The Issuer's Annual Report shall contain or
include by reference:
(a) Financial Statements. The audited financial statements of the Issuer for the most
recent fiscal year of the Issuer then ended. If the Issuer prepares audited financial statement and if
the audited financial statements are not available by the time the Annual Report is required to be
filed, the Annual Report shall contain any unaudited fmancial statements of the Issuer in a format
similar to the financial statements, and the audited financial statements shall be filed in the same
marmer as the Annual Report when they become available. Audited financial statements of the
Issuer shall be audited by such auditor as shall then be required or permitted by State law. Audited
financial statements, if prepared by the Issuer, shall be prepared in accordance with generally
accepted accounting principles as prescribed for governmental units by the Governmental
Accounting Standards Board; provided, however, that the Issuer may from time to time, if required
by federal or state legal requirements, modify the basis upon which its fmancial statements are
prepared. In the event that the Issuer shall modify the basis upon which its financial statements are
prepared, the Issuer shall provide a notice of such modification to each Repository, including a
reference to the specific federal or state law or regulation specifically describing the legal
requirements for the change in accounting basis.
(b) Financial and Ooerating Data. The Annual Report shall contain or incorporate by
reference the following information:
(i) the principal amount of Bonds outstanding as of the September 2 preceding
the filing of the Annual Report;
F-3
DOCSOC/1127107v4g/022245-0161
;)-137
(ii) 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) an update on the status of construction of the public improvements to be
constructed with the proceeds of the Bonds, which shall include an update of Table 2 in the
Official Statement; provided however that such update will not be required after the
construction of the public improvements to be constructed with the proceeds of the Bonds is
completed;
(iv) any changes to the Rate and Method of Apportionment of the Special Taxes
approved or submitted to the qualified electors for approval prior to the filing of the Annual
Report and a description of any parcels for which the Special Taxes have been prepaid in the
Fiscal Year for which the Annual Report is being prepared;
(v) an update of the estimated assessed value-to-lien ratios within the District
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 substantially in the form set forth in
Table 7; provided, however, that all parcels which constitute Developed Property may be
grouped as a single category;
(vi) an update of Table 3 in the Official Statement, including (a) the percentage of
Special Taxes payable by individual homeowners as a group, and (b) a list of all taxpayers
within the District which own property in the District upon which 5% or more of the total
Special Taxes for the current fiscal year have been levied, and a statement as to whether any
of such taxpayers is delinquent in the payment of Special Taxes;
(vii) any event known to the Issuer which reduces or slows the number of
residential units permitted to be constructed within the District or which results in a
moratorium on future building within the District;
(viii) the status of any foreclosure actions being pursued by the Issuer with respect
to delinquent Special Taxes;
(ix) the total Special Taxes levied and the total Special Taxes collected for the
prior fiscal year and the total Special Taxes that remain unpaid for each prior fiscal year in
which Special Taxes were levied; and
(x) any information not already included under (i) through (ix) above that the
Issuer is required to file in its annual report to the California Debt and Investment Advisory
Commission pursuant to the provisions of the Mello-Roos Community Facilities Act of 1982,
as amended.
(c) Any or all of the items listed in (a) or (b) above may be included by specific reference
to other documents, including official statements of debt issues of the Issuer or related public entities,
which have been submitted to each of the Repositories or the Securities and Exchange Commission.
If the document included by reference is a final official statement, it must be available from the
Municipal Securities Rulemaking Board. The Issuer shall clearly identify each such other document
so included by reference.
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SECTION 5. Reporting of Significant Events.
(a) Pursuant to the provisions of this Section 5, the Issuer shall give, or cause to be given,
notice of the occurrence of any of the following events with respect to the Bonds, if material:
(I) principal and interest payment delinquencies.
(2) an event of default under the Indenture other than as described in (I)
above.
(3)
difficulties.
unscheduled draws on the Reserve Fund reflecting financial
(4) unscheduled draws on any credit enhancements securing the Bonds
reflecting fmancial difficulties.
(5) any change in the provider of any letter of credit or any municipal
bond insurance policy securing the Bonds or any failure by the providers of such
letters of credit or municipal bond insurance policies to perform on the letter of credit
or municipal bond insurance policy.
(6) adverse tax opinions or events adversely affecting the tax-exempt
status of the Bonds.
(7) modifications to the rights of Bond Owners.
(8) unscheduled redemption of any Bond.
(9) defeasances.
(10) any release, substitution, or sale of property securing repayment of the
Bonds.
(II) rating changes.
(b) The Dissemination Agent shall, promptly upon the obtaining actual knowledge of the
occurrence of any of the Listed Events, contact the Disclosure Representative, inform such person of
the event, and pursuant to the Indenture, inform such person of the event, and request that the Issuer
promptly notify the Dissemination Agent in writing whether or not to report the event pursuant to
subsection (t).
(c) Whenever the Issuer obtains knowledge of the occurrence of a Listed Event, whether
because ofa notice from the Dissemination Agent pursuant to subsection (b) or otherwise, the Issuer
shall as soon as possible determine if such event would be material under applicable federal
securities laws.
(d) If the Issuer has determined that knowledge of the occurrence of a Listed Event
would be material under applicable federal securities laws, the Issuer shall promptly notify the
Dissemination Agent in writing. Such notice shall instruct the Dissemination Agent to report the
occurrence pursuant to subsection (t).
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(e) If in response to a request under subsection (b), the Issuer determines that the Listed
Event would not be material under applicable federal securities laws, the Issuer shall so notify the
Dissemination Agent in writing and instruct the Dissemination Agent not to report the occurrence
pursuant to subsection (f).
(f) If the Dissemination Agent has been instructed by the Issuer to report the occurrence
of a Listed Event, the Dissemination Agent shall file a notice of such occurrence with (i) the
Municipal Securities Rulemaking Board (in the Central Post Office or (Hili) each National
Repository, and in either case, to each State Repository. Notwithstanding the foregoing, notice of
Listed Events described in subsections (a)(8) and (9) need not be given under this subsection any
earlier than the notice (if any) of the underlying event is given to Owners of affected Bonds pursuant
to the Indenture. In each case of the Listed Event, the Dissemination Agent shall not be obligated to
file a notice as required in this subsection (f) prior to the occurrence of such Listed Event.
(g) The Issuer hereby agrees that the undertaking set forth in this Disclosure Agreement
is the responsibility of the Issuer and that the Fiscal Agent or the Dissemination Agent shall not be
responsible for determining whether the Issuer's instructions to the Dissemination Agent under this
Section 5 comply with the requirements of the Rule.
SECTION 6. Termination of Reoorting Obligation. The obligation of the Issuer and the
Dissemination Agent under this Disclosure Agreement shall terminate upon the legal defeasance,
prior redemption or payment in full of all of the Bonds. If such termination occurs prior to the final
maturity of the Bonds, the Issuer shall give notice of such termination in the same manner as for a
Listed Event under Section 5.
SECTION 7. Dissemination Agent. The Issuer may, from time to time, appoint or engage a
Dissemination Agent to assist it in carrying out its obligations under the Disclosure Agreement, and
may discharge any such Dissemination Agent, with or without appointing a successor Dissemination
Agent. If at any time there is not any other designated Dissemination Agent, the Fiscal Agent shall
be the Dissemination Agent. The initial Dissemination Agent shall be MuniFinancial. The
Dissemination Agent may resign by providing (i) thirty days written notice to the Issuer and the
Fiscal Agent and (ii) upon appointment of a new Dissemination Agent hereunder.
SECTION 8. Amendment. (a) This Disclosure Amendment may be amended, by written
agreement of the parties, without the consent of the Owners, if all of the following conditions are
satisfied: (I) such amendment is made in connection with a change in circumstances that arises from
a change in legal (including regulatory) requirements, a change in law (including rules or regulations)
or in interpretations thereof, or a change in the identity, nature or status of the Issuer or the type of
business conducted thereby, (2) this Disclosure Agreement as so amended would have complied with
the requirements of the Rule as of the date of this Disclosure Agreement, after taking into account
any amendments or interpretations of the Rule, as well as any change in circumstances, (3) the Issuer
shall have delivered to the Fiscal Agent an opinion of a nationally recognized bond counselor
counsel expert in federal securities laws, addressed to the Issuer and the Fiscal Agent, to the same
effect as set forth in clause (2) above, (4) the Issuer shall have delivered to the Dissemination Agent
an opinion of nationally recognized bond counselor counsel expert in federal securities laws,
addressed to the Issuer, to the effect that the amendment does not materially impair the interests of
the Owners or Beneficial Owners, and (5) the Issuer shall have delivered copies of such opinion and
amendment to each Repository.
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(b) This Disclosure Agreement may be amended, by written agreement of the parties,
upon obtaining consent of Owners in the same manner as provided in the Indenture for amendments
to the Indenture with the consent of the Owners of the Bonds, provided that the conditions set forth in
Section 8(a)(1), (2) and (3) have been satisfied.
(c) To the extent any amendment to this Disclosure Agreement results in a change in the
type of frnancial information or operating data provided pursuant to this Disclosure Agreement, the
first Annual Report provided thereafter shall include a narrative explanation of the reasons for the
amendment and the impact of the change.
(d) If an amendment is made to the basis on which financial statements are prepared, the
Annual Report for the year in which the change is made shall present a comparison between the
financial statements or information prepared on the basis of the new accounting principles and those
prepared on the basis of the former accounting principles. Such comparison shall include a
quantitative and, to the extent reasonably feasible, qualitative discussion of the differences in the
accounting principles and the impact of the change in the accounting principles on the presentation of
the financial information.
SECTION 9. Additional Information. Nothing in this Disclosure Agreement shall be
deemed to prevent the Issuer 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 Issuer 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 Issuer shall have no obligation under this
Agreement to update such information or include it in any future Annual Report or notice if
occurrence of a Listed Event.
The Issuer acknowledges and understands that other state and federal laws, including but not
limited to the Securities Act of 1933 and Rule IOb-5 promulgated under the Securities Exchange Act
of 1934, may apply to the Issuer, and that under some circumstances compliance with this Disclosure
Agreement, without additional disclosures or other action, may not fully discharge all duties and
obligations of the Issuer under such laws.
SECTION 10. Default. In the event of a failure of the Issuer or the Dissemination Agent to
comply with any provision of this Disclosure Agreement, the Participating Underwriter or 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 Issuer 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 Issuer or the Fiscal Agent to comply with this Disclosure
Agreement shall be an action to compel performance.
SECTION II. Duties. Immunities and Liabilities of Fiscal Agent and Dissemination Agent.
The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure
Agreement, and the Issuer agrees to indemnify and save the Dissemination Agent and its respective
officers, directors, employees and agents, harmless against any loss, expense and liabilities which
they may incur arising out of or in the exercise or performance of their powers and duties hereunder,
including the costs and expenses (including attorneys fees) of defending against any claim of
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liability, but excluding liabilities due to the Dissemination Agent's negligence or willful misconduct.
The Dissemination Agent shall be paid compensation by the Issuer 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. The Dissemination Agent shall have no duty or obligation to review any information
provided to it hereunder. The obligations of the Issuer under this Section shall survive resignation or
removal of the Dissemination Agent and payment of the Bonds. No person shall have any right to
commence any action against the Dissemination Agent seeking any remedy other than to compel
specific performance of this Disclosure Agreement. The Dissemination Agent shall not be liable
under any circumstances for monetary damages to any person for any breach under this Disclosure
Agreement.
SECTION 12. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of
the Issuer, the Fiscal Agent, the Dissemination Agent, the Participating Underwriter and Owners and
Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or
entity.
SECTION 13. Notices. Notices should be sent in writing to the following addresses. The
following information may be conclusively relied upon until changed in writing.
Disclosure Representative:
Director of Finance
City ofChula Vista
276 Fourth Avenue
Chula Vista, California 91910
Dissemination Agent:
MuniFinancial
27368 Via Industrial, Suite 110
Temecula, California 92590
Attention: Municipal Disclosure
SECTION 14. Counteroarts. This Disclosure Agreement may be executed in several
counterparts, each of which shall be an original and all of which shall constitute but one and the same
instrument.
COMMUNITY FACILITIES DISTRICT NO. 12-1
(McMillin Otay Ranch Village Seven)
By:
Assistant Director of Finance
MUNIFINANCIAL, as Dissemination Agent
By:
Authorized Officer
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EXHIBIT A
NOTICE TO REPOSITORIES OF FAILURE TO FILE ANNUAL REPORT
Name ofIssuer:
Community Facilities District No. 12-1 (McMillin Otay Ranch Village Seven)
Name of Bond Issue: $ City of Chula Vista Community Facilities District No. 12-1
(McMillin Otay Ranch Village Seven) $ 2005 Special Tax Bonds
Date of Issuance:
,2005
NOTICE IS HEREBY GIVEN that the Community Facilities District No. 12-1 (McMillin
Otay Ranch Village Seven) located in the City of Chura Vista, California (the "District ") has not
provided an Annual Report with respect to the above-named Bonds as required by Section 3 of the
Continuing Disclosure Agreement, dated as of November I, 2005, by and between the District and
MuniFinancial, as dissemination agent. [The District anticipates that the Annual Report will be filed
by .J
Dated:
MUNlFINANClAL, as Dissemination Agent
cc: City of Chula Vista
Stone & Youngberg LLC
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APPENDIX G
CONTINillNG DISCLOSURE AGREEMENT OF THE DEVELOPER
This Continuing Disclosure Agreement (the "Disclosure Agreement") dated as of November
1,2005 is executed and delivered by (the "Developer"), and U.S. Bank National
Association, as fiscal agent (the "Fiscal Agent'') and as dissemination agent (the "Dissemination
Agent"), in connection with the execution and delivery by Community Facilities District No. 12-1
(McMillin Otay Ranch Village Seven) (the "District ") $ aggregate principal amount of its
City of Chula Vista Community Facilities District No. 12-1 (McMillin Otay Ranch Village Seven)
2005 Special Tax Bonds (the "Bonds"). The Bonds are being executed and delivered pursuant to an
Indenture dated as of November I, 2005 by and between the District and U.S. Bank National
Association, as Fiscal Agent (the "Indenture''). The Developer covenants and agrees as follows:
SECTION I. Purpose of the Disclosure A!!reement. This Disclosure Agreement is being
executed and delivered by the Developer for the benefit of the Bondowners and Beneficial Owners
and in order to assist the Participating Underwriter in complying with S.E.C. Rule 15c2-12(b)(5).
This Disclosure Agreement does not address additional undertakings, if any, by or with respect to
persons other than the Developer who may be considered obligated persons or purposes of the Rule,
which additional undertakings, if any, may be required for the Participating Underwriter to comply
with the Rule.
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:
"Affiliate" shall mean, with respect to any Person, (a) each Person that, directly or indirectly,
owns or controls, whether beneficially or as an agent, guardian or other fiduciary, twenty-five percent
(25%) or more of any class of Equity Securities of such Person, (b) each Person that controls, is
controlled by or is under common control with such Person, or (c) each of such Person's executive
officers, directors, joint venturers and general partners; provided, however, that in no case shall the
District be deemed to be an Affiliate of the Developer for purposes of this Disclosure Agreement.
For the purpose of this definition, "control" of a Person shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of its management or policies, whether
through the ownership of voting securities, by contract or otherwise.
"Beneficial Owner" shall mean any person which has or shares the power, directly or
indirectly, to make investment decisions concerning ownership of the Bonds (including persons
holding Bonds through nominees, depositories or other intermediaries).
"City" shall mean the City of Chula Vista, California.
"Dissemination Agent" shall mean U.S. Bank National Association, acting in its capacity as
Dissemination Agent hereunder, or any successor Dissemination Agent designated in writing by the
Developer and which has f1!ed with the Developer and the City a written acceptance of such
designation.
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"District" shall mean Community Facilities District No. 12-1 (McMillin Otay Ranch Village
Seven).
"Equity Securities" of any Person shall mean (a) all common stock, preferred stock,
participations, shares, general partoership interests or other equity interests in and of such person
(regardless of how designated and whether or not voting or non-voting) and (b) all warrants, options
and other rights to acquire any of the foregoing.
"Fiscal Year" shall mean the period beginning on July I of each year and ending on the next
succeeding June 30.
"Government Authority" shall mean any national, state or local government, any political
subdivision thereof, any department, agency, authority or bureau of any of the foregoing, or any other
Person exercising executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Listed Event" shall mean any of the events listed in Section 5(a) of this Disclosure
Agteement.
"National Repository" shall mean any Nationally Recognized Municipal Securities
Information Repository for purposes of the Rule.
"Official Statement" shall mean the Official Statement, dated
Bonds.
, 2005, relating to the
"Participating Underwriter" shall mean Stone & Youngberg LLC, the original underwriter of
the Bonds, whose address for purposes of this Disclosure Agteement is One Ferry Building, San
Francisco, California 94111, Attention: Research Department, and any other underwriting firm that
provides written notice to the Developer that they are required to comply with the Rule in connection
with the offering of the Bonds.
"Person" shall mean any natural person, corporation, limited liability compaoy, partnership,
firm, association, Government Authority or any other Person whether acting in an individual
fiduciary, or other capacity.
"Repository" shall mean each National Repository aod the State Repository.
"Rule" shall mean Rule 15c2-12(b)(5) adopted by the Securities and Exchaoge Commission
under the Securities Exchange Act of 1934, as the same may be amended from time to time.
"Semi-Annual Report" shall meao aoy Semi-Annual Report provided by the Developer
pursuaot to, aod as described in, Sections 3 aod 4 of this Disclosure Agteement.
"State" shall meao the State of California.
"State Repository" shall meao any public or private repository or entity designed by the State
as a state repository for the purpose of the Rule aod recognized as such by the Securities and
Exchaoge Commission. As of the date of this Disclosure Agteement, there is no State Repository.
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SECTION 3. Provision of Annual Reports.
(a) The Developer shall, or shall cause the Dissemination Agent to, not later than May 1
and November 1 of each year, commencing May 1, 2006, provide to each Repository, the District
and to Stone & Youngberg LLC a Semi-Annual Report which is consistent with the requirements of
Section 4 of this Disclosure Agreement. The Semi-Annual Report may be submitted as a single
document or as separate documents comprising a package, and may include by reference other
information as provided in Section 4 of this Disclosure Agreement provided that the audited fmancial
statements, if any, of the Developer may be submitted separately from the balance of the Semi-
Annual Report due in May of each year and later than the date required for the filing of the Semi-
Annual Report due in May of each year if they are not available by that date.
(b) Not later than fifteen (15) Business Days prior to the date specified in subsection (a)
for providing the Semi-Annual Report to Repositories, the Developer shall provide the Semi-Annual
Report to the Dissemination Agent or shall provide notification to the Dissemination Agent that the
Developer is preparing, or causing to be prepared, the Semi-Annual Report and the date which the
Semi-Annual Report is expected to be available. If by such date, the Dissemination Agent has not
received a copy of the Semi-Annual Report or notification as described in the preceding sentence, the
Dissemination Agent shall contact the Developer to determine if the Developer is in compliance with
the first sentence of this subsection (b).
(c) If the Dissemination Agent is unable to provide a Semi-Annual Report to
Repositories by the date required in subsection (a) or to verifY that a Semi-Annual Report has been
provided to Repositories by the date required in subsection (a), the Dissemination Agent shall send a
notice to each Repository in substantially the form attached as Exhibit A.
(d) The Dissemination Agent shall:
(i) determine each year prior to the date for providing the Semi-Annual Report
the name and address of each National Repository and the State Repository, if any; and
(ii) file a report with the Developer and the District certifYing that the Semi-
Annual Report has been provided pursuant to this Disclosure Agreement, stating the date it
was provided and listing all the Repositories to which it was provided.
SECTION 4. Content of Semi-Annual Report. The Developer's Semi-Annual Report shall
contain or include by reference the information which is available as of April I and October I of
each year, as applicable, relating to the following:
a. An update to the section in the Official Statement entitled "THE DEVELOPMENT
AND PROPERTY OWNERSHIP" (excluding the information therein relating to
merchant builders that are not Affiliates of the Developer and excluding the
subsections entitled "Appraisal" and "Market Absorption Study") including an update
of tables therein and a discussion of the sources of funds to finance development
relating to its property within the District, and whether any material defaults exist
under any loan arrangement related to such financing.
b. A summary of development activity for property owned by the Developer within the
District, including the number of parcels for which building permits have been
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DOCSOCfl1271 07v~022245-0161
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issued, the number of parcels for which certificates of occupancy have been issued,
the number of parcels for which sales have closed, and land or lot sales by the
Developer including the amount of land or lots sold and the name of the purchaser of
lots to be developed.
c. Status of any material governmentally-imposed preconditions for commencement or
continuation of development of the undeveloped parcels within the District owned by
the Developer and which is known to the Developer.
d. Status of any material legislative, administrative and judicial challenges known to the
Developer affecting the construction of the development to a finished lot condition,
other than the public improvements described in (e) below (the "Developer
hnprovements").
e. Status of completion of the public improvements financed by the Bonds and any
material legislative, administrative and judicial challenges known to the Developer to
or affecting the construction of such public improvements (the "District
hnprovements").
f. Any material amendments to land use entitlements for the property owned by the
Developer within the District or Special Tax rate and method of apportionment with
respect to parcels within the District that are known to the Developer, including (i) a
description of any amendment to the rate and method that affects the total number of
acres subject to the levy of the Special Taxes, and (ii) a listing of any acreage that has
become exempt from the levy of Special Taxes.
g. In the Semi-Annual Report due in May of each year only and until such time as the
Developer and its Aff1liates no longer own land within the District which is
responsible for 20% or more of the annual Special Tax levy, unaudited financial
statements of the Developer and its Affiliates owning land within the District and, if
prepared, audited financial statements of each of such entities for its most recently
completed fiscal year (which currently ends on each December 31), prepared in
accordance with generally accepted accounting principles as promulgated to apply to
private entities from time to time by the Financial Accounting Standards Board. If
the Developer has audited financial statements prepared and the audited financial
statements are not available by the time the Semi-Annual Report is required to be
filed pursuant to Section 3(a), the Semi-Annual Report shall contain unaudited
fmancial statements in a format similar to the audited financial statements for the
preceding year, and the audited financial statements shall be filed in the same manner
as the Semi-Annual Report when they become available. The Developer need only
provide audited or unaudited data once per year.
h. The filing of any lawsuit against the Developer or otherwise known to the Developer
which will materially adversely affect the completion of the District Improvements,
the Developer hnprovements or the development of undeveloped parcels within the
District, or litigation which would materially adversely affect the financial condition
of the Developer or its Affiliates that own property within the District.
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1. A payment default by the Developer on any loan made to the Developer (whether or
not such loan is secured by property within the District ) which is beyond any
applicable cure period in such loan.
Any and all of the items listed above may be included by specific reference to other
documents, including official statements of debt issues which have been submitted to each of the
Repositories or the Securities and Exchange Commission. If the document included by reference is a
final official statement, it must be available from the Municipal Securities Rulemaking Board. The
Developer shall clearly identify each such other document so included by reference.
SECTION 5. Reportine: of Sie:nificant Events.
(a) Pursuant to the provisions of this Section 5, the Developer shall give, or cause to be
given, notice of the occurrence of any of the following events with respect to the Bonds, if material
under clauses (b) and (c):
I. Failure to pay any real property taxes, special taxes or assessments (including
any assessment installment) levied within the District on a parcel owned by the Developer or
any of its Affiliates;
2. A payment default by the Developer or any Affiliate on any loan secured by
property within the District owned by the Developer or any of its Affiliates which is beyond
any applicable cure period in such loan;
3. The filing of any proceedings with respect to the Developer or any of its
Affiliates, in which the Developer or any of its Affiliates that own property within the
District may be adjudicated as bankrupt or discharged from any or all of their respective
debts or obligations or granted an extension of time to pay debts or a reorganization or
readjustment of debts; and
4. A sale or transfer of a majority interest in the Developer to an entity that is
not an Affiliate.
(b) Whenever the Developer obtains knowledge of the occurrence of a Listed Event, the
Developer shall as soon as possible determine if such event would be material under applicable
federal securities laws.
(c) If the Developer determines that knowledge of the occurrence of a Listed Event
would be material under applicable federal securities laws, the Developer shall promptly file a notice
of such occurrence with the Dissemination Agent which shall then distribute such notice to the
Municipal Securities Rulemaking Board and each State Repository, with a copy to the District and
the Participating Underwriter.
SECTION 6. Termination of Reportine: Oblie:ation. The Developer's obligations under this
Disclosure Agreement shall terminate upon any of the following events:
(a) the legal defeasance, prior redemption or payment in full of all of the Bonds,
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(b) if as of the date for filing the Semi-Annual Report the Developer and its Affiliates
own property within the District which is responsible for less than twenty percent (20%) of the
Special Taxes levied in the Fiscal Year for which the Semi-Annual Report is being prepared, and the
Developer Improvements and any District Improvements to be constructed by the Developer have
been completed, or
(c) upon the delivery by the Developer to the District and the Participating Underwriter
of an opinion of nationally recognized bond counsel to the effect that the information required by this
Disclosure Agreement is no longer required. Such opinion shall be based on information publicly
provided by the Securities and Exchange Commission or a private letter ruling obtained by the
Developer or a private letter ruling obtained by a similar entity to the Developer. If such termination
occurs prior to the fmal maturity of the Bonds, the Developer shall give notice of such termination in
the same manner as for a Semi-Annual Report hereunder.
SECTION 7. Dissemination Agent. The Developer 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. If the Dissemination Agent is not the Developer, the Dissemination
Agent shall not be responsible in any marrner for the content of any notice or report prepared by the
Developer pursuant to this Disclosure Agreement. The Developer has initially appointed U.S. Bank,
N .A. as the Dissemination Agent hereunder.
SECTION 8. Amendment Waiver. Notwithstanding any other provision of this Disclosure
Agreement, the Developer may amend this Disclosure Agreement, and any provision of this
Disclosure Agreement may be waived, provided that the following conditions are satisfied:
(a) If the amendment or waiver relates 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;
(b) This Disclosure Agreement, as amended or taking into account such waiver, would,
in the opinion of nationally recognized bond counsel addressed to the District, the Fiscal Agent and
the Participating Underwriter, have complied with the requirements of the Rule at the time of the
original issuance of the Bonds, after taking into account any amendments or interpretations of the
Rule, as well as any change in circumstances;
(c) The amendment or waiver either (i) is approved by the Bondowners in the same
marrner as provided in the Indenture for amendments to the Indenture with the consent of
Bondowners, or (ii) does not, in the opinion of nationally recognized bond counsel addressed to the
City and the Fiscal Agent, materially impair the interests of the Bondowners or Beneficial Owners of
the Bonds; and
(d) The Developer, or the Dissemination Agent, shall have delivered copies of the
amendment and any opinions delivered under (b) and (c) above.
In the event of any amendment or waiver of a provision of this Disclosure Agreement, the
Developer shall describe such amendment in the next Semi-Annual Report, and shall include, as
applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the
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type (or, in the case of a change of accounting principles, on the presentation) of financial
information or operating data being presented by the Developer. In addition, if the amendment
relates to the accounting principles to be followed in preparing fmancial statements, (i) notice of such
change shall be given to the Municipal Securities Rulemaking Board, the State Repository, if any,
and the Repositories, and (ii) the Semi-Annual Report for the year in which the change is made
should present a comparison (in narrative form and also, if feasible, in quantitative form) between the
fmancial statements as prepared on the basis of the new accounting principles and those prepared on
the basis of the former accounting principles. The comparison of fmancial data described in
clause (ii) of the preceding sentence shall be provided at the time financial statements, if any, are
filed under Section 4(g) hereof.
SECTION 9. Additional Information. Nothing in this Disclosure Agreement shall be
deemed to prevent the Developer 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 Semi-Annual Report or notice of occurrence of a Listed
Event, in addition to that which is required by this Disclosure Agreement. If the Developer chooses
to include any information in any Semi-Annual Report or notice of occurrence of a Listed Event in
addition to that which is specifically required by this Disclosure Agreement, the Developer shall have
no obligation under this Disclosure Agreement to update such information or include it in any future
Semi-Annual Report or notice of occurrence of a Listed Event.
SECTION 10. Default. In the event of a failure of the Developer to comply with any
provision of this Disclosure Agreement, any Participating Underwriter or any Bondowner 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 Developer or the
Dissemination Agent 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 Developer to
comply with this Disclosure Agreement shall be an action to compel specific performance.
SECTION 11. Duties. Immunities and Liabilities of Dissemination Agent. The
Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure
Agreement and the Developer agrees to indemnify and save the Dissemination Agent, its officers,
directors, employees and agents (the "Indemnified Parties''), harmless against any loss, expense and
liabilities which they may incur arising out of or in the exercise or performance of theirs powers and
duties hereunder, including the costs and expenses (including attorneys fees) of defending against
any claim of liability, but excluding liabilities due to any Indemnified Party's negligence or willful
misconduct. The Dissemination Agent shall not be deemed to be acting in any fiduciary capacity for
the Developer, the Participating Underwriter, Bondowners or Beneficial Owners or any other party.
The Dissemination Agent may rely and shall be protected in acting or refraining from acting upon a
direction from the Developer or an opinion of nationally recognized bond counsel. The obligations
of the Developer under this Section shall survive resignation or removal of the Dissemination Agent
and payment of the Bonds. No person shall have any right to commence any action against the
Dissemination Agent seeking any remedy other than to compel specific performance of this
Disclosure Agreement. .
The Indemnified Parties will not, without the Developer's prior written consent, settle,
compromise or consent to the entry of any judgment in any pending or threatened claim, action or
proceeding in respect of which indemnification may be sought hereunder unless such settlement,
G-?
DOCSOC/11271 07v~022245-0161
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compromise or consent includes an unconditional release of the Developer and its controlling persons
from all liability arising out of such claim, action or proceedings. If a claim, action or proceeding is
settled with the consent of the Developer or if there is a fmal judgment (other than a stipulated final
judgment without the approval of the Developer) for the plaintiff in any such claim, action or
proceeding, with or without the consent of the Developer, the Developer agrees to indenmify and
hold harmless the Dissemination Agent to the extent described herein.
SECTION 12. Reoorting Obligation of Develooer's Transferees. The Developer shall, in
connection with any sale or transfer of ownership of land within the District which will result in the
transferee (which term shall include any successors and assigns of the Developer) becoming
responsible (i) for the payment of more than 20 percent of the Special Taxes levied on property
within the District in the Fiscal Year following such transfer and (ii) for the construction and/or
installation of some or all of the improvements needed to bring such sold or transferred land to
fmished lot condition, cause such transferee and any Affiliate of the transferee to enter into a
disclosure agreement with terms substantially similar to the terms of this Disclosure Agreement,
whereby such transferee and any such Affiliate agrees to be bound by the obligations under such
disclosure agreement. Additionally, the Developer shall, in connection with any sale or transfer of
ownership of land within the District which will result in the transferee and any Affiliate of the
transferee becoming responsible for the payment of more than 20 percent of the Special Taxes levied
on property within the District in the Fiscal Year following such transfer, which sale or transfer
occurs before such sold or transferred land is in finished lot condition, and the transferee is not
responsible for the construction or installation of some or all of the infrastructure needed to bring
such land to finished lot condition, cause such transferee to enter into a disclosure agreement with
terms substantially similar to the terms of this Disclosure Agreement, whereby such transferee agrees
to provide the information of the type described in Sections 4 and 5 of this Disclosure Agreement,
other than Section 4(e) with respect to its property; provided that such transferee's obligations under
such disclosure agreement shall terminate upon the transferee and any Affiliate of the transferee
together becoming responsible for the payment of less than 20 percent of the annual Special Taxes.
A memorandum regarding the Developer's obligations under this Disclosure Agreement may be
recorded in the Official Records in the office of the County Recorder of the County of San Diego.
SECTION 13. Developer as Independent Contractor. In performing under this Disclosure
Agreement, it is understood that the Developer is an independent contractor and not an agent of the
City or the District.
SECTION 14. Notices. Notices required by this Disclosure Agreement shall be sent in
writing to the following addresses. The following information may be conclusively relied upon until
changed in writing:
Dissemination Agent:
u.S. Bank National Association
633 West Fifth Street, 24th Floor
Los Angeles, CA 90071
Attention: Corporate Trust
Developer:
Attention:
0-8
;)_/s/
DOCSOC/1127107v4g1022245-0161
District:
City of Chula Vista
276 Fourth Avenue
Chula Vista, CA 91910
Attention: Finance Department
Re: Community Facilities District No. 07-1 (Otay Ranch
Village Eleven) 2004 Special Tax Bonds
Participatiog Underwriter:
Stone & Youngberg LLC
One Ferry Buildiog
San Francisco, CA 94111
Attention: Research Department
SECTION 15. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of
the Developer, the City, the Dissemination Agent, the Participating Underwriter and Bondowners and
Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or
entity.
SECTION 16. Counteroarts. This Disclosure Agreement may be executed in several
counterparts, each of which shall be an original and all of which shall constitute one and the same
instrument.
1, a
By:
Its:
By:
Its:
U.S. BANK NATIONAL ASSOCIATION
By:
Its:
G-9
DOCSOC/1127107v4S/022245.0161
;J -/:5~
EXHIBIT A
NOTICE TO REPOSITORIES OF FAILURE TO FILE SEMI-ANNUAL REPORT
Name of the Issuer:
Community Facilities District No. 12-1 (McMillin Otay Ranch Village
Seven) City of Chula Vista, California
I
City of Chula Vista
Community Facilities District No. 12-1
(McMillin Otay Ranch Village Seven) 2005 Special Tax Bonds
Name of Bond Issue:
Date ofIssuance:
,2005
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DOCSOC/1 127107v4g/022245-0161
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APPENDIX H
FORM OF OPINION OF BOND COUNSEL
Mayor and City Council
City of Chula Vista
276 Fourth Avenue
Chula Vista, CA
BOND OPINION
$
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. t2-1
(McMILLIN OT A Y RANCH VILLAGE SEVEN)
2005 SPECIAL TAX BONDS
Ladies and Gentlemen:
We have acted as bond counsel in connection with the issuance by Community Facilities
District No. 12-1 (McMillin Otay Ranch Village Seven) of the City of Chula Vista, County of San
Diego, State of California (the "District "), of $ aggregate principal amount of the City of
Chula Vista Community Facilities District No. 12-1 (McMillin Otay Ranch Village Seven) 2005
Special Tax Bonds (the "Bonds''). The Bonds are issued pursuant to the provisions of the Mello-
Roos Community Facilities Act of 1982, as amended, being Chapter 2.5 (commencing with Section
53311) of Part I of Division 2 of Title 5 of the Govemment Code of the State of California (the
"Act"), a resolution adopted by the City Council on , 2005 (the "Resolution"), and a
Bond Indenture, dated as of November 1,2005 (the "Bond Indenture"), between the District and U.s.
Bank National Association, as fiscal agent (the "Fiscal Agent'').
We have examined the Act, the Resolution, the Bond Indenture and certified copies of the
proceedings taken for the issuance and sale of the Bonds. As to questions of fact which are material
to our opinion, we have relied upon the representations of the District and the City of Chula Vista
without having undertaken to verify the accuracy of any such representations by independent
investigation.
Based upon such examination, we are of the oprnlOn, as of the date hereof, that the
proceedings referred to above have been taken in accordance with the laws and the Constitution of
the State of California, and that the Bonds, having been issued in duly authorized form and executed
by the proper officials and delivered to and paid for by the purchaser thereof, and the Bond Indenture
having been duly authorized and executed by the proper official, constitute the legally valid and
binding obligations of the District enforceable in accordance with their terms subject to the
qualifications specified below. Except where funds are otherwise available, as may be permitted by
law, the Bonds are payable, as to both principal and interest, solely from certain special taxes to be
levied and collected within the District and other funds available therefor held under the Bond
Indenture.
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DOCSOC/1127107v4gl022245-0161
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The Internal Revenue Code of 1986, as amended (the "Code"), sets forth certain investment,
rebate and related requirements which must be met subsequent to the issuance and delivery of the
Bonds for the interest on the Bonds to be and remain exempt from federal income taxation.
Noncompliance with such requirements could cause the interest on the Bonds to be subject to federal
income taxation retroactive to the date of issuance of the Bonds. Pursuant to the Bond Indenture, the
District has covenanted to comply with the requirements of the Code and applicable regulations
promulgated thereunder.
We are of the opinion that, under existing statutes, regulations, rulings and court decisions,
and assuming compliance by the District with the aforementioned covenants, the interest on the
Bonds is excluded from gross income for purposes of federal income taxation and is exempt from
personal income taxation imposed by the State of California.
We are further of the opinion that interest on the Bonds is not a specific preference item for
purposes of the alternative minimum tax provisions of the Code. However, interest on the Bonds
received by corporations will be included in corporate adjusted current earnings, a portion of which
may increase the alternative minimum taxable income of such corporations.
Although interest on the Bonds is excluded from gross income for purposes of federal income
taxation, the accrual or receipt of interest on the Bonds may otherwise affect the federal income tax
liability of the recipient. The extent of these tax consequences will depend on the recipient's
particular tax status or other items of income or deduction. We express no opinion regarding any
such consequences.
The opinions expressed herein may be affected by actions which may be taken (or not taken)
or events which may occur (or not occur) after the date hereof. We have not undertaken to determine,
or to inform any person, whether any such actions or events are taken or occur or are not taken or do
not occur.
The rights of the owners of the Bonds and the enforceability of the Bonds and the Bond
Indenture may be subject to bankruptcy, insolvency, moratorium and other similar laws affecting
creditors' rights heretofore or hereafter enacted, and their enforcement may be subject to the exercise
of judicial discretion in accordance with general principles of equity.
Respectfully submitted,
Best Best & Krieger, LLP
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DOCSOCI1127107v'W022245-0161
<.:) -/55'
APPENDIX I
DTC AND THE BOOK ENTRY SYSTEM
The Depository Trust Company ("DTC"), New York, NY, 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 maturity of the Bonds, each
in the aggregate principal amount of such maturity, and will be deposited with DTC.
DTC, the world's largest depository, is a limited-purpose trust company organized under the
N ew York Banking Law, a "banking 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 17 A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for
over 2 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and
money market instruments from over 85 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, in turn, is owned by a number of Direct Participants of DTC and Members of the National
Securities Clearing Corporation, Government Securities Clearing Corporation, MBS Clearing
Corporation, and Emerging Markets Clearing Corporation, (NSCC, GSCC, MBSCC, and EMCC,
also subsidiaries of DTCC), as well as by the New York Stock Exchange, Inc., the American Stock
Exchange LLC, and the National Association of Securities Dealers, Inc. 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 Standard & Poor's
highest rating: AAA. The DTC Rules applicable to its Participants are on file with the Securities and
Exchange Commission.
Purchases of Bonds under the DTC 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 ofthe 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
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DOCSOC/l127107v4gJ022245-0161
::J- --- 1St;
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
beneficial 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 are credited,
which mayor 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 Direct 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 the 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 redemptions, 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 DTC. If less than all of the Bonds within a maturity are
being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct
Participant in such maturity to be redeemed.
Neither DTC nor Cede & Co. (nor such other DTC nominee) will consent or vote with
respect to the Bonds unless authorized by a Direct Participant in accordance with DTC's 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 the 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 payment 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 nor its nominee, 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 DTC) is the responsibility of the
Fiscal Agent, disbursement of such payments to Direct Participants will be the responsibility ofDTC,
and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and
Indirect Participants.
A Beneficial 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
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DOCSOC/l127107v4W022245-0161
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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 Bonds 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, physical Bonds will be printed and
delivered to DTC.
The information in this section concerning DTC and DTC's book-entry system has been
obtained from sources that the District believes to be reliable, but the District takes no responsibility
for the accuracy thereof.
1-3
DOCSOC/11271 07v4gl022245-0 161
;L-/Sg
BOND INDENTURE
by and between
Community Facilities District No. 12.-1
(McMillin - Otay Ranch - Village Seven)
and
U.S. Bank National Association,
As Fiscal Agent
Dated as of November 1, 2005
Re: $
City of Chula Vista
Community Facilities District No. 12.-1
(McMillin - Otay Ranch - Village Seven)
2005 Special Tax Bonds
WBD\317918.1
;J -/5q
I!XH1BIT S,
TABLE OF CONTENTS
Pal!e
ARTICLE I. DEFINITIONS ...................................................................................................1
SECTION 1.01 DEFINITIONS. .................................................................................................1
ARTICLE II. GENERAL AUTHORIZATION AND TERMS............................................ 14
SECTION 2.01 AMOUNT, ISSUANCE AND PURPOSE. .............................................................14
SECTION 2.02 TYPE AND NATURE OF BOND. ......................................................................14
SECTION 2.03 TERMS OF TIfE BONDs................................................................................. 14
SECTION 2.04 DESCRIPTION OF BONDs; INrERESTRATES....................................................15
SECTION 2.05 PAYMENT....... ........ ........ .............. ........................... ........ ............. ...............15
SECTION 2.06 EXECUTION OF BONDs. ................................................................................16
SECTION 2.07 ORDER TO PRINT AND AUTIfENTICATE BONDS. .............................................. 16
SECTION 2.08 BOOKS OF REGISTRATION; BOOK ENTRY SYSTEM.......................................... 16
SECTION 2.09 EXCHANGE OF BONDs.................................................................................. 18
SECTION 2.10 NEGOTIABILITY, REGISTRATION AND TRANSFER OF BONDS. ...........................18
SECTION 2.11 AUTIfENTICATION. .......................................................................................19
ARTICLE m. FUNDS AND ACCOUNTS........................................................................... 20
SECTION 3.01 ESTABLISHMENT OF SPECIAL FUNDS. ............................................................ 20
SECTION 3.02 SPECIAL TAX FUND. ....................................................................................20
SECTION 3.03 DEBT SERVICE FUND. ..................................................................................22
A. Interest Account......................................................................................................... 22
B. Princival Account. ..................................................................................................... 22
SECTION 3.04 COSTS OF ISSUANCE FUND. ..........................................................................22
SECTION 3.05 PROJECT FUND........... ..... ............................. ...... .................... .......... ........... 22
SECTION 3 .06 RESERVE FUND ......... ................ ....................... ....... ........ ............ ................24
SECTION 3.07 REBATE FUND. ............ .......... .......................... .......... ...... ............................ 25
SECTION 3.08 REDEMPTION FUND. ... ...................... ............. ........... ............... ....................25
SECTION 3 .09 ADMINISTRATIVE EXPENSE FUND. .......................... ..... ...................... ...........25
SECTION 3.10 INVESTMENT OF FUNDs. ..............................................................................26
SECTION3.11 DIsposmONoF BOND PROCEEDS. ...............................................................27
ARTICLE IV. REDEMPTION .............................................................................................28
SECTION 4.01 NOTICE OF REDEMPTION. .............................................................................28
A. Notice bv Mail to Bondholders: ................................................................................. 28
B. Further Notice:.......................................................................................................... 28
C. Failure to Receive Notice ..........................................................................................28
D. Certificate of Giving Notice............ ............................................................ ............... 29
SECTION 4.02 EFFECT OF REDEMPTION. ..............................................................................29
SECTION 4.03 REDEMPTION PRICES AND TERMS. ................................................................29
A. Optional Redemvtion................................................................................................. 29
B. Extraordinary Mandatory Redemption. .....................................................................30
C. Mandatory Sinkinf! Fund Redemvtion........................................................................ 30
E. Notice and Selection of Bonds for Redemption .......................................................... 31
(i)
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WBD\317918.1
TABLE OF CONTENTS
(Continued)
Pa2e
ARTICLE V. SUPPLEMENTAL INDENTURES.................................................................33
SECTION 5.01 AMENDMENTS OR SUPPLEMENTS.................................................................. 33
ARTICLE VI. MISCELLANEOUS CONDITIONS ..........................................................35
SECTION 6.01 OWNERSHIP OF BONDs. ............................................................................... 35
SECTION 6.02 MUTILA1ED, LOST, DESTROYED OR STOLEN BONDs. ....................................35
SECTION 6.03 CANCELLATION OF BONDs. ..........................................................................35
SECTION 6.04 COVENANTS.... ........ ......... ....... ..... ...... ............................ ............................. 35
SECTION 6.05 ARBITRAGE CERTIFICA1E. ............................................................................39
SECTION 6.06 DEFEASANCE............. .............. ..... ....... ........................... ............. ............... 39
SECTION 6.07 FISCAL AGENT. ........... ................. .......................... ........... ...... ......... ............40
SECTION 6.08 LIABILITY OF FISCAL AGENT.........................................................................41
SECTION 6.09 PROVISIONS CONSTITII1E CONTRACT. ...........................................................42
SECTION 6.10 CUSIP NUMBERS........................................................................................43
SECTION 6.11 SEVERABILITY. ............................................................................................43
SECTION 6.12 UNCLAIMED MONEy....................................................................................43
SECTION 6.13 NONPRESENTMENT OF BONDs. .....................................................................44
SECTION 6.14 CONTINUING DISCLOSURE. ...........................................................................44
ARTICLE VII. BOND FORM ..............................................................................................46
SECTION 7.01 FORM OF BONDs. .......... .............. ................. ......... ..................... .................46
SECTION 7.02 TEMPORARY BONDs. ... ........... ...... ...... ........... ....................... ............ ........... 46
ARTICLE VIII EVENT OF DEFAULT ................................................................................47
SECTION 8.01 EVENTS OF DEFAULT. ..................................................................................47
SECTION 8.02 APPLICATION OF REVENUES AND OlHERFUNDS AF1ERDEFAULT ..................47
EXlllB1T "Po:' - FORM OF BOND......................................................................................A-1
(ii)
d- -liP /
WBD\317918.1
BOND INDENTURE
This Bond Indenture dated as of November 1, 2005, is entered into by and between
Community Facilities District No. 12.-1 (McMillin - Otay Ranch - Village Seven), a community
facilities district organized and existing under the laws of the State, and U.S. Bank 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
SECTION 1.01
Definitions.
As used in this Indenture, the following terms shall have the following meanings:
"Acquisition Account" means the account by that name within the Project Fund established pursuant
to Section 3.10 hereof.
"Acquisition/Financing Agreement" means that certain Acquisition/Financing Agreement made and
entered into on , 2005 by and between the City, acting on behalf of itself and the
District, and McMillin Otay Ranch, LLC, a California limited liability company, as such agreement
may be amended from time to time.
"Act" means the "Mello-Roos 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 Special Taxes and preparing
the annual Special Tax collection schedules (whether by the City or a designee thereof or both); the
costs of collecting the Special Taxes (whether by the County, the City 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 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, District or obligated person
disclosure requirements associated with applicable federal or state securities laws and of the Act; the
costs associated with preparing Special Tax disclosure statements and responding to public inquiries
regarding the Special Taxes; the costs of the City, District or any designee thereof related to an
appeal of the 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 provided by Otay Project, L.P.
and/or its successor). Administrative Expenses shall also include Delinquency Collection Expenses.
1
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WBD\317918.1
"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 Special Taxes received each Fiscal Year for the payment
of Administrative Expenses.
"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.
"Assessor's Parcel" means an Assessor's Parcel as defined in the Special Tax RMA.
"Authorized Representative" of the District means the City Manager, Director ofFinance 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 and authorized to act on behalf of the District
under or with respect to this Indenture and all other agreements related hereto.
"Average 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 oflaw before the highest court of the
State.
"Bondowner" or "Owner", 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 ofChula Vista Community Facilities District 08-1 (McMillin-
Otay Ranch - Village Seven) 2005 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 1 of the succeeding calendar year, except in the case of the initial Bond Year which shall
be the period from the Delivery Date to September 1, 2006.
"Business Day" means a day that is not a Saturday or a Sunday or a day of the year on which banks in
New York, New York and Los Angeles, California, or where the Principal Corporate Trust Office is
located, are not required or authorized to remain open.
"Capitalized 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
"City" means the City of Chula Vista, California.
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WBD\317918.1
"City Manager" 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 ofIssuance" means all of the costs of formation of the District and the costs of issuing the
Bonds, including but not limited to, all printing and document preparation expenses in connection
with this 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 3.0 I hereof
"Comptroller of the Currency" shall mean the Comptroller of the Currency of the United States.
"Debt Service Fund" means the fund created and established pursuant to Section 3.0 I 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 Special Tax Revenues on a parity with the lien of the Bonds.
"Delinquency Collection 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 Special Taxes.
"Delinquency Proceeds" means 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.
"Delivery Date" means the date on which the Bonds are issued and delivered to the initial purchaser
thereof
"Depository" 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" means the Director of Finance of the City, acting for and on behalf of the
District.
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WBD\317918.1
"District" means Community Facilities District No. 12.-1 (McMillin - Otay Ranch - Village Seven)
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.
"Facilities Improvements" shall mean the acquisition, construction and development of certain public
facilities authorized to be financed from the proceeds of the City's Public Facilities Development
Impact Fee.
"Facilities Improvement Account" shall means the account by that name within the Project Fund
established pursuant to Section 3.01.
"Facilities Improvement Costs" shall mean the cost of acquisition, construction or development of the
Facilities Improvements in an amount not to exceed $
"Fiscal Agent" means U.S. Bank National Association, and any successor thereto.
"Fiscal Year" means the 12 month period beginning July 1 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 Obligations" means obligations described in Paragraph 1 of the definition of Permitted
Investments.
"Gross Proceeds" has the meaning ascribed to such term in Section 148(f)(6) of the Code.
"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 -
1. 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 District 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.
"Information Services" means Financial Information, Inc's., "Daily Called Bond Service," 30
Montgomery Street, 10th Floor, Jersey City, New Jersey 07302, Attention: Editor; Kenny
Information Services' "Called Bond Service," 65 Broadway, 16th Floor, New York, New York
10006; Moody's Investors Service "Municipal and Government," 99 Church Street, 8th Floor,
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WBD\317918.1
New York, New York 10007, Attention: Municipal News Reports; Standard and Poor's
Corporation "Called Bond Record," 25 Broadway, 3rd Floor, New York, New York 10004; and,
in accordance with then current guidelines of the Securities and Exchange Commission, such other
addressees providing information with respect to called bonds as the District may designate in
writing to the Fiscal Agent.
"Interest Payment Date" means March I and September 1 of each year, commencing March 1, 2006.
"Investment Agreement" means any investment satisfYing the requirements of Paragraph 11 of the
definition of Permitted Investments.
"Legislative Body" 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, its successors and assigns.
"Net Special Tax Revenues" means the 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 time by the Depository.
"Outstanding" means as to the Bonds, all of the Bonds, except:
1. Bonds theretofore canceled or surrendered for cancellation in accordance with
Section 6.03 hereof;
2. 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), provided that, if such Bonds are to be redeemed prior to the maturity
thereof, notice of such redemption shall have been given as provided in this Indenture
or any applicable Supplemental Indenture.
"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");
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WBD\317918.1
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
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)
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WBD\317918.1
(1) Debt obligations
G. Resolution Funding Corporation (REFCORP)
(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-I" 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-I"
by S&P and "Prime-I" by Moody's.
7. Money market funds rated "AAm-l" 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 "AJ" by Moody's
and "N' 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-
1" by Moody's.
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 "AN' or
better by S&P and "AN' or better by Moody's.
9. Pre-refunded municipal obligations rated "AAA" by S & P and "AAA" by Moody's
meeting the following requirements:
A. the municipal obligations are (I) 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;
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WBD\317918.1
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 "1\' 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
"1\' 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 "1\' 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 "Holder of the Collateral") has possession of the collateral or the
collateral has been 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
8
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WBD\317918.1
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 "A3" 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 provider's rating by either S&P or Moody's falls below "AA-" or
"Aa3", respectively, the provider shall, at its option, within 1 0 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 upon such
conditions as would be acceptable to S & P and Moody's to maintain
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WBD\317918.1
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
(2) the provider's rating by either S&P or Moody's is withdrawn or
suspended or falls below "A-" or "AJ", respectively, the provider
must, at the direction of the District or the Fiscal Agent, within 1 0
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 guaranteed by 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.
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"Prepayments" means Special Tax Revenues identified to the Fiscal Agent by an Authorized
Representative as representing a prepayment of the Special Tax.
"Principal Corporate Trust Office" means the office of the Fiscal Agent at 633 West Fifth Street, 24th
Floor, Los Angeles, California 90071 or such other offices as may be specified to the District by the
Fiscal Agent in writing; provided, however for transfer, registration, exchange, payment and
surrender of Bonds means care of the corporate trust office of U.S. Bank National Association in St.
Paul, Minnesota or such other address specified by the Fiscal Agent to the District in writing.
"Project" means the public improvements as set forth and described in Exhibit A to the
Acquisition/Financing Agreement, excluding therefrom the Facilities Improvements.
"Project Costs" means all expenses of and incidental to the construction, acquisition, or both, ofthe
Project.
"Project Fund" means the fund by that name established pursuant to Section 3.01 hereof
"Public Facilities" means anyone or more of those public facilities set forth in Section 3 .50.030 of the
Chula Vista Municipal Code, as such section may be amended from time to time.
"Public Facilities Account" means the account by that name within the Project Fund established for
such series of the Bonds pursuant to Section 3.01.
"Public Facilities Costs" shall mean the cost of acquisition, construction or development of Public
Facilities.
"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.
"Registration Books" shall have the meaning given such term in Section 2.08 hereof
"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 $ .76 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, and (iii) ten
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WBD\317918.1
percent (10%) of the original principal amount of the Bonds less original issue discount, ifany, plus
original issue premium, if any, applicable to the Bonds.
"Securities Depository" means, as of the Closing Date, The Depository Trust Company, 711 Stewart
Avenue, Garden City, New York 11530 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.
"Special Tax" means the Special Tax authorized to be levied in the District pursuant to the Act and
the Special Tax RMA.
"Special 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 District and
who, or each of whom -
1. 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 District 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.
"Special Tax Fund" means the fund by that name established pursuant to Section 3.01 hereof.
"Special Tax Revenues" means (a) the proceeds of the Special Tax levied by the District within The
District pursuant to the Special Tax RMA and received by the District, and (b) the Delinquency
Proceeds.
"Special Tax RMA" means the rate and method of apportionment of the Special Tax originally
authorized to be levied on property within the District as approved at the special election held in
District on August 30,2005, and as it may be modified from time to time in accordance with the Act.
"Standard & Poor's" or "S&P" means Standard & Poor's Rating Services, its successors and assigns.
"State" means the State of California.
"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.
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"Tax Exempt" 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-, the Bonds maturing on September
1, 20_ and the Bonds maturing on September 1, 20_.
"Treasurer" means the Treasurer of the City acting for and on behalf of the District.
"Yield" has the meaning assigned to such term for purposes of Section 148(f) of the Code.
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WBD\31791B.l
ARTICLE II. GENERAL AUTHORIZATION AND TERMS
SECTION 2.01
Amount, Issuance 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. 12.-1 (McMillin - Otay Ranch - Village Seven) 2005
Special Tax Bonds. The purpose of the Bonds shall be to (a) pay for the acquisition or construction
of the Project and the Facilities Improvements, (b) fund the Reserve Fund, (c) pay capitalized interest
on the Bonds through 1, 200_ 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 Special Tax Revenues and on the monies in the funds and accounts
established herein (including the investment earnings thereon) with the exception of the Project Fund,
the Rebate Fund and the Administrative Expense Fund. Except for the Net 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 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 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 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:
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WBD\317918.1
Maturity Date
(September 1)
Principal
Amount
Interest
Rate(%)
Maturity Date
(Selltember 1)
Principal
Amount
Interest
Rate(%)
SECTION 2.04
Description of Bonds; Interest Rates.
The Bonds of each series 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 1 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 shall be payable
with respect to each Bond on each Interest Payment Date (commencing March 1, 2006), until the
principal sum of that Bond has been paid; 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.
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, (ii) 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
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WBD\317918.1
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 ofa
Bondowner of at least $1,000,000 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 of360 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 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 Registration; 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 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.
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WBD\317918.1
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 inunediately
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 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 thereoffor such purpose.
In the event of a reduction in aggregate principal amount of Bonds Outstanding or an advance
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
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WBD\317918.1
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 Bonds 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 ofDTC.
SECTION 2.09
Exchange 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
Negotiability, Registration 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 dilly 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.
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SECTION 2.11
Authentication.
Only such of the Bonds as shall bear thereon a certificate of authentication substantially in the
form below, 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:
FORM OF CERTIFICATE OF AUTHENTICATION
This is one of the Bonds described in
the within defined Indenture.
Dated:
u.s. Bank National Association,
As Fiscal Agent
By:
Authorized Officer
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ARTICLE m. 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 within the
Interest Account, the Capitalized Interest Sub-Account, and the Principal Account;
C. Rebate Fund;
D. Redemption Fund;
E. Project Fund, and within the Project Fund, the Acquisition Account and the Facilities
Improvement Account;
F. Reserve Fund;
G. Administrative Expense Fund; and
H. Costs ofIssuance 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. The District shall, no later than the tenth (lOth) Business Day after which Special Tax
Revenues have been received by the District and in any event not later than February 15th and August
15th of each year, transfer such 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. 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 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:
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WBD\317918.1
1. The Fiscal Agent shall each Fiscal Year transfer to the Administrative Expense Fund
from the first 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 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 Interest Payment Date and redemption date on which the principal of the Bonds
shall be payable, 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 Interest Payment Date, or required to be
redeemed on such date pursuant to this Indenture.
4. On or after March 2 and 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 (a) 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 and (b) the cost of which Administrative Expenses will
be 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 remain on deposit in the Special Tax Fund and shall be subsequently
deposited or transferred pursuant to the provisions of 1. through 6. above.
c. The Fiscal Agent shall, upon receipt of Special Tax Revenues representing Prepayments,
immediately transfer Prepayments to the Redemption Fund and utilize such funds to redeem Bonds
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WBD\317918.1
pursuant to Section 4.03 B and to pay interest on such Bonds to the date of their redemption 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 Fees and Expenses
(as defined in the Special Tax RMA) 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.
SECTION 3.03
Debt Service Fund.
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). All funds in the Capitalized Interest Sub-Account shall be used and withdrawn to
pay interest on the Bonds 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 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 ofIssuance
Fund, if any, on such dates and in such amounts as specified in such requisition to pay the Costs of
Issuance related to each series of 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 each series of the Bonds shall be transferred to the Acquisition Account of the
Project Fund.
SECTION 3.05
Project Fund
A. Acquisition Account. The Fiscal Agent shall, from time to time, disburse monies from the
Acquisition Account 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 AcquisitionlFinancing
Agreement), the Fiscal Agent shall pay the Project Costs from amounts in the Acquisition Account
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.
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WBD\317918.1
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 Acquisition Account to the
Special Tax Fund or the Redemption Fund as an Authorized Representative may direct in writing and
the Fiscal Agent shall apply the amount so transferred in accordance with Section 3.02 or 3.08 as
directed by the Authorized Representative. Upon such transfer the Acquisition Account shall be
closed.
On or after November 1, 2008, the District may deliver to the Fiscal Agent a written
certificate executed by an Authorized Representative certifYing that the District, in its sole and
absolute.discretion, has determined that it will not be necessary for the District to utilize the proceeds
of the Bonds, together with any investment earnings on such proceeds, then remaining on deposit in
the Acquisition Account to fund Project Costs and directing the Fiscal Agent to transfer all such
moneys to the Special Tax Fund or the Redemption Fund and the Fiscal Agent shall apply the amount
so transferred in accordance with Section 3.02 or 3.08 as directed by the Authorized Representative.
Upon such transfer the Acquisition Account 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
Acquisition Account, the Fiscal Agent shall, upon the receipt of written instructions from the District,
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.
B. Facilities Improvement Account. The Fiscal Agent shall, from time to time, disburse monies
from the Facilities Improvement Account to pay the Facilities Improvement Costs. Upon receipt of a
payment request in the form set forth in Exhibit D hereto duly executed by an Authorized
Representative, the Fiscal Agent shall pay the Facilities Improvement Costs from amounts in the
Facilities Improvement Account directly to the contractor( s) or such other person( s), corporation(s)
or entity(ies) specified in the payment request (including reimbursements, ifany, to the District). The
Fiscal Agent may rely on an executed payment request as complete authorization for said payments.
Funds on deposit in the Facilities Improvement Account may not be utilized to pay Project Costs.
After the final payment or reimbursement of all Facilities Improvement 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 Facilities
Improvement Account to the Acquisition Account, if such account is still open, or to the Special Tax
Fund or the Redemption Fund as an Authorized Representative may direct in writing if the
Acquisition Account is closed and the Fiscal Agent shall apply the amount so transferred in
accordance with Section 3.02 or 3.08 as directed by the Authorized Representative.
On or after November 1, 2008, the District may deliver to the Fiscal Agent a written
certificate executed by an Authorized Representative certifYing that the District, in its sole and
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WBD\317918.1
absolute.discretion, has determined that it will not be necessary for the District to utilize the proceeds
of the Bonds, together with any investment earnings on such proceeds, then remaining on deposit in
the Facilities Improvement Account to fund Facilities Improvement Costs and directing the Fiscal
Agent to transfer all such moneys to the Acquisition Account, if account is still open, or to the
Special Tax Fund or the Redemption Fund as an Authorized Representative may direct in writing if
the Acquisition Account is closed and the Fiscal Agent shall apply the amount so transferred in
accordance with Section 3.02 or 3.08 as directed by the Authorized Representative. Upon such
transfer the Facilities Improvement Account shall be closed.
Notwithstanding anything herein to the contrary, if on the date which is three (3) years from
the Delivery Date ofthe Bonds, any funds derived from the Bonds remain on deposit in the Facilities
Improvement Account, the Fiscal Agent shall, upon receipt of written instructions from the District,
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 such series of 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 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 at
least semi-annually on March 1 and September 1. On any date after the transfers required by Section
3.02B(I), (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 1, or the first Business Day thereafter if September 1 is
not a Business Day, of each year, 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, amounts in the
Reserve Fund in excess of the Reserve Requirement following such redemption shall be transferred to
the Principal Account or the Interest Account of the Debt Service Fund, as applicable, pursuant to
written instructions of the District executed by an Authorized Representative and applied to redeem
Bonds.
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.
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WBD1317918.1
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.
Notwithstanding 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 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 Outstanding.
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, 3.05 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.
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.
WBD\317918.1
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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 ofIssuance 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 invest
solely in investments identified in paragraph 7 of the definition of Permitted Investments.
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. Any income realized on or losses resulting from
investments in any fund or account shall be credited or charged 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 investment agreements as described in paragraph 11 of the definition of
Permitted Investments which permit withdrawal at par, 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.
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SECTION 3.11
Disposition of Bond Proceeds.
Upon the receipt of$ as the sale proceeds for the Bonds (being the par amount of
$ .00 less the underwriter's discount of $ and less original issue 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 Acquisition Account of the Project Fund;
$
Fund;
shall be deposited in the Facilities Improvement Account of the Project
$
shall be deposited in the Reserve Fund;
$
shall be deposited into the Costs ofIssuance Fund;
$ shall be deposited in the Capitalized Interest Sub-Account of the Interest
Account of the Debt Service Fund; and
$
shall be deposited in the Administrative Expense Fund.
The Fiscal Agent may establish such temporary funds or accounts on its records, as it may deem
appropriate to facilitate such deposits and transfers.
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ARTICLE IV. REDEMPTION
SECTION 4.01
Notice of Redemption.
A. Notice by Mail to Bondholders:
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 purchasers 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 borne 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 4.01 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 least 2 days before the notice of redemption
is mailed to the Bondholders pursuant to Section 4.01A by registered or certified mail or overnight
delivery service to the Securities Depositories and to at least one (I) Information 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. Failure to Receive Notice:
So long as notice by first class mail has been provided as set forth in Section 4.01 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.
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D. Certificate of Giving 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 or the Redemption 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. Optional Redemption
The Bonds maturing on and after September 1, 20_ 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, 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:
WBD\317918.1
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Redemption Date
Redemption Price
September 1, 20_ and March 1, 20_
September 1, 20_ and March 1, 20_
September 1, 20_ and thereafter
102%
101%
100%
B. Extraordinary Mandatory Redemption
The Bonds shall be subject to redemption on any Interest Payment Date, prior to maturity, as
a whole or in part on a pro rata basis among maturities from amounts deposited to the Redemption
Fund in connection with a prepayment of Special Taxes pursuant to the 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 Special Tax Revenues transferred
to the Redemption Fund pursuant to Section 3.02 C and Section 3.06 to redeem Bonds pursuant to
this Section 4.03 B. 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
March 1, 2006 through March 1, 20_
September 1, 20_ and March I, 20_
September 1, 20_ and March 1, 20_
September 1, 20_ and thereafter
103%
102%
101%
100%
C. Mandatory Sinking Fund Redemotion
The Bonds maturing on September 1, 20_ are subject to mandatory sinking fund redemption,
in part by lot, on September 1 in each year commencing September 1, 20_ at a redemption price
equal to the principal amount of the 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
(September 1)
Principal
Amount
The Bonds maturing on September 1, 20-, are subject to mandatory sinking fund
redemption, in part, by lot, on September 1 of each year commencing September 1, 20-, at a
redemption price equal to the principal amount of the 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.
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Redemption Date
(September 1)
Principal
Amount
The Bonds maturing on September 1, 20--, are subject to mandatory sinking fund
redemption, in part, by lot, on September 1 of each year commencing September 1, 20--, at a
redemption price equal to the principal amount of the 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
Seotember 1)
Principal
Amount
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 Redemotion
In the event the District shall elect to redeem Bonds as provided in this Section 4.03, the District
shall give written notice to the Fiscal Agent of its election so to redeem, the redemption date, the
principal amount of the Bonds to be redeemed, in the case of a redemption pursuant to Section 4.03A
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 Bonds or portions thereof to be selected for redemption.
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
WBD\31791B.!
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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.
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WBD\317918.1
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 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 ofthis 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 terms 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 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 5.01 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
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WBD\317918.1
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 5.0 I
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 ofthe
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 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.
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WBD\317918.1
ARTICLE VI. MISCELLANEOUS CONDITIONS
SECTION 6.01
Ownership 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 oflike 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 oflike 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.
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 Net Special Tax Revenues.
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WBD\317918.1
A. The District will review the public records of the County of San Diego, California, in
connection with the collection of the Special Taxes not later than July 1 of each year to determine the
amount of the 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 Special Taxes in the aggregate of$5,000 or more by October 1 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$2,500 or more by October 1 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 premium, if any, to
maturity or to the date of redemption if redeemed prior to maturity, the District will faithfully 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 Special
Taxes which have, or purport to have, any lien upon the 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 Special Taxes on a parity
with the Outstanding Bonds so long as the issuance 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 payor 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 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 Special Taxes in an amount sufficient to pay the Annual Debt Service on the Bonds when due
and Administrative Expenses when due. Prior to July 1 of each year, the District shall ascertain the
parcels on which the Special Taxes are to be levied in the following Fiscal Year, taking into account
any subdivisions of parcels during the current Fiscal Year. The District shall effect the levy of the
Special Tax in accordance with the 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 Special Tax for the parcels within The District for inclusion on the next real property tax roll.
Upon completion of the computation of the amount ofthe 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 Special Tax on the next real
property tax roll.
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WBD\317918.1
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 Annual Special Tax (as such term is defined in the
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 such term is defined in the 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 the District as of the July 1
preceding the reduction, the Maximum Annual Special Tax which may be levied on all Assessor's
Parcels (as such term is defined in the Special Tax RMA) 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 Parity Refunding Obligations
outstanding ("Maximum Debt Service") after the reduction is approved and will not reduce the
Maximum Annual Special Tax payable from parcels on which a completed structure is located 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 the Owners of the Bonds. Any reduction in the Maximum Annual
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 Annual Special Tax below the levels authorized pursuant to
the Special Tax RMA or to limit the power or authority of the District to levy Special Taxes pursuant
to the 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 Special Taxes
pursuant to the Special Tax RMA.
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 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 District 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.
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WBD\317918.1
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 ofthe interest
on the Bonds under Section 103 of the Code. 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 "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 District 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 payor 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.
I. 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 30th of each year, commencing October 30,2006, and until October
30th following the final maturity of the Bonds, the District shall supply or cause to be supplied to the
California Debt and Investment Advisory Commission by mail, postage prepaid, the information, if
any, then required by Government Code Section 53359.5 to be submitted to such agency.
K. The District covenants that it will not adopt any policy pursuant to Section 53341.1 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 Special Tax Revenues to pay the principal of and interest on the
Bonds when due.
1. 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
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WBD\317918.1
and have been performed and the execution and delivery of the Bonds shall comply in all respects
with the applicable laws of the State.
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 payor 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 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 anyone 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 payable; or
( 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 1 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;
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WBD\317918.1
then, at the election of the District, and notwithstanding that any Outstanding Bonds shall not have
been surrendered for payment, all obligations of the District under the Indenture with respect to such
Bond shall cease and terminate, except for the obligation ofthe Fiscal Agent to payor 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 Fiscal Agent a certificate of an Independent Accountant 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 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 legally defeased in accordance
with the Indenture.
To accomplish such defeasance, the District shall cause to be delivered (i) a report of the
Independent Accountant verifying the determination made pursuant to paragraph (c) above (the
"Verification Report") and (ii) an opinion of Bond Counsel to the effect that the Bonds 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.
SECTION 6.07
Fiscal Agent.
The District hereby appoints U.S. Bank 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 oftransfer 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 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
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WBD\317918.1
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 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.
SECTION 6.08
Liability of Fiscal Agent.
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 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.
The Fiscal Agent 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.
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
41
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WBD\317918.1
hereunder, such matter (unless other evidence in respect thereofbe 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 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 permissive right of the Fiscal Agent to do things enumerated in this Indenture shall not be
construed as a duty.
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 Indenture
and no implied duties or obligations shall be read into this Indenture against the Fiscal Agent.
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 Bondowners 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 may be
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
42
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taken and the Bondowner shall prevail, said Bondowner shall be entitled to receive from the Special
Tax Fund reimbursement for reasonable costs, expenses, outlays and attorney's fees, 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 shall 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.
SECTION 6.10
CUSIP Numbers.
CUSIP identification numbers, if available, will be imprinted on the Bonds, but such numbers
shall not constitute a part of the contract evidenced by the Bonds and no liability shall hereafter attach
to the District or the Fiscal Agent, or any of the officers or agents thereofbecause of or on account of
said numbers.
SECTION 6.11
Severability.
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 Money.
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 General Fund of the District; provided, however, that the Fiscal Agent, before
making 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 General Fund of the District. Thereafter, the Owners of such
Bonds shall look only to the General Fund of the District for payment and then only to the extent of
the amount so received without any interest thereon.
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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 thereofbecomes 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 November 1, 2005 between
the District and (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 a breach of 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 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.
44
WBD\317918.1
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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, CA 91910
Attention: Director of Finance
RE: Community Facilities District No. 12.-1
(McMillin - Otay Ranch - Village Seven)
2005 Special Tax Bonds
Any notice or demand which by 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 letter box
addressed (until another address is filed by the Fiscal Agent with the District) as follows:
U.S. Bank National Association
Attn: Corporate Trust
633 West Fifth Street, 24th Floor
Los Angeles, CA 90071
Reference: Chula Vista CFD
SECTION 6.17.
Applicable 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.
Payment on Business Day.
In any case where the date of the payment of interest on or of principal (and premium, ifany)
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 date but may be made on the next
succeeding day which is a Business Day with the 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.
45
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ARTICLE VIT. BOND FORM
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
Temporary 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 ofthis 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 ofthe 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.
46
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c:J .;2C) 7
ARTICLE vm. EVENT OF DEFAULT
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
3D-day period unless waived by the Fiscal Agent) shall not constitute an Event 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 oftime; 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;
47
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WBD\317918.1
B. To the payment of the principal of and interest then due with respect to the Bonds
(upon presentation ofthe 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 borne 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.
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WBD\317918.1
IN WITNESS WHEREOF, the District and the Fiscal Agent have executed this Bond Indenture
effective the date first above written.
COMMUNITY FACILITIES DISTRICT NO. 12.-1
(MCMILLIN - OT A Y RANCH - VILLAGE SEVEN)
By:
DIRECTOR OF FINANCE
U.S. BANK NATIONAL ASSOCIATION
as Fiscal Agent
By:
AUTHORIZED OFFICER
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WBD\317918.1
EXHmIT "A" - FORM OF BOND
R-
$
United States of America
State of California
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 12.-1
(McMILLIN - OTAY RANCH - VILLAGE SIX)
2005 SPECIAL TAX BONDS
In terest Rate Maturitv Date Bond Date CUSIP No.
% September 1, 20 ,2005
Registered Owner: Cede & Co.
Principal Amount:
City of Chula Vista Community Facilities District No. 12.-1 (McMillin - Otay Ranch - Village
Seven) (the "District"), situated in Chula Vista, California, for value received, hereby promises to
pay, solely from Net 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 1 and September 1, commencing March 1, 2006, (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
payable 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 U.S. Bank National Association (the "Fiscal Agent") in St. Paul, Minnesota (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
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
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WBD\317918.1
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. 12.-1 (McMillin - Otay Ranch - Village Seven) 2005 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, 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
November 1,2005, 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, and both 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 lien upon, the proceeds of the
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 Special Tax to
the amount of such lien and penalties thereon minus amounts applied annually to fund the
Administrative Expense Requirement (together, the "Net 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 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 Special Taxes and 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 1 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 $2,500 or more by October 1 following the close of any fiscal year if the
amount in the Reserve Fund is less than the Reserve Requirement.
The Bonds maturing on and after September 1, 20 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,
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:
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Redemption Date
Redemption Price
September 1, 20 and March 1, 20
- -
September 1, 20_ and March 1, 20_
September 1, 20_ and thereafter
102%
101 %
100%
The Bonds are subject to redemption on any Interest Payment Date, prior to maturity, as a whole
or in part on a pro rata basis among maturities, from the amounts deposited in the Redemption
Fund in connection with the prepayment of Special Taxes pursuant to the 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
March 1, 2006 through March 1, 20_
September 1, 20 and March 1, 20
- -
September 1, 20 and March 1, 20
- -
September 1, 20_ and thereafter
103%
102%
101%
100%
The Bonds maturing on September 1, 20_ are subject to mandatory sinking fund redemption, in
part, by lot, on September 1 of each year commencing September 1, 20_ at a redemption price
equal to the principal amount of the 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
(September 1)
Principal
Amount
The Bonds maturing on September 1, 20_ are subject to mandatory sinking fund redemption, in
part, by lot, on September 1 of each year commencing September 1, 20_ at a redemption price
equal to the principal amount of the 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.
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Redemption Date
(September 1)
Principal
Amount
The Bonds maturing on September 1, 20_ are subject to mandatory sinking fund redemption, in
part, by lot, on September 1 of each year commencing September 1, 20_ at a redemption price
equal to the principal amount of the 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
(September 1)
Principal
Amount
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.
This Bond shall be issued only in fully registered form in the denominations of $5,000 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 redemption 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
A - 4
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WBD\317918.1
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.
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WBD\317918.1
IN WITNESS WHEREOF, the City of Chula Vista Community Facilities District No. 12.-1
(McMillin - Otay Ranch - Village Seven), has caused this Bond to be dated as of ,2005
and to be signed by the Mayor of the City of 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
behalf of the City of Chula Vista Community
Facilities District No. 12.-1 (McMillin - Otay
Ranch - Village Seven)
Mayor, City of ChuJa Vista, for and on
behalf of the City of Chula Vista Community
Facilities District No. 12.-1 (McMillin - Otay
Ranch - Village Seven)
CERTIFICATE OF AUTHENTICATION
This is one of the Bonds described in the within defined Indenture.
Date:
U.S. Bank National Association,
as Fiscal Agent
By:
Authorized Officer
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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
qualified guarantor.
NOTICE: The signature on this assignment 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
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"W'BD\317918.1
EXHIBIT "C"
REQUIsmON 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 she is the duly appointed, qualified and acting Director of Finance of the City
of Chula Vista (the "City") and as such she is an Authorized Representative of the District within
the meaning of the Bond Indenture hereinafter defmed;
(ii) that, pursuant to Section 3.04 of the Bond Indenture, dated as of November 1, 2005
(the "Bond Indenture"), between U.S. Baok 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 Exhibit "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:
City of Chula Vista Community Facilities District
No. 07-1 (Otay Ranch Village Eleven)
By:
Marla Kachadoorian, Director of Finance
City of Chula Vista
B-1
,;J. ~ ,;L I g'
WBD\317918.1
WBD\317918.1
ATTACHMENT A
COSTS OF ISSUANCE
Pavee
DescriDtion of Cost of Issuance
B-2
d) ~,;)/ 1
Amount
EXHmIT "C"
REQUISITION FOR COSTS
REQUISITION NO. PERTAINING TO DISBURSEMENTS
FROM THE ACQUISITION ACCOUNT OF THE PROJECT FUND
TO FUND PROJECT COSTS
The undersigned hereby states and certifies:
(i) that she is the duly appointed, qualified and acting Director of Finance of the City
of Chula Vista (the" City ") and as such she is an Authorized Representative of the District within
the meaning of the Bond Indenture hereinafter defmed;
(ii) that, pursuant to Section 3.05A of the Bond Indenture, dated as of November 1,
2005 (the "Bond Indenture"), between U.S. Bank 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 Acquisition Account of 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 Acquisition Account
of the Project Fund.
Date:
City ofChula Vista Community Facilities District
No. 07-1 (Otay Ranch Village Eleven)
By:
Maria Kachadoorian, Director of Finance
City of Chula Vista
C - 1 .;2 ~ ,.;J c;1.. 0
ATTACHMENT A
PROJECT COSTS
Payee
Descrintion of Proiect Costs
C-2 c:2~~1
Amount
EXHIBIT "D"
REQUISITION FOR COSTS
REQUISITION NO. _ PERTAINING TO DISBURSEMENTS
FROM THE FACll..ITIES IMPROVEMENT ACCOUNT OF THE PROJECT FUND
TO FUND FACll..ITIES IMPROVEMENT COSTS
The undersigned hereby states and certifies:
(i) that she is the duly appointed, qualified and acting Director of Finance of the City
of Chula Vista (the "City") and as such she is an Authorized Representative of the District within
the meaning of the Bond Indenture hereinafter defined;
(ii) that, pursuant to Section 3.05B of the Bond Indenture, dated as of November I,
2005 (the "Bond Indenture"), between U.S. Bank 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 Facilities Improvement Account of 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 Facilities
Improvemnet Account of the Project Fund.
Date:
City of Chula Vista Co=unity Facilities District
No. 07-1 (Otay Ranch Village Eleven)
By:
Maria Kachadoorian, Director of Finance
City of Chula Vista
D - I
02~~~
ATTACHMENT A
FACILITIES IMPROVEMENT COSTS
Description of Facilities
Payee Improvement Costs Amonnt
D - 2
;2 ~,;;J.;2 3
-I
EXHIBIT to
Stradling Yocca Carlson & Rauth
Draft of 10/1 0/05
$
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 12-1
(MCMILLIN OTAY RANCH VILLAGE SEVEN)
2005 SPECIAL TAX BONDS
BOND PURCHASE AGREEMENT
,2005
Community Facilities District No. 12-1
(McMillin Otay Ranch Village Seven)
City of Chula Vista
Chula Vista, California
Ladies and Gentlemen:
Stone & Youngberg LLC (the "Underwriter''), acting not as a fiduciary or agent for you, but
on behalf of itself, offers to enter into this Bond Purchase Agreement with Community Facilities
District No. 12-1 (McMillin Otay Ranch Village Seven) (the "District"), which was formed by the
City of Chula Vista (the "City"), which, upon acceptance, will be binding upon the District and upon
the Underwriter. This offer is made subject to acceptance of it by the District on the date hereof, and
if not accepted will be subject to withdrawal by the Underwriter upon notice delivered to the District
at any time prior to the acceptance hereof by the District.
I. Purchase. Sale and Delivery of the Bonds.
(a) Subject to the terms and conditions and in reliance upon the representations,
warranties and agreements set forth herein, the Underwriter agrees to purchase from the District, and
the District agrees to sell to the Underwriter, all (but not less than all) of the City of Chula Vista
Community Facilities District No. 12-1 (McMillin Otay Ranch Village Seven) 2005 Special Tax
Bonds (the "Bonds'') in the aggregate principal amount specified in Exhibit A hereto. The Bonds
shall be dated the Closing Date (hereinafter defined), and bear interest (payable semiannually on
March I and September I in each year, commencing March I, 2006) at the rates per annum and
maturing on the dates and in the amounts set forth in Exhibit A hereto. The purchase price for the
Bonds shall be the amount specified as such in Exhibit A hereto.
The Bonds shall be substantially in the form described in, shall be issued and secured under
the provisions of, and shall be payable and subj ect to redemption as provided in, the Bond Indenture
(the "Bond Indenture") by and between the District and U.S. Bank National Association, as Fiscal
Agent (the "Fiscal Agent"), dated as of November I, 2005, approved in Resolution No. 2005-_
adopted by the City Council of the City, as the legislative body of the District, on ,2005 (the
"Resolution of Issuance"). The Bonds and interest thereon will be payable from a special tax (the
"Special Tax'') levied and collected on certain taxable land within the District in accordance with
Resolution No. 2005-285 adopted by the City Council on August 16,2005 (the "Resolution of
Formation''), Ordinance No. enacted on ,2005 (the "Special Tax Ordinance").
Proceeds of the sale of the Bonds will be used in accordance with the Bond Indenture and the Mello-
DOCSOC/1129480v3/022245-0161
c:2 -,;2,;) 'I"
Roos Community Facilities Act of 1982, as amended (Sections 53311 ~ ~. of the Government
Code of the State of California) (the "Act") and the City of Chula Vista Community Facilities
District Ordinance ("Authorizing Ordinance" and together with the Act, the "Law"), to acquire
certain public improvements described in the Resolution of Formation. The Resolution of Issuance,
the Resolution of Formation, the Special Tax Ordinance and the Authorizing Ordinance and all other
resolutions adopted with respect to the formation of the District and the issuance of the Bonds are
collectively referred to herein as the "District Resolutions."
(b) At or prior to the acceptance hereof by the District, the District shan cause to
be delivered to the Underwriter (i) a Certificate of Representations and Warranties of the City, dated
as of the date of this Bond Purchase Agreement (the "City Certificate"), in substantially the form
attached hereto as Exhibit B, with only such changes therein as shall have been accepted by the
Underwriter, and (ii) a certificate executed by McMillin Otay Ranch, LLC (the "Developer''), dated
on or prior to the date of this Bond Purchase Agreement and addressed to the Underwriter and the
District deeming the information in the Preliminary Official Statement (as defined in (c) below)
relating to the Developer fmal and accurate as of its date.
(c) Subsequent to its receipt of a certificate from the District deeming the
Preliminary Official Statement for the Bonds, dated , 2005 (which Preliminary Official
Statement, together with the cover page and an appendices thereto, is herein collectively referred to
as the "Preliminary Official Statement" and which, as amended with the prior approval of the
Underwriter and executed by the District, will be referred to herein as the "Official Statement"), final
for purposes of Rule l5c2-12 of the Securities and Exchange Commission ("Rule 15c2-12''), the
Underwriter has distributed copies of the Preliminary Official Statement. The District hereby ratifies
the use by the Underwriter of the Preliminary Official Statement and authorizes the Underwriter to
use and distribute the final Official Statement dated the date hereof (including all information
previously permitted to have been omitted by Rule l5c2-12) and any supplements and amendments
thereto as have been approved by the District and the Underwriter as set forth in Section 2(g) hereof
as evidenced by the execution and delivery of such document by an officer of the District, the Bond
Indenture, the Continuing Disclosure Agreement of the District (the "District Disclosure
Agreement"), this Bond Purchase Agreement, any other documents or contracts to which City or the
District is a party, and all information contained therein, and all other documents, certificates and
statements furnished by the City and the District to the Underwriter in connection with the
transactions contemplated by this Bond Purchase Agreement, in connection with the offer and sale of
the Bonds by the Underwriter. The Underwriter hereby agrees to deliver a copy of the Official
Statement to a national repository on or before the Closing Date (as hereinafter defmed) and to each
investor that purchases any of the Bonds prior to the "end of the underwriting period" (as such term
is defined in Section 2(g) below) and otherwise to comply with all applicable statutes and regulations
in connection with the offering and sale of the Bonds, including, without limitation, MSRB
Rule G-32 and Rule 15c2-12.
(d) Pursuant to the Indenture and the District Disclosure Agreement the District
has agreed to provide, or cause to be provided, to each NRMSIR or the Municipal Securities
Rulemaking Board and any public or private repository or entity designated by the State as a state
repository for purposes of Rule 15c2-l2 adopted by the Securities and Exchange Commission
certain annual financial information and notices of the occurrence of certain events, if material.
These covenants have been made in order to assist the Underwriter in complying with Rule l5c2-l2.
2
DOCSOC/1129480v3/02224S-0161
d- ->>V
(e) At 8:00 A.M., Pacific Daylight Time, on ,2005, or at such earlier
time or date as shall be agreed upon by the Underwriter and the District (such time and date being
herein referred to as the "Closing Date"), the District will deliver (i) to The Depository Trust
Company in New York, New York, the Bonds in definitive form (all Bonds being in book-entry form
registered in the name of Cede & Co. and having the CUSIP numbers assigned to them printed
thereon), duly executed by the officers of the District as provided in the Bond Indenture, and (ll) to
the Underwriter, at the offices of Best Best & Krieger LLP, Bond Counsel in San Diego, California,
or at such other place as shall be mutually agreed upon by the District and the Underwriter, the other
documents herein mentioned; and the Underwriter shall accept such delivery and pay the purchase
price of the Bonds in immediately available funds (such delivery and payment being herein referred
to as the "Closing"). Notwithstanding the foregoing, the Underwriter may, in its discretion, accept
delivery of the Bonds in temporary form upon making arrangements with the District which are
satisfactory to the Underwriter relating to the delivery of the Bonds in definitive form.
2. Reoresentations. Warranties and Agreements of the District. The District represents,
warrants and covenants to and agrees with the Underwriter that:
(a) The City is duly organized and validly eXlstmg as a charter city duly
organized and validly existing under the Constitution and laws of the State of California and has duly
authorized the formation of the District pursuant to the Resolution of Formation and the Law. The
City Council as the legislative body of the City and the District has duly adopted the District
Resolutions, and has caused to be recorded in the real property records of the County of San Diego, a
Notice of Special Tax Lien (the "Notice of Special Tax Lien") (such District Resolutions and Notice
of Special Tax Lien being collectively referred to herein as the "Formation Documents"). Each of
the Formation Documents remains in full force and effect as of the date hereof and has not been
amended. The District is duly organized and validly existing as a community facilities district under
the laws of the State of California. The City has, and at the Closing Date will have, as the case may
be, full legal right, power and authority to execute, deliver and perform on behalf of itself and the
District its obligations under that certain Acquisition/Financing Agreement between the City and the
Developer, together with all amendments thereto (the "Funding Agreement") and to carry out all
transactions contemplated by the Funding Agreement. The District has, and at the Closing Date will
have, as the case may be, full legal right, power and authority (i) to execute, deliver and perform its
obligations under this Bond Purchase Agreement, the District Disclosure Agreement, and the Bond
Indenture, and to carry out all transactions contemplated by each of such agreements, (Ii) to issue,
sell and deliver the Bonds to the Underwriter pursuant to the Resolution of Issuance and Bond
Indenture as provided herein, and (ill) to carry out, give effect to and consummate the transactions
contemplated by the Formation Documents and by the Bond Indenture, this Bond Purchase
Agreement, the District Disclosure Agreement and the Funding Agreement (collectively, the
"District Documents") and the Official Statement;
(b) The District and the City, as applicable, each has complied, and will at the
Closing Date be in compliance, in all material respects with the Formation Documents and the
District Documents, and any immaterial noncompliance by the District and the City, if any, will not
impair the ability of the District and the City, as applicable, to carry out, give effect to or
consummate the transactions contemplated by the foregoing. From and after the date of issuance of
the Bonds, the District will continue to comply with the covenants of the District contained in the
District Documents;
3
DOCSOC/1129480v3/022245-0161
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(c) The City Council has duly and validly: (i) adopted the District Resolutions,
(ii) called, held and conducted in accordance with all requirements of the Law the elections within
the District to approve the levy of the Special Tax, the facilities eligible for financing and the
issuance of the Bonds and recorded the Notice of Special Tax Lien which established a continuing
lien on the land within the District securing the Special Tax, (iii) authorized and approved the
execution and delivery of the Bonds and the District Documents, (iv) authorized the preparation and
delivery of the Preliminary Official Statement and the Official Statement, and (v) authorized and
approved the performance by the District ofits obligations contained in, and the taking of any and all
action as may be necessary to carty out, give effect to and consummate the transactions contemplated
by, each of the District Documents (including, without limitation, the collection of the Special Tax),
and at the Closing Date the Formation Documents will be in full force and effect and the District
Documents and the Bonds will constitute the valid, legal and binding obligations of the District and
(assuming due authorization, execution and delivery by other parties thereto, where necessary) will
be enforceable in accordance with their respective terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of creditors' rights in general
and to the application of equitable principles if equitable remedies are sought;
(d) To the best of the District's knowledge, neither the District nor the City is in
breach of or default under any applicable law or administrative rule or regulation of the State of
California (the "State"), or of any department, division, agency or instrumentality thereof, or under
any applicable court or administrative decree or order, or under any loan agreement, note, resolution,
bond indenture, contract, agreement or other instrument to which the District or the City is a party or
is otherwise subject or bound, a consequence of which could be to materially and adversely affect the
performance by the District of its obligations under the Bonds, the Formation Documents or the
District Documents, and compliance with the provisions of each thereof, will not conflict with or
constitute a breach of or default under any applicable law or administrative rule or regulation of the
State, or of any department, division, agency or instrumentality thereof, or under any applicable court
or administrative decree or order, or a material breach of or default under any loan agreement, note,
resolution, trust agreement, contract, agreement or other instrument to which the District or the City,
as the case may be, is a party or is otherwise subject or bound;
(e) Except for compliance with the blue sky or other states securities law filings,
as to which the District makes no representations, all approvals, consents, authorizations, elections
and orders of or filings or registrations with any State 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 performance by the District of its obligations hereunder,
or under the Formation Documents or the District Documents, have been obtained and are in full
force and effect;
(I) The Special Tax constituting the security for the Bonds has been duly and
lawfully authorized and may be levied under the Law and the Constitution and other applicable laws
of the State of California, and such Special Tax, when levied, will constitute a valid and legally
binding continuing lien on the properties on which it has been levied;
(g) Until the date which is twenty-five (25) days after the "end of the
underwriting period" (as hereinafter defined), if any event shall occur of which the District is aware,
as a result of which it may be necessary to supplement the Official Statement in order to make the
statements in the Official Statement, in light of the circumstances existing at such time, not
misleading, the District shall forthwith notify the Underwriter of any such event of which it has
4
DOCSOC/1129480v3/022245-0161
d-~~~
knowledge and shall cooperate fully in furnishing any information available to it for any supplement
to the Official Statement necessary, in the Underwriter's opinion, so that the statements therein as so
supplemented will not be misleading in light of the circumstances existing at such time and the
District shall promptly furnish to the Underwriter a reasonable number of copies of such supplement.
As used herein, the term "end of the underwriting period" means the later of such time as (i) the
District delivers the Bonds 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. 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) The Bond Indenture creates a valid pledge of the Net Special Taxes and the
moneys in the Special Tax Fund, the Debt Service Fund, the Redemption Fund and the Reserve Fund
established pursuant to the Bond Indenture, including the investments thereof, subject in all cases to
the provisions of the Bond Indenture permitting the application thereof for the purposes and on the
terms and conditions set forth therein;
(i) Except as disclosed in the 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 or, to the best knowledge of the District, threatened (i) which would materially
adversely affect the ability of either the City or the District to perform its obligations under the
Bonds, the Formation Documents or the District Documents, or (ii) seeking to restrain or to enjoin
the development of the land within the District, the issuance, sale or delivery of the Bonds, the
application of the proceeds thereof in accordance with the Bond Indenture or the Funding
Agreement, or the collection or application of the Special Tax pledged or to be pledged to pay the
principal of and interest on the Bonds, or the pledge thereof, or in any way contesting or affecting the
validity or enforceability of the Bonds, the Formation Documents, the District Documents, the land
use approvals granted by the City with respect to the land within the District, any other instruments
relating to the development of any of the property within the District, or any action contemplated by
any of said documents, or (iii) in any way contesting the completeness or accuracy of the Preliminary
Official Statement or the Official Statement or the powers or authority of the District with respect to
the Bonds, the Formation Documents, the District Documents, or any action of the District
contemplated by any of said documents; nor is there any action pending or, to the best knowledge of
the District, threatened against the City or the District which alleges that interest on the Bonds is not
excludable from gross income for federal income tax purposes or is not exempt from California
personal income taxation;
G) The District will furnish such information, execute such instruments and take
such other action in cooperation with the Underwriter as the Underwriter may reasonably request in
order for the Underwriter to qualify the Bonds for offer and sale under the "Blue Sky" or other
securities laws and regulations of such states and other jurisdictions of the United States as the
Underwriter may designate; provided, however, the District shall not be required to register as a
dealer or a broker of securities or to consent to service of process in connection with any blue sky
filing;
(k) Aoy certificate signed by any authorized official of the City or the District
authorized to do so shall be deemed a representation and warranty to the Underwriter as to the
statements made therein;
5
DOCSOC/1129480v3/022245-0161
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(I) The District will apply the proceeds of the Bonds in accordance with the
Bond Indenture and as described in the Official Statement;
(m) The information contained in the Preliminary Official Statement (other than
information therein relating to The Depository Trust Company and its Book-Entry-Only System, as
to which no view is expressed) was as of the date thereof, and the information contained in the
Official Statement (other than information therein relating to The Depository Trust Company and its
Book-Entry-Only System, as to which no view is expressed) as of its date was, and on the Closing
Date shall be, true and correct in all material respects and such information does not and shall not
contain any untrue or misleading statement of a material fact or omit to state any material fact
necessary to make the statements therein, in light of the circumstances under which they were made,
not misleading;
(n) The District shall use its best efforts to cause the Developer to cooperate with
the Underwriter in the preparation of the Official Statement; provided, however, that such efforts
shall not include the expenditure of funds by the District;
(0) The Preliminary Official Statement heretofore delivered to the Underwriter
was deemed final by the District as of its date, except for the omission of such information as is
permitted to be omitted in accordance with paragraph (b)(I) of Rule 15c2-12. The District hereby
covenants and agrees that, within seven (7) business days from the date hereof, the District shall
cause a final printed form of the Official Statement to be delivered to the Underwriter in a quantity
mutually agreed upon by the Underwriter and the District so that the Underwriter may comply with
paragraph (b)(4) of Rule 15c2-12 and Rules G-12, G-15, G-32 and G-36 of the Municipal Securities
Rulemaking Board.
(P) Except as disclosed in the Preliminary Official Statement, to the best of
District's knowledge, there are no entities with outstanding assessment or special tax liens against
any of the properties within the District which are senior to or on a parity with the Special Taxes;
(q) Neither the City nor the District is in default with respect to any reporting
obligation that it has undertaken under Rule 15c2-12 for any indebtedness issued by it.
3. Conditions to the Oblil!ations of the Underwriter. The obligations of the Underwriter
to accept delivery of and pay for the Bonds on the Closing Date shall be subject, at the option of the
Underwriter, to the accuracy in all material respects of the representations and warranties on the part
of the District contained herein, as of the date hereof and as of the Closing Date, to the accuracy in
all material respects of the statements of the officers and other officials of the City and the District
made in any certificates or other documents furnished pursuant to the provisions hereof, to the
performance by the District of its obligations to be performed hereunder at or prior to the Closing
Date and to the following additional conditions:
(a) At the Closing Date, the Formation Documents and the District Documents
shall be in full force and effect, and shall not have been amended, modified or supplemented, except
as may have been agreed to in writing by the Underwriter, and there shall have been taken in
connection therewith, with the issuance of the Bonds and with the transactions contemplated thereby
and by this Bond Purchase Agreement, all such actions as, in the opinion of Best, Best & Krieger
LLP, Bond Counsel for the District, and Stradling Y occa Carlson & Rauth, a Professional
Corporation, counsel to the Underwriter, shall be necessary and appropriate;
6
DOCSOC/1129480v3/022245-0161
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(b) Between the date hereof and the Closing Date, the market price or
marketability of the Bonds at the initial offering prices set forth in the Official Statement shall not
have been materially adversely affected, in the judgment of the Underwriter (evidenced by a written
notice to the District terminating the obligation of the Underwriter to accept delivery of and pay for
the Bonds), by reason of any of the following:
(1) legislation introduced in or enacted (or resolution passed) by the
Congress of the United States of America or recommended to the Congress by the President of the
United States, the Department of the Treasury, the Internal Revenue Service, or any member of
Congress, or favorably reported for passage to either House of Congress by any committee of such
House to which such legislation had been referred for consideration or a decision rendered by a court
established under Article III of the Constitution of the United States of America or by the Tax Court
of the United States of America, or an order, ruling, regulation (final, temporary or proposed), press
release or other form of notice issued or made by or on behalf of the Treasury Department or the
Internal Revenue Service of the United States of America, with the purpose or effect, directly or
indirectly, of imposing federal income taxation upon the interest as would be received by the holders
of the Bonds beyond the extent to which such interest is subject to taxation as of the date hereof;
(2) legislation introduced in or enacted (or resolution passed) by the
Congress of the United States of America, or an order, decree or injunction issued by any court of
competent jurisdiction, or an order, ruling, regulation (final, temporary or proposed), press release or
other form of notice issued or made by or on behalf of the Securities and Exchange Commission, or
any other governmental agency having jurisdiction of the subject matter, to the effect that obligations
of the general character of the Bonds, including any or all underlying arrangements, are not exempt
from registration under or other requirements of the Securities Act of 1933, as amended, or that the
Bond Indenture is not exempt from qualification under or other requirements of the Trust Indenture
Act of 1939, as amended, or that the issuance, offering or sale of obligations of the general character
of the Bonds, including any or all underwriting arrangements, as contemplated hereby or by the
Official Statement or otherwise is or would be in violation of the federal securities laws, rules or
regulations as amended and then in effect;
(3) the introduction, proposal or enactment of any amendment to the
federal or California Constitution or action by any federal or California court, legislative body,
regulatory body or other authority materially adversely affecting the tax status of the District, its
property, income, securities (or interest thereon), the validity or enforceability of the Special Tax or
the ability of the City or the District to construct or acquire the improvements as contemplated by the
Formation Documents, the District Documents or the Official Statement; or
(4) any event occurring, or information becoming known, which, in the
judgment of the Underwriter, makes untrue in any material respect any statement or information
contained in the Official Statement, or results in the Official Statement containing any untrue
statement of a material fact or omitting 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.
(5) any national securities exchange, the Comptroller of the Currency, or
any other 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
7
DOCSOClI129480v3/022245-016!
;;2 -~d- /
force, with respect to the extension of credit by, or the charge to the net capital requirements of, the
Underwriter; or
(6) the declaration of a general banking moratorium by federal, New
York or California authorities;
(7) there shall have occurred any material outbreak or escalation of
hostilities or other calamity or crisis the effect of which on the financial markets of the United States
is such as to make it impracticable, in the judgment of the Underwriter, following consultation with
the City, to sell the Bonds; or
(8) any proceeding shall have been commenced or be threatened ill
writing by the Securities and Exchange Commission against the City.
(c) On the Closing Date, the Underwriter shall have received counterpart
originals or certified copies of the following documents, in each case satisfactory in form and
substance to the Underwriter:
(1) The Formation Documents and the District Documents, together with
a certificate dated as of the Closing Date of the City Clerk to the effect that each Formation
Document is a true, correct and complete copy of the one duly adopted by the City Council;
(2) The Official Statement;
(3) An unqualified approving opinion for the Bonds, dated the Closing
Date and addressed to the City, of Best Best & Krieger LLP, Bond Counsel for the District, in the
form attached to the Preliminary Official Statement as Appendix H, and an unqualified opinion of
such counsel, dated the Closing Date and addressed to the Underwriter, to the effect that such
approving opinion addressed to the District may be relied upon by the Underwriter to the same extent
as if such opinion was addressed to it;
(4) A supplemental opinion, dated the Closing Date and addressed to the
Underwriter, of Best Best & Krieger LLP, Bond Counsel for the District, to the effect that (i) the
District Documents have been duly authorized, executed and delivered by the City or the District, as
applicable, and, assuming such agreements constitute valid and binding obligations of the other
parties thereto, constitute the legally valid and binding agreements of the City or the District, as
applicable, enforceable in accordance with their terms, except as enforcement may be limited by
bankruptcy, moratorium, insolvency or other laws affecting creditor's rights or remedies and by
general principles of equity (regardless of whether such enforceability is considered in equity or at
law); (ii) the Bonds are not subject to the registration requirements of the Securities Act of 1933, as
amended, and the Bond Indenture is exempt from qualification under the Trust Indenture Act of
1939, as amended; (iii) the information contained in the Official Statement on the cover and under
the captions "INTRODUCTION," "THE BONDS," "SOURCES OF PAYMENT FOR THE
BONDS," "THE COMMUNITY FACILITIES DISTRICT," "SPECIAL RISK FACTORS-
Proposition 218," "TAX MATTERS" and Appendices E and H thereof, insofar as it purports to
summarize certain provisions of the Law, the Formation Documents, the Bonds and the Bond
Indenture and our opinion as to the exclusion from gross income for federal income tax purposes and
exemption from State of California personal income taxes of interest on the Bonds, presents a fair
and accurate summary of such provisions; (iv) the Special Tax has been duly and validly authorized
8
DOCSOC/1129480v3/022245-0161
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in accordance with the provisions of the Law and, except as the same may be limited by bankruptcy,
insolvency, reorganization, fraudulent conveyance or transfer, moratorium or other laws relating to or
affecting generally the enforcement of creditors' rights, by equitable principles and by the exercise of
judicial discretion in appropriate cases, a lien to secure payment of Special Taxes has been imposed
on all non-exempt property in the District; and (v) Bond Counsel has examined the proceedings
regarding the levy of the Special Tax, including without limitation, the Notice of Special Tax Lien
which was recorded for the District pursuant to Section 3114.5 of the California Streets and
Highways Code (the "Code'') in the official records of the County of San Diego on
20---, and based on such examination, and its review of applicable laws of the State of California, as
of the date of such opinion, Bond Counsel is ofthe opinion that (a) pursuant to Section 53339.8(a) of
the California Government Code, all non-exempt property in the District became subject to the levy
of the Special Taxes as of the date of the adoption of the Resolution of Formation, (b) pursuant to
Section 53340 of the California Government Code, each levy on such non-exempt property is
secured by a continuing lien; and (c) any delinquent Special Taxes levied on such non-exempt
property will be subject to foreclosure pursuant to Section 53356.1 of the California Government
Code;
(5) An opinion, dated the Closing Date and addressed to the Underwriter,
of Stradling Y occa Carlson & Rauth, a Professional Corporation, counsel for the Underwriter, to the
effect that (i) the Bonds are exempt from the registration requirements of the Securities Act of 1933,
as amended, and the Bond Indenture is exempt from qualification under the Trust Indenture Act of
1939, as amended; and (ii) without having undertaken to determine independently the accuracy or
completeness of the statements contained in the Official Statement, but on the basis of their
participation in conferences with representatives of the City, Bond Counsel, representatives of the
Underwriter and others, and their examination of certain documents, nothing has come to their
attention which has led them to believe that the Official Statement as of its date and as of the Closing
Date contained any untrue statement of a material fact or omitted 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 (except that no opinion or belief need be expressed as any
financial or statistical data, appraisals, assessed values or projections or information regarding the
book-entry system contained in the Official Statement);
(6) A certificate, dated the Closing Date and signed by an authorized
representative of the District, ratifying the use and distribution by the Underwriter of the Preliminary
Official Statement and the Official Statement in connection with the offering and sale of the Bonds;
and certifying that (i) the representations and warranties of the District contained in Section 2 hereof
are true and correct in all material respects on and as of the Closing Date with the same effect as if
made on the Closing Date; (ii) to the best of his or her knowledge, no event has occurred since the
date of the Official Statement affecting the matters contained therein which should be disclosed in
the Official Statement for the purposes for which it is to be used in order to make the statements and
information contained in the Official Statement not misleading in any material respect, and the
Bonds, the Formation Documents and the District Documents conform as to form and tenor to the
descriptions thereof contained in the Official Statement; (iii) the District has complied with all the
agreements and satisfied all the conditions on its part to be performed or satisfied under the
Formation Documents, the District Documents and the Official Statement at or prior to the Closing
Date; and (iv) the representations and warranties of the City contained in the City Certificate are true
and correct in all material respects on and as of the Closing Date, with the same effect as if made on
the Closing Date, except that all references therein to the Preliminary Official Statement shall be
deemed to be references to the Official Statement;
9
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(7) An opinion, dated the Closing Date and addressed to the Underwriter,
of the City Attorney, to the effect that (i) to the best of his or her knowledge and except as disclosed
in the 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 or threatened which
would materially adversely affect the ability of the District to perform its obligations under the
Bonds, the Formation Documents or the District Documents, or seeking to restrain or to enjoin the
development of property within the District, the issuance, sale, delivery of the Bonds or the exclusion
from gross income for federal income tax purposes or State of California personal income taxes of
interest on the Bonds, or the application of the proceeds thereof in accordance with the Bond
Indenture, or the collection or application of the Special Tax 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
Formation Documents or the District Documents or the accuracy of the Official Statement, or any
action of the City or the District contemplated by any of said documents; (ii) the City is duly
organized and validly existing as a charter city under the Constitution and laws of the State of
California and the District is duly organized and validly existing as a community facilities district
under the laws of the State of California, and the District has full legal right, power and authority to
issue the Bonds and each of the City and the District has the full legal right, power and authority to
perform all of its obligations under the Formation Documents and the District Documents; (iii) the
City and the District have obtained all approvals, consents, authorizations, elections and orders of or
filings or registrations with any State governmental authority, board, agency or commission having
jurisdiction which constitute a condition precedent to the levy of the Special Tax, the issuance of the
Bonds or the performance by the District of its obligations thereunder or under the Bond Indenture,
except that no opinion need be expressed regarding compliance with blue sky or other securities laws
or regulations, whatsoever; (iv) the City Council has duly and validly adopted the District
Resolutions at meetings of the City Council which were called and held pursuant to law and with all
public notice required by law and at which a quorum was present and acting throughout, and the
District Resolutions are now in full force and effect and have not been amended; and (v) each of the
City and the District has duly authorized, executed and delivered the District Documents to which it
is a party and the District has duly authorized and executed the Bonds and has duly authorized the
preparation and delivery of the Official Statement, and the District Documents and the Bonds
constitute legal, valid and binding agreements of the District and the City, as applicable, enforceable
in accordance with their respective terms, subject to bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors' rights in general and to the
application of equitable principles if equitable remedies are sought and to the limitations on legal
remedies against cities in the State of California;
(8) A certificate dated the Closing Date and addressed to the Underwriter
and the City, from the Developer, in substantially the form attached hereto as Exhibit C and an
executed copy of the Continuing Disclosure Agreement in the form attached as Appendix G to the
Official Statement (the "Developer Continuing Disclosure Agreement");
(9) An opinion dated the Closing Date and addressed to the Underwriter,
the City and the District, by counsel to the Developer, substantially in the form attached hereto as
Exhibit D;
(10) A certificate dated the Closing Date from McGill, Martin Self, Inc.
(the "Special Tax Consultant") addressed to the City, the District and the Underwriter to the effect
that (i) the Special Tax if collected in the maximum amounts permitted pursuant to the Rate and
Method of Apportionment of Special Taxes as of the Closing Date would generate at least 110% of
10
DOCSOC/1129480v3/022245-0161
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the maximum annual debt service payable with respect to the Bonds, based on such assumptions and
qualifications as shall be acceptable to the Underwriter, (ii) it has reviewed the Appraisal and it is of
the opinion that information contained therein with respect to taxes and tax rates applicable, and
projected to be applicable, to the property in the District is consistent with such information provided
by the Special Tax Consultant to the Appraiser, which information so provided was based on
information obtained by the Special Tax Consultant from the City, the District and the County of San
Diego, and (iii) the statements in the Official Statement concerning the Rate and Method of
Apportionment of Special Tax and all information supplied by it for use in the Official Statement
were as of the date of the Official Statement and are as of the Closing Date true and correct, and do
not contain any untrue statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in light of the circumstances under which they were made, not
misleading;
(II) A letter dated the Closing Date from Bruce W. Hull & Associates,
Inc. (the "Appraiser") addressed to the Underwriter, the District and the City to the effect that it has
prepared the appraisal report (the "Appraisal") with respect to the property located within the District
and that (a) the Appraisal, in the form set forth in Appendix C to the Official Statement, may be
included in the Preliminary Official Statement and the Official Statement, (b) it has reviewed the
Official Statement and the Appraisal included in Appendix C thereto and the information in the
Official Statement referring to the Appraisal and in the Appraisal is accurate and does not contain
any untrue statement of a material fact or omit to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made, not misleading, and
the assumptions made in the Appraisal are reasonable and (c) no events or occurrences have been
ascertained by it or have come to its attention that would materially change the opinion of value set
forth in the Appraisal;
(12) A letter from Sullivan Group Real Estate Advisors dated the Closing
Date addressed to the Underwriter, the City and the District to the effect that it has prepared the
market absorption study (the "Study") referred to in the Official Statement and that (a) the summary
of the Study in Appendix B thereto (the "Summary") may be included in the Preliminary Official
Statement and the Official Statement, (b) it has reviewed the Official Statement and the Summary
and the information regarding the Study and the projected absorption of the proposed development
included in the Official Statement is accurate and does not contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, and (c) no events or occurrences have
been ascertained by it or have come to its attention that would materially change the opinion set forth
in the Study;
(13) A certificate of the District dated the Closing Date, in a form
acceptable to Bond Counsel, that the Bonds are not arbitrage bonds within the meaning of
Section 148 of the Internal Revenue Code of 1986, as amended;
(14) A certificate of the Fiscal Agent and an opinion of counsel to the
Fiscal Agent dated the Closing Date and addressed to the City, the District and the Underwriter to the
effect that it has duly authorized the execution and delivery of the Bond Indenture and the Developer
Continuing Disclosure Agreement and that each of such documents is a valid and binding obligation
of the Fiscal Agent enforceable in accordance with its terms; and
II
DOCSOCIl129480v3/022245-0161
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(15) Such additional legal opmlOns, certificates, instruments and other
documents as the Underwriter may reasonably request to evidence the truth and accuracy, as of the
date hereof and as of the Closing Date, of the statements and information contained in the
Preliminary Official Statement and the Official Statement, of the District's representations and
warranties contained herein and the due performance or satisfaction by the District at or prior to the
Closing of all agreements then to be performed and all conditions then to be satisfied by the District
in connection with the transactions contemplated hereby and by the Official Statement.
If the District shall be unable to satisfy the conditions to the obligations of the Underwriter to
purchase, accept delivery of and pay for the Bonds contained in this Bond Purchase Agreement, and
the unsatisfied conditions are not waived by the Underwriter, or if the obligations of the Underwriter
to purchase, accept delivery of and pay for the Bonds shall be terminated for any reason permitted by
this Bond Purchase Agreement, this Bond Purchase Agreement shall terminate and neither the
Underwriter nor the District shall be under any further obligation hereunder, except that the
respective obligations of the District and the Underwriter set forth in Section 5 and Section 6 hereof
shall continue in full force and effect.
4. Conditions of the District's Oblil!ations. The District's obligations hereunder are
subject to the Underwriter's performance of its obligations hereunder, and are also subject to the
following conditions:
(a) As of the Closing Date, no litigation shall be pending or, to the knowledge of
the duly authorized officer of the District executing the certificate referred to in Section 3(c)(6)
hereof, threatened, to restrain or enjoin the issuance or sale of the Bonds or in any way affecting any
authority for or the validity of the Bonds, the Formation Documents, the District Documents or the
existence or powers of the City or the District; and
(b) As of the Closing Date, the District shall receive the approving opinions of
Bond Counsel referred to in Section 3(c)(3) and (4) hereof, dated as of the Closing Date, addressed to
the City, the District and the Underwriter.
5.
herein:
Expenses. Whether or not the Bonds are delivered to the Underwriter as set forth
(a) The Underwriter shall be under no obligation to pay, and the District shall
payor cause to be paid (out of any legally available funds of the District) all expenses incident to the
performance of the District's obligations hereunder, including, but not limited to, the cost of printing
and delivering the Bonds to the Underwriter, the cost of preparation, printing, distribution and
delivery of the Bond Indenture, the Preliminary Official Statement, the Official Statement and all
other agreements and documents contemplated hereby (and drafts of any thereof) in such reasonable
quantities as requested by the Underwriter; and the fees and disbursements of the Fiscal Agent for the
Bonds, Bond Counsel, financial advisor to the City, counsel to the Underwriter in the amount of
$25,000, and any accountants, engineers or any other experts or consultants the District has retained
in connection with the Bonds including reimbursements to the Developer for advances of such
amounts; and
(b) The District shall be under no obligation to pay, and the Underwriter shall
qualify the Bonds for sale under any "blue sky" or other state securities laws; and all other expenses
incurred by the Underwriter in connection with its public offering and distribution of the Bonds
(except those specifically enumerated in paragraph (a) of this section), including the fees and
disbursements of its counsel and any advertising expenses.
6. Notices. Any notice or other communication to be given to the City under this Bond
Purchase Agreement may be given by delivering the same in writing to the City at 276 Fourth
Avenue, Chula Vista, California 91910, Attention: Director of Finance; and any notice or other
communication to be given to the Underwriter under this Bond Purchase Agreement may be given by
delivering the same in writing to Stone & Youngberg, 4350 La Jolla Village Drive, Suite 140, San
Diego, California 92122, Attention: L. William Huck, and to One Ferry Building, San Francisco,
California 94111, Attention: Public Finance.
7. Parties in Interest. This Bond Purchase Agreement is made solely for the benefit of
the District and the Underwriter (including their successors or assigns), and no other person shall
acquire or have any right hereunder or by virtue hereof.
8. Survival of Reoresentations and Warranties. The representations and warranties of
the District and the City set forth in or made pursuant to this Bond Purchase Agreement and any
certificates delivered hereunder shall not be deemed to have been discharged, satisfied or otherwise
rendered void by reason of the Closing or termination of this Bond Purchase Agreement and
regardless of any investigations made by or on behalf of the Underwriter (or statements as to the
results of such investigations) concerning such representations and statements of the District and the
City and regardless of delivery of and payment for the Bonds.
9. Effective. This Bond Purchase Agreement shall become effective and binding upon
the respective parties hereto upon the execution of the acceptance hereof by the District and shall be
valid and enforceable as of the time of such acceptance.
10. No Prior AlITeemenls. This Bond Purchase Agreement supersedes and replaces all
prior negotiations, agreements and understandings between the parties hereto in relation to the sale of
Bonds for the District.
II. Governinl! Law. This Bond Purchase Agreement shall be governed by the laws of
the State of California.
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12. Counterparts. This Bond Purchase Agreement may be executed in several
counterparts, each of which shall be an original and all of which shall constitute one and the same
instrument.
Very truly yours,
STONE & YOUNGBERG LLC
By:
Managing Director
ACCEPTED:
.2005
COMMUNITY FACILITIES DISTRICT NO. 12-1
(MCMILLIN OTA Y RANCH VILLAGE SEVEN)
By:
Assistant Director of Finance
14
DOCSOCII129480v3/022245-0 161
<.2 ~o:L-3-6.
EXHIBIT A
MATURITY SCHEDULE
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 12-1
(MCMILLIN OTAY RANCH VILLAGE SEVEN)
2005 SPECIAL TAX BONDS
Maturity Date
(September 1)
Principal
Coupon
Price
Par Amount $
Original Issue Discount
Underwriter's Discount
Purchase Price $
A-I
DOCSOCIl129480v3/022245-0161
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EXHIBIT B
CERTIFICATE OF REPRESENTATIONS AND WARRANTIES
OF THE CITY OF CHULA VISTA
,2005
To: Stone & Youngberg LLC
San Diego, California
Re: $ City ofChula Vista Community Facilities District No. 12-1
(McMillin Gtay Ranch Village Seven) 2005 Special Tax Bonds
Ladies and Gentlemen:
We are delivering to you this certificate in connection with the issuance and sale of
$ aggregate principal amount of the City of Chula Vista Community Facilities
District No. 12-1 (McMillin Otay Ranch Village Seven) 2005 Special Tax Bonds and pursuant to the
Bond Purchase Agreement, dated the date hereof (the "Purchase Contract"), by and between you and
Community Facilities District No. 12-1 (McMillin Otay Ranch Village Seven) (the "District"). All
capitalized terms used herein without definition shall have the meanings assigned to such terms in the
Purchase Contract.
The undersigned, in his capacity as an officer of the City and not in his individual capacity,
on behalf of the City, represents and warrants to you that:
(I) The City is duly organized and validly existing as a charter city under the
Constitution and laws of the State of California and the City Council of the City, as the legislative
body of the District, has duly and validly adopted each of the District Resolutions and authorized the
formation of the District pursuant to the Law.
(2) The information contained in the Preliminary Official Statement (except for
information therein as to the book-entry system as to which no view is expressed) was, as of the date
thereof and is, as of the date hereof, true and correct in all material respects and did not, as of the date
thereof, and does not, as of the date hereof, 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.
CITY OF CHULA VISTA
By:
Assistant Director of Finance
B-1
DOCSOCIl129480v3/022245-0161
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EXHIBIT C
CERTIFICATE OF THE DEVELOPER
,2005
Stone & Youngberg LLC
4350 La Jolla Village Drive, Suite 140
San Diego, California 92122
City of Chula Vista
276 Fourth Avenue
Cbula Vista, California 91910
Re: $ City ofChula Vista Community Facilities District No. 12-1
(McMillin Otay Ranch Village Seven) 2005 Special Tax Bonds (the "Bonds")
Ladies and Gentlemen:
McMillin Otay Ranch, LLC, a Delaware limited liability company (the "Developer"), hereby
certifies that:
L The Developer is the owner of certain of the land within Community Facilities
District No. 12-1 (McMillin Otay Ranch Village Seven) (the "District"), as described
in the Official Statement of the District dated , 2005 relating to the
above-captioned Bonds (the "Official Statement").
2. The Developer covenants that, while the Bonds are outstanding, the 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 which in any way seeks to
challenge or overturn the District, the levy of the Special Tax in accordance with the
rate and method of apportionment contained in the Amendment to Notice of Special
Tax Lien recorded in the real property records of the County of San Diego (the "Rate
and Method of Apportionment") or the validity of the Bonds or the proceedings
leading up to their issuance. The foregoing covenant shall not prevent the Developer
from
(a) bringing an action or suit contending that the Special Tax has not been levied
in accordance with the methodology contained in the Rate and Method of
Apportionment; or
(b) bringing any action, suit, proceeding, inquiry or investigation to enforce the
obligations of the District or the City of Chula Vista (the "City") under the
District formation resolutions or any agreement including, without limitation,
the Bond Indenture, the Bond Purchase Agreement, or the
AcquisitionlFinancing Agreement, dated as of , 20_,
executed by and between the City and the Developer, and/or any other
agreement with the District and/or the City for which the Developer is a party
C-l
DOCSOClI129480v3/022245-0161
. /)3Q
~- .~ < 7
or beneficiary, so long as any such action or suit does not seek to interfere, or
have the effect of interfering, with the levy and collection of the Special Tax
in amounts and at times sufficient to pay the principal of and interest on the
90nds when due and unless such act~on or su~t ~s brought or h1ed pursuant to
subsection (a) above.
3. Any and all information submitted by the Developer to the City, the Underwriter and
Underwriter's counsel in connection with the preparation of the Official Statement,
and any and all information submitted by the Developer to the Special Tax
Consultant, the Appraiser and the Market Absorption Consultant, was, to the best of
the Developer's knowledge, true and correct when given and remains true and correct
as of the date hereof, and all information in the Official Statement relating to the
Developer and the development of its land within the District was final as of its date
for purposes of Rule 15c2-12 promulgated under the Securities Exchange Act of
1934.
4. The statements relating to the Developer, its members and related entitIeS, its
proposed development in the District, their property ownership and its contractual
arrangements contained in the Official Slatement 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 the light of the circumstances under
which they were made, not misleading. If at any time subsequent hereto and within
25 days after the Closing Date any such statements in the Official Statement become
untrue, the Developer agrees to notify the City and the Underwriter immediately.
5. No proceedings are pending or, to the best of the Developer's knowledge, threatened
in which the Developer or any of its members may be adjudicated as bankrupt or
discharged from any or all of their debts or obligations or granted an extension of
time to pay its debts or a reorganization or readjustmenl of its debts.
6. Except as disclosed in the 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 or, to the best of the Developer's knowledge, threatened, in
any way seeking to restrain or enjoin the development of the property within the
District or in any way seeking to invalidate or set aside any final or vesting tentative
maps on land in the District.
7. None of the parcels which constitute land within the District owned by the Developer
or any of its affiliates are delinquent in the payment of any taxes or assessments.
8. Except as disclosed in the Official Statement, to the best of the Developer's
knowledge, no other public debt secured by a tax or assessment on the land in the
District 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 land within the District.
9. The Developer will advise the District and the Underwriter promptly of the
occurrence of any event or circumstances of which it becomes aware of during the
ninety days after the end of the underwriting period and a result of which it may be
C-2
DOCSOC/1129480v3/022245-0161
;2 -;20tJ
necessary to supplement the Official Statement in order to make the statements
therein, in light of the circumstances existing at such time, not misleading.
10. Except as disclosed in writing to the Underwriter and the City, to the best of the
Developer's knowledge, 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 the Developer or any of its members is a party which
would materially and adversely affect the ability of the Developer to develop the
property or pay Special Taxes when due.
II. The Developer has duly authorized and executed the Developer Continuing
Disclosure Agreement dated as of November 1, 2005 (the "Disclosure Agreement"),
and such Disclosure Agreement is the valid obligation of the Developer, enforceable
against the Developer in accordance with its terms, and none of the documents which
govern the Developer would cause such Disclosure Agreement to be invalid or
unenforceable against the Developer in accordance with its terms; and no event has
occurred which, with the passage of time, would constitute a default by the Developer
of any of its obligations under the Disclosure Agreement.
12. The Developer has duly authorized and executed the Funding Agreement and such
Funding Agreement constitutes the valid obligation of the Developer, enforceable
against the Developer in accordance with its respective terms, and none of the
documents which govern the Developer would cause such Funding Agreement to be
invalid or unenforceable against the Developer in accordance with its terms; and no
event has occurred which, with the passage oftime, would constitute a default by the
Developer of any of its obligations under the Funding Agreement.
13. All capitalized terms not otherwise defIned herein shall have the meaning set forth in
the Bond Purchase Agreement to be entered into between the District and Stone &
Youngberg LLC relating to the sale of the Bonds.
MCMILLIN OT A Y RANCH, LLC, a Delaware
limited liability company
By:
Name:
Its:
By:
Title:
Its:
C-3
DOCSOCIl129480v3/022245-0161
d2 ~;:< if!
EXHIBIT D
OPINION OF DEVELOPER COUNSEL
(I) The Developer is duly formed, validly existing and in good standing as a limited
liability company under the laws of the State of Delaware.
(2) The Developer has the power to enter into and perform its obligations under the
Acquisition/Financing Agreement, dated , 20----, and the Continuing Disclosure
Agreement dated as of November I, 2005 (collectively, the "Developer Agreements"), has duly
authorized, executed, and delivered the Developer Agreements, and has authorized the performance
of its respective duties and obligations thereunder.
(3) Each of the Developer Agreements constitutes a legally valid and binding obligation
of the Developer, enforceable in accordance with its terms.
(4) The execution and delivery of the each of the Developer Agreements by the
Developer, and compliance with the provisions thereof by the Developer will not result in a violation
of, a breach of, or a default under the operating agreement of the Developer or, to our knowledge, of
any trust agreement, mortgage, deed of trust, note, lease, commitment, agreement, or other
instrument to which the Developer is a party, or, to our knowledge, any order, rule or regulation of
any court or other governmental body having jurisdiction over the Developer, the breach of which
might have a materially adverse effect on the ability of the Developer to perform its obligations
under the Developer Agreement.
(5) There is no litigation pending or threatened against or affecting the Developer
(a) which affects or seeks to prohibit, restrain or enjoin the development by the Developer of the
property it owns within the District, or (b) in which the Developer or any of the members of the
Developer may be 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, or
(c) which seeks to grant an extension of time to pay the Developer's debts, or (d) seeks to effect a
reorganization or readjustment of the Developer's debts or ( e) if detennined adversely to the
Developer, would materially and adversely affect the transactions contemplated by the Official
Statement to be engaged in by the Developer, or the ability of the Developer to perform its
obligations as described in the Official Statement and under the Developer Agreements.
(6) During the course of our representation the Developer, we have reviewed certain
documents and have participated in conferences in which the contents of the Official Statement and
related matters were discussed. To our knowledge, no facts have come to our attention which would
cause us to believe that the statements contained in the Official Statement under the headings "THE
COMMUNITY FACILITIES DISTRICT," "THE DEVELOPMENT AND PROPERTY
OWNERSHIP," and "SPECIAL RISK FACTORS" relating to the District and the Developer
(excluding therefrom the financial and statistical data included therein) 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 (except
as to financial information contained therein, as to which no view or opinion is expressed).
D-l
DOCSOC/l129480v3/022245-0161
c;2 ~,;2 if ,;L
RESOLUTION NO.
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA,
CALIFORNIA, APPROVING THE ACQUISITION/FINANCING
AGREEMENT PERTAINING TO COMMUNITY FACILITIES DISTRICT NO.
12-1 (OTAY RANCH VILLAGE SEVEN), AND AUTHORIZING THE
MAYOR TO EXECUTE THE AGREEMENT ON BEHALF OF THE CITY
WHEREAS, the CITY COUNCIL of the CITY OF CHULA VISTA, CALIFORNIA (the
"City Council"), has held and conducted proceedings relating to the levy of special taxes and the
issuance of bonds in a community facilities district to finance the acquisition of certain public
improvements, as authorized pursuant to the terms and provisions of the "Mello-Roos
Community Facilities Act of 1982", being Chapter 2.5. Part I, 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 is designated as COMMUNITY
FACILITIES DISTRICT NO. 12-1 (OTA Y RANCH VILLAGE SEVEN) (the "District"); and,
WHEREAS, the District was formed for the purpose of financing the acquisition of such
public improvements from McMillin Otay Ranch, LLC, the master developer of the property
within the District (the "Developer"); and,
WHEREAS, the City and the Developer have negotiated the terms and conditions
pursuant to which the public improvements are to be constructed by the Developer and acquired
by the City and bonds are to be issued to finance the acquisition or construction of such public
improvements and such terms and conditions have been memorialized in an
AcquisitionlFinancing Agreement by and between the City and the Developer (the
"Acquisition/Financing Agreement"), the form of which has been presented to this City Council
for its consideration and approval.
NOW, THEREFORE, IT IS HEREBY RESOLVED:
SECTION 1. The above recitals are all true and correct.
SECTION 2. The Acquisition/Financing Agreement, herewith submitted, is approved
substantially in the form submitted. The Mayor is hereby authorized to execute the final form of
such agreement on behalf of the City. The City Manager, subject to the review of the City
Attorney and Bond Counsel, is authorized to approve changes in such agreement deemed to be in
the best interests of the City, approval of such changes to be evidenced by the execution of such
agreement.
I
<;L -;2 'I~3
WBOIJ203461
PREPARED BY:
Sohaib Al-Agha
City Engineer
WBDI320346.!
APPROVED AS TO FORM BY:
2
L-:2 - .;:2 Lf'l
RESOLUTION NO.
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA,
CALIFORNIA, ACTING IN ITS CAPACITY AS THE LEGISLA TNE BODY OF
COMMUNITY FACILITIES DISTRICT NO. 12-1 (OTA Y RANCH VILLAGE
SEVEN), AUTHORIZING AND PROVIDING FOR THE ISSUANCE OF SPECIAL
TAX BONDS OF THE 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
WHEREAS, the CITY COUNCIL of the CITY OF CHULA VISTA, CALIFORNIA (this
"City Council"), did previously conduct proceedings to form and did form a community facilities
district pursuant to the terms and provisions ofthe "Mello-Roos Community Facilities Act ofl982",
being Chapter 2.5, Part I, Division 2, Title 5 of the Government Code of the State of California (the
"Act") and the City ofChula 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 NO. 12-1 (OTAY RANCH VILLAGE SEVEN) (the
"Community Facilities District") for the purpose of financing the acquisition or construction of
certain public improvements; and,
WHEREAS, this City Council has previously declared its intention to issue bonds for the
Community Facilities District to finance the acquisition or construction of such improvements, such
bonds be issued pursuant to the terms and provisions of the Act and 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,
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 the
Community Facilities District; and,
WHEREAS, the forms ofthe 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 U.S. Bank,
National Association, as fiscal agent (the "Fiscal Agent") setting forth the terms and
conditions relating to the issuance and sale of bonds (the "Bond Indenture");
B.
Bond Purchase Agreement authorizing the sale of bonds to Stone & Youngberg LLC,
the designated underwriter (the "Bond Purchase Agreement");
WBD\J203452
2. - ;;2 L/.5
?-~
C. Preliminary Official Statement containing information including but not limited to
the Community Facilities District and the bonds, including the terms and conditions
thereof (the "Preliminary Official Statement"); and
D. Continuing Disclosure Agreement by and between the Community Facilities District
and NBS Government Finance 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 bonds (the "Continuing Disclosure
Agreement"); and
WHEREAS, this City Council, with the aid of City staff, has reviewed and considered the
Bond Indenture, the Bond Purchase 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, all conditions, things and acts required to exist, to have happened and to have
been performed precedent to and in the issuance of the bonds as contemplated by this resolution and
the documents referred to herein exist, have happened and have been performed or have been
ordered to have been preformed 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 ofthe City ofChula Vista.
NOW, THEREFORE, IT IS HEREBY RESOLVED AS FOLLOWS:
SECTION I. Recitals. The above recitals are true and correct.
SECTION 2. Determinations. This legislative body hereby makes the following
determinations pertaining to the proposed issuance ofthe Bonds:
(a) The Goals and Policies generally require that the full cash value of the properties
within the Community Facilities District subject to the levy ofthe special taxes must
be at least 4 times the principal amount of the Bonds (as defined below) and the
principal amount of all other bonds outstanding that are secured by a special tax
levied pursuant to the Act on property within the Community Facilities District or a
special assessment levied on property within the Community Facilities District
(collectively, "Land Secured Bonded Indebtedness").The Act authorizes the City
Council, acting as the legislative body of the Community Facilities District, to sell
the Bonds only if the City Council has determined prior to the award of the sale of
the Bonds that the value of such properties within the Community Facilities District
will be at least 3 times the amount of such Land Secured Indebtedness.
The value of the property within the Community Facilities District which will be
subj ect to the special tax to pay debt service on the Bonds will be at least 4 times the
amount of the Land Secured Bonded Indebtedness.
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 4 times
WBD\320J452
2
c2~<~ -r?
-~.
the Land Secured Bonded Indebtedness allocable to each such property. Final
subdivision maps have been filed for each development area within the Community
Facilities District, therefore, there are no unmapped development areas remaining
within the Community Facilities District.
The foregoing determinations are based upon the full cash value of such properties
and development areas as shown upon an appraisal ofthe subject properties prepared
by Bruce W. Hull & Associates, a state certified real estate appraiser, as defined in
Business and Professions Code Section l1340( c). Such determination was made in a
manner consistent with the Goals and Policies.
(b) The terms and conditions of the 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 the
Community Facilities District and the relative overall lack of diversity of ownership
of property therein, the private sale ofthe Bonds will result in a lower overall cost to
the Community Facilities District.
SECTION 2. Bonds Authorized. Pursuant to the Community Facilities District Law, this
Resolution and the Bond Indenture, special tax bonds of the Community Facilities District
designated as "City of Chula Vista Community Facilities District No. 12-1 (Otay Ranch Village
Seven) 2005 Special Tax Bonds" (the "Bonds") in an aggregate principal amount not to exceed
$25,000,000 are hereby authorized to be issued. The date, manner of payment, interest rate orrates,
interest payment dates, denominations, form, registration privileges, manner of execution, place of
payment, terms of redemption and other terms, covenants and conditions of the Bonds shall be as
provided in the Bond Indenture as finally executed.
SECTION 3. Authorization and Conditions. The City Manager, an Assistant City Manager,
the Director of Finance and such other official or officials of the City as may be designated in writing
by this City Councilor 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 Bonds in excess of$25,000,000, an annual interest rate on the Bonds
in excess of six percent (6.00%) per year and a purchase price for the Bonds not less than ninety
eight and seventy five hundredths percent (98.75%) of the par amount of the 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 4. Bond Indenture. The form of Bond Indenture by and between the Community
Facilities District and the Fiscal Agent, with respect to the Bonds as presented to this City Council
and on file with the City Clerk is hereby approved. An Authorized Officer is hereby authorized and
WB0\320J452
3
,;2 -,;2 Lj 7
directed to cause the same to be completed and executed on behalf of the Community Facilities
District, subject to the provisions of Section 3 above.
SECTION 5. Official Statement and Continuing Disclosure Agreement. 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 or, in the absence of the Director of Finance, another Authorized Officer.
Pursuant to Rule 15c2-12 under the Securities Exchange Act of 1934 (the "Rule") the Director of
Finance or, in the absence of the Director of Finance, another Authorized Officer is authorized to
determine when the Preliminary Official Statement is deemed final, and the Director of Finance 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 or, in the absence ofthe Director of
Finance, 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 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 Section 3 above.
SECTION 6. Sale of Bonds. This City Council hereby authorizes and approves the
negotiated sale ofthe 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 7. Bonds Prepared and Delivered. Upon the execution of the Bond Purchase
Agreement, the 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 ofthe 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 Bonds upon the receipt of the purchase price thereof from the Underwriter.
SECTION 8. 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 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 Bonds in accordance with the Community
WBDl3203452
4
.;2 -,;2~6
Facilities District Law, this Resolution, the Bond Indenture, the Bond Purchase Agreement, the
Continuing Disclosure Agreement, and any certificate, agreement, contract, and other document
described in the documents herein approved.
SECTION 9. Effective Date. This resolution shall take effect from and after its adoption.
Presented by
Approved as to form by
1Jlr/l~
Ann Moore
City Attorney
Sohaib Al-Agha
City Engineer
WBD\3203452
5
,~- ,;2L/1
COUNCIL AGENDA STATEMENT
Item
Meeting Date
3
11/01/05
ITEM TITLE:
Resolution accepting bids and awarding a contract for the
Upgrade of Traffic Signal at Second Avenue and H Street (TF-326/TF-311)
project to HMS Construction, Incorporated, and appropriating funds from
Traffic Signal fimds for said proj ect.
SUBMITTED BY: City Engineersf>--
r,
REVIEWED BY: City Manager P
(4/5ths Vote: Yes.x No->
On Wednesday, September 14, 2005, the City Engineer received sealed bids from four electrical
contractors for the Upgrade of Traffic Signal at Second Avenue and H Street (TF-326/TF-311)
project. Tonight, Council will consider awarding the subject project to HMS Construction,
Incorporated. Council will also consider approving an additional appropriation of$71,660 from the
Traffic Signal Fund for completing the subject project. A reimbursement of up to $95,040 toward
the total estimated project cost of$130,000 will be received from a Hazard Elimination Safety (HES)
grant upon completion of the project in early summer of2006.
RECOMMENDATION: That Council approve a contract with HMS Construction, Incorporated
for the upgrade ofthe traffic signal at Second Avenue and H Street and appropriate $71,600 from the
available balance of the Traffic Signal fund for said project.
BOARDS/COMMISSIONS: Not applicable.
DISCUSSION:
A Capital Improvement Program (CIP) project number TF-311 was approved for funding in fiscal
year 2004 to upgrade two traffic signal locations at 1) First Avenue and H Street and 2) Second
Avenue and H Street. Staff separately advertised each of the locations in order to properly document
the contract for the Second Avenue and H Street intersection after it was authorized for HES
funding. The scope of work is summarized on Attachment 1 "Scope of Work Summary."
On February 10, 2005, Caltrans authorized the construction for the upgrade of traffic signal at the
intersection of Second Avenue and H Street under federal project number STPLH 5203 (018). Staff
advertised the project on May 27,2005 and opened bids on June 22, 2005. All three bids submitted
were found to be non-responsive. Based on the incomplete bids, on August 8, 2005, Council
approved resolution number 2005-275 rejecting bids and directing the City Engineer to re-advertise
the proj ect.
The cost to complete this traffic signal modification has increased due to general increases in
equipment and labor costs since the project was appropriated. Additional staff costs have arisen due
to federal documentation/authorization process and filrther design changes in plans to accommodate
the federal requirements, as well as the re-advertisement process described above. In addition,
unanticipated, increased staff time was required during the construction of the traffic signal at the
3-1
Page 2, Item
Meeting Date 11/01/05
intersection of First Avenue and H Street due to contractor staffing issues. AEC Contractor is not
associated with the signal project at Second Avenue and H Street.
For this traffic signal upgrade at Second Avenue and H Street, staff received bids on September 14,
2005 from four (4) electrical contractors:
w........'.....'''''....'''.......''''..''''''''........-...'''...........".........''''''''''''''''..'''''''''..''''''''''..'''.......,""'..="'....""'.."""""""""'......-.."'..-..''''"''''.....''''':''"..="..'''''''''''''''.....................'"'.......''''''"-~,..'''''''''''''''''''-'''''''.....''''~l
R..'.'!. <::~!!t.ra~_o._r-.-----._--..-.---..-.--.--------.-.----.---- ...-..--.-.--.-.-.--.......---------}~!d-. ..~I!l. .QU.-. .11. tn. _.-.--.--.-.......-...-..'..;...1
i HMS Construction, Incorporated (San Marcos, CA)! $102,016 I
1 T & if Electric db~ P~rry-Electric-(Sant~e, cAf--------T"----n---$106;;750--- ------ii
,----.----..------____.___..___._____.___..__n____..n_--__._________..,.....,..___.__._______...____n____m.__........._..u_...__ . ..____..__......m__.___... ___._____.______..,
:1 Lekos Electric, Incorporated (El Cajon, CA) i $108,400 Ii
:r-'-..'.-.-.--.-.~--..-.---..---------...-.---.--------..-.....-..,...........".--........--.-.---.....---....---.--..----'t'---------.---------...-.-m-"-"..-".~----_.--.----..-------....-......---.--.......;!
ji Select Electric, Incorporated (Spring Valley, CA). $144,200 !
L"'"=,"'"",.__"'''''''m='''''''"'''"'''o'm=''"'..'.,'''''''____'''~''''''''"'...m..="''"'....m'''''"=,~~..,""'"~_"'....m.."""=""....""';,,w.=,,="""'''''"'.;""''''.._'""''''''''''''''''''''."""'""'m''''~m~..'''''..=,.."''''''''=='''_..''''m='"'.."~,,.'"
The low bid, submitted by HMS Construction is below the engineer's estimate of$102,350 by $334
(0.3 %). HMS Construction has installed traffic signal projects in the City with satisfactory
performance. All bids submitted were complete.
Conflict of Interest: None of the Council members owns a property within 500' of the intersection of
Second Avenue and H Street in the City of Chula Vista.
Environmental Status: The work involved in this project is categorically exempt under Section
15301 of the California Environmental Quality Act (Minor Alterations of Existing Public
Improvements or Public Structures).
FISCAL IMPACT: \
i-.-'--.-,.._..,._.._--~"..-- ~-_._.--.._----"-.,...,.,_.,-_..._-..,.,',._,-.....,...---,~....,-,."
! ESTIMATED FUNDS REQUIRED FOR CONSTRUCTION I
: ~:..._ Contract Amount (HMS Construction, Incorporated) -----__________j_~___l~?_~}_~_J
i B. Approximately 10% Contract Contingencies ' $ 10,202 Ii
, . I
C. Design, Survey, and Construction/Inspection i $ 17,782 ::
L!.2!~.!_':I~~ ~~!R!~.!.2~ C?NS.!.~~,C!I.2~....,_,.,_,._____.,...~_,___~.30~_~0 I
r-..---..-~_.-"-'-----FUNDING'SUMMARY----._...,.-...-.""""--------"-'1
f--------.~ . . .:-___________m ---r-------..--i
A. Traffic SIgnal Fund AppropnatlOn I $ 230,000!
B. Gas Tax ! $ 20,000 :1
C. Contract Amount for TF-311, Upgrade T-Signal at First Ave and H St ! (:5 113,660) I!
D. Staff Costs to date for both locations (First Ave/H St and Second Ave/H St) i ($ 78,000) Ii
-'----.--.---------------.------------------------..-.---..----.-----.--------1---.---.--------..1
E. Additional Appropriation to be reimbursed (HES Grant up to $95,040) ! $ 71,660 :!
TOTAL FUNDS AVAILABLE FOR CONSTRUCTION i $ 130,000 I
"""="'""'-..........""""""'""=-"""'''',."...=-__......,,=_-........-'''''''==''''""m""~='............'''''''''''''..''''''''''''"'=_===._,..___=.........,)J
After completion of the traffic signal installation work at First Avenue and H Street, the remaining
project account balance was $58,340 out the $250,000 total originally budgeted for both the First
3-2
Page 3, Item
Meeting Date 11/01/05
Avenue/H Street and the Second Avenue/H Street intersections.
Therefore, staff requests that Council approve the estimated additional Traffic Signal appropriation
of $71,660 required to complete the subject project. Please note that the intersection at Second
Avenue and R Street signal upgrade will ultimately be reimbursed up to $95,040 by RES federal
funding (per attached form E-76) upon the completion ofthe project in early summer of2006. Thus
the $71,660 appropriation from Traffic Signal funds will be reimbursed with RES Funds, replacing
up to $95,040 in the Traffic Signal Fund. There are no General Fund impacts and the available
balance of the Traffic Signal Fund is sufficient to allow the appropriation. Upon completion of
improvements at Second Avenue and R Street, normal annual signal energy and preventive
maintenance costs are estimated to be $5,500 for the intersection.
Attachment:
1. Scope of Work Summary for projects TF-326/TF31l
2. Contractor's Disclosure Statement
3. California Department of Transportation Form E-76
4. Resolution No. 2005-275
5. Capital Improvements Program Detail Sheet
1: IEngineer\AGENDA ICAS2005\1 0-25-05ITF326ReadvertiseAI13rev. doc
3-3
Attachment 1
Scope of Work Summary
Proiects TF-326/TF-311,
Furnish and Install:
. New Traffic Signal Standards
. Mast Arms
. Signal Light Emitting Diode (LED) Indications
. Wiring
. Video Detection System
. Conduits
. Luminaries
. Pull Boxes
. Internally Illuminated Street Name Signs (IISNS)
. Meter Pedestal Cabinet
. Uninterruptible Power Supply (UPS) Unit
. Signs
. ADA Pedestrian Push Button
. Framework
Other Work:
. Removal and Salvage of Existing Street Light Mast Arms, Luminaires, Existing Signs
. Relocation of Existing Indications, IISNS, and EVPE
. Replacing of Existing Pull Box, Cabinet, and New LED Indication per plan
. Traffic Control
. Protection, Restoration, Removal, and Disposal of Existing Improvements
. Removal and Salvage of Existing Improvements
. Construction of All Appurtenances and other Miscellaneous Work Necessary to make the
Traffic Signal Systems Complete and Operational
3-4
CITY OF CHULA VISTA DISCLOSURE STATEMENT
ATTACHMENT 2..
Pursuant to Council Policy 101-01, prior to any action upon matters that will require discretionary action
by the Council, Planning Commission and all other official bodies of the City, a statement of disclosure of
certain ownership or financial interests, payments, or campaign contributions for a City of Chula Vista
election must be filed. The following information must be disclosed:
I. List the names of all persons having a financial interest in the property that is the subject of the
application or the contract, e.g., owner, applicant, contractor, subcontractor, material supplier.
I
N/flr
/
2. If any person" identified pursuant to (I) above is a corporation or partnership, list the names of all
individuals with a $2000 investment in the business (corporation/partnership) entity.
(
/V If(
I
3. If any person" identified pursuant to (1) above is a non-profit organization or trust, list the names
of any person serving as director of the non-profit organization or as trustee or beneficiary or
trustor of the trust.
# Iff
f
4. Please identify every person, including any agents, employees, consultants, or independent
contractors you have assigned to represent you before the City in this matter.
. !
JV / IJ
f
5. H~s any person" associated with thi~ contract ha~ any financial dealings' with an official"",o;I
CIty ofChula VIsta as It relates to thIS contract wlthm the past 12 months? Yes_ No
3Wi
J:\Engineer\TRAFFIOACAD Dw(;S\CIP PRQJECTS\Tf-Jl1:rnd TFJ26\TF326H-:!nd\TF326h-2ndSPECs.doc
If Yes, briefly describe the nature of the [mancial interest the official" may have in this contract.
6.
// lit
Have you made a contribution of more than $~thin the past twelve (12) months to a current
member of the Chula Vista City Council? No _ Yes _ If yes, which Council member?
7. ..
Have you provided more than $340 (or an it. em~:~ivalent value) to an official" of the City
of Chula Vista in the past twelve (12) months? \1' includes being a source of income, money to
retire a legal debt, gift, loan, etc.) Yes _ No_
If Yes, which official** and what was the nature of item provided?
Date:
Q--;tf-05
,
Signature of Con actor! Applicant
RoltdUL oelVUr'rft!
f'Fint ;!.,r ~e ~e of Con~ctoYl ~ppli.
VI~ \r-es{~
Person is defined as: any individual, firm, co-partnership, Joint venture, association, social club,
fraternal organization, corporation, estate, trust, receiver, syndicate, any other county, city,
municipality, district, or other political subdivision, -or any other group or combination acting as
a unit.
"
Official includes, but is not limited to: Mayor, Council member, Planning Commissioner,
Member ofa board, commission, or committee of the City, employee, or staff members.
3ij6
"\I="..i"..",r\Tll:AFF1\.\ACAO n""".\rtp PRnlPr-r"'Tf_'lll~~,l TJ:"...,...\TC~'.cU "~"'T!:'7.<;h_'n.lC;:Di:""'. """
FNM-76 (VERSION E-76)
FEDERAL AID PROGRAM
OLP LOCATOR 11-SD-OCHV
PREFIX STPLH
PROJECT NO 5203(018)
SEQ NO 2
DIST-EA 11-956232L
AGENCY CHULA VISTA
ROUTE
TIP DATA:
MPO/YEAR SANDAG
DATE 04/05
STIP REF:
21000000365 (AMEND3)
URBANIZED SAN DIEGO
ORB/RURAL URBAN AREA
BRIDGE NOS
PHASE
AMENDMENT/MODIFICATION SUMMARY
ATTACHMENT 1L
CALIFORNIA DEPARTMENT OF TRANSPORTATION
PROJECT LOCATION
SECOND AVE & H STREET
PREVo AUTH/AGREE DATE
PE 01/15/04
TYPE OF WORK R/W
UPGRADE SIGNAL & LT TRN CHAN CON 02/10/04
FED. RR NOS SPR
POC CODE(S) MCS
EXEMPT FROM FHWA REVIEW OTH
ENV STATUS CAT. EXCL. - ST DOC 12/17/04APPR CODES Q210
R/W STATUS 1 07/07/04 LINE NOS 10 30 31
BEGIN MP .000 IMPRV TYPE 15 44 17
END (.jp .000 FlJ'NC. SYS M
INV RTE
PROJECT COST
FEDERAL COST
AC COST
--------------------------------------------------------------------------------
PE
PREVo OBLIGATION
THIS REQUEST
SUBTOTAL
3,000.00
7,000.00
10,000.00
2,700.00
6,300.00
9,000.00
.00
.00
.00
--------------------------------------------------------------------------------
PREVo OBLIGATION
CON THIS REQOEST
SUBTOTAL
,00
95,600,00
95,600.00
.00
86,040.00
86,040,00
,00
,00
,00
--------------------------------------------------------------------------------
PPNO - 1l-CAL43
STATE REMARKS
TOTAL
105,600.00
95,040.00
.00
CITY OF CHOLA VISTA: 2005 RES PROJECT- 2ND AVE, AND H ST.
01/15/04 RZ: THIS SEQUENCE(~l) AUTHORIZES PE.
01/28/05 MV: THIS SEQUENCE (w2) AUTHORIZES CON.
02/00/05 THIS SEQUENCE(~2) ADDS PE l6,300, AOTHORIZES CON l78,953
AND CE l7,087 Q210 FUND. LP2000 RES 10 ~3156
AUTHORIZATION TO PROCEED WITH CON PREPARED BY M.VARNER ON 01/28/05 858-616 6528
CON & CE REVIEWED BY WINTON EMMETT ON 02/07/05 916-654-6018
AUTHORIZED BY W, &I!METT ON 02/10/05
ELECTRONIC SIGNATURE DOCUMENT TYPE AMEND/MOD SIGNED BY W. EMMETT ON 02/10/05 FOR CALTRANS
PROCESSED BY L WALLAC ON 02/15/05 FOR FHWA
LAST FHWA ELECTRONIC SIGNATURE EXECUTED BY DIANE R, TEECE ON 01/16/04
3-7
ATTACHMENT ~
RESOLUTION NO. 2005-275
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA REJECTING BIDS AND DIRECTING THE
CITY ENGINEER TO RE-ADVERTISE THE UPGRADE OF
TRAFFIC SIGNAL AT SECOND A VENUE AND H STREET
(PROJECT IF-326m-311)
WHEREAS, the City's current Capital Improvement Program (CIP) includes a signal
upgrade project at two signalized intersections, First A venuelH Street and Second A venue/H
Street (IF-311); and
WHEREAS, only the signal upgrade at Second Avenue and H Street project was
approved for a Hazard Elimination Safety (HES) grant federal funding; and
WHEREAS, in order to better organize and separate any federally qualified and
reimbursable expenses, staff created a new project number TF-326 for the Second A venue and H
Street project sharing the same project funding account number with IF-311; and
WHEREAS, on February 8, 2005, Council awarded the upgrade of traffic signal at the
intersection of First A venue and H Street, the first of the two intersections budgeted under the
IF-31l project; and
WHEREAS, due to the requirements of the HES grant funding. the second intersection,
Second Avenue and H Street, was advertised separately on May 27, 2005 after receiving
construction authorization from Caltrans; and
WHEREAS, staff opened bids on June 22, 2005, and all three bids submitted were found
to be non-responsive due to missing key documents that were determined to compromise the
integrity of the bid submittals.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula
Vista does hereby reject all bids and direct the City Engineer to re-advertise the Upgrade of
Traffic Signal at Second Avenue and H Street (Project TF-326!TF-311).
Presented by
Approved as to form by
r
h."c<~<O
Soliaib Al-Agha
City Engineer
>[g~
~clO'" IfJ
Ann oore
CitY Attorney
3-8
Resolution No. 2005-275
Page 2
PASSED, APPROVED, and ADOPTED by the City Council of the City of Chula Vista,
California, this 9th day of August, 2005, by the following vote:
AYES:
Councilmembers:
Castaneda, McCann, Rindone, and Padilla
NAYS:
Councilmembers:
None
ABSENT:
Councilmembers:
A TIEST:
:: _-at'l~~~_
Susan Bigelow, MMC, City erk
STATE OF CALIFORNIA )
COUNTY OF SAN DIEGO )
CITY OF CHULA VISTA )
I, Susan Bigelow, City Clerk of Chula Vista, California, do hereby certify that the foregoing
Resolution No. 2005-275 was duly passed, approved, and adopted by the City Council at a
regular meeting of the Chula Vista City Council held on the 9th day of August, 2005.
Executed this 9th day of August, 2005.
~.u-A-t.. ~r~
Susan Bigelow, MMC, City Clerk
3-9
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RESOLUTION NO. 2005-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA ACCEPTING BIDS AND AWARDING OF
CONTRACT FOR THE UPGRADE OF TRAFFIC SIGNAL AT
SECOND AVENUE AND H STREET (TF-326/TF-311)
PROJECT TO HMS CONSTRUCTION, INCORPORATED AND
APPROPRIATING FUNDS AS A LOAN FROM TRAFFIC
SIGNAL FUNDS
WHEREAS, the TF-311 project's budget is to nmd the upgrade of two signalized
intersections at First Avenue/H Street and Second AvenuelH Street. Staff separately advertised
each of the signal locations in order to properly document the contract for the upgrade at Second
Avenue and H Street after it was authorized for Hazard Elimination Safety (HES) funding; and
WHEREAS, on February 10, 2005, Caltrans authorized the construction of federal
project number STPLH 5203 (018), Upgrade of Traffic Signal at Second Avenue and H Street.
Staff advertised the project on May 27,2005 and opened bids on June 22, 2005; and
WHEREAS, all three bids received were found to be non-responsive based on the
incomplete bids. On August 8, 2005, City Council approved the rejection on all of the bids and
the re-advertisement of the project. This project was re-advertised on August 19, 2005; and
WHEREAS, costs for traffic signal work have gone up due to general increases in
equipment and labor costs since the project was appropriated. For this project, additional staff
costs have arise due to federal documentation/authorization process requirements and further
design changes in plans to accommodate the federal requirements, as well as the re-
advertisement process described above; and
WHEREAS, additional staff time was also required during the construction of the traffic
signal at the intersection of First Avenue and H Street due to the contractor's staffing changes.
AEC Contractor's main field supervisor left the company in the middle of the signal installation,
which created delays and the frequent/daily inspections by City inspectors; and
WHEREAS, four contractors submitted bids to perform the work as follows:
Contractor
HMS Construction, Incorporated (San Marcos, CA)
T & M Electric dba Perry Electric (Santee, CA)
".". ._---~---_._--^
Lekos Electric, Incorporated (El Cajon, CA)
..o'..n_..".. _____.._......._...___.__......._.......
Select Electric, Valley, CA)
Bid Amount
$102,016
$106,750
$108,400
_ ..__m.'.__"...._......._.__.__...._...........,.....
$144,200
WHEREAS, the low bid, submitted by HMS Construction is below the engineer's
estimate of$102,350 by $334 (0.3 %). HMS Construction has installed traffic signal projects in
the City with satisfactory performance. All bids submitted were complete; and
3-11
WHEREAS, after completion of the traffic signal installation work at First Avenue and H
Street, the remaining project account balance was $58,340 out the $250,000 total budget amount
for both First A venuelH Street and the Second A venuelH Street intersections; and
WHEREAS, staff requests that Council approve the estimated additional traffic signal
appropriation of $71,660 required to complete the subject project. The intersection at Second
Avenue and H Street signal upgrade will ultimately be reimbursed up to $95,040 ofHES federal
funding upon the completion of the project in early summer of2006; and
WHEREAS, there are no impacts to the General Fund and the available balance of the
Traffic Signal Fund is sufficient to allow the appropriation. Upon completion of improvements
at Second Avenue and H Street, normal annual signal energy and preventive maintenance costs
are estimated to be $5,500 for the intersection; and
WHEREAS, the Environmental Review Coordinator has reviewed the proposed project
for compliance with the California Environmental Quality Act and has determined that the
project qualifies for a Class I categorical exemption pursuant to Section 15301 of the State
CEQA Guidelines. Thus, no further environmental review is necessary.
NOW, THEREFORE, be it resolved the City Council of the City of Chula Vista does
hereby accept bids and award the contract for the Upgrade of Traffic Signal at Second Avenue
and H Street (TF-326/TF-311) project to HMS Construction, Incorporated in the amount of
$102,016 and authorizes staff to appropriate funds in the amount of $71,660 from the Traffic
Signal Fund needed to complete the project.
BE IT FURTHER RESOLVED that the Mayor of the City of Chula Vista is hereby
authorized and directed to execute said contracts on behalf of the City of Chula Vista.
Presented by
Approved as to form by
Sohaib AI-Agha
City Engineer
H:lengineerIRESOSIResos2005111-0 1-051TF326 11-01-05
3-12
COUNCIL AGENDA STATEMENT
l!-
Item:
Meeting Date: 11/1/05
ITEM TITLE:
RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF CHULA VISTA TO CREATE THE POSITION OF
FIRE PREVENTION ENGINEER
RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF CHULA VISTA AMENDING THE FY 2006 FIRE
DEPARTMENT BUDGET BY APPROPRIATING $61,968
FROM THE AVAILABLE BALANCE OF THE GENERAL
FUND TO ADD ONE FIRE PREVENTION ENGINEER AND
APPROPRIATING $45,810 FROM THE AVAILABLE
BALANCE OF THE PUBLIC FACILITIES DEVELOPMENT
IMPACT FUND TO PURCHASE AND OUTFIT ONE PICK-
UP TRUCK, AND RELATED FURNISHINGS, UNIFORMS
AND EQUIPMENT
SUBMITTED BY:
Fire Chief\)~r
City Manager #
(4/5ths Vote: YesLNo -1
REVIEWED BY:
The Fire Department is recommending the addition of one Fire Prevention
Engineer to the Fire Prevention Line of Business. The addition of this position is
necessary in order to ensure that the current workload demands resulting from
the current pace of growth are addressed.
RECOMMENDATION:
That Council adopts the above resolutions and thereby:
· Establish the position of Fire Prevention Engineer in the middle manager
group with an initial E-Step salary equivalent to the Plans Examiner
Classification
· Amend the Fire Department's personnel services budget by $59,368 for
fiscal year 2006 for the purpose of adding one Fire Prevention Engineer.
4-1
Item:
Meeting Date:
Li
/
11/1/05
· Amend the Fire Department's supplies and services budget by $2,600 for
fiscal year 2006 for the necessary supplies and services for the addition
of the Fire Prevention Engineer position.
· Amend the FY 2006 Fire Department budget and appropriate $45,810
from the available balance of the Public Facilities Development Impact
Fund to purchase and outfit one pick-up truck and related furnishings, and
uniforms and equipment.
BOARDS/COMMISSIONS RECOMMENDATION: N/A
BACKGROUND:
On September 7, 2004, the City Council accepted in concept the Fire
Department Strategic Business Plan. The Strategic Business Plan internally
aligns staff resources and positions to achieve mission-oriented results for the
residents of Chula Vista. This agenda statement will add one position to Fire
Prevention Line of Business. One of the purposes of this line of business is to
provide technical assistance and plan review services to developers, contractors
and property and business owners so they can expeditiously build in compliance
with City Municipal Codes and Fire Prevention policies. The addition of one Fire
Prevention Engineer to the Fire Prevention Line of Business will ensure that the
current workload demands created by the current pace of growth are addressed.
DISCUSSION:
Impact of Growth
The current pace of growth is impacting the services provided by the Fire
Prevention Division. The greatest workload impact has been created by the
various major building projects that are currently being undertaken throughout
the City. The number, size and scope of these projects, including major retail
centers, industrial complexes, and sectional planning areas are projected to
continue to increase. The current workload requirements created by the growth
of these projects has outpaced the Fire Prevention Division's ability to provide
plan check and inspection services. In an effort to address this workload issue
and mitigate the possible negative impacts resulting from the delayed opening of
these projects, staff is recommending the addition of one Fire Prevention
Engineer to the Fire Prevention Division.
4-2
Item: 4-
Meeting Date: 11/1/05
Current Staffing Level Capability
The Fire Prevention Division is currently comprised of four staff members
including the Fire Marshal. This staff provides inspection and plan check services
to citizens, property owners, and the development community. This staffing level
is capable of delivering approximately 1,600 plan checks and 1,000 inspections
per year. Inspection staff that has been re-assigned from other duties is
performing the current workload. As a result, other services including fire
inspections to existing structures, business license permitting, and responding to
constituent complaints have been curtailed. It is estimated that the future
workload may require approximately 3,000 plan checks and 2,000 inspections to
be performed based on the number of building permits that have already been
issued. The workload described above does not include the additional
inspections required in order to verify code compliance. The verification of code
compliance requires additional follow-up from field staff and is subsequently also
being impacted by the current growth rate.
The current growth rate will continue to maintain the workload in the Fire
Prevention Division at elevated levels in the coming years as several other major
projects are brought online. Examples of these projects include, but are not
limited to: Redevelopment of the Bayfront (phases I through IV), Otay Valley
Redevelopment Area, Southwest Redevelopment Area, and Town Center I & II.
Non-redevelopment areas include: Otay Ranch Town Center, Eastlake Design
District, Shops at San Miguel, The Crossings, Village Walk, University Site,
Eastern Urban Center, and the Auto Park Expansion.
Recommended Staffing Level
Staff is recommending the addition of one Fire Prevention Engineer position to
the Fire Prevention Division in order meet the current and future workload needs
resulting from the rapid growth pace, and to ensure the timely opening of major
development projects that will positively impact the City.
The Fire Prevention Engineer position will act as the primary technical advisor to
the Fire Prevention Division. This position will be responsible for conducting the
more complex plan reviews and inspections for the increased number of fire
suppression and fire protection systems resulting from the pace of growth, and
the size and scope of the projects that are being undertaken in the City. In
addition, the Fire Prevention Engineer will also be responsible for the formulation
4-3
Item: 4
Meeting Date: 11/1/05
of policies to maintain the City's fire code such that Fire and Life Safety
Compliance is ensured. The Human Resources Department developed the
classification for this position based on the above duties and responsibilities.
This position was classified as a middle manager with an E-Step salary
equivalent to the Plans Examiner.
The addition of this position will allow the Fire Marshal to assume the full duties
of providing oversight, planning, and direction to the Fire Prevention Division as
he is currently performing the duties that will be assumed by the Fire Prevention
Engineer.
This position will be hired in January 2006.
FISCAL IMPACT:
The total first year cost of this proposal is $107,778. The addition of the Fire
Prevention Engineer position will result in costs of $61,968 for fiscal year 2005-
06. These costs will be offset by $61,968 to be generated by additional
inspections revenues resulting in no impact to the General Fund. The ongoing
cost for this position for fiscal year 2006-07 is $128,848. Increased building
revenues to be generated as a result of the future update to the building fees
schedule will offset the ongoing costs. An additional $45,810 will be allocated
from the Public Facilities Development Impact Fee Fund for one-time vehicle and
related equipment costs resulting in no impact to the General Fund.
4-4
RESOLUTION NO. 2005-
RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF CHULA VISTA TO CREATE THE
POSITION OF FIRE PREVENTION ENGINEER
WHEREAS, the Human Resources Department has created new classifications to
better reflect the needs of the City's workforce; and,
WHEREAS, the Human Resources Department has created the classification of
Fire Prevention Engineer; and,
WHEREAS, this position has been classified as a Middle Manager with an
equivalent E-Step salary to the Plans Examiner classification; and,
WHEREAS, the Fire Department is recommending the addition of one Fire
Prevention Engineer to the Fire Prevention Line of Business; and,
WHEREAS, the addition of this position is necessary in order to ensure that the
current workload demands resulting from the current pace of growth are addressed.
NOW, THEREFORE, BE IT RESOLVED THAT the City Council does hereby
approve the creation of the position of Fire Prevention Engineer classified as a Middle
Manager with an equivalent E-Step salary to the Plans Examiner classification.
y:
~~
Approved as to form by:
"'t\os~\\~r~\v\
Ann Moore
City Attorney
as A. Perry
Fire Chief
H:/shared/attomeylFire-fire prevention engineer position
4-5
RESOLUTION NO. 2005-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA AMENDING TIIE FY 2006 FIRE
DEPARTMENT BUDGET BY APPROPRIATING $61,968
FROM THE AVAILABLE BALANCE OF TIIE GENERAL
FUND TO ADD ONE FIRE PREVENTION ENGINEER AND
APPROPRIATING $45,810 FROM TIIE AVAILABLE
BALANCE OF THE PUBLIC FACILITIES DEVELOPMENT
IMPACT FUND TO PURCHASE AND OUTFIT ONE PICK-
UP TRUCK, AND RELATED FURNISHINGS, UNIFORMS
AND EQUIPMENT
WHEREAS, the Fire Department is recommending the addition of one Fire Prevention
Engineer to the Fire Prevention Line of Business; and,
WHEREAS, the Fire Prevention Engineer position will act as the primary technical
advisor to the Fire Prevention Division; and,
WHEREAS, this position will be responsible for conducting the more complex plan
reviews and inspections for the increased number of fire suppression and fire protection systems;
and,
WHEREAS, The addition of this position is necessary in order to ensure that the current
workload demands resulting from the current pace of growth are addressed; and,
WHEREAS, The addition of this position will help ensure the timely opening of major
development projects that will positively impact the City; and,
WHEREAS, The addition of this position will result in a first year cost of$107,778; and,
WHEREAS, the first year cost of this position will result in $61,968 impact to the
General fund and a one-time $45,810 impact to the Public Facilities Development Impact Fund
respectively; and,
WHEREAS, the first year impact to the General Fund and the Public Facilities
Development Impact Fund will be offset by $61,968 from increased Inspection Fees and by
$45,810 from Development Impact fees respectively; and,
WHEREAS, the ongoing cost for this position is $128,848 and will be offset by
inspection fees and increased building revenues to be generated as a result of the future update to
the building fees schedule.
NOW, THEREFORE, BE IT RESOLVED THAT the City Council does hereby amend
the FY 2006 Fire Department Budget by appropriating $61,968 from the available balance of the
General Fund to add one Fire Prevention Engineer and appropriating $45,810 from the available
balance of the Public Facilities Impact Fund to purchase and outfit one pick-up truck and related
furnishings, uniforms and equipment. The funds will be appropriated in the following manner:
4-6
. $59,368 to personnel servIces and $2,600 to supplies and services In the Fire
Department budget
. $43,550 to capital expenditures and 2,260 to supplies and services in the Fire
Suppression Expansion Development Impact Fund
Pre
~
Approved as to form by:
glas A. Perry
Fire Chief
~.'fD~\~~~
Ann Moore
City Attorney
H:/sharedlanomey/fire prevention engineer appropriations
4-7
COUNCIL AGENDA STATEMENT
r
Item: ::....;
Meeting Date: 11/1/05
ITEM TITLE:
REVIEWED BY:
RESOLUTION ACCEPTING $100,000 FROM
THE OFFICE FOR DOMESTIC PREPAREDNESS AND
APPROPRIATING SAID FUNDS TO THE FISCAL YEAR
2005/2006 CAPITAL BUDGET OF THE POLICE
DEPARTMENT FOR THE BUFFER ZONE PROTECTION
PROGRAM
Chief of pOIiY
City ManagerP
(4/5ths Vote: YesLNo _l
SUBMITTED BY:
The Office for Domestic Preparedness (ODP) has allocated $100,000 to the
Police Department to address two sites identified by ODP as Critical
Infrastructure sites, which are located in the City of Chula Vista. Funds from the
FY 2005 Buffer Zone Protection Program will allow the City to acquire equipment
necessary to implement protective measures that will reduce vulnerabilities
around the two identified sites.
RECOMMENDATION: That Council adopts the resolution accepting $100,000
from the Office for Domestic Preparedness and appropriating said funds to the
Fiscal Year 2005/2006 capital budget of the Police Department for the Buffer
Zone Protection Program.
BOARDS/COMMISSIONS RECOMMENDATION: N/A
BACKGROUND: The Office for Domestic Preparedness (ODP) is a component
of the U.S. Department of Homeland Security's Office of State and Local
Government Coordination and Preparedness (SLGCP). SLGCP is the federal
government's lead agency responsible for preparing the nation against terrorism
by assisting states, local and tribal jurisdictions and regional authorities as they
prevent, deter and respond to terrorist acts. SLGCP provides a broad array of
assistance to America's first responders through funding, coordinated training,
exercises, equipment acquisition and technical assistance.
DISCUSSION: The Office for Domestic Preparedness has identified two Critical
Infrastructure and Key Resources (CI/KR) sites within the City of Chula Vista.
CI/KR sites are potential targets deemed most crucial in terms of national-level
public health and safety. The two CI/KR sites identified within the City of Chula
5-1
Page 2,ltem:
Meeting Date:
c::
'--'
11/1/05
Vista are Knott's Soak City USA and Terra Nova Plaza. The Office for Domestic
Preparedness has identified these two CI/KR sites by using a structured
vulnerability assessment methodology that factored in various site
characteristics. During the assessment, site surveys were not conducted and
input from the City was not requested.
The Office for Domestic Preparedness has provided funding from the FY 2005
Buffer Zone Protection Program (BZPP) to reduce vulnerabilities around CI/KR-
identified sites. The City is allocated $50,000 per CI/KR site to purchase
equipment that will reduce vulnerability and deter threats aimed at the site. Staff
has conducted site surveys at Knott's Soak City USA and Terra Nova Plaza to
assess vulnerability, and recommends using the $100,000 allocated funding for
the purchase and installation of wireless video cameras that will be installed on
City property just outside the perimeters of the two sites. The Police Department
will be able to monitor and control these cameras remotely (pan/tiIUzoom),
improving the Department's ability to respond to critical incidents at those sites.
State agencies are only eligible to apply for BZPP funding. The State of
California is the responsible agency for the City's FY05 BZPP funds. Staff has
already submitted a Buffer Zone Protection Plan and Vulnerability Reduction
Purchasing Plan, and will be able to draw down funds upon approval from the
Office for Domestic Preparedness.
FISCAL IMPACT: Approval of this resolution will result in a one-time
appropriation of $100,000 to the capital budget of the Police Department. The
funding from the Office for Domestic Preparedness will completely offset these
costs, resulting in no net fiscal impact to the General Fund.
5-2
RESOLUTION NO.
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA
VISTA ACCEPTING $100,000 FROM THE OFFICE FOR
DOMESTIC PREPAREDNESS AND APPROPRIATING SAID
FUNDS TO THE FISCAL YEAR 2005/2006 CAPITAL BUDGET
OF THE POLICE DEPARTMENT FOR THE BUFFER ZONE
PROTECTION PROGRAM
WHEREAS, the Office for Domestic Preparedness used a structured
vulnerability assessment methodology to identify Knott's Soak City USA and
Terra Nova Plaza as two Critical Infrastructure and Key Resources (CI/KR) sites
within the City of Chula Vista; and
WHEREAS, CI/KR sites are potential terrorist targets deemed most crucial
in terms of national-level public health and safety; and
WHEREAS, funds from the FY 2005 Buffer Zone Protection Program will
allow the City to acquire equipment necessary to implement protective measures
that will reduce vulnerabilities around its two CIIKR-identified sites; and
WHEREAS, the purchase and installation of wireless video cameras will
improve the Police Department's ability to respond to critical incidents at the two
CIIKR-identified sites; and
WHEREAS, the Fiscal Year 2005/2006 Police budget will be amended to
add $100,000 for capital expenditures.
NOW, THEREFORE, BE IT RESOLVED the City Council of the City of
Chula Vista does hereby accept $100,000 from the Office for Domestic
Preparedness and appropriate said funds to the Fiscal Year 2005/2006 capital
budget of the Police Department for the Buffer Zone Protection Program.
Presented by:
Approved as to form by:
Richard P. Emerson
Police Chief
/R!,~ ~ :6lf
Ann Moore tI
City Attorney
5-3
CITY COUNCIL AGENDA STATEMENT
Item: ..
Meeting Date: 11/01105
SUBMITTED BY:
RESOLUTION; Adopting an amendment to Otay Valley Regional
Park Joint Exercise of Powers Agreement (JEP A) between the County of San
Diego and the Cities of Chula Vista and San Diego, and authorizing the
Mayor to sign the amended agreement.
Director of Planning and Buildin~ ~
Director ofR~n \
CityManag~ (4/5Vote:Yes_No-1L)
ITEM TITLE:
REVIEWED BY:
Over the past IS years the City of Chula Vista, the County of San Diego and the City of San Diego
have worked successfully together to plan and acquire land for the Otay Valley Regional Park (see
Attachment I). Over 750-acres of property has been acquired for public park purposes, and it is
necessary now to amend the Joint Exercise of Powers Agreement (JEPA) in order to provide
guidance for the operations and maintenance of the park as we begin to establish trails and other
recreation features, as well as to care for the property now in public ownership. The item before
Council is an amendment to the Otay Valley Regional Park JEP A adding language that will
accomplish this.
RECOMMENDATION:
That Council Adopt Resolution.
BOARDS AND COMMISSION RECOMMENDATION: N/A
DISCUSSION:
1. Background
In January 1990, the County of San Diego and the Cities ofChula Vista and San Diego signed a Joint
Exercise of Powers Agreement (JEPA) for the acquisition, planning and design of the Otay Valley
Regional Park (OVRP).
The planning area for OVRP totals approximately 8,000 acres and extends about 13 miles from the
South San Diego Bay National Wildlife Refuge east along the Otay River Valley, and including the
Upper and Lower Otay Reservoirs and the land surrounding them (see Attachment I). This open
space corridor also serves to define the community edges of south Chula Vista and the City of San
Diego's Otay Mesa and OtaylNestor Community Planning Areas. The JEP A established a 3-member
6-1
Page No.2, Item:
Meeting Date: 11/01/05
Policy Committee (PC) of elected officials and a 3D-member Citizens Advisory Committee (CAC).
The Policy Committee consists of three elected representatives appointed respectively by the San
Diego County Board of Supervisors, the Chula Vista City Council, and the San Diego City Council.
It sets or recommends policy for the administration of the regional park, including but not limited to
prioritizing property acquisitions, recommending approval of implementation master plans, and
prioritizing staff implementation efforts such as preparation of design standards and responding to
day-to-day park management issues. The CAC was created to serve the Policy Committee as its
advisory body on such park implementation issues.
Beyond the establishment of the PC and CAC, the current JEP A focuses on provisions that empower
the three involved agencies to acquire and hold property, and to plan and design public facilities and
appurtenances for park purposes.
2. JEP A Amendment
While the original JEP A has been successful in providing guidance to obtain funding, acquire land,
and keep the public engaged in the formation of this amenity, the current JEP A lacks the guidance to
fully address the operations and management of the OVRP. Approximately 754-acres have been
acquired within which trails, staging areas, and viewpoints are being planned or constructed today.
Staff and legal counsel from the three jurisdictions have completely reviewed the JEP A, and jointly
prepared comprehensive and appropriate amendments that will continue to address the planning and
acquisition of land for the regional park, but also address the operations and management of the
OVRP.
The following are the key areas addressed with the amended JEP A (see Attachment 2):
· Length of Agreement (Section 3) - The length of the agreement is for 25 years and can be
terminated upon 3 D-days written notice by anyone of the agencies.
· Definition of Terms (Section 4) - "Developed Recreation", "Maintenance", "Natural Open
Space" and "Operations" are defined for purposes of the regional park.
· Role of Citizen Advisory Committee (Section 7) - The thirty member advisory committee
can now establish a minimum quorum of twelve members in order to take action. CAC is
advisory to Policy Committee.
· Operations and Maintenance of the OVRP (Section 12) - General maintenance of public
regional park open space west of Heritage Road is established as the responsibility of the
City of San Diego, with Chula Vista contributing funds to pay its fair share. The County of
San Diego will maintain public regional park open space east of Heritage Road, subject to
Chula Vista also paying its fair share. (Note: Responsibilities specified in the MSCP
J :\Planning\FRANKH\jepa_ agenda_statement_9.20.2005 _ DuaneEdits2.doc
6-2
Page No.3, Item:
Meeting Date: 11/01105
subject to this agreement). The payment of funds for general maintenance will be subject to
availability. Operations and maintenance of active recreation parklands will be the sole
responsibility of the agency that acquires it.
. Defense and Indemnity (Section 13) - Clarifies responsibilities for each agency in case of
claims.
. OVRP Revenue (Section 15) - Any revenue obtained from the operation and use of OVRP
natural open space property shall be used exclusively for the OVRP.
. Coordination of Operations and Budget (Section 16) - Executive managers of each agency
shall meet to review and resolve issues, and determine an annual budget for the OVRP
natural open space lands.
3. Conclusion
The proposed amendments provide the appropriate tools to guide the operations and management of
the OVRP for years to come. Staff recommends that the City Council authorize the Mayor to execute
the Agreement.
FISCAL IMPACT:.
There is no direct fiscal impact by approving this amendment to the existing JEPA; however, by
amending the JEP A, each jurisdiction agrees to continue to operate and maintain the OVRP, thereby
committing to the contribution of annual funds and staff support. Although not a part of this report,
the following information is provided.
. Annual costs for operating and maintaining the OVRP are being shared equally by each
jurisdiction, and have amounted to approximately $60,000 per jurisdiction, in addition to
staff costs. These funds are currently specified within the Planning and Building
Department's annual budget.
. Additional costs for clean-up activities within the Otay Valley, amounting to $93,000
annually, will be included in the annual budget.
. As the construction of trails and staging areas occur, and active use ofthe park continues to
increase, it is anticipated that annual budget increases will likely occur. Staff will provide
Council with appropriate analysis and information of any such increases through the regular
budget process.
Attachments:
1. Locator Map
2. Amended OVRP Joint Exercise of Powers Agreement (JEPA)
6-3
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THE ATTACHED AGREEMENT HAS BEEN REVIEWED
AND APPROVED AS TO FORM BY THE CITY
ATTORNEY'S OFFICE AND WILL BE
FORMALLY SIGNED UPON APPROVAL BY
THE CITY COUNCIL
Ann Moore
City Attorney
Dated: 10/21/05
JOINT EXERCISE OF POWERS AGREEMENT
AMONG THE COUNTY OF SAN DIEGO AND THE
CITIES OF CHULA VISTA AND SAN DIEGO
FOR THE OTAY VALLEY REGIONAL PARK
6-6
DRAFT
JOINT EXERCISE OF POWERS
AGREEMENT AMONG THE
COUNTY OF SAN DIEGO AND THE
CITIES OF CHULA VISTA AND
SAN DIEGO
FOR THE OT A Y VALLEY
REGIONAL PARK
THIS AGREEMENT, dated for convenience as of the
day of
2005
is entered into by the Cities of Chula Vista and San Diego, California Municipal Corporations,
and the County of San Diego, a political subdivision of the State of California, (hereinafter
referred to individually or collectively as Public Agency or Public Agencies).
RECITALS
WHEREAS, the Public Agencies are each empowered by law to acqUIre and hold
property and to plan and design public facilities and appurtenances for park purposes; and
WHEREAS, the Public Agencies desire to coordinate acquisition, planning, and design Of
the Otay Valley Regional Park (OVRP) for the benefit of their citizens and the public; and
WHEREAS, joint cooperation and participation among the Public Agencies will be
mutually beneficial and in the public interest; and
WHEREAS, the Public Agencies have acquired property for OVRP and wish to
coordinate the operation and maintenance of OVRP for the benefit of their citizens and others, by
jointly exercising their common powers in the manner set forth in this Agreement.
NOW, THEREFORE, the Public Agencies agree as follows:
SECTION 1. Rescind Original JEPA.
The Joint Exercise of Powers Agreement for the Planning and Acquisition for OVRP
dated January 30, 1990 is hereby rescinded and replaced in its entirety by this Agreement.
1
6-7
SECTION 2.
Purpose.
This Agreement is made pursuant to the provisions of Article 1, Chapter 5, Division 7,
Title 1 of the Government Code of the State of California cornmencing with Section 6500,
(hereinafter referred to as the "Act") relating to the joint exercise of powers common to public
agencies. The Public Agencies possess the powers referred to in the above recitals. The purpose
of this Agreement is to exercise such powers jointly by coordinating acquisition, planning,
design, operations and maintenance of the OVRP.
SECTION 3.
Term.
This Agreement shall become effective when executed by all parties and shall continue in
full force and effect for 25 years from the date hereof or until terminated by any of the agencies
upon 30 days written notice to the other agencies. At the expiration of the term provided for
herein, any money appropriated by the Public Agencies for the implementation of this
Agreement which has not been spent shall be returned to the parties in proportion to their
respective contributions.
SECTION 4. -Definitions.
Developed Recreation - Areas that have been altered to provide for active recreational use,
such as sports fields, turf areas, recreation centers, and paved parking.
Maintenance - The normal maintenance duties of an agency's ranger staff that includes, but not
limited to:
. Removal oflitter and illegal dump sites;
. Installing and repairing fencing and gates;
. Constructing and maintaining trails;
. Site remediation (i.e. erosion control);
2
6-8
Natural open space - Areas that are managed for habitat value and passive recreation, such as
trails and staging areas with interpretive facilities.
Operations - The normal operation duties of an agency's ranger staff that include:
. Developing and conducting nature walks and other interpretive programs on the natural
and historical features of the OVRP;
. Designing and preparing exhibits and information materials related to OVRP;
. Serving as liaison to other jurisdictional departments and agencies, community groups
and organizations, and the public regarding OVRP facilities, services and improvements;
. Patrolling roads and trails in OVRP to monitor park usage and to enforce park rules and
regulations;
. Answering questions and explaining/enforcing OVRP policies and regulations, and
Issues;
. Developing, coordinating and administering OVRP maintenance and security contracts;
. Assigning, training, and evaluating the work of contractors and volunteer OVRP staff;
. Maintaining records of OVRP activities and preparing reports regarding OVRP;
. Providing first aid assistance;
Monitoring OVRP use by the public; and
. Preparing and monitoring an annual OVRP budget.
SECTION 5. Boundaries.
The boundaries of the territory within which the Public Agencies shall exercise their
powers under this Agreement shall be the boundaries of the approved Concept Plan map as
adopted by the Public Agencies on May 23, 2001 (see Exhibit "A")except for the City of San
Diego reservoirs as depicted on Exhibit "A".
3
6-9
A depiction of the Concept Plan boundaries shall not be construed to affect the uses to
which any property may legally be devoted and is not intended to constitute an announcement of
the Public Agencies' intent to acquire, by purchase or condemnation, any particular parcel of
property located within said boundaries, but rather is intended to facilitate continued planning for
potential future park development.
SECTION 6. Policy Committee.
A Policy Committee consisting of three elected representatives appointed respectively by
the San Diego County Board of Supervisors, the Chula Vista City Council and the San Diego
City Council shall, by unanimous vote, set the policies for the administration of this Agreement
including the resolution of any issues or disputes that have not been satisfactorily resolved
through coordination efforts described in Section 16 herein. The representative for the County of
San Diego shall be a member of and appointed by the County Board of Supervisors. The
representative from the City of Chula Vista shall be a member of and appointed by the City
Council. The representative from the City of San Diego shall be a member of and appointed by
the City Council. Appointment to the Policy Committee shall be for a term not to exceed the
appointee's current term in office. A quorum for the purposes of conducting business will
consist of two members of the Policy committee. In the absence of a quorum, a single member
present may move to adjourn.
The Policy committee may adopt bylaws, rules and regulations as required to conduct
meetings and business.
The Policy Committee shall conduct regular meetings at least annually and at such other
times as may be determined by the Committee or provided for in its bylaws.
4
6-10
The Policy Committee shall appoint a Citizen Advisory Committee and oversee its
activities. The Policy Committee may also appoint alternates for Citizen Advisory Committee
Representatives.
The Ralph M. Brown Act (Government Code Sections 54950-54963) shall govern the
proceedings, noticing and general activities of the Policy Committee.
SECTION 7.
Citizen Advisory Committee.
The Citizen Advisory Committee shall consist of thirty members appointed by the Policy
Committee. The Citizen Advisory Committee shall select from its membership a chairperson
and a vice-chairperson. The Citizen Advisory Committee shall be comprised of members of the
community, members of community organizations, property owners and others interested in
OVRP as determined by the Policy Committee. The purpose of the Citizen Advisory Committee
is to advise the Policy Committee on matters on which the Policy Committee requests such
advice and to support agency staff in various park matters.
The Citizen Advisory Committee members shall serve at the pleasure of the Policy
Committee for a' term to be set by the Policy Committee. A quorum for purposes of conducting
business shall consist of 12 committee members or alternates. A simple majority (7) of the
the 12 votes shall be required to take action on an item.
In the absence of a quorum, a single member present may move to adjourn.
The Ralph M. Brown Act (Government Code Sections 54950-54963) shall govern the
proceedings, noticing and general activities of this Citizen Advisory Committee.
SECTION 8. Administration.
This Agreement shall be administered by the Public Agencies. This Agreement shall be
administered on behalf of the County of San Diego by the Director of Parks and Recreation; on
5
6-11
behalf of the City of San Diego by the Director of Park and Recreation; and on behalf of the City
of Chula Vista by the City Manager or his/her designee per written designation.
The County of San Diego agrees to act as lead agency for purposes of scheduling
meetings, preparing agendas, recording minutes and maintaining records related to the planning,
design, operations and maintenance of the OVRP.
SECTION 9.
Privileges and Immunities.
All of the privileges and immunities from liability, exemptions from laws, ordinances and
rules, all pension, relief, disability, workers' compensation, and other benefits which apply to the
activity of officers, agents, or employees of any of the Public Agencies when performing their
respective functions within their territorial limits, shall apply to them to the same degree and
extent while engaged in the performance of any of their functions and duties extra-territorially
under this Agreement.
SECTION 10. Records and Accounts.
Each Public Agency shall be strictly accountable for all funds and shall report all
receipts and disbursements related to the acquisition of real property for OVRP and to the
operation and maintenance of OVRP under this Agreement.
SECTION 11. Title ofProperty.
All right, title and interest to the real property acquired for the OVRP shall belong to and
be vested in the Public Agency, i.e., the County of San Diego, the City of Chula Vista, or the
City of San Diego, that acquired the real property. Termination of this Agreement shall not
change the right, title, or interest of any real property comprising the OVRP. If the property is in
another jurisdiction, the Public Agency that acquired the real property may retain ownership of
the property or may transfer ownership to the jurisdiction in which the property is located if the
6
6-12
Public Agency in whose jurisdiction the property is located provides its written consent to the
transfer.
SECTION 12. Operations and Maintenance of the OVRP
A. At its cost, the City of San Diego shall operate and maintain the public lands
designated for natural open space purposes in Area "A" on Exhibit "A." The City of San Diego
shall maintain these lands in a good and sanitary order, condition and repair and in a manner
reasonably acceptable to the City of Chula Vista and County of San Diego. This obligation
applies irrespective of which Public Agency owns the public lands in Area "A," but the
obligation is subject to the availability of funds as determined by the San Diego City Council.
B. At its cost, the County of San Diego shall operate and maintain the public lands
designated for natural open space purposes in Areas "B" and "c" on Exhibit "A." The County
of San Diego shall maintain these lands in a good and sanitary order, condition and repair and in
a manner reasonably acceptable to the City of Chula Vista and City of San Diego. This
obligation applies irrespective of which Public Agency owns the public lands in Areas "B" and
"C," but the obligation is subject to the availability of funds as determined by the Board of
Supervisors.
C. At its sole cost, the City of San Diego shall operate and maintain for water
resources purposes (lake operations, water-related recreation, and watershed protection) , all of
the land in Area "c" on Exhibit "A" that the City of San Diego owns. This obligation shall be
subject to the availability offunds as determined by the San Diego City Council.
D. The obligations of the City and County of San Diego to operate and maintain the
natural open space property in Areas "A" and "B" on Exhibit "A" owned by the City of Chula
Vista in fee or through an easement restricting development are contingent on the City of Chula
7
6-13
Vista paying to the City and County of San Diego the funds reasonably necessary for this
purpose. However, the City ofChula Vista's obligation to pay the City and County of San
Diego is subject to the availability of funds as determined by the Chula Vista City Council.
E. The obligations specified above to operate and maintain the public lands
designated for natural open space purposes in Areas "A" and "B" on Exhibit "A" do not include
those responsibilities specified in the Multiple Species Conservation Program Subarea Plans, the
Otay Ranch Resource Management Plan or the Western Otay Valley Regional Park Natural
Resources Management Plan, unless otherwise agreed to under separate instrument.
F. The City of San Diego, the City of Chula Vista and the County of San Diego shall
each be solely responsible for operating and maintaining lands in OVRP that the respective
Public Agency acquires or acquired that is or will be developed for purposes of active recreation
(lands not designated for natural open space purposes).
G. Upon the approval of the owning Public Agency and approval by the Policy
Committee, a different Public Agency shall have the right to enter said property for the purpose
of constructing open space amenities (i.e. trails, kiosks, signage, staging area).
SECTION 13. Defense and Indemnity
A. Claims Arising From Sole Acts or Omissions of County of San Diego.
The County of San Diego (County) hereby agrees to defend and indemnify the City of San
Diego and/or City of Chula Vista, and their respective agents, officers and employees, from
any claim, action or proceeding against the City of San Diego and/or City of Chula Vista,
arising solely out of the acts or omissions of the County in the performance of this
Agreement. At its sole discretion, the City of San Diego and/or City of Chula Vista may
participate at its own expense in the defense of any claim, action or proceeding, but such
8
6-14
participation shall not relieve the County of any obligation imposed by this Agreement. The
City of San Diego and/or City of Chula Vista shall promptly notify the County of any claim,
action or proceeding and cooperate fully in the defense.
B. Claims Arising From Sole Acts or Omissions of City of San Diego.
The City of San Diego hereby agrees to defend and indemnify the City of Chula Vista and/or
the County of San Diego, and their respective agents, officers and employees, from any
claim, action or proceeding against the City of Chula Vista and/or the County of San Diego,
arising solely out of the acts or omissions of the City of San Diego in the performance of this
Agreement. At its sole discretion, the City of Chula Vista and/or the County of San Diego
may participate at its own expense in the defense of any claim, action or proceeding, but such
participation shall not relieve the City of San Diego of any obligation imposed by this
Agreement. The City of Chula Vista and/or the County of San Diego shall promptly notify
the City of San Diego of any claim, action or proceeding and cooperate fully in the defense.
C. Claims Arising From Sole Acts or Omissions of City of Chula Vista.
The City of Chula Vista hereby agrees to defend and indemnify the City of San Diego and/or
the County of San Diego, and their respective agents, officers and employees, from any
claim, action or proceeding against the City of San Diego and/or the County of San Diego,
arising solely out of the acts or omissions of the City of Chula Vista in the performance of
this Agreement. At its sole discretion, the City of San Diego and/or the County of San Diego
may participate at its own expense in the defense of any claim, action or proceeding, but such
participation shall not relieve City of Chula Vista of any obligation imposed by this
Agreement. The City of San Diego and/or the County of San Diego shall promptly notify the
City of Chula Vista of any claim, action or proceeding and cooperate fully in the defense.
9
6-15
D. Claims Arising From Concurrent Acts or Omissions.
The County of San Diego hereby agrees to defend itself, the City of San Diego hereby agrees
to defend itself and the City of Chula Vista hereby agrees to defend itself, from any claim,
action or proceeding arising out of the concurrent acts or omissions of the County of San
Diego, City of San Diego and/or City of Chula Vista. In such cases, County of San Diego,
City of San Diego and City of Chula Vista agree to retain their own legal counsel, bear their
own defense costs, and waive their right to seek reimbursement of such costs, except as
provided in subsection F below.
E. Joint Defense.
Notwithstanding subsection D above, in cases where the County of San Diego, City of San
Diego and/or City of Chula Vista agree in writing to a joint defense, the County of San
Diego, City of San Diego and/or City of Chula Vista may appoint joint defense counsel to
defend the claim, action or proceeding arising out of the concurrent acts or omissions of the
County of San Diego, City of San Diego and/or City of Chula Vista. Joint defense counsel
shall be selected by mutual agreement of the parties. The parties agree to share the costs of
such joint defense and any agreed settlement in equal amounts, except as provided in
subsection F below. The parties further agree that no party may bind the other party or
parties to a settlement agreement without the written consent ofthe other party or parties.
F. Reimbursement and/or Reallocation.
Where a final judgment of a court or an arbitration award allocates or determines the
comparative fault of the parties, the County of San Diego, City of San Diego and/or City of
10
6-16
Chula Vista may seek reimbursement and/or reallocation of defense costs, settlement
payments, judgments and awards, consistent with such comparative fault.
SECTION 14. Entrance on Premises
Each Public Agency reserves and shall always have the right to enter the land that it
owns irrespective of whether the land is in Area "A," "B" or "c" on Exhibit "A."
SECTION 15. OVRP Revenue
The Public Agencies agree that all revenues obtained from the operation and use of the
OVRP natural open space property shown in Areas "A","B" and "c" on Exhibit "A" shall be
collected by the Public Agency managing the lands and shall be used exclusively for OVRP
natural open space purposes as defmed in Section 2. For lands shown in Exhibit "A", Area "C",
all water-related revenues will remain with the City of San Diego, but all natural open space
related revenues shall be collected by the County of San Diego Parks and Recreation Department
and used exclusively for OVRP natural open space purposes.
SECTION 16. Coordination of Operations and Budget.
On or before December 31 of each year, the Chief Administrative Officer of the County
of San Diego and the City Managers of the Cities of San Diego and Chula Vista, or their
designees, shall meet to review and resolve any issues or disputes regarding development,
operation and maintenance, and to determine an annual budget for the OVRP natural open space
lands, shown in Exhibit "A", that is equitable to each public agency and arrange for transfers of
funds as may be authorized by their respective agencies.
SECTION 17. Notices.
Any notice or notices provided by this Agreement or required by law to be given
or served upon the Public Agencies may be given by depositing the same in the United States
11
6-17
mail, postage prepaid, addressed to the Director of Parks and Recreation, County of San Diego,
5201 Ruffin Road, Suite P, San Diego, CA 92123; Park and Recreation Director, City
Administration Building, 202 "c" Street, Ninth Floor, San Diego CA 92101; or City Manager,
City ofChula Vista at 276 4th Avenue, Chula Vista, CA 92010 or to such addresses as the Public
Agencies may subsequently specify in writing.
SECTION 18. Governing Law.
This Agreement shall in every respect be binding upon the parties hereto and their
respective successors and assigns. This Agreement shall be governed by the laws of the State of
California.
SECTION 19. Provisions Required by Law.
Each and every provision of law and clause required by law to be inserted in this
Agreement shall be deemed to be inserted herein and the Agreement shall be read and enforced
as though it were included herein, and if for any reason any such provision is not inserted, or is
not correctly stated, then upon application of any party the Agreement shall forthwith be
physically amended to make such insertion or correction.
SECTION 20. Partial Invalidity.
If any provision of this Agreement or the application thereof to any person or
circumstances shall to any extent, be invalid or unenforceable, the remainder of this Agreement,
or the application of such provision to persons or circumstances other than those as to which it is
invalid or unenforceable, shall be unaffected thereby and shall remain valid and be enforced to
the fullest extent permitted by law.
12
6-18
SECTIOi'l 21. Execution.
This Agreement may be simultaneously executed in any number of counterparts, each of
which when so executed shall be deemed to be an original, but all together shall constitute but
one and the same Agreement. It is also understood and agreed that separate counterparts of this
Agreement may be separately executed by City of San Diego, City of Chula Vista, and County
of San Diego, all with the same full force and effect as though the same counterpart has been
executed simultaneously by each City and the County of San Diego.
SECTION 22. Termination.
The Agreement may be terminated upon written notice by any of the Public Agencies to
the other Public Agencies and shall be effective no less than 30 days after receipt, unless a
shorter time is agreed upon in writing by the Public Agencies.
SECTION 23. Entire Agreement.
This Agreement contains the entire understanding to the parties with respect to the
subject matter contained herein. All prior understandings and representations, written and oral,
are superseded by this Agreement. No term or provision hereof may be changed, waived,
discharged or terminated unless the same be in writing and signed by the parties to the
Agreement.
13
6-19
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and
attested by their proper officers thereunto duly authorized, as of this date first written.
CITY OF CHULA VISTA
Mayor
ATTEST:
Q~'\
City Clerk
CITY OF SAN DIEGO
City Manager
ATTEST:
City Clerk :\
COUNTY OF SAN~~
By: Q
Clerk of the Board of Supervisors
14
6-20
OTAY VALLEY REGIONAL PARK
EXHIBIT A
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6-21
RESOLUTION NO.
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA
VISTA ADOPTING AN AMENDMENT TO THE OTAY VALLEY
REGIONAL PARK JOINT EXERCISE OF POWERS AGREEMENT
(JEPA) BETWEEN THE COUNTY OF SAN DIEGO AND THE CITIES
OF CHULA VISTA AND SAN DIEGO AND AUTHORIZING THE
MAYOR TO SIGN THE AMENDED AGREEMENT
.,
WHEREAS, the City of Chula Vista, City San Diego and County of San Diego ("agencies")
exercise jurisdictional control over property located within the Otay River Valley area, and
WHEREAS, the agencies entered into a Joint Exercise of Powers Agreement ("JEPA") on
January 30, 1990 for the planning, design and acquisition of land for the Otay Valley Regional Park
("OVRP"); and
WHEREAS, the agencies recognize that the original JEP A did not address operations and
management of the OVRP and therefore are now proposing amendments that will address this; and
WHEREAS, this JEP A Amendment has been forwarded to the agencies for their approval, and is
attached hereto;
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula Vista does
hereby adopt an amendment to the JEP A between the County of San Diego and the Cities of Chula Vista
and San Diego, a copy of which is attached hereto and incorporated herein by reference as if set forth in
fulL
BE IT FURTHER RESOLVED that the Mayor of the City of Chula Vista is hereby authorized
and directed to execute this JEP A amendment for and on behalf of the City of Chula Vista.
Jim Sandoval
Director of Planning and Building
Buck Martin
Director of Recreation
Presented by
6-22
COUNCIL AGENDA STATEMENT
Item No 7
Meeting Date 11/1/05
ITEM TITLE: RESOLUTION APPROVING REQUEST FROM THE CHULA
VISTA HIGH SCHOOL BAND AND PAGEANTRY CORP AND THE
CHULA VISTA SCHOOL FOR THE CREATIVE AND
PERFORMING ARTS TO CONDUCT THE 9TH ANNUAL BAND
REVIEW AND AUTHORIZING TEMPORARY STREET
CLOSURES AND WAIVING CITY FEES FOR POLICE SERVICES.
SUBMITTED BY: Chief of Police P /h ,# J ,
Director of Human Reso~s ' ~
Director of Public worke?"~b~(\C.'"
REVIEWED BY: City Manager JiJ (4/5ths Vote: Yes_ No ~ )
The Chula Vista High School Band and Pageantry Corps, in conjunction with the Chula
Vista School for the Creative and Performing Arts, is requesting permission to conduct
an organized band review on Saturday, November 12, 2005.
RECOMMENDATION:
That Council adopts the resolution approving the waiver of City fees for police services
and authorizing temporary street closures for the organized band review subject to staff
conditions.
BOARDS/COMMISSIONS RECOMMENDATIONS: Not Applicable
DISCUSSION:
Chula Vista High School Band and Pageantry Corps, and the Chula Vista School for the
Creative and Performing Arts, (band review sponsor) is requesting permission to
conduct their 9th Annual Band Review parade on Saturday, November 12, 2005. The
parade will consist of approximately thirty marching bands and marching groups and
over 1,500 participants competing against one another for top honors and awards.
The participating groups in the parade will stage on the south side of Sear's, 500 "I"
Street. The proposed parade route will take place going west on "I" Street to Broadway,
south on Broadway to "K" Street, and east on "K" Street to the Chula Vista High School
football stadium.
7-1
Page 2, Item 7
Meeting Date 11/1/05
The parade is scheduled to take place between 8:00 AM and 10:30 AM. The street
closures would be in effect from approximately 7:30 AM to 11 :00 AM to allow for the
dispersion of parade participants.
The Police Department will monitor the progress of the parade, and will close and
subsequently reopen streets and intersections as quickly as possible. The sponsor will
also provide teaching staff to accompany each band to monitor the progress of the
parade. A diagram of the parade route is attached (Attachment A).
The street closures will have an impact on City bus service in the area. Transit has
agreed to cancel and re-route bus service in the area during the parade, and erect signs
of the interruption of service.
Approval is recommended subject to the following conditions:
1. Prior to the event, Chula Vista High School (Chula Vista School for the Creative
and Performing Arts - parade sponsor) shall provide evidence, acceptable to the
City, of commercial general liability insurance in the amount of $5 million in the
form of a Certificate of Insurance and Policy Endorsement naming the City of
Chula Vista as additional insured (Attachment B).
2. Adequate police coverage at the event as determined by the Police Department
through coordination with the Department's Special Events Coordinator. The
parade route will be marshaled by Police and Police Department volunteers.
3. Adequate traffic control equipment and devices as determined by the Police
Department. The sponsor will be responsible for renting or purchasing the
equipment and delivering and removing it from designated locations.
4. Posting and removal of "No-Parking" signs along the parade route.
5. Provision and subsequent removal of adequate portable toilets and trash
receptacles at the parade staging area and at Chula Vista High School.
6. Provide a letter acceptable to the City Attorney from the sponsors in which they
agree:
(1) Not to sue the City, its agents and employees from any act arising
from the Band Review: or
(2) To defend, indemnify, release, protect and hold harmless, the City, its
agents and employees from any and all liability arising from the Band
7-2
Page 3, Item 7
Meeting Date 11/1/05
Review, excluding only that liability which may arise from the sole
negligence or sole willful conduct of the City.
The Chula Vista High School Marching Band and Pageantry Corps has also made a
formal request to the Mayor and Council asking that fees associated with police
services for this year's Annual Band Review be waived. The full cost recovery fee
for this event is estimated at $23,824. The cost was calculated based upon full cost
recovery of police services from 6:30 AM until 1 :00 PM. The use of volunteers is
based on availability; however, staff is confident that up to ten volunteers (Explorer
Scouts and Senior Volunteers) will be available for this year's event.
The Annual Band Review is expected to draw 30 participating bands and pageantry
groups from the San Diego Region, as well as portions of Southern California. As in
the past, the Band Review provides a positive image and venue for the youth in our
community.
FISCAL IMPACT: The full cost recovery fee is $23,824 to provide coverage for
this event. A waiver of the fees to Sweetwater Union High School District will result
in a $5,848 direct cost to the Police Department overtime budget which will be
absorbed in the FY06 Police Department overtime budget.
7-3
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7-Lj
RESOLUTION
RESOLUTION APPROVING REQUEST FROM THE
CHULA VISTA HIGH SCHOOL BAND AND
PAGEANTRY CORP AND THE CHULA VISTA
SCHOOL FOR THE CREATIVE AND PERFORMING
ARTS TO CONDUCT THE 9TH ANNUAL BAND
REVIEW AND AUTHORIZING TEMPORARY STREET
CLOSURES AND WAIVING CITY FEES FOR POLICE
SERVICES
WHEREAS, the Chula Vista High School and Pageantry Corp in conjunction
with the Chula Vista School for the Creative and Performing Arts will be conducting
the 9th Annual Band Review on Saturday, November 12, 2005; and
WHEREAS, the Chula Vista High School Band and Pageantry Corp has
requested City fees for police services be waived; and
WHEREAS, Law Enforcement related fees estimated at $23,823.89 dollars
shall be waived; and
WHEREAS, the Chula Vista High School and Pageantry Corp and the Chula
Vista School for the Creative and Performing Arts will provide evidence of
insurance in the form of a Certificate of Insurance and Policy Endorsement,
acceptable to the City, in the amount of $5 million dollars naming the City of Chula
Vista as additional insured, and their insurance company as primary; and
WHEREAS, the Chula Vista High School Band and Pageantry Corp and the
Chula Vista School for the Creative and Performing Arts will provide adequate
traffic control equipment and "No-Parking" signs as specified by the Chula Vista
Police Department; and
WHEREAS, the Chula Vista High School Band and Pageantry Corp and the
Chula Vista School for the Creative and Performing Arts will provide adequate
police coverage at the event as determined by the Chula Vista Police Department;
and
WHEREAS, parade sponsors provide a letter agreeing not to sue the City, its
agents and employees for any act arising from the Band Review to hold the City
harmless, fully indemnify and release the City, its agents and employees from any
and all liability arising from the Band Review, excluding only that liability which may
arise from the negligence or sole willful conduct of the City:
7-5
NOW, THEREFORE, BE IT RESOLVED the City of Chula Vista does hereby
approve the waiver of police service fees and authorizes temporary street closures
on Saturday, November 12, 2005 for the 9th Annual Band Review sponsored by the
Chula Vista High School and Pageantry Corp and the Chula Vista School for the
Creative and Performing Arts.
Presented By
Approved as to form by
AJfL-
Richard P. Emerson
Chief of Police
/ I ~~-P;l\
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David Byers
Director of Public Works Operations
~,^,,\\ \'\() ~,,\\
Ann Moore
City Attorney
Marcia Raskin
Director of Human Resources
7-6
~-
COUNCIL AGENDA STATEMENT
Item
Meeting Date November 1, 2005
ITEM TITLE:
PUBLIC HEARING: Regarding the Proposed Assessment of
Certain Delinquent Sewer Service Charges as Recorded Liens Upon
the Respective Owner Occupied Parcels of Land and Placement of
Delinquent Charges on the Next Regular Tax Bill for Collection
RESOLUTION Assessing Certain Delinquent
Sewer Service Charges as Recorded Liens Upon the Respective
Owner Occupied Parcels of Land (Group "A") and Approving
Placement of Delinquent Charges on the Next Regular Tax Bill
RESOLUTION Assessing Certain Delinquent
Sewer Service Charges as Recorded Liens Upon the Respective
Owner Occupied Parcels of Land (Group "B") and Approving
Placement of Delinquent Charges on the Next Regular Tax Bill
SUBMITTED BY: Director of FinancefTreasurer 'tlt-
REVIEWED BY: City Manager (LV
(4/5ths Vote: Yes _NoLl
In order to adequately protect the City's interest in delinquent sewer service charges and
insure that collection efforts are directed towards the responsible property owner in the
event of a change in ownership, staff is recommending approval for liens against affected
properties as a preliminary action to replacing the delinquencies on the property tax rolls if
they remain unpaid. Adoption of this resolution will enhance the collection process for
delinquent sewer service charges by ensuring that the correct property owners are
charged and that payment be received on a more timely basis. This is the identical
process approved by City Council since August 1998.
RECOMMENDATION:
That Council open the public hearing to consider assessing
delinquent sewer service charges as recorded liens on the
affected properties, consider all testimony and adopt the
resolution overruling all protests and assessing these charges
as liens upon the respective owner occupied parcels of land.
BOARDS/COMMISSIONS RECOMMENDATIONS: Not applicable.
DISCUSSION:
The Chula Vista Municipal Code Section 13.14.150 allows delinquent sewer service
charges to be assessed as recorded liens upon the affected properties and ultimately
placed on the property tax bills for collection. The ordinance states that upon notification
8-1
"""
Page 2, Item_
Meeting Date NovAmbAr 1,2005
of the property owners, a public hearing is set for sewer service accounts which are over
sixty days delinquent. At the hearing the City Council considers the delinquent accounts
together with any objections or protests by interested parties. At the conclusion of the
hearing, the City Council, may either approve the delinquency and amount owed on the
accounts as submitted or as modified or corrected by the City Council. Lastly, the City
Council adopts a resolution assessing such amounts as liens upon the respective parcels
of land, and the amounts are charged to the property owners on the next regular property
tax bill.
Because charges can only be submitted for placement on the property tax bills once a
year in August, staff is recommending assessing liens on the affected properties midyear
as to better ensure the City's chances for collection. If the City were to address these
delinquent charges only once a year in August, the effectiveness of using the property tax
bill as a means of collection would be significantly reduced as the owners of record in
August would not necessarily be the people responsible for the delinquent charges. In
cases where the properties are sold or transferred, assessing liens midyear holds the
correct parties responsible for the delinquent charges. In cases where the property
owners choose to refinance their mortgages, the midyear liens would ensure the City
receiving payment in a more timely manner as the delinquent charges would be paid
through escrow during the refinancing process.
In July 2005, City Council approved liens for 86 delinquent sewer service accounts valued
at $41,900 to be forwarded to the County for collection on the next regular property tax
bill. Staff has currently identified 99 owner occupied accounts totaling $24,000 as being
over 60 days delinquent (listing available at the City Clerk's office). Many of these
property owners have gone through this lien process previously as they continue to leave
their sewer service accounts unpaid.
These property owners have been notified of their delinquencies, and last month, they
were notified of the public hearing and were asked again to pay their delinquent sewer
service charges to avoid a lien being placed on their property. Payment arrangements
will be set up as needed, and staff will continue to update this list as payments are
received and accounts are cleared. A final list will be submitted to the City Council for
consideration as soon as all payments are recorded.
Staff is recommending that the City Council approve the final list of delinquent sewer
accounts as submitted, and that these charges be forwarded to the County and assessed
as liens on the respective owner occupied parcels of land and ultimately placed on the
next' regular tax bill for collection.
FISCAL IMPACT:
By placing delinquent sewer service charges on the property owner's regular tax bill,
8-2
~
Page 3, Item_
Meeting Date November 1,2005
$115,000 in additional sewer fund revenues were collected in FY04-05. For FY05-06, an
estimated $120,000 in additional revenues should be realized using this collection
method.
8-3
~.
RESOLUTION NO. 2005-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA
VISTA ASSESSING CERTAIN DELINQUENT SEWER SERVICE
CHARGES AS RECORDED LIENS UPON THE RESPECTIVE OWNER
OCCUPIED PARCELS OF LAND (GROUP "A") AND APPROVING
PLACEMENT OF THOSE CERTAIN DELINQUENT CHARGES ON THE
NEXT REGULAR TAX BILL
WHEREAS, Chula Vista Municipal Code Section 13.14.150 allows delinquent sewer service
charges to be assessed as liens upon the affected properties and ultimately placed on the property tax
bills for collection; and
WHEREAS, in July 2005, City Council approved liens for 86 delinquent sewer service
accounts valued at $41,900 to be forwarded to the County of San Diego for collection on the next
regular property tax bill; and
WHEREAS, staffhas identified owner-occupied accounts totaling $24,000 as being over 60
days delinquent, a copy of which is on file with the City Clerk's office; and
WHEREAS, Section 13.14.150 of the Chula Vista Municipal Code further authorizes the
City Council to hold a public hearing to consider the delinquency of solid waste service accounts,
together with any objections or protests by interested persons; and
WHEREAS, the respective property owners have been notified of their delinquencies and of
the public hearing regarding the assessment of delinquent sewer charges; and
WHEREAS, since charges can only be submitted for placement on the property tax bills once
a year in August, staff is recommending assessing liens on the affected properties midyear as to
better ensure the City's chances for collection; and
WHEREAS, adoption of this resolution will enhance the collection process for delinquent
sewer service charges by ensuring that the correct property owners are charged and that payment be
received on a more timely basis; and
WHEREAS, staff further recommends that the City Council approve the final list of
delinquent sewer accounts as submitted, and that these charges be forwarded to the County and
assessed as liens on the respective owner occupied parcels ofland and ultimately placed on the next
regular tax bill for collection.
8-4
~
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula Vista
has considered and approves the November 1,2005 List of Delinquent Sewer Service Accounts,
Group "A," as submitted by City staff in connection with the public hearing on this matter (a copy of
which is attached to this Resolution).
BE IT FURTHER RESOLVED that the City Council has considered all objections and
protests raised at the public hearing, overrules those protests and objections and assesses the
delinquent sewer service charges as liens upon the respective parcels ofland.
BE IT FURTHER RESOLVED that the City Council authorizes the City Manager, or his
designee, to take all action necessary to record these assessments with the County of San Diego for
placement on the next regular tax bill for collection.
Presented by
Approved as to form by
Maria Kachadoorian
Director of Finance
It!:~
City Attorney
J:lattomeylresolsewerldeliq sewer seve ehgs 2005 11 1 05
8-5
~
LIST OF DELINQUENT SEWER SERVICE ACCOUNTS ..~
GROUP "A"
APN
ADDRESS
AMOUNT
5691710800 225.43
5733421800 161.45
6193505200 167.85
5680441700 448.72
5651403100 1504.98
5684110200 161.45
5685121100 225.43
5671010900 243.00
5913101900 222.37
5681821700 231.30
588.04
5710500900 1094.08
5651920600 205.66
5722210200 . 212.63
5691800300 250.06
5662911700 246.86
5651311600 288.12
6392000800 198.64
5732503301 133.45
5732502300 155.93
5633011500 246.86
5742021000 199.85
5670801400 246.86
5933401500 247.97
5670902900 188.12
5691706300 238.23
5753420300 231.83
5710622200 212.93
5743911900 358.16
5754911400 193.45
6232720500 238.23
5752930200 253.67
5752310800 161.45
5740502800 205.62
6396210900 132.68
5742816100 166.88
6396901800 180.65
5740107700 199.85
.6394502100 238.23
?754111100 219.03
. 5754110400 161.45
8-6
~
~
5651521900 225.75
5712921400 197.47
6201001600 189.05
5743621500 165.18
6233111500 558.44
5732900600 145.91
5751221100 187.05
5734503900 238.23
5662320100 239.01
5661210200 213.73
6396601600 193.45
5651611200 233.60
5711221400 246.86
6203400500 193.45
6390730500 347.75
6202100300 238.23
6390109600 238.23
6390109700 238.23
6391700300 155.05
5741202100 180.65
5754820600 229.64
5752721300 238.23
6396701700 187.05
6394600400 246.50
6190721000 202.94
6391402900 180.65
5711910800 195.23
5711410800 154.04
5711920800 163.87
6394120100 238.23
6394110600 386.03
6203801300 167.85
6200430900 539.31
6202720200 160.55
6202610600 186.35
6203011100 238.23
6203030300 428.45
6193503500 192.34
6200710400 179.61
6202621800 160.55
5691201200 166.39
6193601300 149.08
6230720200 371.98
5703800600 160.59
6204502200 154.33
8-7
~
6203302400 206.25
5650320300 226.75
5660801000 220.33
5693411200 155.05
5720301200 187.68
5734830700 186.06
5933020800 247.97
6232904900 225.43
5730740500 168.82
5662502700 154.04
5712631000 207.1 0
$23,976.27
8-8
~
-
RESOLUTION NO. 2005-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA
VISTA ASSESSING CERTAIN DELINQUENT SEWER SERVICE
CHARGES AS RECORDED LIENS UPON THE RESPECTIVE OWNER
OCCUPIED PARCELS OF LAND (GROUP "B") AND APPROVING
PLACEMENT OF THOSE CERTAIN DELINQUENT CHARGES ON THE
NEXT REGULAR TAX BILL
WHEREAS, Chula Vista Municipal Code Section 13.14.150 allows delinquent sewer service
charges to be assessed as liens upon the affected properties and ultimately placed on the property tax
bills for collection; and
WHEREAS, in July 2005, City Council approved liens for 86 delinquent sewer service
accounts valued at $41,900 to be forwarded to the County of San Diego for collection on the next
regular property tax bill; and
WHEREAS, staff has identified owner-occupied accounts totaling $24,000 as being over 60
days delinquent, a copy of which is on file with the City Clerk's office; and
WHEREAS, Section 13.14.150 of the Chula Vista Municipal Code further authorizes the
City Council to hold a public hearing to consider the delinquency of solid waste service accounts,
together with any objections or protests by interested persons; and
WHEREAS, the respective property owners have been notified of their delinquencies and of
the public hearing regarding the assessment of delinquent sewer charges; and
WHEREAS, since charges can only be submitted for placement on the property tax bills once
a year in August, staff is recommending assessing liens on the affected properties midyear as to
better ensure the City's chances for collection; and
WHEREAS, adoption ofthis resolution will enhance the collection process for delinquent
sewer service charges by ensuring that the correct property owners are charged and that payment be
received on a more timely basis; and
WHEREAS, staff further recommends that the City Council approve the final list of
delinquent sewer accounts as submitted, and that these charges be forwarded to the County and
assessed as liens on the respective owner occupied parcels ofland and ultimately placed on the next
regular tax bill for collection.
8-9
--
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula Vista
has considered and approves the November 1, 2005 List of Delinquent Sewer Service Accounts,
Group "B," as submitted by City staff in connection with the public hearing on this matter (a copy of
which is attached to this Resolution).
BE IT FURTHER RESOLVED that the City Council has considered all objections and
protests raised at the public hearing, overrules those protests and objections and assesses the
delinquent sewer service charges as liens upon the respective parcels ofland.
BE IT FlJRTHER RESOLVED that the City Council authorizes the Cjty Manager, or his
designee, to take all action necessary to record these assessments with the County of San Diego for
placement on the next regular tax bill for collection.
Presented by
Approved as to form by
Maria Kachadoorian
Director of Finance
J:lattorneylresolsewerldeliq sewer srve ehgs 200SB II 1 05
8-10
~
-
LIST OF DELINQUENT SEWER SERVICE ACCOUNTS
GROUP "Bn
APN
ADDRESS
AMOUNT
5691710800 225.43
5733421800 161.45
6193505200 167.85
5680441700 448.72
5651403100 1504.98
5684110200 161.45
5685121100 225.43
5671010900 243.00
5913101900 222.37
5681821700 231.30
588.04
5710500900 1094.08
5651920600 205.66
5722210200 212.63
5691800300 250.06
5662911700 246.86
5651311600 288.12
6392000800 198.64
5732503301 133.45
5732502300 155.93
5633011500 246.86
5742021000 199.85
5670801400 246.86
5933401500 247.97
5670902900 188.12
5691706300 238.23
5753420300 231.83
5710622200 212.93
5743911900 358.16
5754911400 193.45
6232720500 238.23
5752930200 253.67
5752310800 161.45
5740502800 205.62
6396210900 132.68
6396901800 180.65
5740107700 199.85
,6394502100 238.23
5754111100 219.03
575411 0400 161.45
8-11
~
-
5651521900 225.75
5712921400 197.47
6201001600 189.05
5743621500 165.18
6233111500 558.44
5732900600 145.91
5751221100 187.05
5734503900 238.23
5662320100 239.D1
5661210200 213.73
6396601600 193.45
5651611200 233.60
5711221400 246.86
6203400500 193.45
6390730500 347.75
6202100300 238.23
6390109600 238.23
6390109700 238.23
6391700300 155.05
5741202100 180.65
5754820600 229.64
5752721300 238.23
6396701700 187.05
6394600400 246.50
6190721000 202.94
6391402900 180.65
5711910800 195.23
5711410800 154.04
5711920800 163.87
6394120100 238.23
6394110600 386.D3
6203801300 167.85
6200430900 539.31
6202720200 160.55
6202610600 186.35
6203011100 238.23
6203030300 428.45
6193503500 192.34
6200710400 179.61
6202621800 160.55
5691201200 166.39
6193601300 149.08
6230720200 371.98
5703800600 160.59
6204502200 154.33
8-12
~
-..,,0;;,.,
6203302400 206.25
5650320300 226.75
5660801000 220.33
5693411200 155.05
5720301200 187.68
5734830700 186.06
5933020800 247.97
6232904900 225.43
5730740500 168.82
5662502700 154.04
5712631000 207.1 0
$23,809.39
8-13
COUNCIL AGENDA STATEMENT
Item q
Meeting Date November 1, 2005
ITEM TITLE:
PUBLIC HEARING: Regarding the Proposed Assessment of
Certain Delinquent Solid Waste Service Charges as Liens Upon the
Respective Parcels of Land and Placement of Delinquent Charges
on the Next Regular Tax Bill for Collection
RESOLUTION Assessing Certain Delinquent
Solid Waste Service Charges as Liens Upon the Respective Parcels
of Land (Group "A") and Approving Placement of Delinquent
Charges on the Next Regular Tax Bill
RESOLUTION Assessing Certain Delinquent
Solid Waste Service Charges as Liens Upon the Respective Parcels
of Land (Group "B") and Approving Placement of Delinquent
Charges on the Next Regular Tax Bill
RESOLUTION Assessing Certain Delinquent
Solid Waste Service Charges as Liens Upon the Respective Parcels
of Land (Group "C") and Approving Placement of Delinquent
Charges on the Next Regular Tax Bill
SUBMITTED BY: Director of FinancefTreasurer.~
REVIEWED BY: City Manager Q
(4/5ths Vote: Yes _NoL)
In order to adequately protect the City's interest in delinquent solid waste service charges
and ensure that collection efforts are directed towards the responsible property owner in
the event of a change of ownership, staff is recommending approval for liens against
affected properties as a preliminary action to placing the delinquencies on the property
tax rolls if they remain unpaid. Adoption of this resolution will enhance the collection
process for delinquent solid waste service charges by reducing the amount of
uncollectible losses and ensure that payment will be received on a more timely basis.
This is the identical process approved by City Council on a regular basis since mid- 2001.
RECOMMENDATION:
That Council open the public hearing to consider assessing
delinquent solid waste service charges as liens on the
affected properties, consider all testimony, and adopt the
resolution overruling all protests and assessing these charges
as liens upon the respective parcels of land.
BOARDS/COMMISSIONS RECOMMENDATIONS: Not applicable.
9-1
Page 2, Item_ q
Meeting Date Novemh"'f 1,2005
DISCUSSION:
In November 1998, City Council amended Municipal Code Section 8.24 to eliminate
suspension of solid waste service for nonpayment. To ensure that all residents pay their
fair share of the costs of this program, the ordinance allows delinquent solid waste service
charges to be assessed as liens upon the affected properties and ultimately placed on the
property tax bills for collection. The ordinance states that upon notification of the property
owners, a public hearing is set for solid waste service accounts that are over ninety days
delinquent. At the hearing the City Council considers the delinquent accounts together
with any objections or protests by interested parties. At the conclusion of the hearing, the
City Council, may either approve the delinquency and amount owed on the accounts as
submitted or as modified or corrected by the City Council. Lastly, the City Council adopts
a resolution assessing such amounts as liens upon the respective parcels of land, and
the amounts are charged to the property owners on the next regular property tax bill. As
these amounts are collected, the monies are remitted to Pacific Waste Services less the
City's Franchise Fees, AB939 fees and late charges.
Because charges can only be submitted for placement on the property tax bills once a
year in August, staff is recommending assessing liens on the affected properties midyear
as to better ensure the City's chances for collection. If the City were to address these
delinquent charges only once a year in August, the effectiveness of using the property tax
bill as a means of collection would be significantly reduced as the owners of record in
August would not necessarily be the people responsible for the delinquent charges. In
cases where properties are sold or transferred, assessing liens midyear holds the correct
parties responsible for the delinquent charges. In cases where property owners choose
to refinance their mortgages, the midyear liens will ensure the City receiving payment in a
more timely manner as the delinquent charges would be paid through escrow during the
refinancing process.
In July 2005, City Council approved 248 delinquent accounts valued at $31,300 to be
placed on the property tax bills for collection. Since then, Pacific Waste Services has
identified and submitted an additional 1 ,079 delinquent accounts valued at over $135,200
to the city for collection. Through the City's preliminary collection efforts, 411 accounts
have been resolved, and the remaining 668 accounts valued at $83,700 are now being
submitted (listing available at the City Clerk's office). The account status and property
ownership on these accounts have been verified by both Pacific Waste and City staff.
Many of these delinquent accounts have gone through the lien process before as they
continue to remain unpaid.
These property owners were notified of their delinquencies through a series of past due
notices sent by Pacific Waste until they were ultimately submitted to the City for
collection. City staff also sent out a past due letter, and last month, these property owners
were notified of the public hearing and were asked to pay their delinquent solid waste
service charges prior to transmittal of the delinquent account list to the County to avoid a
9-2
Page 3, Item_
Meeting Date Novemher 1,2005
q
lien being placed on their property. City staff has been working with Pacific Waste to
resolve any customer disputes as they arise and payment arrangements have been set
up as needed. Staff will continue to update this list as payments are received and
accounts are cleared. A final/ist will be submitted to the City Council for consideration as
soon as all payments are recorded.
Staff is recommending that the City Council approve the final list of delinquent solid waste
accounts as submitted, and that these charges be forwarded to the County and assessed
as liens on the respective parcels of land and ultimately placed on the next regular tax bill
for collection.
FISCAL IMPACT:
By using the property tax bill as the ultimate collection method for delinquent solid waste
service charges, approximately $279,000 was collected in FY 04-05. The same amount
is estimated for FY05-06. These funds are forwarded to Pacific Waste Services less the
city's Franchise Fees, AB939 fees and late charges. The city should realize an estimated
$22,000 in Franchise Fees, $5,500 in AB939 fees, and $165,000 in late charges for
FY05-06.
9-3
RESOLUTION NO. 2005-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA
VISTA ASSESSING CERTAIN DELINQUENT SOLID WASTE SERVICE
CHARGES AS LIENS UPON THE RESPECTIVE PARCELS OF LAND
(GROUP "A") AND APPROVING PLACEMENT OF CERTAIN
DELINQUENT CHARGES ON THE NEXT REGULAR TAX BILL
WHEREAS, Chula Vista Municipal Code Section 8.24 allows delinquent solid waste service
charges to be assessed as liens upon the affected properties and ultimately placed on the property tax
bills for collection; and
WHEREAS, in July, 2005, City Council approved 248 delinquent accounts valued at $31,300
to be placed on the property tax bills for collection; and
WHEREAS, since July, 2005, Pacific Waste Services has identified and submitted an
additional 1,079 delinquent accounts valued at over $135,200 to the City for collection; and
WHEREAS, through the City's preliminary collections efforts, 411 accounts have been
resolved, and the remaining accounts valued at $83,700 have been submitted to the City, a copy of
which is on file with the City Clerk's office.
WHEREAS, Section 8.24 authorizes the City Council to hold a public hearing to consider the
delinquency of solid waste service accounts, together with any objections or protests by interested
persons; and
WHEREAS, the respective property owners have been notified oftheir delinquencies and of
the public hearing regarding the assessment of delinquent solid waste service charges; and
WHEREAS, since charges can only be submitted for placement on the property tax bills once
a year in August, staff is recommending assessing liens on the affected properties midyear as to
better ensure the City's chances for collection; and
WHEREAS, adoption of this resolution will enhance the collection process for delinquent
solid waste service charges by ensuring that the correct property owners are charged and that
payment be received on a more timely basis; and
WHEREAS, staff further recommends that the City Council approve the final list of
delinquent solid waste accounts as submitted, and that these charges be forwarded to the County and
assessed as liens on the respective parcels of land and ultimately placed on the next regular tax bill
for collection.
9-4
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula Vista
has considered and approves the November I, 2005 List of Delinquent Solid Waste Service
Accounts, Group "A,"as submitted by City staff in connection with the public hearing on this matter
(a copy of which is attached to this Resolution).
BE IT FURTHER RESOLVED that the City Council has considered all objections and
protests raised at the public hearing, overrules those protests and objections and assesses the
delinquent solid waste service charges as liens upon the respective parcels ofland.
BE IT FURTHER RESOLVED that the City Council authorizes the City Manager, or his
designee, to take all action necessary to record these assessments with the County of San Diego for
placement on the next regular tax bill for collection.
Presented by
Approved as to form by
Maria Kachadoorian
Director of Finance
A;d- f-~
Moore
CIty Attorney
J:lattorneylresolsolid wasteldeliq solid waste srve ehgs 2005 11 1 05
9-5
t''5r1'
~{~
~
-O;::~--~.
"""""- --
CllY OF
CHUlA VISTA
LIST OF DELINQUENT SOLID WASTE SERVICE ACCOUNTS
GROUP '-A"
Octo~.r24, 2005,
.....
- . - -
Account Parcel No Balance Due
,
34279 5720630800 $115,56
163972 5933600300 $118.51
157762 6220202700 $125.71
153697 --_..~._~---_.__._,,- . 5955601400 $110.55
101356 -- -_._--~._--- 5754910300 $126.47
60193 I 5751720400 $116.58
141078 ---..-------- ~ 5752312300 $136.99
157051 6411112600 $123.02
98564 5952153100 $110.55
35707 5691331400 $131.74
152488 5692410700 $114.55
60657 6291510100 $30.00
23031 6291510600 $132.50
23301 -----.----.-..- r 6291520200 $132.50
124176 I 6426232200 $159.98
3519 --'.'-'-.'-'--- , 6401514400 $125.71
-------~ ., =
-
153882 I 6426000700 $109.91
145611 6436715200 $110.55
31280 5943410800 $126.47
143977 ------..--- 5933702600 $89.85
- ---~---~----_.. 6206202000
83473 6401713400 $110.18
94352 .5671010900 $110.55
I
132447 ___~__m._.. 15720800600 $129.06
150084 5722130200 $109.91
138212 ---------- r 6412711500 $132.50
137677 16412712100 $141.35
148820 5958212900 $141.31
73632 6230301120 $89.35
142563 _._._ 6230301134 $110.55
144691 6433801127 $126.47
135064 6412204300 $109.91
34349,,,-_~'_ 5752321500 $20.53
93861. 5633100400 $75.94
--.-.-------------
Page 1 of 15
---
9-6
~{f?
.:~- =
~=-= -=
ellY OF
CHUIA. VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account . ....... ParcelNo ~ Balance Due
. 70234 5953216123 $109.91
84726 6432001900 $117.13
145964 6435205309 $90.81
57327 5670800400 $252.69
68956 5720801200 $132.50
27680 8391921200 $144.95
133282 5952923400 $136.58
149769 6435204505 $109.85
142445 6431304200 $126.47
68121 5913101900 $116.58
108759 6425011400 $119.56
104305 5943231900 $110.55
141343 5957642100 $115.75
136558 6422724800 $115.94
109239 5933721500 $20.56
128167 5954200603 $110.55
9618 . \640033370~ ..- 30~
'f5~ l' ,p955100l1Q9 5109.9,
~04141 5955100815 $109.91
162185 5950314519 $110.55
148582 5950314410 $158.22
118312 6420803018 $89.35
142139 6420803315 ,$110.55
154175 6403302101 $110.55
160228 6403301305 $158.22
155059 6420802909 $104.10
121701 6420802902 $110.55
87700 6403515200 $126.47
100454 6420110300 $116.58
167781 5931601000 $235.57
100718 5931500400 $110.55
165074 5932920100 $176.91
102773 5932920700 $110.55
79182 5933714500 $110.55
142002 5943911400 $112.80
154887 5943932800 $116.58
Pa~e 2 of 15
9-7
~u~
=~_:
.~----~.
- - ~~
CllY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account ParcelNo - - Balance Due
114986 5931430400 $115.97
166254 .6426810500 $133.90
62421 5661510400 $116.58
164939 5651320100 $140.17
147507 6436411200 $116.58
79971 6400221900 $109.91
82218 6400222900 $110.55
122742 5722010300 $157.24
159983 5921820400 $109.91
149114 5957403400 $116.58
149371 5943830800 $132.50
65694 6401614400 $135.62
109145 6401624300 $110.36
118038 5952163800 $141.41
107335 5952031700 $110.55
122680 6425203600 $142.30
133375 5712610400 $80.09
143398 5712220100 $109.91
94150 5712610400 $125.71
87674 5711020200 $116.58
165050 5957320100 $164.14
150222 6233423600 .. $125.71
156085 6424800800 $149.03
145518 6436612900 $158.22
148074 5957803900 $126.47
93717 5741500200 $110.55
148332 5958100600 $128.79
148363 5958103500 $88.96
108699 5943511800 $145.23
166449 5943821600 $155.03
79112 6395502300 $116.58
35813 5702010100 $109.91
161327 6181101400 $141.78
26965 6423060700 $126.47
22925 6423060300 $160.08
107888 5752520500 $80.94
Page 3 of 15
9-8
October 24, 2005
Account
"
164374.,'
1 _
145185
162056
93100
119428
93083
152646
98188
98197
160468
106661
166042
35909
21797
87113
158862
28932
94137
90194
93431
119326
159668
104281
80432
'" 107614
150541
92227
165735
23345
34382
154521
146814
164391
166337
157750
~{~
1~~~
- -
- -~
erN OF
CHUlA VISTA
Finance Deoartment
Col/ections Unit
Accounts With Notice Of Public Hearing Sent
-
Parcel No
5663004800
-
5650901300
5722011000
5722021400
6240512900
6240553100
6404400408
5681630400
5660601000
5683511600
5732503300
5733410500
5633011500
6193203600
6192011100
6422622700
5752410600
, 6220611300
I 6392000400
5662511400 l
5690600200 ~
5952220370 i'
.~,.
5751101700
5750600200
5652010800
5721611200
6191211400
6182401100
6182401200
6393910300
5755000100
6436002100
6403106500
5956801700
5681811100
...t
Paoe4of 15
9-9
Balance Due
5126.47
...
5126.47
5164.25
5109.91
5131.74
5126.47
589.35
5291.64
5119.79
$119.93
$95.18
$119.45
5116.58
5126.47
$110.55
$111.97
5110.55
5109.91
5110.18
5116.58
$131.74
$109.91
$109.91
5125.71
5116.58
$125.71.
$101.85
$125.04
5132.50
$109.91
$117.38
$110.55
$113.69
$115.45
$110.56
~{f?
~
~~---=.
~- --
CIlY' Of
CHUlA VISfA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account ParcelNo Balance Due
129187 5671023500 $132.50
13989 5670801400 $115.94
35581 5735210800 $116.58
142936 5953502500 $110.55
160364 6433201400 $126.47
61262 6232905300 $126.47
88806 6395601000 $115.94
99244 6395500600 $105.47
105734 5651922200 $109.91
155223 5652501300 $187.74
152684 5721501000 $125.71
163170 5680120900 $178.64
163744 5720420300 $110.55
144804 6206010400 $110.55
37175 6192503800 $220.11
88066 6191421200 $165.95
162884 0 $173.27
99863 6192611100 $68.22
22853 6192612500 $132.50
95639 6192612200 $109.91
84915 5690431000 $132.50
25130 5691710800 $115.94
113956 5691631800 $145.97
63398 -' 5693520900 $109.91
94784 5742810200 $110.55
"
162108 5955503900 $132.50
137239 5651911900 $126.47
154523 6432802200 $125.71
14365 5751821600 $115.94
167865 5734201400 $90.99
151062 5734201400 $122,69
138072 6220728100 $166.26
117017 5691706300 $141.44
14522 5661810400 $109.91
106622 6192120900 $153.50
130954 5733021400 $89.35
Page50115.
9-10
October 24, 2005
Account
104627
127143
163435
23239
57233
147503
147398
81149
161852
137766
137077
161360
165854
165576
150203
165377
136526
108651
108856
14953
104312
113033
152413
152611
167966
130976
15075
144902
7971
148578
--
147571
28526
124983
162858
110679
~f(~
:~~_:
~--~~.
-- ~-
ellY OF
CHUlA VISTA
Finance Deoartment
Co//ections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
5733030500
6192622600
6435801300
6192502600
6192502600
6436410900
5953710300
6421202900
6421202800
6421300900
6422300600
6422300700
6422301000
5951711600
6432333400
6434851600
! 5953212635
6422000300
6392220100
6392111800
5732101200
5952420500
5957321700
5950814600
5950823400
5753221200
6202512000
5752002000
5921813300
5957262100
11
6435701700
6203800200
6232720800
5661321200
5751710400
Page60115
9-11
Balance Due
$110.55
$132.50
$125.71
$110.55
$110.55
$181.24
$148.33
$126.47
$116.71
$132.50
$163.47
$125.71
$128.02
$88.81
$132.50
$77.85
$110.55
$109.91
$109.91
$80.09
$122.61
$110.55
$110.55
$120.55
$134.07
$113.73
$110.55
$125.71
$139.78
$242.82
-
$109.91
$116.16
$115.94
$116.58
$93.36
October 24, 2005
Account
129933
166849
150528
103382
75017
30619
155076
120820
85276
21972
87433
164685
166613
47035
67840
28158
142789
.35613
165297
164747
100969
166322
11261
135928
69738
165782
73670
147898
129807
77455
102569
162166
135958
127801
136673
127988
~V?-
:- ~~ ~
- - - -
~~=~~.
ellY OF
CHUlA VISTA
Finance DeDartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
6432500600
6425906000
6396840800
5732312300
5742816100
6396901800
5742611200
6402210800
6222110400
6222120500
5754110400
5753660100
5753611600
6391303000
6393220400
6232723800
5712711900
5712720800
6442023600
6442024200
6202513300
6202520700
6201001600
5712721900
5750312300
5733100100
5951641200
6183710300
6434104800
5735320600
5734503900
5953215320
5954100211
5954102406
5954102638
5954102811
Balance Due
$110.55
$140.50
$116.58
$115.94
$95.88
$115.94
$154.29
$145.27
$116.58
$185.98
$170.96
$125.71
$213.47
$115.94
$132.50
$110.36
$166.40
$116.58
$126.47
$113.69
$50.55
$192.81
$109.91
$109.91
$158.22
$122.85
$110.55
$148.32
$113.67
$108.27
$110.55
$109.91
$109.91
$110.55
$110.15
$109.91
PaQe70f 15
"
9-12
~{~
=~- -=
~----~.
- --
em OF
CHUlA VISTA
Finance DeDartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account ParcelNo Balance Due
167847 6434701700 $109.41
161020 5954301706 $49.91
149584 5954301805 $115.94
72541 6243900600 $110.55
25519 6243900100 $142.30
105172 5754211600 $115.94
114432 5661210200 $109.91
165407 6433801210 $104.08
36483 6394601100 $126.47
114677 6425906400 $109.91
24021 6243851300 $125.22
165326 6435022300 $110.55
120608 5957002500 $110.55
145251 6404300415 $187.75
92553 6422521400 $157.24
74442 5921810200 $146.47
146245 C 6435146400 $110.55
120799 5712100300 $91.91
121922 5712331600 $167.38
94603 5651611203 $126.47
105578 5710800800 $110.55
166033 6180210400 $137.34
37412 5671020900 $165.32
70344 5941210500 $131.74
164797 6241201500 $195.40
4208 5703123900 $141.37
118421 6396823200 $109.91
157635 5954901000 $116.75
100814 5954510900 $122.56
154593 5954505400 $130.67
158727 5954503400 $126.47
34624 5932622000 $109.91
16571 6201130300 $142.30
94426. 6243410100 $160.47
167723 6393921000 $122.27
166878 6203602400 $202.95
Page 8 of 15
9-13
October 24, 2005
Account
71331
33961
166021
101779
106028
26954
120856
129353
140934
144782
165321
94452
153990
82396
11550
165631
122225
117556
48844
34126
164413
167045
113957
166914
158517
119332
17437
142300
165485
9022
17474
111492
146785
146794
146799
167055
~{rt-
:-~~
- - --
~~~~-
"'"'to-- ~_
CllY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
6241200100
6241600200
6241700800
6241700300
6390760600
6441130800
6441220700
6441220800
: 6441301700
: 6425108500
5744100500
5662512600
6205700800
6392612800
, 5754220800
5755120300
6201230100
6424811200
6391510300
6393510300
6393620300
5651311000
5691000800
6426704400
6426706200
6426804200
6200440400
6232213000
6433700301
6190900600
6190900100
6190710200
6436805303
6436805321
6436805317
6412704300
Balance Due
$126.47
$142.69
$74.14
$111.00
$119.66
$109.65
$110.55
$110.55
$129.48
$132.50
$110.55
$130.21
$115.94
$136.71
$110.55
$156.57
$187.94
$116.58
$116.58
$110.55
$129.55
$136.32
$66.08
$179.84
$110.55
$110.55
$110.55
$110.55
$127.43
$95.88
$163.27
$117.86
$120.95
$166.39
$197.12
$126.47
Page90f 15
9-14
October 24, 2005
Account
144651
94722
159636
166203
85302
77587
138075
126264
107501
119032
147277
91979
105534
145152
106738
137240
94965
112180
158820
94969
151354
3875
164556
153824
154417
166266
151473
158338
162664
18402
167559
162292
151992
138070
155766
164612
~ {f?.
:~--~
~~-- =.
- - -~
C1lY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
6412713800
6391820800
6431613800
5754810300
5754212400
6391402900
6396300100
6202240600
6202230300
6403102300
6436510717
5952220131
5952220135
5711920100
6181012400
5710610600
5712710900
5712910500
6435421400
6394110600
6435043100
6393640400
6393832000
6205004800
6242402100
6243001400
6243003300
6201920700
6201821100
6201940100
6200410600
6200420100
6201930900
6200430900
6220431700
6202610600
Balance Due
5110.43
5109.91
5232.93
5132.50
5126.47
5110.55
5122.32
5110.55
5119.70
5116.58
$146.47
5110.55
5109.91
5164.74
$115.94
5115.94
$109.91
5109.91
$116.58
5145.43
$142.58
5112.99
$132.56
5205.68
5109.91
5132.14
$109.91
5132.62
5132.50
5129.77
5169.83
582.58
$126.47
5132.50
5125.71
5119.06
Pa~e 10 of 15
9-15
October 24, 2005
Account
24509
36752
95451
167866
82846
128728
31844
160007
110624
149789
167551
36765
92756
143562
58045
149972
162007
116520
94877
160871
29628
137769
131627
155501
155803
124228
19271
24254
164015
153553
116944
121146
106368
103552
165195
123891
~ {It--
~
~-=-C~.
--.-.--
ellY Of
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
6202720200
6202730400
5942111100
5942102100
5692630400
5672503200
5943920500
6183010600
6191721200
6192210500
5755201300
6201702100
6394141000
6193502200
6200221100
6240553700
6310133800
6310132500
6240203700
5734402100
6202621600
5953701800
5682611500
5671400600
6435301900
5933718200
6401961400
6403000400
6403501500
6403920200
6432305400
6442121600
5952710800
5952622500
6442011200
6200731400
Balance Due
$110.18
$116.58
$109.91
$116.52
$110.55
$110.55
$132.50
$49.54
$110.55
. $115.86
$224.07
$110.55
$116.58
$126.47
$109.91
$127.95
$126.71
$125.71
$249.90
$125.71
$130.96
$115.94
$132.50
$110.55
$150.59
$141.44
$184.25
$109.91
$92.27
$110.55
$126.47
$115.94
$116.58
$125.91
$110.55
$89.24
Page 11 of 15
9-16
October 24, 2005
Account
29546
152661
116939
78062
29792
158419
140523
92678
19114
157116
163344
137334
149238
19181
114345
96555
62068
108574
36873
129930
146971
121006
128808
109613
99097
91336
156394
165022
113921
108377
155983
109804
166300
95290
130748
95295
~fl?-
~~
~~===.
CIlY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
6203101200
5755301600
6230400200
6243930900
6206523700
6242000100
6204400500
6204502200
6203302300
5953902600
5713020500
5712820100
5713011900
5742522000
6411324400
6442022800
5672310700
6401804300
5734820300
5956003700
6427000301
6425810300
6412201400
6426101500
5953302100
6190812500
6191820500
6193505000
6192500500
5680741600
5690302200
5683521600
5662513400
5731801200
5732602200
5735000400
Page 12 of 15
9-17
Balance Due
$60.55
$126.47
$158.22
$110.55
$213.42
$125.71
$141.44
$109.91
$125.71
$156.43
$70.58
$109.91
$110.55
$136.24
$104.76
$110.55
$110.55
$110.55
$110.55
$92.93
$142.80
$110.55
$126.47
$109.91
$109.91
$89.85
$233.80
$179.08
$109.91
$148.33
$110.55
$130.21
$171.86
$109.91
$109.91
$89.85
October 24, 2005
Account
153484
143773
19598
125092
21058
144928
132410
149043
158890
129331
160592
113734
140476
155629
96167
131179
141278
118262
156730
95393
124917
95404
161989
153437
129342
167913
159395
104192
130187
155773
142573
167775
131309
158825
27938
129549
~~f?
~
~~~~.
C1lY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
6423800610
6423800424
5730710600
6434505800
6233330200
6183020400
5750331700
5958040800
6192313200
6243832300
5672312100
5651000200
6412301800
6434865389
6432201300
6411901500
6411924800
6220120200
6402723200
5952142400
6402525700
6240414400
5957611700
5957611500
5934000200
6433015200
6433011200
6243204400
6243204300
6192621000
6192701600
6192701600
5953213602
6232904800
5690705100
6231614100
Balance Due
$141.47
$110.55
$122.41
$110.55
$109.91
$115.94
$116.58
$161.28
$0.02
$148.33
$110.55
$222.03
$132.50
$142.30
$109.91
$109.91
$115.94
$136.68
$116.58
$110.55
$119.93
$109.91
$130.55
$116.58
$110.55
$156.54
$110.55
$110.55
$138.63
$110.55
$106.58
$127.67
$109.91
$90.62
$163.27
$126.47
Page 13 of 15
9-18
October 24, 2005
Account
23114
135549
152141
78272
72980
26829
167587
134436
110761
20548
137907
70195
99491
154764
165231
122169
155653
20039
33078
147500
118229
156936
102531
124437
102523
135551
130189
99428
163187
159779
152227
141921
155397
117937
158841
75924
~{~
~:=
~--~-.;;.
- - -~
CITY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
i ParcelNo
,
6231412400
6231110800
5733412100
5733411300
6423203300
6422712200
6435910100
6240553600
6400231600
6205000100
5954506800
5954508500
5944305000
6425501401
6425500306
6403512800
6403800700
5893110100
5661324500
6432914700
6240210400
5952110900
5952120300
6426611600
6182303900
6180706700
6425904800
5922314600
6424401500
6434313700
5953215022
5953214818
6411132000
5693730800
5693720900
5730630400
PaQe140f 15
9-19
Balance Due
$130.55
$109.91
$122.06
$125.71
$126.47
$116.58
$131.84
$126.47
$110.55
$116.58
$111.97
$110.55
$110.55
$110.55
$129.83
$116.58
$115.94
$116.58
$132.50
$132.50
$89.17
$110.55
$110.55
$158.22
$116.58
$162.30
$146.01
$132.50
$110.55
$141.44
$109.91
$110.55
$128.90
$147.47
$232.93
$115.94
~{f?
~
.~~--~.
- - - -
eI1Y Of
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account _.. . .."--- ParcelNo Balance Due
154192 5740600400 $147.47
151588 5741040600 $47.05
160457 5954404800 $113.63
8191 5952802800 $119.02
147172 6435412900 $132.64
160603 5921912011 $110.55
109448 5921912141 $113.18
141573 5921912149 $110.55
166581 5921715900 $173.83
165186 6181310300 $132.50
150208 5671902300 $120.93
155229 5711830700 $145.11
167833 6435163200 $144.79
146370 6435163400 $186.69
No Of Accounts ... Total Due: - ,
513 (,4o'i'2.,'3?>
Page 150f 15
9-20
RESOLUTION NO. 2005-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA
VISTA ASSESSING CERTAIN DELINQUENT SOLID WASTE SERVICE
CHARGES AS LIENS UPON THE RESPECTIVE PARCELS OF LAND
(GROUP "B") AND APPROVING PLACEMENT OF CERTAIN
DELINQUENT CHARGES ON THE NEXT REGULAR TAX BILL
WHEREAS, Chula Vista Municipal Code Section 8.24 allows delinquent solid waste service
charges to be assessed as liens upon the affected properties and ultimately placed on the property tax
bills for collection; and
WHEREAS, in July, 2005, City Council approved 248 delinquent accounts valued at $31,300
to be placed on the property tax bills for collection; and
WHEREAS, since July, 2005, Pacific Waste Services has identified and submitted an
additional 1,079 delinquent accounts valued at over $135,200 to the City for collection; and
WHEREAS, through the City's preliminary collections efforts, 411 accounts have been
resolved, and the remaining accounts valued at $83,700 have been submitted to the City, a copy of
which is on file with the City Clerk's office.
WHEREAS, Section 8.24 authorizes the City Council to hold a public hearing to consider the
delinquency of solid waste service accounts, together with any objections or protests by interested
persons; and
WHEREAS, the respective property owners have been notified oftheir delinquencies and of
the public hearing regarding the assessment of delinquent solid waste service charges; and
WHEREAS, since charges can only be submitted for placement on the property tax bills once
a year in August, staff is recommending assessing liens on the affected properties midyear as to
better ensure the City's chances for collection; and
WHEREAS, adoption of this resolution will enhance the collection process for delinquent
solid waste service charges by ensuring that the correct property owners are charged and that
payment be received on a more timely basis; and
WHEREAS, staff further recommends that the City Council approve the final list of
delinquent solid waste accounts as submitted, and that these charges be forwarded to the County and
assessed as liens on the respective parcels ofland and ultimately placed on the next regular tax bill
for collection.
9-21
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula Vista
has considered and approves the November I, 2005 List of Delinquent Solid Waste Service
Accounts, Group "B,"as submitted by City staff in connection with the public hearing on this matter
(a copy of which is attached to this Resolution).
BE IT FURTHER RESOLVED that the City Council has considered all objections and
protests raised at the public hearing, overrules those protests and obj ections and assesses the
delinquent solid waste service charges as liens upon the respective parcels of/and.
BE IT FURTHER RESOLVED that the City Council authorizes the City Manager, or his
designee, to take all action necessary to record these assessments with the County of San Diego for
placement on the next regular tax bill for collection.
Presented by
Approved as to form by
Q~(-P ~_
AnnM e
City Attorney
Maria Kachadoorian
Director of Finance
J:\allorneylreso\solid waste\deliq solid waste srve ehgs 2005 II 105
9-22
. :S"--
'/-'
~V?-
:~--~
~----~.
""""""-- - -
CITY OF
CHULA VlsrA
LIST OF DELINQUENT SOLID WASTE SERVICE ACCOUNTS
GROUP "R"
Octo~er'24. 2005
----,--_.._---'"-~-_._-- .....
Account Parcel No Balance Due
34279 --------.---- 5720630800 $115.56
163972 ~..__-._,.-~.-~_ 5933600300 $118.51
157762 6220202700 $125.71
153697 -~-------_._.~- 5955601400 $110.55
101356 .. -----,-~-._.~- 5754910300 $126.47
60193 5751720400 $116.58
141078 ------- .-------.---.-- -'- 5752312300 $136.99
157051 -~_._--_._._-_._~- 6411112600 $123.02
98564 5952153100 $110.55
35707 --.-------- 5691331400 $131.74
152488 .----.. 5692410700 $114.55
60657 6291510100 $30.00
23031 -.. --_._--_._--,---~- 6291510600 $132.50
23301 -------.--- , 6291520200 $132.50
124176 i 6426232200 $159.98
3519 ...--.-...- i 6401514400 $125.71
127328 _._.__._--~-----,_._--- i 6423521600 $109.90
127491 i 6423613200 $220.45
153882 --.--.------. 6426000700 $109.91
145611 --~---- i.6436715200 $110.55
31280 , 5943410800 $126.47
143977 ___..__._u____. ____ f 5933702600 $89.85
- ----..- -~-_.--.__._-_.- 6206202000 -
83473 6401713400 $110.18
94352 f 5671010900 $110.55
,
132447 --.--..--------- 5720800600 $129.06
150084 5722130200 $109.91
138212 ._---------~... 6412711500 $132.50
137677 _________ 6412712100 $141.35
148820 5958212900 $141.31
73632 --------_._-- 6230301120 $89.35
142563 ____~___ 6230301134 $110.55
144691 6433801127 $126.47
135064 6412204300 $109.91
34349, .,___c'""--~______._ 5752321500 $20.53
93861 ... 5633100400 $75.94
_'_'_ '.._______n..___ ___._
Paoe 1 of 15
- -----.------,...,..,--
9-23
~ {f?.
~
~-oii:~-='
--- ~~
em OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account - ParcelNo ".~~:r' . Balance Due
70234 5953216123 $109.91
84726 6432001900 $117.13
145964 6435205309 $90.81
57327 5670800400 $252.69
68956 5720801200 $132.50
27680 6391921200 $144.95
133282 5952923400 $136.58
149769 6435204505 $109.85
142445 6431304200 $126.47
68121 5913101900 $116.58
108759 6425011400 $119.56
104305 5943231900 $110.55
141343 5957642100 $115.75
136556 6422724800 $115.94
109239 5933721500 $20.56
128167 . 5954200603 $110.55
9618 6400333700 $130.21
157113 5955100609 $109.91
104141 5955100615 $109.91
162165 5950314519 $110.55
148582 5950314410 $158.22
118312 6420803018 $89.35
142139 6420803315 . $110.55
154175 6403302101 $110.55
160228 6403301305 $158.22
155059 6420802909 $104.10
121701 6420802902 $110.55
87700 6403515200 $126.47
100454 6420110300 $116.58
167781 5931601000 $235.57
100718 5931500400 $110.55
165074 5932920100 $176.91
102773 5932920700 $110.55
79182 5933714500 $110.55
142002 5943911400 $112.80
154887 5943932800 $116.58
Peae20f 15
9-24
~V?-
~
~- --.....:=
- - ~--
C/lY OF
CHUlA VISfA
Finance DeDartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account ParcelNo - - Balance Due
114986 5931430400 $115.97
166254 .6426810500 $133.90
62421 5661510400 $116.58
164939 5651320100 $140.17
147507 6436411200 $116.58
79971 6400221900 $109.91
82218 6400222900 $110.55
122742 5722010300 $157.24
159983 5921820400 $109.91
149114 5957403400 $116.58
149371 5943830800 $132.50
65694 6401614400 $135.62
109145 6401624300 $110.36
118038 5952163800 $141.41
107335 5952031700 $110.55
122680 6425203600 $142.30
133375 5712610400 $80.09
143398 5712220100 $109.91
94150 5712610400 $125.71
87674 5711020200 $116.58
165050 5957320100 $164.14
150222 6233423600 .. $125.71
156085 6424800800 .' $149.03
145518 6436612900 $158.22
148074 5957803900 $126.47
93717 5741500200 $110.55
148332 5958100600 $128.79
148363 5958103500 $88.96
108699 5943511800 $145.23
166449 5943821600 $155.03
79112 6395502300 $116.58
35813 5702010100 $109.91
161327 6181101400 $141.78
26965 6423060700 $126.47
22925 6423060300 $160.08
107888 5752520500 $80.94
Page 3 of 15
9-25
October 24, 2005
Account
164374:
72834
145185
162056
93100
119428
93083
152646
98188
98197
160468
106661
166042
35909
21797
87113
158862
28932
94137
90194
93431
119326
159668
104281
80432
. 107614
150541
92227
165735
23345
34382
154521
146814
164391
166337
157750
~ff?
=-~=
~----=-
- --
C1lY OF
CHULA VISTA
Finance Deoartment
CoJlections Unit
Accounts With Notice Of Public Hearing Sent
-
Parcel No
5663004800
5660902200
5650901300
5722011000
5722021400
6240512900
6240553100
6404400408
\ 5681630400
5660601000
5683511600
5732503300
5733410500
5633011500
6193203600
6192011100
6422622700
5752410600
6220611300
6392000400
5662511400 l
5690600200 ,f
5952220370"
;,..
5751101700
5750600200
5652010800
5721611200
6191211400
6182401100
6182401200
6393910300
5755000100
6436002100
6403106500
5956801700
5681811100
.,
Page 4 of 15
9-26
Balance Due
$126.47
$303.30
$126.47
$164.25
$109.91
$131.74
$126.47
$89.35
$291.64
$119.79
$119.93
$95.18
$119.45
$116.58
$126.47
$110.55
$111.97
$110.55
$109.91
$110.18
$116.58
$131.74
$109.91
$109.91
$125.71
$116.58
$125.71
$101.85
$125.04
$132.50
$109.91
$117.38
$110.55
$113.69
$115.45
$110.56
~{f?
=~~_-::
~~~~.
ellY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account ParcelNo Balance Due
129187 5671023500 $132.50
13989 5670801400 $115.94
35581 5735210800 $116.58
142936 5953502500 $110.55
160364 6433201400 $126.47
61262 6232905300 $126.47
88806 6395601000 $115.94
99244 6395500500 $105.47
105734 5651922200 $109.91
155223 5652501300 $187.74
152684 5721501000 $125.71
.. .-
163744 5720420300 $110.55
144804 6206010400 / $110.55
37175 6192503800 $220.11
88066 6191421200 $185.95
162884 0 $173.27
99863 6192611100 $68.22
22853 6192612500 $132.50
95639 6192512200 $109.91
84915 5690431000 $132.50
25130 5691710800 $115.94
113956 5691631800 $145.97
63398 ~. 5693520900 $109.91
94784 5742810200 $110.55
162108 5955503900 $132.50
137239 5651911900 $126.47
154523 6432802200 $125.71
14365 5751821600 $115.94
167865 5734201400 $90.99
151062 5734201400 $122.69
138072 6220728100 $166.26
117017 5691706300 $141.44
14522 5661810400 $109.91
108622 6192120900 $153.50
130954 5733021400 $89.35
Page50f 15.
9-27
October 24, 2005
Account
104627
127143
163435
23239
57233
147503
147398
81149
161852
137766
137077
161360
165854
165576
150203
.165377
136526
108651
108856
14953
104312
113033
152413
152611
167966
130976
15075
144902
7971
148578
.160580
147571
28526
124983
162858
110679
~{I?-
:~--=
~---- =.
- --
ellY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
5733030500
6192622600
6435801300
6192502600
6192502600
6436410900
5953710300
6421202900
6421202800
6421300900
6422300600
6422300700
6422301000
5951711600
6432333400
6434851600
, 5953212635
6422000300
6392220100
6392111800
5732101200
5952420500
5957321700
5950814600
5950823400
5753221200
6202512000
5752002000
5921813300
5957262100
, 6431810100
6435701700
6203800200
6232720800
5661321200
5751710400
Balance Due
$110.55
$132.50
$125.71
$110.55
$110.55
$181.24
$148.33
$126.47
$116.71
$132.50
$163.47
$125.71
$128.02
$88.81
$132.50
$77.85
$110.55
$109.91
$109.91
$80.09
$122.61
$110.55
$110.55
$120.55
$134.07
$113.73
$110.55
$125.71
$139.78
$242.82
$109.91
$109.91
$116.16
$115.94
$116.58
$93.36
Page 6 of 15
9-28
October 24, 2005
Account
129933
166849
150528
103382
75017
30619
155076
120820
85276
21972
87433
164685
166613
47035
67840
28158
142789
35613
165297
164747
100969
166322
11261
135928
69738
165782
73670
147898
129807
77455
102569
162166
135958
127801
136673
127988
~Jf?
~
~----~.
~- -~
CllY OF
CHUlA VISTA
Finance DeDartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
Parcel No
6432500600
6425906000
6396840800
5732312300
5742816100
6396901800
5742611200
6402210800
6222110400
6222120500
5754110400
5753660100
5753611600
6391303000
6393220400
6232723800
5712711900
5712720800
6442023600
6442024200
6202513300
6202520700
6201001600
5712721900
5750312300
5733100100
5951641200
6183710300
6434104800
5735320600
5734503900
5953215320
5954100211
5954102406
5954102638
5954102811
Balance Due
$110.55
$140.50
$116.58
$115.94
$95.88
$115.94
$154.29
$145.27
$116.58
$185.98
$170.96
$125.71
$213.47
$115.94
$132.50
$110.36
$166.40
$116.58
$126.47
$113.69
$50.55
$192.81
$109.91
$109.91
$158.22
$122.85
$110.55
$148.32
$113.67
$108.27
$110.55
$109.91
$109.91
$110.55
$110.15
$109.91
Page 7 of 15
,
9-29
~ff?
:~--=
~~--~.
~ -
ellY OF
CHUlA VISfA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account ParcelNo Balance Due
167847 6434701700 $109.41
161020 5954301706 $49.91
149584 5954301805 $115.94
72541 6243900600 $110.55
25519 6243900100 $142.30
105172 5754211600 $115.94
114432 5661210200 $109.91
165407 6433801210 $104.08
36483 6394601100 $126.47
114677 6425906400 $109.91
24021 6243851300 $125.22
165326 6435022300 $110.55
120608 5957002500 $110.55
145251 6404300415 $187.75
92553 6422521400 $157.24
74442 5921810200 $146.47
146245 G 6435146400 $110.55
120799 5712100300 $91.91
121922 5712331600 $167.38
94603 5651611203 $126.47
105578 5710800800 $110.55
166033 6180210400 $137.34
37412 5671020900 $165.32
70344 5941210500 $131.74
164797 6241201500 $195.40
4208 5703123900 $141.37
118421 6396823200 $109.91
157635 5954901000 $116.75
100814 5954510900 $122.56
154593 5954505400 $130.67
158727 5954503400 $126.47
34624 5932622000 $109.91
16571 6201130300 $142.30
94426 6243410100 $160.47
167723 6393921000 $ 1 22.27
166878 6203602400 $202.95
Paae 8 of 15
9-30
~~f?
~
~--~~.
- - ~~
ellY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account ParcelNo Balance Due
71331 6241200100 $126.47
33961 6241600200 $142.69
166021 6241700800 $74.14
101779 6241700300 $111.00
106028 6390760600 $119.66
26954 6441130800 $109.65
120856 6441220700 $110.55
129353 6441220800 $110.55
140934 6441301700 $129.48
144782 6425108500 $132.50
165321 5744100500 $110.55
94452 5662512600 $130.21
153990 6205700800 $115.94
82396 6392612800 $136.71
11550 5754220800 $110.55
165631 5755120300 $156.57
122225 6201230100 $187.94
117556 6424811200 $116.58
48844 6391510300 $116.58
34126 6393510300 $110.55
164413 6393620300 $129.55
167045 5651311000 $136.32
113957 5691000800 $66.08
166914 6426704400 $179.84
158517 6426706200 $110.55
119332 6426804200 $110.55
17437 6200440400 $110.55
142300 6232213000 $110.55
165485 6433700301 $127.43
9022 6190900600 $95.88
17474 6190900100 $163.27
111492 6190710200 $117.66
146785 6436805303 $120.95
146794 6436805321 $168.39
146799 6436805317 $197.12
167055 6412704300 $126.47
Pag.90115
9-31
October 24, 2005
Account
144651
94722
159636
166203
85302
77587
138075
126264
107501
119032
147277
91979
105534
145152
106738
137240
94965
112180
158820
94969
151354
3875
164556
153824
154417
166266
151473
158338
162664
18402
167559
162292
151992
138070
155766
164612
~ff?-
~
~==~~.
em OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
6412713800
6391820800
6431613800
5754810300
5754212400
6391402900
6396300100
6202240600
6202230300
6403102300
6436510717
5952220131
5952220135
5711920100
6181012400
5710610600
5712710900
5712910500
6435421400
6394110600
6435043100
6393640400
6393832000
6205004800
6242402100
6243001400
6243003300
6201920700
6201821100
6201940100
6200410600
6200420100
6201930900
6200430900
6220431700
6202610600
Balance Due
$110.43
$109.91
$232.93
$132.50
$126.47
$110.55
$122.32
$110.55
$119.70
$116.58
$146.47
$110.55
$109.91
$164.74
$115.94
$115.94
$109.91
$109.91
$116.58
$145.43
$142.58
$112.99
$132.56
$205.68
$109.91
$132.14
$109.91
$132.62
$132.50
$129.77
$169:83
$82.58
$126.47
$132.50
$125.71
$119.06
Page 10 of 15
9-32
October 24, 2005
Account
24509
36752
95451
167866
82846
128728
31844
160007
110624
149789
167551
36765
92756
143562
58045
149972
162007
116520
94877
160871
29628
137769
131627
155501
155803
124228
19271
24254
164015
153553
116944
121146
106368
103552
165195
123891
~Vt--
:-~~
- --
'~""C"--~'
- ~-
CllY OF
CHUIA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
Parcel No
6202720200
6202730400
5942111100
5942102100
5692630400
5672503200
5943920500
6183010600
6191721200
6192210500
5755201300
6201702100
6394141000
6193502200
6200221100
6240553700
6310133800
6310132500
6240203700
5734402100
6202621600
5953701800
5682611500
5671400600
6435301900
5933718200
6401961400
6403000400
6403501500
6403920200
6432305400
6442121600
5952710800
5952622500
6442011200
6200731400
Balance Due
$110.18
$116.58
$109.91
$116.52
$110.55
$110.55
$132.50
$49.54
$110.55
. $115.86
$224.07
$110.55
$116.58
$126.47
$109.91
$127.95
$126.71
$125.71
$249.90
$125.71
$130.96
$115.94
$132.50
$110.55
$150.59
$141.44
$184.25
$109.91
$92.27
$110.55
$126.47
$115.94
$116.58
$125.91
$110.55
$89.24
Page 11 of 15
9-33
October 24, 2005
Account
29546
152661
116939
78062
29792
158419
140523
92678
19114
157116
163344
137334
149238
19181
114345
96555
62068
108574
36873
129930
146971
121006
128808
109613
99097
91336
156394
165022
113921
108377
155983
109804
166300
95290
130748
95295
~f(?-
~
~-'i:--~.
~ - ~
erlY OF
CHUlA VISfA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
6203101200
5755301600
6230400200
6243930900
6206523700
6242000100
6204400500
6204502200
6203302300
5953902600
5713020500
5712820100
5713011900
5742522000
6411324400
6442022800
5672310700
6401804300
5734820300
5956003700
6427000301
6425810300
I 6412201400
6426101500
5953302100
6190812500
6191820500
I 6193505000
6192500500
5680741600
5690302200
5683521600
5662513400
5731801200
5732602200
5735000400
Paoe 12 of 15
9-34
Balance Due
$60.55
$126.47
$158.22
$110.55
$213.42
$125.71
$141.44
$109.91
$125.71
$156.43
$70.58
$109.91
$110.55
$136.24
$104.76
$110.55
$110.55
$110.55
$110.55
$92.93
$142.80
$110.55
$126.47
$109.91
$109.91
$89.85
$233.80
$179.08
$109.91
$148.33
$110.55
$130.21
$171.86
$109.91
$109.91
$89.85
October 24, 2005
Account
153484
143773
19598
125092
21058
144928
132410
149043
158890
129331
160592
113734
140476
155629
96167
131179
141278
118262
156730
95393
124917
95404
161989
153437
129342
167913
159395
104192
130187
155773
142573
167775
131309
158825
27938
129549
~~f?-
=~_::
--- ~~
~- ~-
ellY OF
CHUlA VlsrA
Finance Deoartment
Colfections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
6423800610
6423800424
5730710600
6434505800
6233330200
6183020400
5750331700
5958040800
6192313200
6243832300
5672312100
5651000200
6412301800
6434865389
6432201300
6411901500
6411924800
6220120200
6402723200
5952142400
6402525700
6240414400
5957611700
5957611500
5934000200
6433015200
6433011200
6243204400
6243204300
6192621000
6192701600
6192701600
5953213602
6232904800
5690705100
6231614100
Balance Due
$141.47
$110.55
$122.41
$110.55
$109.91
$115.94
$116.58
$161.28
$0.02
$148.33
$110.55
$222.03
$132.50
$142.30
$109.91
$109.91
$115.94
$136.68
$116.58
$110.55
$119.93
$109.91
$130.55
$116.58
$110.55
$156.54
$110.55
$110.55
$138.63
$110.55
$106.58
$127.67
$109.91
$90.62
$163.27
$126.47
Page 13 of 15
9-35
October 24, 2005
Account
23114
135549
152141
78272
72980
26829
167587
134436
110761
20548
137907
70195
99491
154764
165231
122169
155653
20039
33078
147500
118229
156936
102531
124437
102523
135551
130189
99428
163187
159779
152227
141921
155397
117937
158841
75924
~{f?-
~
.~~-~~
~- -
CllY OF
CHUlA VISTA
Finance DeDartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
Parcel No
6231412400
. 6231110800
5733412100
.5733411300
6423203300
6422712200
. 6435910100
6240553600
: 6400231600
. 6205000100
. I 5954506800
5954508500
5944305000
6425501401
6425500306
6403512800
6403800700
5693110100
5661324500
6432914700
6240210400
5952110900
. 5952120300
6426611600
I 6182303900
6180706700
6425904800
5922314600
6424401500
6434313700
5953215022
5953214818
6411132000
5693730800
5693720900
5730630400
Balance Due
$130.55
$109.91
$122.06
$125.71
$126.47
$116.58
$131.84
$126.47
$110.55
$116.58
$111.97
$110.55
$110.55
$110.55
$129.83
$116.58
$115.94
$116.58
$132.50
$132.50
$89.17
$110.55
$110.55
$158.22
$116.58
$162.30
$146.01
$132.50
$110.55
$141.44
$109.91
$110.55
$128.90
$147.47
$232.93
$115.94
Page 14 of 15
9-36
~V?-
=~--=
~-c~~
~ --~
CITY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account ... ~ . .---- ParcelNo Balance Due
154192 5740600400 $147.47
151588 5741040600 $47.05
160457 5954404800 $113.63
8191 5952802800 $119.02
147172 6435412900 $132.64
160603 ' 5921912011 $110.55
109448 5921912141 $113.18
141573 5921912149 $110.55
166581 5921715900 $173.83
165186 6181310300 $132.50
150208 5671902300 $120,93
155229 5711830700 $145.11
167833 6435163200 $144.79
146370 6435163400 $186.69
No Of Accounts - Total Due: .
Hb (, 'f. "'O7."~
Page 15 of 15
9-37
RESOLUTION NO. 2005-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA
VISTA ASSESSING CERTAIN DELINQUENT SOLID WASTE SERVICE
CHARGES AS LIENS UPON THE RESPECTNE PARCELS OF LAND
(GROUP "C") AND APPROVING PLACEMENT OF CERTAIN
DELINQUENT CHARGES ON THE NEXT REGULAR TAX BILL
WHEREAS, Chula Vista Municipal Code Section 8.24 allows delinquent solid waste service
charges to be assessed as liens upon the affected properties and ultimately placed on the property tax
bills for collection; and
WHEREAS, in July, 2005, City Council approved 248 delinquent accounts valued at $31,300
to be placed on the property tax bills for collection; and
WHEREAS, since July, 2005, Pacific Waste Services has identified and submitted an
additional 1,079 delinquent accounts valued at over $135,200 to the City for collection; and
WHEREAS, through the City's preliminary collections efforts, 411 accounts have been
resolved, and the remaining accounts valued at $83,700 have been submitted to the City, a copy of
which is on file with the City Clerk's office.
WHEREAS, Section 8.24 authorizes the City Council to hold a public hearing to consider the
delinquency of solid waste service accounts, together with any objections or protests by interested
persons; and
WHEREAS, the respective property owners have been notified oftheir delinquencies and of
the public hearing regarding the assessment of delinquent solid waste service charges; and
WHEREAS, since charges can only be submitted for placement on the property tax bills once
a year in August, staff is recommending assessing liens on the affected properties midyear as to
better ensure the City's chances for collection; and
WHEREAS, adoption of this resolution will enhance the collection process for delinquent
solid waste service charges by ensuring that the correct property owners are charged and that
payment be received on a more timely basis; and
WHEREAS, staff further recommends that the City Council approve the final list of
delinquent solid waste accounts as submitted, and that these charges be forwarded to the County and
assessed as liens on the respective parcels of land and ultimately placed on the next regular tax bill
for collection.
9-38
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City ofChula Vista
has considered and approves the November I, 2005 List of Delinquent Solid Waste Service
Accounts, Group "C,"as submitted by City staff in connection with the public hearing on this matter
(a copy of which is attached to this Resolution).
BE IT FURTHER RESOLVED that the City Council has considered all objections and
protests raised at the public hearing, overrules those protests and objections and assesses the
delinquent solid waste service charges as liens upon the respective parcels ofland.
BE IT FURTHER RESOLVED that the City Council authorizes the City Manager, or his
designee, to take all action necessary to record these assessments with the County of San Diego for
placement on the next regular tax bill for collection.
Presented by
Approved as to form by
fdAn
oore
City Attorney
//Uu~
,
Maria Kachadoorian
Director of Finance
J:lattomeylresolsolid waste\deliq solid waste srve ehgs 2005 11 1 05
9-39
)(~)c
~{f?
:~--~
~~~~.
- - ~~
erlY OF
CHUlA VISfA
LIST OF DELINQUENT SOLID WASTE SERVICE ACCOUNTS
GROUP "Cn
October 24, 2005
1IIIII!J.
-~-~-~-_._---_._---_.. _ ,-'c' -._.... ,e,"
.. ..-. ..
Account ParcelNo Balance Due
34279 ----~---_._- 5720630800 $115.56
163972 ~----- 5933600300 $118.51
157762 6220202700 $125.71
153697 ....----.--.. 5955601400 $110.55
101356 --,~-_._,- - --- 5754910300 $126.47
60193 5751720400 $116.58
141078 .. ---.---------.- 5752312300 $136.99
157051 6411112600 $123.02
98564 , 5952153100 $110.55
35707 5691331400 $131.74
152488 -~~------ 5692410700 $114.55
60657 6291510100 $30.00
23031 -- - _._-_._--~--_.. 6291510600 $132.50
23301 -------_... i 6291520200 $132.50
124176 , 6426232200 $159.98
3519 , 6401514400 $125.71
127328 -.------.------ , 6423521600 $109.90
127491 ! 6423613200 $220.45
153882 ------~,---- , 6426000700 $109.91
145611____ I 6436715200 $110.55
31280 5943410800 $126.47
143977 --.--.------....---- i 5933702600 $89.85
- -. .-..-.---- ..--..-- 6206202000
83473 6401713400 $l10.18
94352 5671010900 $110.55
132447 -.-.-- 5720800600 $129.06
150084 5722130200 $109.91
138212 ____._u__..__..__________.__ 6412711500 $132.50
137677__ 6412712100 $141.35
148820 5958212900 $141.31
73632 ~------------ 6230301120 $89.35
142563 _.__u ,6230301134 $110.55
144691 . ,6433801127 $126.47
135064 6412204300 $109.91
34349" ..'..:.......____ , 5752321500 $20.53
93861 , 5633100400 $75.94
_._'_..,_._--_._.~_.- ,
Page 1 of 15
~ -~---,--._.,...--_.__.-
9-40
~V?-
~
~---- =.
- -
CITY Of
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account - ParcelNo .. iW Balance Due
---
. 70234 5953216123 $109.91
84726 6432001900 $117.13
145964 6435205309 $90.81
57327 5670800400 $252.69
68956 5720801200 $132.50
27680 6391921200 $144.95
133282 5952923400 $136.58
149769 6435204505 $109.85
142445 6431304200 $126.47
68121 5913101900 $116.58
108759 6425011400 $119.56
104305 5943231900 $110.55
141343 5957642100 $115.75
136556 6422724800 $115.94
109239 5933721500 $20.56
128167 5954200603 $110.55
9618 6400333700 $130.21
157113 5955100609 $109.91
104141 5955100615 $109.91
162165 5950314519 $110.55
148582 5950314410 $158.22
118312 6420803018 $89.35
1012139 6420803315 $110.55'
154175 6403302101 $110.55
160228 6403301305 $158.22
155059 6420802909 $104.10
121701 6420802902 $110.55
87700 6403515200 $126.47
100454 6420110300 $116.58
167781 5931601000 $235.57
100718 5931500400 $110.55
165074 5932920100 $176.91
102773 5932920700 $110.55
79182 5933714500 $110.55
142002 5943911400 $112.80
154887 5943932800 $116.58
Page 2 of 15
9-41
~~f?
~
~~~-=.
- - -~
ellY Of
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account Parcel No - .. - Balance Due
114986 5931430400 $115,97
166254 -6426810500 $133.90
62421 5661510400 $116.58
164939 5651320100 $140.17
147507 6436411200 $116.58
79971 6400221900 $109.91
82218 6400222900 $110.55
122742 5722010300 $157.24
159983 5921820400 $109.91
149114 5957403400 $116.58
149371 5943830800 $132.50
65694 6401614400 $135.62
109145 6401624300 $110.36
118038 5952163600 $141.41
107335 5952031700 $110.55
122680 6425203600 $142.30
133375 5712610400 $80.09
143398 5712220100 $109.91
94150 5712610400 $125.71
87674 5711020200 $116.58
165050 5957320100 $164.14
150222 6233423600 ." $125.71
156085 6424800800 $149.03
145518 6436612900 $158.22
148074 5957803900 $126.47
93717 5741500200 $110.55
148332 5958100600 $128.79
148363 5958103500 $88.96
108699 5943511800 $145.23
166449 5943821600 $155.03
79112 6395502300 $116.58
35813 5702010100 $109.91
161327 6181101400 $141.78
26965 6423060700 $126.47
22925 6423060300 $160.08
107888 5752520500 $80.94
Page30f 15
9-42
October 24, 2005
Account
164374.
72834.
145185
162056
93100
119428
93083
152646
98188
98197
160468
106661
166042
35909
21797
87113
1588.62
28932
94137
90194
93431
119326
159668
104281
80432
107614
150541
92227
165735
23345
34382
154521
146814
164391
166337
157750
~{f?
~.
~ ~=
C1lY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
-
ParcelNo
5663004800
5660902200
5650901300
5722011000
5722021400
6240512900
6240553100
6404400408
\ 5681630400
5660601000
5683511600
5732503300
5733410500
5633011500
6193203600
6192011100
6422622700
5752410600
6220611300
6392000400
5662511400 t
5690600200 ..
I 5952220370"
"
5751101700
5750600200
5652010800
5721611200
6191211400
6182401100
6182401200
6393910300
5755000100
6436002100
6403106500
5956801700
5681811100
"
Page 4 of 15
9-43
Balance Due
$126.47
$303.30
$126.47
$164.25
$109.91
$131.74
$126.47
$89.35
$291.64
$119.79
$119.93
$95.18
$119.45
$116.58
$126.47
$110.55
$111.97
$110.55
$109.91
$110.18
$116.58
$131.74
$109.91
$109.91
$125.71
$116.58
$125.71
$101.85
$125.04
$132.50
$109.91
$117.38
$110.55
$113.69
$115.45
$110.56
~{~
':~- :
- - - -
~----~
- - - -
CIlY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account ParcelNo Balance Due
129187 5671023500 $132.50
13989 5670801400 $115.94
35581 5735210800 $116.58
142936 5953502500 $110.55
160364 6433201400 $126.47
61262 6232905300 $126.47
88806 6395601000 $115.94
99244 6395500600 $105.47
105734 5651922200 $109.91
155223 5652501300 $187.74
1.52684 5721501000 $125.71
163170 5680120900 $178.84
163744 5720420300 $110.55
144804 6206010400 $110.55
37175 6192503800 $220.11
88066 6191421200 $185.95
162884 0 $173.27
99863 6192611100 $68.22
22853 6192612500 $132.50
95639 6192612200 $109.91
84915 5690431000 $132.50
25130 5691710800 $115.94
113956 5691631800 $145.97
63398 -' 5693520900 $109.91
94784 5742810200 $110.55
162108 5955503900 $132.50
137239 5651911900 $126.47
154523 6432802200 $125.71
14365 5751821600 $115.94
167865 5734201400 $90.99
151062 5734201400 $122.69
138072 6220728100 $166.26
117017 5691706300 $141.44
14522 5661810400 $109.91
108622 6192120900 $153.50
130954 5733021400 $89.35
Peae50f 15.
9-44
October 24, 2005
Account
104627
127143
163435
23239
57233
147503
147398
81149
161852
137766
137077
161360
165854
165576
150203
165377
136526
108651
108856
14953
104312
113033
152413
152611
167966
130976
15075
144902
7971
148578
.160580
147571
28526
124983
162858
110679
~{f?
=~~-=
~---c-=-
- --
em OF
CHUIA VISTA
Finance Deoartment
Col/ections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
5733030500
6192622600
6435801300
6192502600
6192502600
6436410900
5953710300
6421202900
6421202800
6421300900
6422300600
6422300700
6422301000
5951711600
6432333400
6434851600
, 5953212635
6422000300
6392220100
6392111800
5732101200
5952420500
5957321700
5950814600
5950823400
5753221200
6202512000
5752002000
5921813300
5957262100
~ 6431810100
6435701700
6203800200
6232720800
5661321200
5751710400
Balance Due
$110.55
$132.50
$125.71
$110.55
$110.55
$181.24
$148.33
$126.47
$116.71
$132.50
$163.47
$125.71
$128.02
$88.81
$132.50
$77.85
$110.55
$109.91
$109.91
$80.09
$122.61
$110.55
$110.55
$120.55
$134.07
$113.73
$110.55
$125.71
$139.78
$242.82
$109.91
$109.91
$116.16
$115.94
$116.58
$93.36
Page 6 of 15
9-45
October 24, 2005
Account
129933
166849
150528
103382
,..
30619
155076
120820
85276
21972
87433
164685
166613
47035
67840
28158
142789
35613
165297
164747
100969
166322
11261
135928
69738
165782
73670
147898
129807
77455
102569
162166
135958
127801
136673
127988
~u~
~.
- - -
- ~~~
ellY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
6432500600
6425906000
6396840800
5732312300
l'
6396901800
5742611200
6402210800
6222110400
6222120500
5754110400
5753660100
5753611600
6391303000
6393220400
6232723800
5712711900
5712720800
6442023600
6442024200
6202513300
6202520700
6201001600
5712721900
5750312300
5733100100
5951641200
6183710300
6434104800
5735320600
5734503900
5953215320
5954100211
5954102406
5954102638
5954102811
Balance Due
$110.55
$140.50
$116.58
$115.94
-
$115.94
$154.29
$145.27
$116.58
$185.98
$170.96
$125.71
$213.47
$115.94
$132.50
$110.36
$166.40
$116.58
$126.47
$113.69
$50.55
$192.81
$109.91
$109.91
$158.22
$122.85
$110.55
$148.32
$113.67
$108.27
$110.55
$109.91
$109.91
$110.55
$110.15
$109.91
Page 7 of 15
"
9-46
-."-
~{f?-
;~-=;;
-
- --
ellY OF
CHUlA VISTA
Finance DeDartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account ParcelNo Balance Due
167847 6434701700 $109.41
161020 5954301706 $49.91
149584 5954301805 $115.94
72541 6243900600 $110.55
25519 6243900100 $142.30
105172 5754211600 $115.94
114432 5681210200 $109.91
165407 6433801210 $104.08
36483 6394601100 $126.47
114677 6425906400 $109.91
24021 6243851300 $125.22
165326 6435022300 $110.55
120608 5957002500 $110.55
145251 6404300415 $187.75
92553 6422521400 $157.24
74442 5921810200 $146.47
146245 : 6435146400 $110.55
120799 5712100300 $91.91
121922 5712331600 $167.38
94603 5651611203 $126.47
105578 5710800800 $110.55
166033 6180210400 $137.34
37412 5671020900 $165.32
70344 5941210500 $131.74
164797 6241201500 $195.40
4208 5703123900 $141.37
118421 6396823200 $109.91
157635 5954901000 $116.75
100814 5954510900 $122.56
154593 5954505400 $130.67
158727 5954503400 $126.47
34624 5932622000 $109.91
16571 6201130300 $142.30
94426 6243410100 $160.47
167723 6393921000 $122.27
166678 6203602400 $202.95
Page 8 of 15
9-47
October 24, 2005
Account
71331
33961
166021
101779
106028
26954
120856
129353
140934
144782
165321
94452
153990
82396
11550
165631
122225
117556
48844
34126
164413
167045
113957
166914
158517
119332
17437
142300
165485
9022
17474
111492
146785
146794
146799
167055
~{~
:~--=
~-i:- =.
-:.... --
ellY OF
CHUlA VISfA
Finance DeDartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
6241200100
6241600200
6241700800
6241700300
6390760600
6441130800
6441220700
6441220800
6441301700
6425108500
5744100500
5662512600
6205700800
6392612800
5754220800
5755120300
.6201230100
6424811200
. 6391510300
6393510300
6393620300
5651311000
5691000800
6426704400
6426706200
6426804200
6200440400
6232213000
6433700301
6190900600
6190900100
6190710200
6436805303
6436805321
6436805317
6412704300
Balance Due
$126.47
$142.69
$74.14
$111.00
$119.66
$109.65
$110.55
$110.55
$129.48
$132.50
$110.55
$130.21
$115.94
$136.71
$110.55
$156.57
$187.94
$116.58
$116.58
$110.55
$129.55
$136.32
$66.08
$179.84
$110.55
$110.55
$110.55
$110.55
$127.43
$95.88
$163.27
$117.86
$120.95
$168.39
$197.12
$126.47
Paoe 9 of 15
9-48
October 24, 2005
Account
144651
94722
159636
166203
85302
77587
138075
126264
107501
119032
147277
91979
105534
145152
106738
137240
94965
112180
158820
94969
151354
3875
164556
153824
154417
166266
151473
158338
162664
18402
167559
162292
151992
138070
155766
164612
~{f?
~c:
~~--~
- --
C1lY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
6412713800
6391820800
6431613800
5754810300
5754212400
6391402900
6396300100
6202240600
6202230300
6403102300
6436510717
5952220131
5952220135
5711920100
6181012400
5710610600
5712710900
5712910500
6435421400
6394110600
6435043100
6393640400
6393832000
6205004800
6242402100
6243001400
6243003300
6201920700
6201821100
6201940100
6200410600
6200420100
6201930900
6200430900
6220431700
6202610600
Balance Due
$110.43
$109.91
$232.93
$132.50
$126.47
$110.55
$122.32
$110.55
$119.70
$116.58
$146.47
$110.55
$109.91
$164.74
$115.94
$115.94
$109.91
$109.91
$116.58
$145.43
$142.58
$112.99
$132.56
$205.68
$109.91
$132.14
$109.91
$132.62
$132.50
$129.77
$169:83
$82.58
$126.47
$132.50
$125.71
$119.06
Page 10 of 15
9-49
October 24, 2005
Account
24509
36752
95451
167866
82846
128728
31844
160007
110624
149789
167551
36765
92756
143562
58045
149972
162007
116520
94877
160871
29628
137769
131627
155501
155803
124228
19271
24254
164015
153553
116944
121146
106368 .
103552
165195
123891
~f~
~
~- - ~.
- - - -
CI1Y OF
CHULA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
Parcel No
6202720200
6202730400
5942111100
5942102100
5692630400
5672503200
5943920500
6183010600
6191721200
I 6192210500
5755201300
6201702100
6394141000
6193502200
6200221100
6240553700
6310133800
6310132500
6240203700
5734402100
6202621600
5953701800
5682611500
5671400600
6435301900
5933718200
6401961400
6403000400
6403501500
6403920200
6432305400
6442121600
5952710800
5952622500
6442011200
6200731400
Balance Due
$110.18
$116.58
$109.91
$116.52
$110.55
$110.55
$132.50
$49.54
$110.55
. $115.86
$224.07
$110.55
$116.58
$126.47
$109.91
$127.95
$126.71
$125.71
$249.90
$125.71
$130.96
$115.94
$132.50
$110.55
$150.59
$141.44
$184.25
$109.91
$92.27
$110.55
$126.47
$115.94
$116.58
$125.91
$110.55
$89.24
Page 11 of 15
9-50
29546
152661
116939
78062
29792
158419
140523
92678
19114
157116
163344
137334
149238
19181
114345
96555
62068
108574
36873
129930
146971
121006
128808
109613
99097
91336
156394
165022
113921
1083n
155983
109804
166300
95290
130748
95295
October 24, 2005
Account
~{f?
:~--~
- ---- =.
- - - -<0:0...-
erlY OF
CHUlA VISTA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
Parcel No
6203101200
5755301600
6230400200
6243930900
6206523700
6242000100
6204400500
6204502200
6203302300
5953902600
5713020500
5712820100
5713011900
5742522000
6411324400
6442022800
5672310700
6401804300
5734820300
5956003700
6427000301
6425810300
6412201400
6426101500
5953302100
6190812500
6191820500
6193505000
6192500500
5680741600
5690302200
5683521600
5662513400
5731801200
5732602200
5735000400
Page 12 of 15
9-51
- Balance Due
$60.55
$126.47
$158.22
$110.55
$213.42
$125.71
$141.44
$109.91
$125.71
$156.43
$70.58
$109.91
$110.55
$136.24
$104.76
$110.55
$110.55
$110.55
$110.55
$92.93
$142.80
$110.55
$126.47
$109.91
$109.91
$89.85
$233.80
$179.08
$109.91
$148.33
$110.55
$130.21
$171.86
$109.91
$109.91
$89.85
October 24, 2005
Account
153484
143773
19598
125092
21058
144928
132410
149043
158890
129331
160592
113734
140476
155629
96167
131179
141278
118262
156730
95393
124917
95404
161989
153437
129342
167913
159395
104192
130187
155773
142573
167775
131309
158825
27938
129549
~Vt..
~
~~~-=.
- - ~~
CllY OF
CHUlA VlsrA
Finance Deoartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
ParcelNo
6423800610
6423800424
5730710600
6434505800
6233330200
6183020400
5750331700
5958040800
6192313200
6243832300
5672312100
5651000200
6412301800
6434865389
6432201300
6411901500
6411924800
6220120200
6402723200
5952142400
6402525700
6240414400
5957611700
5957611500
5934000200
6433015200
6433011200
6243204400
6243204300
6192621000
6192701600
6192701600
5953213602
6232904800
5690705100
6231614100
Balance Due
$141.47
$110.55
$122.41
$110.55
$109.91
$115.94
$116.58
$161.28
$0.02
$148.33
$110.55
$222.03
$132.50
$142.30
$109.91
$109.91
$115.94
$136.68
$116.58
$110.55
$119.93
$109.91
$130.55
$116.58
$110.55
$156.54
$110.55
$110.55
$138.63
$110.55
$106.58
$127.67
$109.91
$90.62
$163.27
$126.47
Page 13 of 15
9-52
October 24, 2005
Account
23114
135549
152141
78272
72980
26829
167587
134436
110761
20548
137907
70195
99491
154764
165231
122169
155653
20039
33078
147500
118229
156936
102531
124437
102523
135551
130189
99428
163187
159779
152227
141921
155397
117937
158841
75924
~ {f?.
~
-=~~--=.
~- ~-
ellY OF
CHUlA VISTA
Finance DeDartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
. ParcelNo
6231412400
.6231110800
5733412100
.5733411300
6423203300
6422712200
i 6435910100
i 6240553600
6400231600
6205000100
5954506800
5954508500
5944305000
6425501401
6425500306
6403512800
6403800700
5693110100
: 5661324500
i 6432914700
. 6240210400
, 5952110900
5952120300
6426611600
6182303900
6180706700
6425904800
5922314600
6424401500
6434313700
5953215022
5953214818
6411132000
5693730800
5693720900
5730630400
Balance Due
$130.55
$109.91
$122.06
$125.71
$126.47
$116.58
$131.84
$126.47
$110.55
$116.58
$111.97
$110.55
$110.55
$110.55
$129.83
$116.58
$115.94
$116.58
$132.50
$132.50
$89.17
$110.55
$110.55
$158.22
$118.58
$162.30
$146.01
$132.50
$110.55
$141.44
$109.91
$110.55
$128.90
$147.47
$232.93
$115.94
Page 14 of 15
9-53
~~f?-
=~~-~
-=-.-- -~
- --
CIlY OF
CHULA VISTA
Finance Denartment
Collections Unit
Accounts With Notice Of Public Hearing Sent
October 24, 2005
Account -" - . .---- Parce/No Balance Due
154192 5740600400 $147.47
151588 5741040600 $47.05
160457 5954404800 $113.63
8191 5952802800 $119.02
147172 6435412900 $132.64
160603 i 5921912011 $110.55
109448 5921912141 $113.18
141573 5921912149 $110.55
166581 5921715900 $173.83
165186 6181310300 $132.50
150208 5671902300 $120.93
155229 . 5711830700 $145.11
167833 i 6435163200 $144.79
146370 . 6435163400 $186.69
No Of Accounts - Total Due:
SIb ~4 ~CIC.1o I
Page 15 of 15
9-54
~
COUNCIL AGENDA STATEMENT
Item No JO
Meeting Date 11/1/2005
ITEM TITLE:
RESOLUTION APPROVING POSTING OF "NO ALCOHOL"
SIGNS AT MEMORIAL, EUCTAL YPTUS, FRIENDSHIP, AND
LAUDERBACH PARKS
ORDINANCE AMENDING MUNICIPAL CODE 2.66.043
PERMITTING POSSESSION AND CONSUMPTION OF ALCOHOL
BY PERMIT DURING PARK OPERATING HOURS.
SUBMITTED BY:
Chief of Police ~ "'-,J."
Director of Public Works Operations lcb!.
Director of Recreation ~l y~
{J
REVIEWED BY: City Manager
(4/5ths Vote: Yes _ No X )
RECOMMENDATIONS:
Staff recommends that the City Council continue this item to the November 15, 2005
Council Meeting.
10-1
COUNCIL AGENDA STATEMENT
Item No.:
Meeting Date:
II
11/1/05
SUBMITTED BY:
Report; Potential edits to the Draft General Plan Update regarding Transit
Focus Areas
Director OfPl~g and BUilding~
City Manager r;l ~ Pt: (4/5thsVote: Yes_ Nol)
ITEM TITLE:
REVIEWED BY:
At the October 4, 2005, City Council meeting, the Mayor indicated his desire to have an option
before the Council for consideration as part of the General Plan Update (GPU) that would
provide for a maximum of mid-rise development for all of the property located within the Transit
Focus Area (TF A) at Third and H Street. Based on subsequent direction from the City
Manager's office, staff has developed draft potential GPU edits that could accomplish this, and
would further clarify design considerations for development within all TFA designated areas.
Staff has prepared these edits for Council review as an option to consider at the GPU hearing in
December.
RECOMMENDATION: That Council direct staff to bring back the proposed edits as another
GPU option to consider at the GPU hearing.
BOARDS/COMMISSIONS RECOMMENDATION: N/A
DISCUSSION:
In the pending GPU, there are four areas with in the City that are proposed for the highest
densities and intensities, and mix ofland uses, given their location in proximity to existing and
future transit stations, and their role as major activity areas. Four such areas are designated in
the GPU, and include the Eastern Urban Center in Otay Ranch, and in Northwest Chula Vista,
the three "transit focus areas"(TF As) surrounding the existing trolley stations at E Street/I-5 and
H Street/I-5, and the future station area around H Street and Third Ave.
Because of their role as activity nodes and entryways, the proposed GPU also provides that these
areas would be the most appropriate areas in which to consider the use of the tallest building
forms, largely to emphasize the areas' importance and provide visual landmarks. This was not to
say that "high-rise" buildings would be allowed by right in these areas, or that high rises would
necessarily be built, but rather that any consideration of them should occur only in these areas.
When the GPU was originally circulated for public comment in early 2005, there were
substantial comments and concerns expressed as to how and under what circumstances high-rise
buildings might occur. In response to these and other cominents, staff prepared a set of edits to
11-1
Page 2, Item No.:
Meeting Date: 11/1/05
the GPU, which included significantly expanded discussions on the topic of urban design and
form, along with policies and criteria regarding the circumstances under which potential high-
rise buildings could be considered in the TF As. Staff's edits also responded to public comments
regarding protections to overall community character, and the preservation of stable
neighborhood areas, particularly within the older core area of downtown that the public has
termed "the village".
Prior to releasing the September 2005 proposed GPU edits, staff held discussions with the GPU
Steering Committee. Among its comments, the Steering Committee indicated that they would
prefer an option that retained the potential for high-rise buildings in the EUC, and in the two
TFAs at the E Street/I-5 and H Street/I-5, but not within the TFA near H Street/Third Ave. The
Steering Committee felt that, due to the proximity of the H Street/Third Ave. TFA to the village,
a mid-rise designation for that particular TF A is more compatible with the community charater
of the surrounding area. The Steering Committee also requested that an eighth theme be added
to the GPU based on the notion of "harmonizing change", where new development and
redevelopment take ques from the existing land use context.
At the joint Planning commission/City Council workshop on August 18,2005, Council (among
other inputs) directed staff to include the harmonizing change theme, and to release the edits as
proposed by staff for public review along with the re-circulated Draft EIR. The proposed GPU
edits and a re-circulated Draft Environmental Impact Report were released for public review on
September 19, 2005.
Since the time of the release, there has continued to be substantial public comment and
discussion regarding the provisions for potential high-rise buildings within the proposed TF A at
H Street and Third Ave. In response (as noted in the beginning of this report), staff was
requested to prepare possible additional GPU text edits that could provide Council with an option
to limit development to mid-rise within the H Street/Third Ave. TFA. Staff also prepared further
GPU language and policy enhancements that could better clarifY the design considerations to be
applied to all TF As regarding the form and massing of larger buildings, and the interface
between the TF A and surrounding areas.
In response, staff has prepared further potential GPU edits beyond those released on September
19th, and which are presented in Attachment 1. These edits provide guidance and policy
enhancements in the following areas (references are to Attachment 1):
· Building heights within the H Street/ Third Ave. TFA would be limited to mid-rise
heights. (see pg. 3, policy LUT 2.3; pg. 8; pg. 9, policy LUT 49.13; pg. 10; pg. 11 and
pg. 12, policy LUT 53.3)
· To further ensure that new development in all the TFAs is sensitive to surrounding
neighborhoods, additional building setback, step-back and design provisions are
proposed. (see pg. 1; pg.3, policy LUT 2.5; pg. 4, policy LUT 3.3; pg. 5, policies LUT
4.6 and 6.3; pg. 7, policy LUT 7.6)
11-2
Page 3, Item No.:
Meeting Date: 1111/05
. New development within all TF As would be required to include features to soften the
transition to adjacent areas. (see pg.l, 2; pg. 6, policy LUT 7.5)
The above proposed provisions and policies would not be detrimental to, or inconsistent with
realizing a successful TFA at H Street/Third Ave. As noted earlier, high-rise building forms are
not necessary to achieve the density/intensity intended for the TF As, but are primarily intended
to provide visual identification and landmarks at these key areas. Of the three TF As in the
Northwest area, the two along the 1-5 corridor are most important in creating visual landmark
identification along a major, regional travel route, and at the primary western entrances to the
City and the future bayfront development. The desired demarcation at the H St/Third Ave. TFA
is more internally focused to highlighting the southern entrance to the downtown Third Ave.
corridor. Necessary identification for this community entrance through architectural uniqueness
and other elements could be successfully accomplished with mid-rise building forms.
FISCAL IMPACT:
None. This report is primarily for information, and the nature of the potential GPU edits do not
change the fundamental land uses considered through the GPU's Fiscal Impact Analysis.
Attachments
1. Draft Potential GPU edits regarding TF As.
H:\PLANNING\General_Plan\Erratas\TFA-heightl al13 lO-26-05.finall.doc
11-3
Attachment 1
Draft Staff-Generated Potential General Plan Update Revisions
In resoonse to City Manaaer direction reaarqjna mid-rise heiaht orovisions
for the Third & H Street TFA. and l<larifjcations on desian and urban form
considerations/orovisions for TFAs in aenera!
October 27, 2005
Note: The following uses the proposed GPU edits distributed for public review on
September 19, 2005, as a base document. Proposed potential edits in response
to the above City Manager direction are highlighted in yellow.
\
--------------------------------------------------------------------------------------------~-----------
, ,
\
\
CHAPTER 5 - LAND USE AND TRANSPORT A TIOt:!JiLEMENT
I.
\
\
7.2
(~e LUT-74)
\
\
,.
Urban Desilln and Form (NEW SECTION)
\ '
As ,niroduced in LUT Secti 3: and 3 5, establi hin and reinforcin this Ci 's urban desi n
and form is necessa to en'sure t~at the desired araefer and ima e of the Ci is rotected and
enhanced as the eit rows an develo s ov ime. The evolvlna urban desi n and form of
(~.!).,.'.I8_\flg~.9~ GQD!>ldeI~iLL~J<:ID'..1QJbiS City's community. chas.9ct~L-"DiL.Lf}J.~iliL.9n93h9~ici
.I29_-"gQre~--":<lt-efultLAs note? in.ll8rticular under Theme 8 - "Shapinll the Future throuah the
Present al\1d Past", such challllle and evolution must be accomplished in a manner that
com iements Ch a Vista's herita e and uni ue sense of iace. This includes consideration of a
number of inte related factors such as reservin and enhancin stable residential
nei hborhood ocusin on ed es between new deveio ment and redeveio ment to ensure
compatible and use and edae transitions, and historic preservation. amona others. This approach
to ensurina harmonv between needed and desired chanaes. and the Citv's past and present. is
carried out throuah a number of obiectives and policies both in this Section and in Sections 7.3
throuah 7.6 as well as in the Area Plans in LUT Sections 8 throuah 10,
Proposed TFA/Height Revisions - October 27, 2005
Page 1 of 12
11-4
_'1il~mf_"MIl'llI!~!ftHf;jf's!!lilm~~'l!i!itm"atiliiit"' Historjcally. talleLbuildlnqs.1.overNlli.....Qr!JY.?
stofiesJJ}",~ o<;,,-wred rarely. and certainlY not Jhrouqh _a stratS9l<;..~lf9JLto def1!J.?Jhe.C.lti~
.s1Y.llnit to Identify wt)ere..Qfominent blllldin.9-[Dass wouldJl~Q5',~efiCL~L19-~mn,!Ll!DQQrt~Qt
"'<;UYlti.cenliirs._.As sM",!,n on Fiqure 5.17 A. this General Plan identifie.s four. lirY\jf"l,L!ocatlQL1~
',yi]"lL~'!Ij;l'illJ. deY.5l12QJDent iDtensltles an<;Ltaller Quildll1.9.LQrm3L~v9uld J25'J.l10sJJ!QPIQOnqflL.ItL?se
LO.clu ,!!L tile .It) rEl.<'l.jJallslt foc.~lLar<'l.aS IIl.JJrban _ CorEt-'2L,'1este rO.s.tlu la.Visi;9.;... tWQ arQJ!.nQ..tll?
e_xlsfIIJ.(lJ;.. Str.<'l.<'l.t.?D.!!__tL~Jr.".<'lt trolle'LsLaJIQIJ"'-?IJ.<:Ub.!LtiJ ird ~r.Q.UDc)Jb.<'l.M,!I.?.stq!lon' 9D.ti~.trge!
'lQ~.cJ.b!.rg...6Y9.flUe c._Tb.9..!.Qurth.<;l.re?!.sJ.Il~d:asternW[J?<!n..QeQter..lIlQ1?'LB.?I}Qb.'<'{QiQl}_b.s!s _b<').<').Q
Rl?nnec) lQL.ldrQ?",.g.ey.?-IQ!?ffien.t2lc!<:;.eJb<'i.Q@LB.?nc.iJ.QQIJ.QJ~LQevj)lc[2Ln.flol.PJ.ElD_'!VJ!'??!?!?r9y"g
iI}J~99.
Also deoicted on Fiqure 5-17A is the H Street Transit Corridor Special Studv Area. The purpose
of this special study is to analyze and evaluate the appropriateness of plan chanqes that could
result in mixed land uses, increased intensities. and potential hiqh-rise buildinqs alonq H Street
between Interstate 5 and ;Jt4Mj:U,15crinrllfu Avenue. An important consideration of the stud v is that the
area is a ma'or activi corridor and functions as the rima ent into the urban reo It is a
ma.or link between Broadwa and the downtown area is tar eted as a ma'or ra it connection
between the eastern portion of the Citv and the west. and Gurrentlv consists" primarilv of
communitv or sub-reqional-servinq non-residential land uses. Piese uses include the South
Countv Reqional Center and Superior Court. medical offices:(Several bank facilities. a maior
hos ital and medical facili at Scri s ma.or commercial uses t the Chula \[sfa Center
numerous restaurants. retail businesses and professionai offices.~n view of these existinq land
uses alonq H Street. the future intensificatiOn(lanned with the 0 TFAs at either end of the
corridor and the otential for future market f rces to focus on Street as a ke corridor a
special studv is needed that examines further p entia! chanoes in and use and intensitv. buildinq
mass the otential for talle ildln s and the relati.>nshi and a ro riate transitions to ad.acent
stable neiqhborhoods (see ,olicv UT 2.6).
'"
..
LtJ<')I(jS11J.t~.il!jQ' 9fJhese abo e trat'l'Sit focus?r"leS and corridor within-iA the Citv's Urban Core.
as well as\Vrthln e Eastern an Center EUC flL<').111.t9ncJegJ9..?s.t?I:>I@ilJ:lI;e"g"where people
are attract d to active edestrian-oriented ex eriences includin sho in restaurants,
'i'.O.t9f.t;e.il1ffi9.!1t a em 10 ment ;e.QQ."'!blcI1.;em_J9<:;.?t'2.cJ_flI90QiL1flJ9r_~}or.9ld9.hJ.flLE!s.aI19Jr.<:ln.slt
r91..I,tQs...l'{b<'i[ ..!&'y..g?D..jJ~.JDQs..tLC@Jj.UL~(;9_~.s99.._..Y'!h i.!(J_ flJIg}'18 nCE!J9L .11] q hOL.!l}!<'lDsl!les al1cJ
taller buildinqs. or "hioh-rise" structures. in Jhos(J..l9cat!'QO.~.PJ:9.\1LQ.E:!s...no.9J.E)_b..Q~sI0lL..2I}1.R.I9)lf1},,-n.t
;e11IJ.9,th.9r. QQQQr:\IdOI]9S on a smaller amount of land Jbli_Rrln.cJpaILE!1!s9.11!9L hiqh-rise structures
is to provide landmarks and skyline recoqnition for kev areas of the Citv. and punctuate them as
vibrant. active and successful communitv centers.
The followino Obiectives and policies are provided to ensure that the evolution of more urban
land use areas within Chula Vista are strateqicallv focused and harmoniouslv. inteqrated to
adioininq stable neiqhborhood areas and that the allowance of hioh-rise structures of eiqht or
more (8+) stories is accordinoly manaoed. In addition. ..pPlease see Planninq Area Plans (LUT
Sections 8-10) for site.further area-specific discussions and policies, as well as the Otav Ranch
General Development Plan (GDP) which addresses development within the EUC.
(NOTE: existing Objective LUT 2 re-numbered to LUT 4)
Proposed TFA/Height Revisions - October 27, 2005
Page 2 of 12
11-5
Obiective LUT 2 (NEW)
limit locations for the hiqhest deyelopment intensities and densities. and the tailest buildinq
Lorms to key urban activity centers that are also well served by transit
(new)LUT 2.1: Locate Mixed Use Transit Focus Areas where major transit stations exist or are
planned.
(new)LUT 2.2: Locate the hiqhest development intensities and residential densities within Mixed
Use Transit Focus Areas where stronq City qateway elements exist or key urban
activity areas occur.
(new)LUT 2.3: Limit the location of. h!oh-rise structures to Within the5'iitlt~fJ1eel;'tffillit.t~t~~
Transit Focus AreasatIf!'4t!. and the Eastern Urban Center area of Otay Ranch.
(new) t"\,JI2A_."I:II9-h:rL~!ULI!.Hg.iIlli~."'!IIL'Q~~!!.l:Ji~to_Qiscri)!!QDELi L~v.L~,~ in order.tQ_~n,sI!Le_\h~Y
are a.JiQ~.itIYe addition to th~ Cltv In accordanc~,with 1!l~JQI!owIQ!l.QroVl?!.90~.
(new) LUT 2.5
r-
\
\
\
\
. The buildin must refiect uoi lie. Slcnature architecture that s '. bo!ize, the
Clt' . and can be immediate! reeo nized as a ositive Chu!a V' landmark.
.>>._Tb~..t?I!.tl9.iQg!I1I!,sLl:le,,-ggQIJ1Qi;lD.Ig(Li:lHJ~?.r..9>'dI:Jl!t;,l:lefleJt!~iD, <&_e~t?!I'ce...91
the he! ht such as increased ubllc areas~ olazas. fountalr~. oarks Of
paseos. extensive streetsc808 inlorovem ~,or other Duhlic \ venues or
amenities. \ \ ~
. The overall buildin' tleicht and massin mu eflect a rooriate transiltons
\Q..5_lirrQ!dndlQ.9.E[eas In i;lt;Cor,;l"Qce ,,'iiltUhe,w.r.'E,vlsion. foUt1Ose .,,-r<:!.q;;~Qr
!Uhe buildinq IS on the ri '~rY of an ar~of chanq~,_tQJ!L~_adiQ!DJQg
!leiqhl:JQjj1oo.9~ S ecific Plans General evelo ment Plans/Sectional
Plannin re Plans or other ornn re ulations will rovide the basis for
definin such ransitions. ,.
onduot a s ecial stud to examine the otential for hi her land use intensities
and taller buildings alonq the H Street Transit Focus Corridor between Interstate
5 and:I;fiiFill'fi'tcii:tl:l:1il Avenue, and to also address compatibility issues with
adiacent stable neiqhborhoods. The precise boundaries will be established at
the time of the study, and all land use policies contained in this General Plan
shall appiv until modified as a result of studY findinqs, and any appropriate
amendments to this Plan.
Obiective LUT 3 (new)
Direct the urban desiqn and form of new development and redevelopment in a manner that
blends with and enhances Chula Vista's character and qualities, both physical and social.
Policies:
(new)LUT 3.1 Adopt urban desiqn quidelines and/or other development requlations for all
Districts or Focused Areas of Chanqe, (as presented in the Area Plans (Seotions
Proposed TFNHeight Revisions - October 27, 2005
Page 3 of 12
11-6
(new)3.2
LUT 8-10)) as necessary to ensure that new development or redevelopment
recoanizes and enhances the character and identitv of adiacent areas. consistent
with this General Plan's vision.
Anv such urban desian auidelines and/or other development reaulations shall
also be consistent with other. related policies and provisions in this General Plan.
includina Sections LUT 7.3. 7.4. 7.5 and 7.6.
7.2-~ Preserving and Enhancing Stable Residential Neighborhoods (Page LUT-74)
Planning for existing neighborhood preservation. identity and protection IS one of the most
Important purposes of the City's General Plan. I;xistilJfLI~sid'2.I]JlgLD.@jgt1J?2r.b29-,I.~L11J..\h~..gl\Y.
g2E~SU)L~iJher -DJ9.s.tLy.....sLngl\".:fan:illY_...9.Y!..ellllJ!l.h__DJos!ly_m uITI::far1Jj!Y...1w.@j!iD~'l:QL_,,[g,"L!D
rrill'siTIOIL...B."!s.ldentiaLD~borJloog~ thaUere.o.QL<e9Ji.s!Qg.r..Eld in transition are conslllered.st.,.ple
ijD9..sJJ9J!JiLI:>El.PS21gct?..g,Jl'J?ase refer to L\J.T S,gction 'L21Qr di~CUSSlQD..9LTIJ~rrl:)!!ioIQ9Yl
To maintain the quality of existing, stable residential neighbor~oods requires ~at the City
conserve existing housing, ensure good street design, minimi~nd control traffic ii\residential
neighborhoods, and ensure that development adheres to qualitY des\en standards. p.r.,ase refer
to Section 7.3 for additional policies on the protection of stable nei~rhoods, ....
. \
\
Objective LUT 2..1
,
"
Establish policies, standarc(' an~ procedures to'llliin~e blighting influences and maintain the
integrity of stable residential neig~orhoods. ,)
POlicies\, \, ) ,
LUT ~ 1 \~serve and reinforce the commumty character of eXisting older
. Intalned stable reSidential neighborhoods not desi9n:3ted os fee~e:
located outside of the districts or focus areas identified for chanae
LUT ~2
LUT~.3
LUT ~.4
we!i..
areoe:
111 this
document.
Protect existina stable sinale-familv neiahborhoods throuah zonina or other
reaulations that discouraae the introduction of hiOher densitv residential or otltElr
Pr.gleet exie:1in9 slaeilized sin91e family Rei9Reerhoode: from the enero3ehment of
incompatible or potentiallv disruptive land uses and/or activities.
Ene:~reReouire that new development. or redevelopment. ie: :3 pesitive addition to
tRe City'e: en'/ironment ::lAd throuah consideration of site and buiidino desian. and
appropriate transition and edoe treatments does not delrasl from neoativelv
affect the nature and character of appmpriale nearby established nelahborhoods
QL deveiopment.
Ensure that proposals for new construction, remodels and additions w..i1b"in
exl?\!D9__~\?hL,,-..neJ.gbJ2Q[b..Q9dLare appropriately sized and designed to be
compatible with the 6*isting neighborhood's character, lhereey and to
minimiz~ impacts on adjacent parcels
Proposed TFNHeight Revisions" October 27, 2005
Page 4 of 12
11-7
LUT~5
LUT ~6
LUT 4.7
AllGWi;.?1~blish-<=.9-,]1!l9-9LQ.!b?r re~.lations to e_n~.!dre that non-residential ~sesor
activitifl.1;;' in ?tabl~ residential !leiqh!?.9rhood-"L_o..9..9>!r 8I'eaS only when ihe
character and the quality of the neighborhood can be maintained.
Qevelep str3tegies to Elisc9ur3!je Minimize to the maximum extent practicable.
the use of neighborhood streets in stable residential neiqhborhoods for regional
anEl local Q!:..cuHhrough traffic. throuqh circulation desiqn andior traffic calminq
features--aAEI to protect those exiEting neighborhoods from adverse traffic effects
ij[~si,girliilliijjjdlWl!ie;ae~ili1lia~:fjillID'lSi~:iiii&'t$:ia_al~Sii -
Recoanize established communities and neiahborhoods within the Citv throuqh
siqnaae. landscaoina or other identifvinq features.
1-47.5 Compatible Land Use and Edge Transitions
(Page LUT-77)
Incompatible land uses immediately adjacent to one another, such as residential and industrial
uses, may significantly affect the health of a community. Uses should be approp~lelY buffered
or incompatibilities should be addressed through redesignation of uses or mit!9Ptioi\ o. f impacts to
adjacent uses in the area. Mixed use areas will inherently have higher levels ot, activity and
intensity than solely residential neighborhoods, Both the pa~rn of mixed use\ areas and
individual project designs must be sensitive to edge transitions ~e!!n neighborhoodS, and strive
to minimize potential impacts on adjacent residential neighbOrhood~ '"
\
(~ge LUT-77,78)
Objective LUT 4~
\
\
-\
Ensure adjacent land uses ~~ coypatible with onrn~er.
Policies '!'" /
\
'\' \ ".
LUT -42.1, \ 6nsure throu dherence with desi n uidelines and zonin standards that the
\ d sign review process guarantees excellence in design, and that new
\ c nstruction and alterations to existing buildings are compatible with the best
character elements of the area
LUT -422
LUT -42.3
LUT -42.4:
Ensure Reauire that Rf.QRQ.1;fl<t.Qe--,!",-IQQ!:D~Qt~_..;:lD<:Lpf.Q.i!eRt'L.Ele'/elopers
consider and [1]iQ!l]}i;;L_.aaElrocs project impacts upon surrounding
neighborhoods. ElyriRg the EleslgR aREI Ele"elg~ment ~rocess.
Discourage additional multi-family development in existing single-family
designated neighborhoods.
Proposed TFNHeight Revisions - October 27, 2005
Page 5 of 12
11-8
LUT -49..5
LUT -49..6:
LUT -49..7:
LUT -49.8:
LUT -49..9:
LUT -49..10:
Ene~re Reouire that neighborhood retail centers and commercial service
buildings are compatible with the surrounding neighborhood~I:l[Q.~9tLSfn?I!i'!~
and attractive desion amJ that all 9~ileina I:3caees are a\tracti'/e.
Establish design guidelines and development standards for commercial and
mixed use development that respect and complement the character of
surrounding neighborhoods and uses.
Require that outdoor storage areas or salvage yards be screened from any public
right-of-way.
ERs~reReouire that any land use that handles, generates and/or transports
hazardous substances, os eefiRee by state ,me feeeral res~latiGR6, will not
negatively impact existing or future sensitive receptors/land uses as defined bv
state and federal reoulations.
Coordinate with adjacent landowners, cities, and the County of San Diego in
eo~'ela~iRS establishino compatible land uses for areas adjacent to the City's
boundaries..
Coordinate and work closely with the City of San Diego,Qtv ,ef'Na . _nJl.L<:::itY!20Q
.QountLQLQ.9.!lJ2l~ in the Otay Valley Regi021i Park and Swee ater/Bonita
areas to participate in the development review esses of projects roposed in
these areas. Work to ensure that such deve opmElnt takes applica Ie City of
Chula Vista standards into consideration, as apprOJliillte. "..
. \
'\ ' \
\ .)
(Page LUT-79)
Objective LUT 5I \' \ t"'" ).
Appropriate transitions should be~rovided betw.ee\' land uses.
)/
teet adjacent stable residential neighborhoods by establishing guidelines that
r uce the otential im acts scale eawn eevela~FReRt at the eGises of higher
tensity mixed use, commercial, and urban resideQtiaLdevelopments afea&-(Le.,
transitional areas).
Policies \'
\
LUT-5Z.1: \
LUT -5Z.2:
LUT -5Z.3:
LUT -5Z.4:
Require new or expanded uses to provide mitigation or buffers between existing
uses where significant adverse impacts could occur.
Require that commercial and industrial development adjacent to residential or
educational uses be adequately screened and buffered to minimize noise, light,
glare and any other adverse impacts upon these uses.reciGleAtial Aeish9arhaod
9r ee~catianaLfacility.
Require landscape and/or open space buffers-to maintain a naturalized or softer
edge for proposed private development directly adjacent to natural and public
open space areas.
Proposed TFA/Height Revisions - October 27, 2005
Page 6 of 12
11-9
LUT Section 9.0 - Northwest Area Plan
,
\
9.3.8 Urban Design andJ Form (pa~U~58)
As the City continues to mature, there wili be more infili develOpment and rede~elopment of
existing properties within the Urban Core Subarea. Urban ~ign consideratiorr~, such as
buiiding heights and massing, architectural style, public view corridors, circulation linlSilges, and
the appearance of important gateways need to.be addressed, in o~ to balance ne~ed urban-
type revitalization and redevelopment in the area. while ackno-Medoino and protectino stabie
nei hborhood areas and maintainin the ove all'sense of lace 'that the communi identifies
with. \
?"'- \ .
\ \ If"" ",;..
As the Cltv and the communltv tlHrouoh this Ge~ral Pian and other efforts, focus their attention
on the revitalization and rede~opment of the Urban Core. the issue of urban form and attendant
communi har cter wili be of e i rtance in strikino an acceptable balance between the new
proiects a~d activ.ities that wili Sbep erd in the needed and desired chanoes, and the shapinq of
those in manner ' hat retains '1m ortant ke character elements.. Guiding policies on urban
design and rm ili help to implement the General Plan's Gily's vision of how it-the City should
grow, what vis' , first impressions of the City should be, and how to improve I\ffiFlef- define the
overall imago' and amenities in western Chula Vista. the City wonts te ~romete.
Policies addressing these design considerations are found in tRis-Section 9.4 Urban Core
Subarea, and Section 9.5 District and Focus Areas, of this selement. Also refer to Sectionj! 7.2
Urban Desion and Form and 7.6 Enhancing Community Image, of this element for city-wide
objectives and policies addressing urban desian and form. community image and identity,
gateways and streetscapes, and quality design. Backoround discussions on Community Imaae
and Character. and Urban Desion and Form can be found in Sections 3.0 and 7.2 of this LUT
Element accordinalv.
Vision for the UrJ1a.1l' Core Subarea
(Page LUT-159,160)
The Urban Core Subarea has developed into a vibrant area, with housing, shops, restaurants,
entertainment, and activities that attr~ct from eastern Chula Vista and city-wide. Higher density
housing, shopping, and job centers atl:i located near OJd~ting 3Rtl-flJaMed-the three maior transit
Proposed TFAjHeighl Revisions - October 27, 2005
Page 7 of 12
11-10
A network of linked urban parks and plazas creates pleasant pedestrian routes
and provides areas for community activities. Increased population (residents and workers) in the
Urban Core Subarea has created opportunities for more shops and a variety of restaurants.
Entertainment and cultural arts are housed in new and renovated buildings, offering both day and
evening activities. The streets are bustling with shoppers and people enjoying outdoor dining or
heading to entertainment venues.
A grade-separated trolley line at E and H Streets has improved the flow of east-west traffic, while
a local shuttle provides frequent service between Urban Core Subarea activity centers. The Bus
Rapid Transit (BRT) line allows residents in the East Planning Area convenient access to the
Urban Core Subarea.
F Street is a pedestrian-oriented promenade that links Third Avenue, the Civic Cent~r, Broadway,
the E Street transit center, and the Bayfront Planning Area with themed landscapin'g and public
art. The freeway crossings of Interstate 5 have been widened to accommo~ additional
pedestrian use, and entryways into the Urban Core Subarea are enhanced Sl'td i iting Chula
Vista's Urban Core Subarea has matured into an urban, pedest~an-oriented, actl e area that
continues to be the primary economic, governmental, and SO~iar'focal point of the\south San
Diego County region. \)
. ('
Policies \) (Page LUT161-164)
Uses
LUT 4949.6:
f'
LUT 4949.~:
-\
LUT 4949.8:
LUT 4949.9:
LUT 4949.1 0:
Intensity/Height
\" \ ("'/
Discourage unwJrranted intrusJO'n of uses that weaken the attractiveness of
,continuous re~i1 frontage in pedestrian shopping areas.
\ \ .;
sure that all' residential development provides sufficient a4equate--oo-site
p rking particularly in high-density residential projects. either on-site and/or
t ou h creative solutions such as shared arkin .
Encourage parking strategies noted in Section 7.124 of this element.
Determine the appropriateness of centralized and shared parking structures, and
where suitable, encourage their development.
Support the development of public and private recreation and urban parks that
include pedestrian-oriented plazas, benches, other streetscape amenities and,
where appropriate, landscaped play areas.
LUT 4949.11: Establish locations within Focus Areas where the permitted heights and densities
are greater than in locations adjacent to single-family areas.
Proposed TfNHeight Revisions - October 27, 2005
Page 8 of 12
11-11
LUT 4e49.12: Establish standards for transitions in buiiding height that respond to public view
corridors and proximity to single-family areas.
LUT 4e49.13: Concontrate Limit high-rise development wi#ljfl-to
use areas near the E Streetjai:il H Street
stationSc-. subiect to the provisions of LUT Section 7.2.
transit-oriented mixed
transit
(new)LUT 49.14:Conduct a speciai studY to examine the potential for hieher land use intensities
and tallerbuil?i~8S alone the H Street Transit Focus Corridor between Interstate
5 and ~Il'olilrtll:l Avenue. and which will also address compatibility issues with
adiacent stable neiahborhoods. The precise boundaries will be established at
the time of the study. and all land use policies contained in this General Plan
shall aoolv until modified as a result of study findines and aoorooriate
amendments to this Plan. (see also LUT 2.6).
Design
LUT 4e49A419.: Recognize that different portions of the Urban Core Subarea ha~a desirable
character, and develop specific plans and programs to strengthen d reinforce
their uniqueness. Develop land use, density, special de;ign (eatures, and
building guidelines for appropriate Focus Areas. \
\ \
LUT 4e49~16:Prepare urban form guidelines and standards for de~lopment as par;kffthe
Urban Core Specific Plan.' \"
, .
\ \
LUT 4e49Al>1l:Establish policies, developmen~stan~rds and/Or~Sign guidelines in the Urban
Core Spec~Plav to address~h h].gh-rise buildings should be concentrated,
how to establish}nd/or reinforc peaestrian-scaled development, and how site
and building ~sign should res nd to public view corridors.
\" \ \ ,.
LUT 4e49.\1-71], ith the ado . n of the Urban Core S ecific Plan e€stablish design standards
\~' fo mixed use development that achieves a high quality pedestrian-scaled
\ e ironment and promotes side or rear located parking areas, streelfront
indows and entries, and public and private open space.
LUT 4e49A<l19:With the adoption of the Urban Core Soecific Plan. cCreate a pedestrian-
oriented realm by requiring retail or public uses at the ground fioor of buildings
Policies numbered 46.19 thru 46.25 renumbered to 49.20 thru 49.26 accordingly.
9.5.2 H Street Corridor District
(Page LUT-173)
Vision for District
The H Street Corridor District connects the H Street aatewav and Broadwav commercial corridor
with downtown Third Avenue. and includesis a mixed use area with offices, shopping, and multi-
Proposed TFAfHeighl Revisions - October 27, 2005
Page 9 of 12
11-12
family housing in a high-intensity, transit-oriented development pattern near the Third Avenue
transit station. A redeveloped Chula Vista Center shopping mall includes some high-density
residential housing, substantial office space, and a transit station.
It is important to note that in view of the emeraina character of H Street as a transit corridor and
maior link between the Bavfront. Broadwav and Downtown: and the existence of maior activitv
nodes like the Chula Vista Center. medical facilities at Scripps. and the South Countv Reaional
Center: that a special studv to evaluate the potential for increased land use intensities and taller
buildina forms will be conducted subseouent to adoption of this pian (see Section 7.2 and Fia. 5-
HA). \
....('
\
\
9.5.4
H Street Office Focus Area
;.
\I,e LUT-180)
.)
\
-'
\
\
The H Street Office Focus ~a I~e Figure 5-28) on!jiSts of the area on both sides of H Street,
between Third Avenue and Pourttl Avenue, incl some areas 'ust east of Third Avenue
extending north to G Street arr~ south to I Street.
'(' \ '""
E . t' C\d't' \ ).
XIS Ing o~ I Ions
The H Stre~e Focus Area is characterized by existing office uses on both sides of H Street,
including the South County Regional Center on the south side of H Street and recent mixed use
development on the north side. Other uses within this Focus Area along Third Avenue include a
mix of retail and small offices, and a church at the northeast corner of H Street and Third Avenue.
Between Third and Fourth Avenues, along Roosevelt Street, existing uses include a mix of single-
family and multi-family residential units.
Description of Focus Area
Vision for Focus Area
The H Street Office Focus Area is one of the three Transit Focus Areas (TFA) within the Urban
Core. and is characterized by more intensive development surroundinQ the transit station. and
serves as the southern anchor of the downtown Third Avenue activitv corridor. It hosts the South
County Regional Center and offices fronting on the south side of H Street, between Fourth
Avenue and Third Avenue, aRG-Gy-ll1e-el(panEio~f- with transit focus mixed uses on the north
side of H Street, extending tORarth af Roosevelt Street and on the east and west sides of Third
Proposed TfNHeight Revisions - October 27, 2005
Page 10 of 12
11-13
Avenue. To the north of Roosevelt Street. the Urban Core Residential uses transition to hioher-
density housinG which blends with the existino multi-familv area on the south side of G Street.
To ensure an appropriate urban form for the hiGher density and intensity of develooment at this
imoortant activity area, the followinG outcomes should be achieved throuGh development within
that area:
Function as a maior Gateway to downtown Third Avenue throuGh the use of uniaue
architecture that s mbolizes the area-so that the communi as well as visitors to\the Ci
will immediatelv recoanize it as a aatewav to downtown.
and benefits i.e.
and which also serve to si
,
n features
rivate vehicles.
The urban form and re ulato standards for this area as established throu h the Urban
Core ecilic Plan or other ani actions will achieve the above in consideration of the
conteXt of arilas surroundi the Transit Focus Area.
Objective L~~53
(Page LUT -181,182)
Encourage redevelopment to be mixed use along the H Street Corridor, between Third Avenue
and Fourth Avenue, within walking distance of a planned future transit station near Third Avenue
and H Street.
Policies
Uses
LUT W53.1: Strive for a distribution of uses within the Mixed Use Transit Focus Area
designation on the north side of H Street and on the east side of Third Avenue to
be mostly residential with offices and some retail, oriented to the H Street and
Third Avenue frontages, as generally shown on the chart below:
Proposed TFNHeight Revisions - October 27, 2005
Page 11 of 12
11-14
fJ
o Residential
o Retail
. Offices
Intensity/Height
LUT W53.2: In the H Street Office Focus Area, residential densities within the Mixed Use
Transit Focus Area designation are intended to have a Focus Area-wide gross
density of 60 dwelling units per acre and are encouraged to develop at the high
end of the density range-fGf-Mi.xe;:J-Use Tmnsit f'ec~s NOQ, provided that
projects meet pedestrian and transit-oriented objectives. and..utili2e-the-j._ive
~-arn complv with the amenities provisions as presented in LUT Section 7.13.
LUT W53.3: In the H Street Office Focus Area, the commercial (retail and office) portion of the
Mixed Use Transit Focus designation is intended to have a FO~. s Area-wide
aggregate FAR of 2.0.HGwevel7-S~ubsequent specific plan or zoning
ordinance regulations will establish parcel-specific FARs tha~a .vary from the
Focus Area-wide aggregate (refer to Section 4.~.1 Interpreting t~e Land Use
Diagram for a discussion of Focus Area-wide vee parcei-specific P.~R).
Buildin hei hts within the H Street Office Focus Are \ shall rimaril ' mid-~i~~;(
Design \. \ ,.) /
LUT W453\' Tle Urban Core Specific Plan. or other zonlnQ reQulatlons shall establish design
~ndards for ltle-MixeG-lJse Transit-FGsllS-ArBa-witAfR-the H Street Office Focus
Area. -consistent with the abovesOOGlec Qnd vision and policies.
Proposed TFA/Height Revisions - October 27, 2005
11-15
Page 12 of 12
COUNCIL AGENDA STATEMENT
Item: /2-
Meeting Date: 11/01/05
ITEM TITLE: RESOLUTION ACCEPTING $1;125,000 FROM THE U.S.
DEPARTMENT OF JUSTICE'S OFFICE OF COMMUNITY ORIENTED
POLICING SERVICES FOR THE UNIVERSAL HIRING PROGRAM
GRANT, ADDING ELEVEN PEACE OFFICERS TO THE AUTHORIZED
STAFFING LEVEL OF THE POLICE DEPARTMENT AND
APPROPRIATING FUNDS THEREFOR.
SUBMITTED BY: Chief of POIiC~
REVIEWED BY: City Manage(>> (4/5ths Vote: YeslLNo ->
The Police Department has received funding from the U.S. Department of Justice, Office of
Community Oriented Policing Services (COPS) to partially fund the hiring of fifteen officers.
The Universal Hiring Program will fund up to $75,000 per officer over a 3-year grant period.
Eleven officers are requested to be added at this time, and the remaining four officers will be
addressed during the strategic plan presentation.
RECOMMENDATION: That Council adopts the resolution accepting $1,125,000 from the
U.S. Department of Justice, Office of Community Oriented Policing Services for the Universal
Hiring Program grant, adding eleven officers to the authorized staffing level of the Police
Department and amending the FY 2005/2006 budget to appropriate $642,573 from said grant
funds for personnel costs, $275,504 from the available balance of the Public Facilities
Development Impact Fund for associated equipment costs and $35,089 from the available
balance of the General Fund for fleet maintenance and equipment replacement.
BOARDS/COMMISSIONS RECOMMENDATION: N/A
BACKGROUND: The Universal Hiring Program (UHP) is one of several programs
developed by the Office of Community Oriented Policing Services (COPS) to increase the
number of officers on the beat. The UHP grant will minimize the costs of the new officers,
and will fund up to $75,000 of the entry-level salary and benefits of each newly hired
additional officer over 3 years. On the fourth year, when the grant terminates, the City will
pay the full cost associated with each position added, which is approximately $119,000 per
officer. To date, the City has received five UHP grant awards, increasing the department's
police strength by 41 officers.
12-1
Page 2, Item: /2-
Meeting Date: 11/01/05
DISCUSSION: The Office of Community Oriented Policing Services (COPS), under the
direction of the U.S. Department of Justice, has awarded the Police Department $1,125,000
in grant funding through the Universal Hiring Program (UHP). The UHP grant will fund
$75,000 for each of the fifteen newly hired officers that will supplement the currently
authorized number of sworn officers. This increase in the sworn count of the Police
Department is in conjunction with the strategic planning efforts currently underway.
Acceptance of this grant is requested prior to Council approval of the strategic plan due to
grant requirements. The 2001 UHP grant terminates on December 31, 2005, and new
officers must be hired before this date to prevent a loss of funding. Upon hire, an extension
will be granted to partially fund the new officers over a 3-year period. Eleven officers are
requested to be added at this time, and the remaining four officers will be addressed during
the strategic plan presentation. The Council presentation of the Police strategic plan is
scheduled for early December.
In conjunction with the current strategic planning efforts, the Patrol Staffing Model was
updated in February 2005 to determine current patrol deployment needs. This update was
completed by former City employee Marty Chase, who developed the original model in 1984
and also participated in the various updates since that time. The Patrol Staffing Model has
not been used in five years and therefore the results of the February update indicate a need
to increase the Patrol Division by 11 Peace Officers. This increase in officers will enable
officers on regular beat patrols to provide proactive enforcement in addition to the normal
reactive enforcement (responding to calls-for-service).
Patrol Staffing Model
The Department's Patrol Staffing Model was initially developed and subsequently refined
over a two-year period in 1984-1986. Its primary purpose is to provide the City with a
workload-based methodology for assessing staffing needs. The goal is that for each hour an
officer spends responding to calls for service, the officer also spends one hour performing
proactive duties. In 1986, this model was selected by the National Institute of Criminal
Justice as one of the ten best police-related studies developed throughout the United States.
In 1994, the San Diego Unified Port District adopted the model as the basis for the District's
annual reimbursements for patrol services provided to tidelands property. During the
strategic planning process in 2000, the Patrol staffing study resulted in the addition of one
lieutenant and six officers to the authorized strength of the Department. For a number of
years, the staffing formula based on call for service workload and officer initiated activity has
enabled the City to maintain the patrol staffing levels needed to meet various service goals.
LOCAL MATCH: A minimum 25% local match is required for the Universal Hiring Program.
The match must be a cash match from funds not previously budgeted for any law
enforcement purpose.
12-2
Page 3, Item:
Meeting Date:
12-
11/01/05
FISCAL IMPACT: Approval of this resolution will result in the addition of eleven officers to
the Police Department, appropriating $642,573 to the FY06 personnel budget based on a
November 1, 2005 hire date, $275,504 from the available balance of the Public Facilities
Development Impact Fund for associated equipment costs and $35,089 from the available
balance of the General Fund for fleet maintenance and equipment replacement. The funding
from the COPS Office will completely offset the personnel costs for the eleven officers in
FY06, and will partially offset the costs during subsequent years, reducing the net fiscal
impact to the General Fund. One-time costs for fully-equipped patrol vehicles, portable
radios, and other initial equipment will be funded from the available balance of the Public
Facilities Development Impact Fund. The City will assume full funding for these positions in
FY10. The City will retain the hired officers after the grant expires, creating an ongoing net
impact to the General Fund as detailed in the table below.
FY05-06 FY 06 - 07 FY 07 - 08 FY 08 - 09 FY09-10
Personnel Costs
Salaries & Benefits - 11 Officers $642,573 $1,033,569 $1,128,916 $1,227,430 $1,304,752
Funding from UHP Grant $642.573 $100000 $60,000 $22.427 $0
Personnel Impact $0 $933,569 $1,068,916 $1,205,003 $1,304,752
Supplies/Equipment
4 Patrol Vehicles (fully-equipped) $210,604 $0 $0 $0 $0
8 Portable Radios $26,400 $0 $0 $0 $0
Uniforms/Equipment $38,500 $0 $0 $0 $0
Funding from DIF $275,504 $0 $0 $0 $0
Fleet Maintenance $18,707 $44,896 $44,896 $44,896 $44,896
Equipment Replacement $16382 $39,316 $39,316 $39,316 $39,316
Supplies/Equipment Impact $35,089 $84,212 $84,212 $84,212 $84,212
Net Impact to General Fund $35,089 $1,017,781 $1,153,128 $1,289,215 $1,388,964
12-3
RESOLUTION NO.
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ACCEPTING $1,125,000 FROM THE U.S. DEPARTMENT OF JUSTICE'S
OFFICE OF COMMUNITY ORIENTED POLICING SERVICES FOR THE
UNIVERSAL HIRING PROGRAM GRANT, ADDING ELEVEN PEACE
OFFICERS TO THE AUTHORIZED STAFFING LEVEL OF THE POLICE
DEPARTMENT AND APPROPRIATING FUNDS THEREFOR.
WHEREAS, a Patrol staffing study was conducted to review the deployment needs in
Patrol; and
WHEREAS, the Patrol staffing study resulted in a recommendation to add eleven
officers in FY 2005/2006 to meet the current deployment needs of the City; and
WHEREAS, the Community Oriented Policing Services (COPS) Universal Hiring
Program provides partial funding to local governments for additional sworn law enforcement
officers; and
WHEREAS, the COPS office has awarded the Police Department $1,125,000 of grant
funding under the Universal Hiring Program for 15 new Peace Officers and acceptance of the
grant will enable the City to offset the cost of up to 15 new Peace Officers; and
WHEREAS, the Police Department requests to immediately implement 11 new officers
as a result of the staff model, and will present justification for the 4 remaining officers as part
of the Police Department's Strategic Plan; and
WHEREAS, the City agrees to provide the local match required by the grant and retain
the officers after the grant has ended.
NOW, THEREFORE, BE IT RESOLVED the City Council of the City of Chula Vista
does hereby accept $1,125,000 from the U.S. Department of Justice's Office of Community
Oriented Policing Services for the Universal Hiring Program grant, adding eleven officers to
the authorized staffing level of the Police Department and amending the FY 2005/2006
budget to appropriate $642,573 from said grant funds for personnel costs, $275,504 from the
available balance of the Public Facilities Development Impact Fund for associated equipment
costs and $35,089 from the available balance of the General Fund for fleet maintenance and
equipment replacement.
~
Approved as to form by:
~,\) ~ill V\~ Y-~'Q \\ ,
Ann Moore
City Attorney
Richar P. Emerson
Police Chief
12-4