HomeMy WebLinkAboutAgenda Packet 2005/11/22
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(HULA VISTA
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Stephen C. Padilla, Mayor
Patty Davis, Councilmember David D. Rowlands, Jr., City Manager
John McCann, Council member Ann Moore, City Attorney
Jerry R. Rindone, Councilmember Susan Bigelow, City Clerk
Steve Castaneda, Council member
November 22, 2005
6:00 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
. PRESENTATION BY CATHERINE HILL FROM THE LEAGUE OF CALIFORNIA
CITIES OF THE HELEN PUTNAM AWARD FOR EXCELLENCE TO THE POLICE
DEPARTMENT FOR ITS ANTI-BULLYING PROJECT IMPLEMENTED IN THREE
CHULA VISTA ELEMENTARY SCHOOLS
. PRESENTATION BY MAYOR PADILLA TO BARBIE BROOKOVER, POLICE
SUPPORT SERVICES MANAGER, OF A PROCLAMATION PROCLAIMING
WEDNESDAY, NOVEMBER 30,2005 AS LAW ENFORCEMENT RECORDS AND
SUPPORT PERSONNEL DAY
. PRESENTATION BY MAYOR PADILLA OF A PROCLAMATION TO JACK
MITCHELL, 2005 VETERAN OF THE YEAR
CONSENT CALENDAR
(Items I through 10)
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. APPROVAL OF MINUTES of October 25, and November 1, 2005.
Staff recommendation: Council approve the minutes.
2. WRlTTEN COMMUNICATIONS
. Memorandum from Wendy Endaya, Secretary to the Human Relations
Commission, informing Council of the resignation of Samuel Avalos.
Staff recommendation: Council accept the resignation and direct the City Clerk to
post the vacancy in accordance with the Maddy Act.
3. ORDINANCE OF THE CITY OF CHULA VISTA AMENDING MUNICIPAL CODE
2.66.043 PERMITTING POSSESSION AND CONSUMPTION OF ALCOHOL BY
PERMIT DURING PARK OPERATING HOURS (SECOND READING)
Adoption of the ordinance amends the Municipal Code to permit possession and/or
consumption of alcohol in City parks under the terms of a lease, operating agreement or
permit issued by the Public Works Director, Recreation Director or City Manager and/or
their designee. This ordinance was introduced on November IS, 2005. (Police Chief,
Public Works Operations Director, Parks and Recreation Director)
Staffrecommendation: Council adopt the ordinance.
4. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
APPROVING CHANGES TO THE CHULA VISTA CONSTRUCTION STANDARDS
AND SUBDNISION MANUAL (Continued from October 25, 2005)
Proposed changes to federal accessibility standards were published in July 2004. Since
then, a team of City staff has reviewed the City's requirements, specifications, and
standards for the design and construction of public works projects. Adoption of the
resolution approves changes to the City standards for curb ramps and the Subdivision
Manual to reflect and comply with the existing and proposed regulations of the Access
Board. (City Engineer)
Staff recommendation: Council adopt the resolution.
5 A. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ACTING IN ITS CAPACITY AS THE LEGISLATIVE BODY OF COMMUNITY
FACILITIES DISTRICT NO. 13-1 (OTAY RANCH VILLAGE SEVEN) DECLARING
THE RESULTS OF A SPECIAL ELECTION IN SUCH COMMUNITY FACILITIES
DISTRICT
B. ORDINANCE OF THE CITY OF CHULA VISTA AUTHORIZING THE LEVY OF A
SPECIAL TAX IN COMMUNITY FACILITIES DISTRICT NO. 13-1 (OTAY RANCH
VILLAGE SEVEN)
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November 22, 2005
Council previously adopted a Resolution of Intention to establish Community Facilities
District No. 13-1 (CFD 13-1) and to declare the necessity to incur bonded indebtedness.
A special election of the eligible property owners was held on November 1, 2005 to vote
on the formation of CFD 13-1. Adoption of the resolution declares the results of that
election; and adoption of the ordinance will authorize the levy of a special tax in CFD 13-
1. (City Engineer)
Staff Recommendation: Council adopt the resolution and place the ordinance on first
reading.
6. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
AUTHORIZING THE APPLICATION AND, IF AWARDED, ACCEPTANCE OF A
FISCAL YEAR 2006/2007 BICYCLE TRANSPORTATION ACCOUNT (BTA)
PROGRAM GRANT FROM THE CALIFORNIA DEPARTMENT OF
TRANSPORTATION TO FUND BICYCLE FACILITIES ON INDUSTRIAL
BOULEVARD; AND AUTHORIZING THE COMMITMENT OF MATCHING
FUNDS THEREFOR
With a steady growth in bicycle usage and the demand for new bikeways and routes since
1996, the Bikeway Master Plan was updated in January 2005 in order to locate, develop
and encourage the use of the City's bikeway system. The plan identified a key project
that will develop and improve bicycle facilities along Industrial Boulevard. (City
Engineer)
Staff recommendation: Council adopt the resolution.
7. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
APPROVING THE SECOND AMENDMENT TO THE AGREEMENT WITH
ERICKSON-HALL CONSTRUCTION CO. WHICH WILL INCREASE THE
GUARANTEED MAXIMUM PRICE (GMP) FOR THE DESIGN AND
CONSTRUCTION OF HARBORSIDE PARK (CIP PR249) LOCATED ON OXFORD
STREET IN WESTERN CHULA VISTA, AUTHORIZING THE MAYOR TO
EXECUTE SAID AMENDMENT AND AUTHORIZING THE TRANSFER OF
FUNDS FROM THE "WESTERN CHULA VISTA INFRASTRUCTURE PROGRAM
(GGl88)" TO THE "HARBORS IDE PARK (PR249)" AS NECESSARY TO
COMPLETE THE PROJECT (4/5THS VOTE REQUIRED)
On October 5, 2004, Council approved a design build agreement with Erickson-Hall
Construction Co. and established the guaranteed maximum price (GMP) at $1,987,030 on
May 17, 2005. The proj ect is current! y in the construction phase. Due to unanticipated
materials found on the site, it has become necessary to increase the GMP to cover
expenses necessary for proper material removal. (General Services Director)
Staffrecommendation: Council adopt the resolution.
8. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
AMENDING THE FISCAL YEAR 2006 LIBRARY DEPARTMENT BUDGET BY
APPROPRIATING UNANTICIPATED EVEN START GRANT AUGMENTATION
FUNDS IN THE AMOUNT OF $15,833 FOR EXPENDITURES ASSOCIATED WITH
THE CHULA VISTA LITERACY TEAM'S EVEN START FAMILY LITERACY
GRANT (4/5THS VOTE REQUIRED)
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The California Department of Education has advised the Chula Vista Public Library that
its four-year Even Start grant in the amount of$166,667 has been augmented by $15,833
for Fiscal Year 2006. These funds must, therefore, be appropriated. (Assistant City
Manager Palmer)
Staff recommendation: Council adopt the resolution.
9. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
RECLASSIFYING A LIBRARIAN III POSITION TO SENIOR LIBRARIAN IN THE
LIBRARY DEPARTMENT BUDGET
A Librarian III currently manages the EastLake Branch Library. Due to increased
patronage, the Library is requesting that this position be reclassified to a Senior Librarian.
(Assistant City Manager Palmer)
Staff recommendation: Council adopt the resolution.
10. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
APPROVING THE ADDENDUM TO THE MEMORANDUM OF UNDERSTANDING
BETWEEN THE CITY OF CHULA VISTA AND THE CHULA VISTA
ELEMENTARY SCHOOL DISTRICT REGARDING JOINT OPERATION OF THE
DYNAMIC AFTER SCHOOL HOURS (DASH) AND SAFE TIME FOR
RECREATION, ENRICHMENT, AND TUTORING FOR CHILDREN (STRETCH)
AFTER SCHOOL PROGRAMS AND APPROPRIATING FUNDS THEREFOR
(4/5THS VOTE REQUIRED)
Adoption of the resolution approves an addendum to the memorandum of understanding
between the City and the Chula Vista Elementary School District for Fiscal Year
2005/2006 for the operation of two after-school programs at elementary school sites.
(Assistant City Manager Palmer)
Staff recommendation: Council adopt the resolution.
lO.l RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
APPROVING A WAIVER OF POTENTIAL CONFLICT OF INTEREST WITH
RESPECT TO PROSPECTIVE REPRESENTATION OF FLIER'S INCORPORATED
On November 16, 2005, former Senior Assistant City Attorney Glen R. Googins
requested that the City Attorney confirm that Mr. Googins' prospective representation of
Flier's Incorporated does not present a conflict of interest that must be waived pursuant to
California Rules of Professional Conduct 3-3lO(D). The decision to waive a potential
conflict of interest lies with the City Council. Although there is always the potential for
future conflict, it does not appear at this time that the interests of Mr. Googins'
prospective client are adverse to the City. Accordingly, it is recommended that the City
Council waive any potential conflict arising trom the limited scope of the proposed
representation.
Staffrecommendation: Council adopt the resolution.
ITEMS REMOVED FROM THE CONSENT CALENDAR
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November 22. 2005
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 general(v 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.
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.
11. CONSIDERATION OF ESTABLISHING A CAPITAL IMPROVEMENT PROJECT
FOR STORM DRAIN PIPE REHABILITATION (PROJECT DR-165),
TRANSFERRING FUNDS FOR THAT PURPOSE; REJECTING THE AUGUST 17
AND SEPTEMBER 7, 2005 BIDS, AND ACCEPTING THE OCTOBER 12,2005 BIDS
FOR PROJECT DR-165
As part of an ongoing program to rehabilitate corrugated metal drainage pipe throughout
the City, staff has identified a number of stonn drain facilities that are deteriorated and in
need of rehabilitation. This project consists ofreplacing those drainage facilities at three
locations most in need of rehabilitation. (General Services Director)
Staff recommendation: Council adopt the following resolutions:
A. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ESTABLISHING A CAPITAL IMPROVEMENT PROJECT ENTITLED CMP
STORM DRAIN PIPE REHABILITATION PROGRAM (DR-165) PROJECT
AND TRANSFERRING EXISTING FUNDS FROM CIP "WESTERN CHULA
VISTA INFRASTRUCTURE" (GG-188) TO DR-165 FOR SAID PURPOSE
B. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
REJECTING THE AUGUST 17 AND SEPTEMBER 7, 2005 BIDS FOR CMP
STORM DRAIN PIPE REHABILITATION PROGRAM (DR-165)
C. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ACCEPTING THE OCTOBER 12, 2005 BIDS AND AWARDING A
CONSTRUCTION CONTRACT FOR THE CMF STORM DRAIN PIPE
REHABILITATION PROGRAM (DR-l 65) PROJECT
12. CONSIDERATION OF AWARDING A CONTRACT FOR PAVEMENT
REHABILITATION; AUTHORIZING THE EXPENDITURE OF ALL AVAILABLE
CONTINGENCIES AND A BUDGET TRANSFER AS NECESSARY TO COMPLETE
THE PROJECT
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November 22,2005
On October 26, 2005, the General Services Director received sealed bids for this project.
The work consists of the application of a seal coat and pavement overlay on various
pavement locations in the City. The work also includes the removal/replacement of
failed pavement, striping, traffic control, and other miscellaneous work, all labor,
material, equipment, and transportation necessary for the proj ect. (General Services
Director)
Staff recommendation: Council adopt the following resolutions:
A. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ACCEPTING BIDS, AWARDING A CONTRACT FOR THE "PAVEMENT
REHABILITATION PROGRAM FISCAL YEAR 2004/2005 OVERLAY IN
THE' CITY OF CHULA VISTA, CALIFORNIA" PROJECT, A COMPONENT
OF THE 2005 PAVEMENT REHABILITATION PROJECT (STL-310), AND
AUTHORIZING THE EXPENDITURE OF ALL AVAILABLE
CONTINGENCIES AS NECESSARY TO COMPLETE THE PROJECT
B. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
AUTHORIZING A BUDGET TRANSFER IN THE AMOUNT OF $144,358
FROM THE PARKS PARKING LOT PROJECT (PR-236) TO THE
"PAVEMENT REHABILITATION PROGRAM FISCAL YEAR 2004/2005
OVERLAY IN THE CITY OF CHULA VISTA, CALIFORNIA" PROJECT, A
COMPONENT OF THE 2005 PAVEMENT REHABILITATION PROJECT
(STL-310) AS NECESSARY TO COMPLETE THE PROJECT (4/5THS VOTE
REQUIRED)
13. REPORT ON UTILITY UNDERGROUNDING PROGRAM FUNDING AND
PRIORITIES
This report provides details on the City's utility undergrounding program, as well as
estimated costs for the undergrounding districts that have not yet been constructed, and
the ramifications of expediting the design and construction of L Street from Monserate
Avenue to Nacion Avenue. The report outlines schedules and costs involved for the
recommended alternative. (City Engineer)
Staff recommendation: Council accept the report.
14. CONSIDERATION OF APPROVAL OF THE FORM OF THE SECOND
AMENDMENT TO THE ACQUISITION/FINANCING AGREEMENT FOR
COMMUNITY FACILITIES DISTRICT 2001-1 (CFD 2001-1, SAN MIGUEL
RANCH), AND AUTHORIZING THE ISSUANCE OF SPECIAL TAX BONDS FOR
IMPROVEMENT AREA B OF CFD 2001-1
On December 4, 2001, the Council established Improvement Area B in Community
Facilities District 2001-1. The district was formed for the purpose of providing for the
financing and acquisition of certain authorized public facilities. Adoption of the
resolutions amends the acquisition/finance agreement for the district and authorizes the
issuance of special tax bonds for Improvement Area B. (City Engineer)
Staff recommendation: Council adopt the following resolutions:
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November 22, 2005
A. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
APPROVING THE FORM OF THE SECOND AMENDMENT TO THE
ACQUISITION/FINANCING AGREEMENT FOR COMMUNITY FACILITIES
DISTRICT NO. 2001-1 (SAN MIGUEL RANCH)
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. 2001-1 (SAN MIGUEL RANCH),
AUTHORIZING AND PROVIDING FOR THE ISSUANCE OF SPECIAL TAX
BONDS OF SUCH COMMUNITY FACILITIES DISTRICT FOR
IMPROVEMENT AREA B THEREOF, 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
15. REPORT REGARDING THE IMPLEMENTATION OF THE DOWNTOWN
PROPERTY BASED BUSINESS IMPROVEMENT DISTRICT (PBID) RENEWAL
PROCESS AND POTENTIAL BOUNDARY EXPANSION
This report addresses a proposal to include additional City parcels within an expanded
PBID boundary. (Director of Community Development)
Staffrecommendation: Council accept the report.
OTHER BUSINESS
16. CITY MANAGER'S REPORTS
17. MAYOR'S REPORTS
A. Ratification of appointment of Karina Liston (Hilltop High School) to the Youth
Commission.
B. Ratification of appointment of Elizabeth Vargas (Castle Park Middle School) to
the Youth Commission.
C. Ratification of appointment of Bill Richter to the Charter Review Commission.
18. COUNCIL COMMENTS
. John McCann: Referral to staff to come back to Council with an ordinance within
60 days banning convicted sexual predators trom being within 300 feet of
schools, daycare centers, playgrounds, parks, amusement centers, arcades and
libraries.
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November 22, 2005
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)
19. CONFERENCE WITH LEGAL COUNSEL REGARDING ANTICIPATED
LITIGATION PURSUANT TO GOVERNMENT CODE SECTION 54956.9
. One case
20. 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 an Adjourned Regular Meeting on November 29, 2005 at 6:00 p.m. in
Executive Conference Room C-I 03, located in City Hall, and thence to the
Regular Meeting of December 6, 2005, at 4:00 p.m. in the Council
Chambers.
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.
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November 22,2005
DRAFT
MINUTES OF A REGULAR MEETING OF THE
CITY COUNCIL OF THE CITY OF CHULA VISTA
October 25, 2005
6:00 P.M.
A Regular Meeting of the City Council of the City of Chula Vista was called to order at 6:13
p.m. in the Council Chambers, located in the Public Services Building, 276 Fourth Avenue,
Chula Vista, California.
ROLL CALL:
PRESENT:
Councilmembers:
Castaneda, McCann, Rindone, and Mayor
Padilla
ABSENT:
Councilmembers:
Davis (excused)
ALSO PRESENT: City Manager Rowlands, City Attorney Moore, and Sr. Deputy
City Clerk Peoples
PLEDGE OF ALLEGIANCE TO THE FLAG, MOMENT OF SILENCE
Mayor Padilla, on behalf of himself and the Council, expressed deepest condolences to the
family of Joshua Denton, a Bonita Vista High School student killed on his way to school
Monday, as well as to the family of Rosa Parks, mother of the civil rights movement. He stated
that the meeting would be adjourned in their memories.
CONSENT CALENDAR
(Items I through 10)
I. APPROVAL OF MINUTES of the Adjourned Regular Meeting of October 4, Regular
Meetings of October 4 and October II, and Special Meeting of October 18, 2005.
Staff recommendation: Council approve the minutes.
2. WRITTEN COMMUNICATIONS
A. Memorandum requesting an excused absence for Councilmember Rindone fTom
the Council Meeting of October II, 2005.
Staff recommendation: Council excuse the absence.
B. Letter of resignation fTom Stacey Stevenson, member of the Child Care
Commission.
Staffrecommendation: Council accept the resignation and direct the City Clerk to
post the vacancy in accordance with the Maddy Act.
3. ORDINANCE NO. 3023, ORDINANCE OF THE CITY OF CHULA VISTA
AMENDING CHAPTER 15.26 OF THE CHULA VISTA MUNICIPAL CODE
ADOPTING THE CALIFORNIA ENERGY CODE AND THE OUTDOOR LIGHTING
ZONES MAP, DATED SEPTEMBER 2,2005 (SECOND READING)
//1-/
DR AfT
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CONSENT CALENDAR (continued)
The state mandates that jurisdictions within the state start enforcing the 2005 California
Energy Code on October 1, 2005. This ordinance adopts the California Energy Code and
an outdoor lighting zones map_ The ordinance was introduced on October 11, 2005.
(Director of Planning & Building)
Staffrecommendation: Council adopt the ordinance.
4. ORDINANCE NO. 3024, ORDINANCE OF THE CITY OF CHULA VISTA
APPROVING A ZONE CHANGE TO THE OTAY RANCH VILLAGE SIX
SECTIONAL PLANNING AREA (SPA) PLANNED COMMUNITY (PC) DISTRICT
REGULATIONS LAND USE DISTRICTS MAP (SECOND READING)
Otay Project, LP (Otay Ranch Company) proposes a mixed-use project in the Village Six
core, along both sides of East Palomar Street, providing approximately 20,000 square feet
of ground floor commercial retail space on the south side and 20 live/work shopkeeper
units on the north side. The project includes 158 for-sale condominium units on both
sides of East Palomar Street, between View Park Way and Magdalena Avenue, including
units reserved for low-income households. The ordinance was introduced on October 11,
2005. (Director of Planning & Building)
Staffrecommendation: Council adopt the ordinance.
5. ORDINANCE NO. 3025, ORDINANCE OF THE CITY OF CHULA VISTA
AMENDING CHULA VISTA MUNICIPAL CODE SECTION 5.36 PERTAINING TO
MASSAGE PARLORS (SECOND READING)
A recent review of the City's ordinance relating to massage parlors has shown that some
practitioners are being licensed in Chula Vista after being denied a license in other cities
within San Diego County. Some massage business practices are also unregulated in
Chula Vista. The proposed ordinance updates Chula Vista's ordinance relating to
massage parlors to regulate those practices and be more consistent with ordinances of
other cities within San Diego County. This ordinance was introduced on October 11,
2005. (Police Chief)
Staff recommendation: Council adopt the ordinance.
6. ORDINANCE NO. 3026, ORDINANCE OF THE CITY OF CHULA VISTA
AMENDING CHAPTER 17.10 OF THE MUNICIPAL CODE RELATING TO THE
REVIEW AND ADJUSTMENT OF PARK ACQUISITION AND DEVELOPMENT
FEES TO PAY FOR THE ACQUISITION OF LAND AND THE DEVELOPMENT OF
PARK FACILITIES (SECOND READING)
In July 2004, the Council increased the parkland acquisition and development (PAD) fees
for parkland acquisition and development. Since that time, land values have increased
substantially, generating the need to adjust the parkland acquisition component of the fee.
The proposed increases ensure that sufficient PAD fee funds are available for the City to
meet park facilities thresholds. This ordinance was introduced on October 11, 2005.
(Director of General Services)
Staff recommendation: Council adopt the ordinance.
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October 25, 2005
DRAFT
CONSENT CALENDAR (continued)
7. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
APPROVING CHANGES TO THE CHULA VISTA CONSTRUCTION STANDARDS
AND SUBDIVISION MANUAL
Proposed changes to federal accessibility standards were published in July 2004. At that
time, the City Engineer appointed a team of City staff to review the City's current
requirements, specifications, and standards for the design and construction of public work
projects and update them, if necessary. As a result of the review process, staff
recommends changes to both the City standards for curb ramps and the Subdivision
Manual to reflect and comply with the existing and proposed regulations of the
Architectural and Transportation Barriers Compliance Board. (City Engineer)
Staff recommendation: Council continue this item to November 22, 2005.
8. RESOLUTION NO. 2005-349, RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF CHULA VISTA APPROVING A CONTRACT WITH DEKRA-LITE
INDUSTRIES INC. AND APPROPRIATING $53,250 FROM THE CITY'S
RESIDENTIAL CONSTRUCTION TAX (RCT) FUND TO IMPLEMENT THE
DOWNTOWN AMBIENT TREE LIGHTING PROGRAM (4/5THS VOTE
REQUIRED)
For the past six years, the City has provided annual holiday decor and tree canopy
lighting in the downtown area. By separate action, the Council approved an expanded
holiday decor program on October 4, 2005. While tree lighting was initially part of the
holiday decor, maintaining the downtown tree lights as a year-round amenity proved to
be popular with businesses and residents. Staff issued a request for proposals in early
August 2005 to solicit proposals rrom tree lighting companies for the most effective way
to provide year-round tree lighting. Dekra-Lite Industries is proposed as the contractor
for this work. (Director of Community Development)
Staffrecommendation: Council adopt the resolution.
9. RESOLUTION NO. 2005-350, RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF CHULA VISTA WAIVING THE FORMAL CONSULTANT SELECTION
PROCESS AND AWARDING A PURCHASING AGREEMENT TO WEIDNER INC.
TO DEVELOP STRATEGIC BUSINESS PLANS FOR CITY DEPARTMENTS
Adoption of the resolution awards a contract to Weidner Inc. to develop strategic
business plan for City departments. Weidner's "Managing for Results" model is
consistent with the City's Performance Management Framework previously adopted by
the Council. Weidner Consulting has extensive experience working with public sector
organizations and recently completed a strategic business plan for the Office of
Communications and Fire, Police, Finance and General Services Departments. (Director
of Budget and Analysis)
Staff recommendation: Council adopt the resolution.
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October 25, 2005
II} . _3
DPAF1
CONSENT CALENDAR (continued)
10. RESOLUTION NO. 2005-351, RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF CHULA VISTA ACCEPTING BIDS AND AWARDING A CONTRACT
FOR THE TRAFFIC SIGNAL INSTALLATION AT THE INTERSECTION OF FIFTH
AVENUE AND NAPLES STREET (TF-318) TO HMS CONSTRUCTION,
INCORPORATED AND TRANSFERRING FUNDS THEREFOR
The traffic signal installation at the subj ect intersection was approved and budgeted as
part of the fiscal year 2005 capital improvement program. Adoption of the resolution
authorizes staff to transfer funds in the amount of $28,660 to this project from the cost
savings of the traffic signal installation project at Fifth Avenue and Moss Street (TF-315).
The scope of the project includes the installation of a fully actuated traffic signal system
and ancillary work at the subject intersection. (City Engineer)
Staff recommendation: Council adopt the resolution.
ACTION:
Mayor Padilla moved to approve staffs recommendations and offered the
Consent Calendar, headings read, texts waived. The motion carried 4-0.
ITEMS REMOVED FROM THE CONSENT CALENDAR
There were none.
PUBLIC COMMENTS
Susan Tellez spoke regarding accidents on East H Street at Otay Lakes Road and suggested the
Council consider: I) flashing lights reading "school crossing," 2) police presence prior to the
start and at the conclusion of school hours, and 3) a pedestrian bridge, funding for which could
be obtained through the Safe Routes to School Program.
Councilmember Rindone noted that on Monday, he asked staff to review the East H Street/Otay
Lakes intersection and provide options to enhance safety.
Jaime Mercado, Sweetwater Union High School District Boardmember, expressed concerns with
the situation on East H Street and stated that the district would cooperate with the City in any
way possible to make improvements happen.
Jim Ladd, owner of a home on G Street, spoke regarding recent code enforcement activity on his
property relative to a 1955 garage conversion and a sprinkler system installed ten years ago. He
asked for verification that the cited violations actually violated the code when the improvements
were made.
Betsy Cory stated she was happy to hear that the Council was looking into safety issues on East
H Street. She then stated that the Friends of Rice Canyon had a successful clean-up and that a
new group, the Friends of Del Rey Canyon, had formed. Anyone interested in forming a canyon
group may contact Eric Bowlby of the Sierra Club at 619.284.9399.
Archie McAllister, representing the Bonita Vista High School neighborhood, spoke in support of
the recommendations presented earlier by Ms. Tellez, especially the need for police presence.
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October 25, 2005
UK/\FT
PUBLIC COMMENTS (continued)
Frank and Susan Luzzaro spoke regarding issues affecting their property as a result of their
neighbor's development and the lack of consistency by City staff in interpreting and adhering to
City codes.
Jackie Mcquade asked that speakers during Public Comments be asked to state their name and
city of residence for the record, acknowledging that they are no longer required to state their
specific addresses.
PUBLIC HEARlNGS
11. PUBLIC HEARlNG TO TAKE PUBLIC TESTIMONY ON THE FORMATION OF
COMMUNITY FACILITIES DISTRICT NO. 13-1 (OTAY RANCH - VILLAGE
SEVEN) AND TO CONSIDER THE AUTHORIZATION TO LEVY SPECIAL TAXES
AND TO INCUR A BONDED INDEBTEDNESS SECURED BY SUCH SPECIAL
TAXES
On February 1, 2005, the Council accepted the Otay Project, L.P. application and
approved the initiation of proceedings to consider the formation of Community Facilities
District No. 13-1 (CFD 13-1). On September 20, 2005, the Council approved the
Resolution of Intention to form CFD 13-1 and the Resolution of Intention to incur a
bonded indebtedness and set the public hearing for October 25,2005.
CFD 13-1 will fund the construction of public facilities such as roadways for the Village
Seven project. In addition, a portion of the proceeds may be authorized to be used for
certain public facilities as directed by the City. Adoption of the proposed resolutions
continues the formal proceedings leading to the establishment of CFD 13-1 and
authorizes, subject to the approval of the qualified electors, the levy of special taxes,
amendment of the rate and method of apportionment, amendment of the boundary map
and issuance of bonds secured by the levy of such special taxes. (City Engineer)
Notice of the hearing was given in accordance with legal requirements, and the hearing was held
on the date and at the time specified in the notice.
Mayor Padilla opened the public hearing.
With no members of the public wishing to speak, Mayor Padilla closed the public hearing.
ACTION:
Councilmember McCann offered the following resolutions for adoption, headings
read, texts waived:
RESOLUTION NO. 2005-352, RESOLUTION OF THE CITY
COUNCIL OF THE CITY OF CHULA VISTA ADOPTING AN
AMENDED BOUNDARY MAP FOR COMMUNITY FACILITIES
DISTRICT NO. 13-1 (OTA Y RANCH - VILLAGE SEVEN), FORMING
AND ESTABLISHING SUCH COMMUNITY FACILITIES DISTRICT
AND AUTHORIZING SUBMITTAL OF LEVY OF SPECIAL TAXES
WITHIN SUCH COMMUNITY FACILITIES DISTRICT TO THE
QUALIFIED ELECTORS THEREOF
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PUBLIC HEARINGS (continued)
RESOLUTION NO. 2005-353, RESOLUTION OF THE CITY
COUNCIL OF THE CITY OF CHULA VISTA DECLARING
NECESSITY TO INCUR BONDED INDEBTEDNESS FOR
COMMUNITY FACILITIES DISTRICT NO. 13-1 (OTAY RANCH -
VILLAGE SEVEN), SUBMITTING TO THE QUALIFIED ELECTORS
OF SUCH COMMUNITY FACILITIES DISTRICT SEPARATE
PROPOSITIONS TO AUTHORIZE THE LEVY OF A SPECIAL TAX
THEREIN, TO AUTHORIZE SUCH COMMUNITY FACILITIES
DISTRICT TO INCUR A BONDED INDEBTEDNESS SECURED BY
THE LEVY OF SUCH SPECIAL TAX TO FINANCE CERTAIN TYPES
OF PUBLIC FACILITIES AND TO ESTABLISH AN
APPROPRIATIONS LIMIT FOR SUCH COMMUNITY FACILITIES
DISTRICT, AND GNING NOTICE THEREON
The motion carried 4-0.
12. CONSIDERATION OF APPROVAL OF PCS 05-10, A TENTATIVE MAP TO
SUBDIVIDE l.08 ACRES AT 916 FOURTH AVENUE INTO A ONE-LOT
CONDOMINIUM PARCEL CONTAINING 15 RESIDENTIAL UNITS (APPLICANT:
OAK FOURTH DEVELOPMENT, LLC.)
The applicant, Oak Fourth Development LLC, has submitted an application for a
tentative subdivision map to convert an existing IS-unit apartment complex to 15
condominium units for individual ownership. The l.08-acre project is located at 916
Fourth Avenue.
Notice of the hearing was given in accordance with legal requirements, and the hearing was held
on the date and at the time specified in the notice.
Mayor Padilla opened the public hearing.
Project Planner Putnam provided an overview of the staff report and responded to questions of
the Council.
Michael Offerman, owner of the Casa Vianney condominium complex adjacent to the west side
of the project, expressed concerns with on-going irrigation and drainage issues from the project
site that affect his property.
Chuck Schrader, representing the Casa Vianney Homeowners Association, expressed concerns
with trees along the west side of the project that cause damage to the complex and water
drainage issues from the back of 916 Fourth Avenue that affect the complex. He asked how
these would be handled once the units are sold to individuals.
Wes Allen, project applicant and current property owner, responded to questions of the public
and Council regarding the drainage and tree issues.
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PUBLIC HEARlNGS (continued)
With no further members of the public wishing to speak, Mayor Padilla closed the public
hearing.
Principal Planner Schmitz offered additional language under condition 10 to address the removal
and replacement of trees along the west side of the site.
ACTION:
Councilmember McCann offered the following resolution for adoption, as
amended regarding condition 10, heading read, text waived:
RESOLUTION NO. 2005-354, RESOLUTION OF THE CITY
COUNCIL OF THE CITY OF CHULA VISTA APPROVlNG AND
ESTABLISHlNG CONDITIONS OF A TENTATIVE MAP TO DIVIDE
lNTEREST IN 1.08 ACRES AT 916 FOURTH AVENUE FOR A ONE-
LOT CONDOMINIUM CONTAINING 15 RESIDENTIAL UNITS -
OAK FOURTH DEVELOPMENT, LLC
The motion carried 4-0.
Mayor Padilla asked staff to provide a report on Title 24 requirements as they pertain to
apartment conversions.
OTHER BUSINESS
13. CITY MANAGER'S REPORTS
There was none.
14. MAYOR'S REPORTS
. Ratification of appointment of Jerome Sandoval to the Child Care Commission.
Councilmember Castaneda moved to ratify the appointment of Jerome
Sandoval to the Child Care Commission. Councilmember McCann
seconded the motion, and it carried 4-0.
15. COUNCIL COMMENTS
Councilmember McCann stated that he had represented the Council at the 30th anniversary of the
YMCA and attended and congratulated Kitty Raso and family of La Bella Pizza on their 50th
anniversary. He then thanked all volunteers, including Mayor Padilla and Councilmembers
Castaneda and Rindone, for their participation in the recent Christmas in October program, for
which he served as Honorary Chair in Councilmember Davis' absence. He also stated that he
attended the South County Economic Development Commission summit, as well as the Senior
Volunteer Patrol dinner. He thanked the seniors for their hard work.
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COUNCIL COMMENTS (continued)
Councilmember Castaneda stated that he attended the Walk a Child to School event and saw
numerous areas without sidewalks where property owners had encroached into the right-of-way,
putting children at risk by forcing them to walk in the street. He asked staff to inventory the
neighborhoods and focus on committing financial and grant writer resources on sidewalks
leading to schools. He said he also appeared with Representative Filner at a neighborhood
meeting in Otay Ranch regarding sexual predators who are released without providing prior
notification to the affected neighborhoods. He encouraged citizens and the City to make their
voices heard on this issue.
Councilmember Rindone spoke regarding Christmas in October and acknowledged that
Councilmember Davis visited all seven houses. He also stated that he attended the Scripps
Hospital joint fundraiser with Scripps/Mercy and extended congratulations to them. He then
asked staff to (I) make sidewalks leading to elementary schools a top priority; and (2) examine
the possibilities of creating an amnesty program with regard to building code upgrades and
possibly waiving violation penalties if a building is brought up to code within a certain time
frame.
Mayor Padilla expressed appreciation to Councilmember Davis for visiting the Christmas in
October sites.
CLOSED SESSION
16. CONFERENCE WITH LEGAL COUNSEL REGARDING EXISTING LITIGATION
PURSUANT TO GOVERNMENT CODE SECTION 54956.9(a)
. City ofChula Vista, et al. v. CPUC (Rulemaking Nos. R-03-10-003 and R-01-10-
024)
No reportable action was taken on this item.
17. CONFERENCE WITH LEGAL COUNSEL REGARDING ANTICIPATED
LITIGATION PURSUANT TO GOVERNMENT CODE SECTION 54956.9
. One case
No reportable action was taken on this item.
ADJOURNMENT
At 8:42 p.m., Mayor Padilla adjourned the meeting in memory of Joshua Denton and Rosa Parks
to the Regular Meeting of November 1,2005, at 4:00 p.m. in the Council Chambers.
Lori Anne Peoples, CMC, Sf. Deputy City Clerk
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MINUTES OF A REGULAR MEETING OF THE
CITY COUNCIL OF THE CITY OF CHULA VISTA
November 1,2005
4:00 P.M.
A Regular Meeting of the City Council of the City of Chula Vista was called to order at 4:17
p.m. in the Council Chambers, located in the Public Services Building, 276 Fourth Avenue,
Chula Vista, California.
ROLL CALL:
PRESENT:
Councilmembers:
Castaneda, McCann, Rindone, and Mayor
Padilla
ABSENT:
Councilmembers:
Davis (excused)
ALSO PRESENT: City Manager Rowlands, City Attorney Moore, and City Clerk
Bigelow
PLEDGE OF ALLEGIANCE TO THE FLAG, MOMENT OF SILENCE
SPECIAL ORDERS OF THE DAY
. OATH OF OFFICE: Jerome Sandoval, Child Care Commission
Mayor Padilla announced that this item would be re-scheduled for a future date.
· INTRODUCTION BY DAN BEINTEMA, DIRECTOR OF THE NATURE CENTER,
OF THE EMPLOYEE OF THE MONTH, JOYCE REMP, REGISTERED
VETERINARY TECHNICIAN
Nature Center Director Beintema introduced Ms. Remp. Mayor Padilla read the proclamation,
and Councilmember McCann presented it to Ms. Remp.
· INTRODUCTION BY POLICE CHIEF EMERSON OF NEWLY HIRED LATERAL
POLICE OFFICER ROBIN DOWNEY
Officer Downey was unable to be present. This item will be rescheduled for the meeting of
November 15,2005.
· PRESENTATION OF "EXCELLENCE IN GIVING AWARD" TO THE CITY
COUNCIL BY DONALD EPPS, REPRESENTATIVE OF UNITED WAY OF SAN
DIEGO COUNTY
United Way representative Epps presented the award to the Mayor and City Manager, who
accepted it on behalf of the City.
. VIDEO PRESENTATION OF 2005 MAYOR'S AWARDS FOR NEIGHBORHOOD
PRESERVATION
Mayor Padilla presented a video of the 2005 award recipients and introduced those who were
present in the audience.
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CONSENT CALENDAR
(Items 1 through 7)
Mayor Padilla announced that Item 2 would be considered with Action Items.
1. RESOLUTION NO. 2005-355, 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.
2. Item 2 was moved to Action Items and considered following Item 10.
3. RESOLUTION NO. 2005-358, 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-31l) TO HMS CONSTRUCTION, INCORPORATED
AND APPROPRIATING FUNDS AS A LOAN FROM TRAFFIC SIGNAL FUNDS
(4/5THS VOTE REQUIRED)
On September 14, 2005, sealed bids were received for this project. The project provides
for the upgrade of the traffic signal at Second A venue 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 NO. 2005-359, RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF CHULA VISTA TO CREATE THE POSITION OF FIRE PREVENTION
ENGINEER
B. RESOLUTION NO. 2005-360, 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)
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CONSENT CALENDAR (continued)
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 NO. 2005-361, 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.
6. RESOLUTION NO. 2005-362, RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF CHULA VISTA ADOPTING THE AMENDMENT TO OTAY VALLEY
REGIONAL PARK. JOINT EXERCISE POWERS AGREEMENT (IEP 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
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)
Staffrecommendation: Council adopt the following resolution:
7. RESOLUTION NO. 2005-363, 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 PERFORMING ARTS TO CONDUCT THE
NINTH ANNUAL BAND REVIEW, AUTHORIZING TEMPORARY STREET
CLOSURES AND WAIVING CITY FEES FOR POLICE SERVICES
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CONSENT CALENDAR (continued)
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.
ACTION:
Mayor Padilla moved to approve staffs recommendations and offered Consent
Calendar Items 1 and 3 through 7, headings read, texts waived. The motion
carried 4-0 except on Item 1, which carried 3-0-1, with Councilmember Rindone
abstaining due to the proximity of his residence to the property.
With regard to Item 4A, Councilmember Castaneda requested implementation as soon as
possible of a Public Safety Committee to address future staffing needs. Regarding Item 6,
Mayor Padilla requested the commitment of funding; and Councilmember Castaneda requested a
mid-year review and a commitment of funds to ensure adequate maintenance.
PUBLIC COMMENTS
Jacque McQuade stated that the presentation on the neighborhood preservation awards was
beautifully done and that she was proud to live in Chula Vista.
PUBLIC HEARINGS
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 timelier basis. This is the identical process
approved by the Council since August 1998. (Finance Director)
Notice of the hearing was given in accordance with legal requirements, and the hearing was held
on the date and at the time specified in the notice.
Mayor Padilla opened the public hearing. No members of the public wished to speak to the item.
ACTION:
Councilmember Rindone moved to continue the public hearing to November 15,
2005. Councilmember McCann seconded the motion, and it carried 4-0 with
regard to Item 8A and 3-0-1 with regard to Item 8B, with Councilmember
Castaneda abstaining due to the proximity of a piece of land in which he has an
interest to a delinquent parcel.
.
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PUBLIC HEARINGS (continued)
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)
Notice of the hearing was given in accordance with legal requirements, and the hearing was held
on the date and at the time specified in the notice.
Mayor Padilla opened the public hearing. No members of the public wished to speak to the item.
ACTION:
Councilmember Rindone moved to continue the public hearing to November 15,
2005. Mayor Padilla seconded the motion, and it carried 4-0 on Item 9A; 3-0-1
on Item 9B, with Counci1member McCann abstaining due to the proximity of a
piece ofland in which he has an interest to a delinquent parcel; and 3-0-1 on Item
9C, with Councilmember Castaneda abstaining due to the proximity of a piece of
land in which he has an interest to a delinquent parcel.
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 Director/Parks and Recreation Director)
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PUBLIC HEARINGS (continued)
Notice of the hearing was given in accordance with legal requirements, and the hearing was held
on the date and at the time specified in the notice.
Mayor Padilla opened the public hearing. No members of the public wished to speak to the item.
ACTION:
Councilmember McCann moved to continue the public hearing to November 15,
2005. Councilmember Castaneda seconded the motion, and it carried 4-0.
Councilmember Castaneda stated he had issued a Council referral regarding the need for a
comprehensive program covering all City parks, which should be addressed by the Public Safety
Committee, when formed. Councilmember Rindone asked that the topic of banning alcohol in
City parks be addressed in a workshop format. Mayor Padilla asked that the topic of forming a
Public Safety Committee be brought back on a future agenda for Council direction.
ACTION ITEMS
Item NO.2 was heard at this time.
2A. RESOLUTION NO. 2005-356, 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 NO. 2005-357, 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)
ACTION:
Councilmember McCann offered Resolutions 2005-356 and 2005-357, headings
read, texts waived. The motion carried 4-0.
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ACTION ITEMS (continued)
I!. 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. (Planning and Building
Director)
Councilmember Castaneda recused himself from participation in discussion on the item due to
activities of members of his family with regard to the Espanada .project and pending a ruling
from the Fair Political Practices Commission. He then left the dais.
Mayor Padilla stated for the record that the Council had been provided with a copy of
correspondence addressed to City Attorney Ann Moore, dated October 28, 2005, from Attorney
Greg Vega of Seltzer, Caplan, McMahon Vitek with respect to Item I!. Mr. Vega, who
represents Espanada Chula Vista LLC, requested that the item be continued to provide him an
opportunity to study the suggested edits and provide input. Mayor Padilla clarified that the
proposed action at this time is to direct staff to prepare an alternative to be brought back for
Council consideration at the adoption hearing in December. Mayor Padilla stated that there was
sufficient time between now and December for Mr. Vega and/or his client to provide input, up to
and including testimony at the public hearing, on any suggested edits.
Advanced Planning Manager Batchelder provided an overview of the General Plan update,
including proposed edits to the transit corridor special study area, and responded to questions of
the Council.
Patricia Aguilar, representing Crossroads II, thanked and congratulated the Mayor for his
leadership on the issue and expressed hope that this meeting would mark a new spirit of
collaboration and cooperation between the community and elected representatives.
Sharon Floyd spoke regarding an e-mail previously submitted to the Council in support of
designating the transit service area at Third and H Street for mid-rise rather than high-rise
buildings.
Earl Jentz, representing the Roosevelt Street Steering Committee, spoke in support of the
proposed edits and complemented the Mayor and City Council for being willing to meet and
listen to Chula Vista citizens. Further, he expressed hope that the groups and City would move
forward together.
Laura Hunter, representing the Environmental Health Coalition, expressed support for the
direction being taken on the proposed edits, the use of language including harmonizing change
and the vision of the Council, and the continued special planning efforts.
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ACTION ITEMS (continued)
ACTION:
Mayor Padilla moved to direct staff to bring back the proposed edits as another
GPU option to consider at the GPU hearing in December. Councilmember
McCann seconded the motion, and it carried 3-0-1, with Councilmember
Castaneda abstaining and not present in the Chambers due to the activities of
family members with regard to the Espanada project and pending a ruling ITom
the Fair Political Practices Commission.
12. CONSIDERATION OF ACCEPTANCE OF FUNDING FROM THE U.S.
DEPARTMENT OF JUSTICE'S OFFICE OF COMMUNITY ORIENTED POLICING
SERVICES FOR THE UNIVERSAL HIRING PROGRAM GRANT TO ADD ELEVEN
PEACE OFFICERS TO THE POLICE DEPARTMENT AND APPROPRIATING
FUNDS THEREFOR.
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 IS
officers. The program will fund up to $75,000 per officer over a three-year grant period.
Appropriations for II officers are requested at this time, and the remaining four officers
will be addressed during the strategic plan implementation. (Police Chief)
ACTION:
Councilmember McCann offered the resolution, heading read, text waived:
RESOLUTION NO. 2005-264. 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 motion carried 4-0.
OTHER BUSINESS
13. CITY MANAGER'S REPORTS
With regard to Item 12, City Manager Rowlands suggested that, with Council permission, he
would work with Mayor Padilla and Councilmember Castaneda as an ad-hoc committee to
prepare a report regarding the establishment of a Public Safety Committee to be brought back to
Council for action.
He then provided an update on the actions taken to select a Director of the Chula Vista
Redevelopment Corporation, stating that a request for proposals was sent to 34 recruiting firms,
and responses are due by November 10, 2005. The Council will have an opportunity to
interview the top firms. He then distributed a list of applicants for the four appointee positions
and asked the Council to review the list, indicate on the list the applicants they would like to
interview, and forward the list to Assistant City Manager Smith by November 3, 2005, so that
the Mayor's Office can schedule interviews in mid-November.
OTHER BUSINESS (Continued)
14. MAYOR'S REPORTS
Page 8 - Council Minutes
http://www.chulavistaca.gov
November I, 2005
/6~f
DR/\FT
OTHER BUSINESS (Continued)
14. MAYOR'S REPORTS
Mayor Padilla stated that he attended Baykeeper's lOth anniversary celebration at the Hotel Del
Coronado. The organization is now known as Coastkeeper. He also requested a report back in
60 days on the Alpine Minot undergrounding and street condition issues, along with possible
options, and suggested that when prioritizing projects, staff consider that the neighbors have
taken the initiative on this request. Additionally, he encouraged everyone to participate in the
Chula Vista cleanup event scheduled for Saturday, November 5.
15. COUNCIL COMMENTS
With regard to the Mayor's comments on the Alpine Minot undergrounding project,
Councilmember Rindone asked the Council not to negate its prior commitment to the Nolan Way
neighborhood off of L Street. He also requested a report back on the 1993-2005 residential units
permitted and requested additional information as to what units had been excluded and the
reason they were omitted. Additionally, although the City has a healthy reserve, he
recommended the City remain cautious and look closely at mid-cycle recommendations for
appropriations.
Councilmember Castaneda stated that a significant number of well-qualified candidates
participated in the recruitment process for Director of the San Diego Centre City Development
Corporation. He suggested that perhaps the City could save time and money by following up on
those candidates who might be qualified for the Director of the Redevelopment Corporation.
Councilmember McCann thanked staff for issuing the request for proposals for the Chula Vista
Redevelopment Corporation. He then reported that he attended the Veteran's Home Fleet Week
Celebration and the grand opening of the third Wal-Mart in Chula Vista. He also thanked the
Mayor for presenting the beautification award video, commended individual citizens for
improving the community, and asked that the video be made available on the City's web site, if
possible.
CLOSED SESSION
Closed Session was cancelled, and the following item was not discussed:
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
At 6:16 p.m., Mayor Padilla adjourned the meeting to the Regular Meeting of November 15,
2005, at 6:00 p.m. in the Council Chambers, noting that the Regular Meeting of November 8,
2005 has been cancelled.
~~lv\~~~
Susan Bigelow, MMC, City Clerk
Page 9 - Council Minutes
http://www.chulavistaca.gov
November 1, 2005
1(3 .- '9
/f~ "
11/17/2005 11:24
Spirit of Excd/.net!
Chief of Poll~.
RIchard P, Emerson
DlvlsloR Co,","aftder
Asst. Chief Jim loll
(819) 891-5209
UnIt Supervisor
Sgt. David EIsenberg
(01 9) 409.54SS
Crlmtf F,... Multi.
HOU$lnl1 Coordlnlltor
Richard E. Preuu
(519) 5.'.5127
Community ResDurr:e
Coordinator
Wendy Endaya
(619) 891-5187
5194752391
CRU
PAGE 02/02
Chula Vista Police Department
Community Relations Unit
November 17,2005
Dear Honorable Mayor and Council Members:
This memo is to inform you the Human Relations Commission received a verbal
notice of resignation from Commissioner Samuel Avalos in January of 2005. Our
Chairman Anthony Jemison responded to Mr. Avalos' verbal resignation with a
letter of acknowfedgement
-2-
SE.CONO RE."'DlNG "'NO "'OOPI\ON
ORDINANCE NO.
AMENDING MUNICIPAL CODE 2.66.043 PERMITTING
POSSESSION AND CONSUMPTION OF ALCOHOL BY
PERMIT DURING PARK OPERATING HOURS.
WHEREAS, Chapter 2.66.043 of the Chula Vista Municipal Code establishes
regulations on the possession and consumption of alcohol in city parks; and
WHEREAS, Chapter 2.66.043 allows the prohibition of the possession and consumption
of alcohol in City parks when the appropriate signage is present; and
WHEREAS, a significant number of complaints from residents and Police calls-for-
service in Eucalyptus, Friendship, Memorial and Lauderbach parks were received
complaining of various violent crime and disorder activities in the parks which oftentimes
included individuals and groups drinking excess alcohol; and
WHEREAS, a team of employees from the Police, Recreation and Public Works
departments studied the issues and determined that the possession and consumption of
alcohol at these parks plays a significant role in the violent crime and disorder activity in
the area; and
WHEREAS, the team also recognizes that law abiding citizens who frequent the parks
for family gatherings or organized events are not the source of the problems in the
parks; and
WHEREAS, on October 20, 2005, the Chula Vista Parks and Recreation Commission
reviewed this ordinance change and unanimously voted to recommend that the City of
Chula Vista City Council adopt staffs recommendations; and
WHEREAS, the amended Municipal Code would permit the possession and
consumption of alcohol in parks which have signs posted prohibiting the possession and
consumption of alcohol provided a permit is obtained as a result of the terms of a lease,
operating agreement or permit issued by the Director of Recreation, Director of Public
Works Operations, the City Manager, or their designees.
NOW, THEREFORE, the City Council of the City of Chula Vista does hereby ordain:
SECTION I. That Chapter 2.66.043 of the Chula Vista Municipal Code is hereby
amended to read as follows:
3-1
or parts thereof when posted with signs prohibiting drinking, except where permitted
under the terms of a lease. operatinq aqreement or permit issued bv the Director of
Recreation. Director of Public Works Operations. the City Manaqer. or their desiqnees.
Any signs posted pursuant to this section must be posted under the authority of a city
council resolution upon a finding by the council that the park, or portion thereof, was
experiencing problems with the public's consumption of alcohol. (Ord. 2651 91, 1995;
Ord. 2493 99 1, 2, 1992).
SECTION II. This Ordinance shall take effect and be in full force on the thirtieth day
from and after its adoption.
Presented by
Approved as to form by
/);~ ~
Ann Moore
City Attorney
Richard Emerson
Chief of Police
Buck Martin
Director of Recreation
David Byers
Director of Public Works Operations
3-2
COUNCIL AGENDA STATEMENT
Item t/
Meeting Date 11/22/05
ITEM TITLE:
Resolution Approving Changes to the Chula Vista
Construction Standards and Subdivision Manual
SUBMITTED BY:
City Engineer 8l<"
REVIEWED BY:
/ ,1 -;](
City Manager' Ji ~ j 1\
(4/Sths Vote: Yes _ No..xJ
BACKGROUND:
Proposed changes to federal accessibility standards were published in July 2004. At that time the
City Engineer appointed a team of City employees to review the City's current requirements,
specifications, and standards for the design and construction of public work projects and update
them if necessary. As a result of the review process, staff is recommending changes to both the
City standards for curb ramps and the Subdivision Manual, to reflect and comply with the
existing and proposed regulations of the Access Board.
RECOMMENDATION:
That Council adopt the resolution approving the proposed changes to the Chula Vista
Construction Standards and Subdivision Manual
BOARDS/COMMISSIONS: NOT APPLICABLE
DISCUSSION:
The Architectural and Transportation Barriers Compliance Board (Access Board), is an
independent federal agency devoted to accessibility issues for people with disabilities. It is
composed of representatives of disability groups, the design professions, building code
organizations and federal enforcement agencies. Under the Americans with Disabilities Act
(ADA), the Access Board is charged with recommending accessibility guidelines to federal
enforcement agencies for all issues governed by the ADA. Once the Access Board
recommendations are adopted by the Department of Justice (DOJ), the guidelines serve as the
basis for enforceable standards for public agencies subject to the ADA and the Architectural
Barriers Act (ABA).
In July of 2004, the Access Board published proposed accessibility standards to update the
standards adopted by the DOJ in 1994. The proposed guidelines represent the cumulative efforts
of the Access Board and a broad cross-section of interested parties. After adoption, the standards
were published for an extended period for public review and comment before final publication
by the Access Board.
Before publishing the [mal guidelines, the Access Board reviewed over 2,500 comments
received during the public comment period and incorporated many of these recommendations
into the guidelines. The proposed guidelines have now been accepted by the DOJ and published
4-1
Page 2, Item ~
Meeting Date 11/22/05
as an Advanced Notice of Proposed Rule Making (ANPRM). They are now undergoing an
additional period of public review and comment.
The first Americans with Disabilities Act Accessibility Guidelines (ADAAG) were adopted by
the DOl in 1994 and have served as guidance for the City in all of its construction standards. The
proposed changes to existing City standards regarding curb ramp design are consistent with those
guidelines and also incorporate some recommendations from the Access Board's proposed
ADA! ABA Accessibility Guidelines and draft Public Rights-of-Way guidelines.
The Access Board's recommendations are not yet enforceable regulations under the ADA.
Nevertheless, staff recommends the City incorporate some of the proposed changes now in
anticipation of the various federal agencies (including DOT and DOl) ultimately approving the
Access Board's recommendations. The advantages to adopting these standards now are the
following:
· First, the Access Board's updated recommendations represent the state of the art in
accessible design. By following the recommendations, Chula Vista will continue to be an
accessible community to all individuals.
· Second, under ADA, the City is required to adopt accessibility standards at least as
stringent as the federal standards. If the City does not adopt the ADAAG standards, the
City must independently prove that any standard it does adopt is as stringent as the
ADAAG standards. Adopting the standards provides an affirmative defense to potential
ADA claims without requiring additional proof. The Access Board has provided the
following guidance regarding the adoption of the ADAAG standards by a public agency:
"Although no federal scoping or technical requirements have been established that apply
specifically to public rights-of-way, both ADAAG1 and UFAS contain technical
requirements for the construction of accessible exterior pedestrian routes that may be
applied to the construction of public rights-of-way. In the absence of a specific federal
standard, public entities may also satisfy their obligation by complying with any
applicable state or local law that establishes accessibility requirements for public rights-
of-way that are equivalent to the level of access that would be achieved by complying
with ADAAG or UF AS."
· Third, the standards will provide clear direction to the development community on the
requirements for accessibility and will provide for consistent enforcement of the
standards by all City departments. Adoption of new standards ensures that once the
proposed ADAAG standards become enforceable, development projects under design or
construction will already be in compliance, thereby providing a seamless transition from
current ADAAG standards to the new ADAAG standards.
The proposed City standards are consistent with the City of San Diego's recent changes to its
accessibility standards and with the standards currently adopted by the Regional Standards
Committee for the San Diego area. In addition, the City of Sacramento (defendant in the
landmark Barden case) has adopted similar standards.
1 ADA Accessibility Guidelines published by the Access Board, a federal agency.
4-2
Page 3, Item ~
Meeting Date 11/22/05
Staff will require compliance with the new standards for all new construction and/or alteration
projects in accordance with the "Curb Ramp Implementation Procedure" presented in
Attachment 2. Please note that the City of Chula Vista is already applying these new standards
for retrofitting existing ramps and/or constructing new ramps triggered by CIP projects
including new construction, alterations to existing facilities, and the curb ramp transition plan.
A brief discussion of the proposed changes to City standards is presented below:
Curb Ramp Construction Standards
In 2002, Council approved the Chula Vista Construction Standards currently in use by City
departments and private developers working on projects in the City. These standards are based
on the 1994 ADAAG standards. Since the publication of the 2004 proposed ADAAG standards,
staff has been working on a revision to the City's curb ramp standards and other accessibility
issues to improve compliance with existing ADA requirements and to ensure a smooth transition
from the current ADAAG standards to the new standards when the DOJ approval process is
complete and the proposed ADAAG standards are formally adopted. The task force appointed
by the City Engineer included members from the City Attorney's office and the General
Services, Public Works Operations and Engineering Departments.
Staff recommends updating the City's current public right of way curb ramp standards to be
consistent with the existing ADAAG standards and, in some areas, with the Access Board's
recommendations on accessibility design2 and the federal requirement to install truncated domes.
The proposed changes to City standards include requiring a maximum curb ramp cross-slope of
2%, level landings, no lip at gutter, and the installation of truncated domes. (Attachment 1)
Subdivision Manual Changes
In 2002, City Council approved the current Chula Vista Subdivision Manual. The proposed
changes to the Subdivision Manual will limit street intersection grades to 4% (current standard is
6%) and grades along the curb of a curb return to 3% (currently 6%). These changes are
necessary to ensure compliance with the new ADA curb ramp standard requiring level ramps and
landings. It is important to note that the draft Public-Right-of-Way guidelines proposed by the
Access Board stipulate that the cross-slope of pedestrian crosswalks shall not exceed 2%. This
will require street grades at intersections to be reduced even further to 2% from the current staff
recommendation of 4% maximum. Staff considers it prudent to require new projects to meet the
City's proposed 4% maximum grade in order to ease the compliance process with the more
restrictive 2% requirement in the event it becomes a future mandate.
The proposed Subdivision Manual changes also authorize the City Engineer to approve higher
street intersection grades (to a maximum 6%), on a case-by-case basis, as long as all applicable
ADA requirements are met. This will facilitate compliance during implementation of approved
tentative maps that were designed using the previously allowed 6% maximum grade or where
unique project's conditions require providing a higher grade.
2 Recommendations are consistent with July 2004 ADAI ABA Accessibility Guidelines and the June 2002 Access
Board draft recommendations on Public Rights of Way.
4-3
Page 4, Item ~
Meeting Date 11/22/05
Meetings with the Development Community
The proposed changes to City standards were presented to the development community in a letter
dated July 19, 2005. In the letter, staff also proposed holding a meeting to discuss the proposed
changes and address any concerns the development community might have regarding the
changes. The response of the development community to the proposed changes was minimal.
Only representatives of the McMillin Company, Otay Land Company, and Rick Engineering
responded. A meeting was held on July 27,2005 with representatives from the three companies.
During the meeting, staff provided clarifications to questions regarding the proposed changes
and discussed the implementation schedule. No additional comments were received by staff from
these three companies following the meeting.
Later, on October 25, 2005, staff met with the Otay Ranch Company to discuss their concerns
regarding the implementation of the proposed maximum grade of 4% at street intersections.
They were concerned that: 1) the new 4% requirement may not be met for tentative maps that
were designed with the previous standard of 6% maximum, and 2) unique project's conditions
may require higher intersection grades. In response to their concern, staff added language
authorizing the City Engineer to approve higher street intersection grades (to a maximum 6%),
on a case-by-case basis, as long as all applicable ADA requirements are met.
The proposed Subdivision Manual Changes are presented in Attachment 3.
FISCAL IMPACT: There is no impact to the General Fund.
Attachment I - Chula Vista Construction Standards 25 through 29
Attachment 2 -Curb Ramp Implementation Procedure
Attachment 3 - Subdivision Manual Changes
J:\EngineerIAGENDAICAS200511 O-18-05IADA standards Rev 3.doc
4-4
AITACHMENT I
Monolithic curb if speCified or required
-0
,<:> It of Retum
~..,~
.-.-'
305mm (12 in.) wide border with
5.35mm (1/4 in.) grooves approx.
19.1 mm (3/4 in.) D.C.
"
Limit of construction/""-,-,-,
1.22m
Z 4 ft.) Z
t.:A
PlAN - lYPE A
NOTE
1. See Drowing eves- 29 for general notes.
2. For truncated domes deteRs, please see
Drowing eves-29.
3. Landing cross slope and longitudinal slope shall be 2X.
4. Z side slope shall be 10:1.
Monolithic curb if
specified or required
rA 1.22m (4 ft.) Minim~
Transition area
R/W
305mm (12 in.) wide border with
6.35mm (1/4 in.) grooves opprox.
19.1mm (3/4 in.) D.C.
R/W
Z 4 ft. Z Lip (toe)
LA of gutter
PlAN
Top of curb
. '. .. ". ", -, ",
.... . -,.."
'.. ',. '., ...... ,.-......
. .
..
ELEVATION
"TYPES
Gutter fiow
line
Curb
152mm
(6 in.)
1.22m (4 ft.) min
j Lending 3D5mm 2%!.Iin
~ (12 in.) 8.33% Max
<LI
Sidewalk
......
57. maximum gutter
apron slope at ramp
opening
R/W
NOTE
See Standard Drawing CVCS-29 for genera! notes.
Truncated
domes
SECTION A-A 509.5 mm
(2 ft.)
See Deteil 8
evcs- 29
Revised:
CITY ENGINEER Date:
CITY OF C HULA VISTA
PUB LlC WORKS DEPARTMENT
C URB RAMP-TYPES A and B
(New Construction)
eves
25
4-5
I'
Landing
,.-A
.<;
E::E g"
N .'-
N ~ "
~ c
-v..5:
. ).
. .
304.8 mm (12 in.)
wide border with
6.35 mm (1/4 in.)
grooves, 19.1 mm
(3/4 in.) a.c.
..................
..................
..................
.................
.................
Truncated dam es
z
1.22 m (4 ft.)
'-A
PlAN
1.22 m (4 ft.)
ELEVATION
1.22 m (4 ft.)
min.
2% Max
2% Min
8.33% Max.
'.' ,... '
a, .' ",'..0. .
PO"", "
4" Thick Min
SECTION A-A
NOTES
'. . ,
. .
Transition area
""
C
'"
"
"
111
'"'
.c
~
en
'x
W
z
Face of curb
(toe) of Gutter
Top of curb
Gutter flow line
5% max. gutter
apron slope at
ramp opening
2' truncated
domes
--
--
12'~
See Detcil B
CVCS- 29
Concrete
1. See Standard Drawing CVCS-29 for general notes.
2. Type A-1 is a designation for ramp ot curb return.
3. Type 8-1 is a designotion far ramp at straight curb (shown obove).
4. Landing cross slape and longitudinal slope shall be 2% max.
5. For truncated domes details, please see CVCS-29.
6. Z side slope shall be 10: 1.
Revised:
CITY OF
PUB LlC WORKS
C HULA VISTA
DEPARTMENT
CURB RAMP-TYPE A-1 & B-1 eves
(For existing Sidewalk) 26
CITY ENGINEER Date:
4-6
12" wide border
See Detail A
CVCS-29
Truncated domes
2% Nlin '!.
~
Al
t
r I> . I
............
............
............
............
...........
4'
A-J
PLAN
~
Monolithic Curb
Meet sidewalk elevation
Bock of Sidewalk
CT
Face of curb
(toe) of gutter
~.' '."
...-- . ..
Top of curb
;LI ;LI ;LI ;l>
. . . .
CT 4' CT
2' truncated
domes
57. max gutter
apron slope. at
ramp opening
'1> .
--
~~
See Detail B
CVCS-29
ELEVATION
Gutter Flow Line
4' min. Landing
I>
. I>
6" \
,27. Max
SECTION A-A
.
. "
4" Thick Min.
NOTES
1. Type C ramps are only to be used to mitigate conditions where inadequate
right-of-way exists. Type C shall only be used with the approval of the City Engineer.
2. See Standard Drawing CVCS-29 for general notes.
3. Landing cross slope and longitudinal slope shall be 27. max.
4. For truncated domes, please see CVCS-29.
5. CT Curve Transition slope sholl be 8.337. maximum.
Revised:
CITY ENGINEER Date:
CITY OF
PUBLIC
C HULA VISTA
WORKS DEPARTMENT
C URB RAMP-TYPE C
eves
27A
4-7
12" \\IDE BORDER \\ITH 1/4"
GROOVES APPROX.. 3/4" D.C.
STANDARD SIDEWALK ~NISH
CURB
HEIGHTf--t
I
~"
~"'oL
<<..~V
~<""<<"~<:'''
TRUNCATED DOME
4'
20"
TRANSITlON ffiOM 5:>:
TO EXISTING CURB
APRON SLOPE.
A-J
1;..;; ,; '~~:=rJ
12:1
12:1
4'
~ "~I
., :'0':< ..
CURB f
REMOVE & REPLACE ASPHALT
To PROVIDE 5:>: MAX. SLoPE
IIITHIN 4' OF RAMP.
GUTTER
4' LANDING MIN.
RETAINING CURB
OR WALL
2-1/2"
12
c:::::=--
~
1/2" RAOIUS
12"
. .
.~. ~ ...~:~
l4"
2' RAMP
SECTION A-A
NOTES:
1. Type C ramps are only to ~e used to mitigate conditions where inadequate right-af-way
. exists. Type C shall only be used with the approval of the City Engineer.
2. See CVCS-29 for General Notes.
3. landing cross slope and longitudinal slope sholl be 21. maximum.
4. For truncated domes, please see CVCS-Z9,
5. CT Curve Transition slope shall be 8.33% maximum.
NOT TO SCALE
date: 3-23-94
CVM Date: 8-21-01
CITY OF .CHULA VISTA
PUBLIC WORKS DEPARTMENT
PEDESTR~ RAMP DETAIL
TYPE "e" MODIFIED
eves
278
CITY ENGINEER Date:
4 8
2'(min.)~,,"...::::
. "
v .-
E
Monolithic curb
4'(min.)
See Note #2 R W
>,
"
Existing Non-contiguous
Sidewalk
4'
<(
Truncated domes
Street
TYPICAL PLAN
Truncated domes
- The romp side flares and
grooves may be eliminated by the
Engineer and replaced by 0
monolithic curb flush with the
existing ground and sidewalk.
12" wide border
See Detail C
CVCS-29
PLAN VIEW
--
2' truncated
domes
2% Min.
B.33% Max. I
4' min. Landing
5% max gutter
apron slope ot
romp opening
2% Max
. ~ .
~
~
~
. ~ ..
l4" Thick
~
--
Min.
See Detail 8
CVCS-29
SECTION A - A
NOTES
1. See CVCS-29 for general notes.
2. Landing cross slope and longitudinal slope sholl be 2% max.
3. For truncated domes details, see CVCS-29.
Revised:
date:
Date:
CITY OF C HULA
PUB LlC WORKS
VISTA
DEPARTMENT
CURB RAMP - TYPE D
eve s
28
CITY ENGINEER Date:
4-9
ee note #6
L
Remove & reconstruct
pavement as shown on
plans to provide 5%
max. slope with in 4' of
sidewalk limit.
4' - 0" min.
Landing
12" wiqe border
with 1/4 grooves Line of Curb
O~raximatelY 2~ .
3 ,," /a Mm
~ a.c. 8.337. Ma;.
..''',' ,.110 .
....... .
'.
Truncated domes
2'
Minimum
12"
.:<
0_
;, .-
" E
:E::i
U1
\ \
I> \ .>'
\ I> \
\ ... \ ,&..
\ '
DETAIL B
DETAIL A
12" wide border
NOTES
1. For construction of Curb Ramps on existing sidewalks, removel of additional
sidewalk maybe required to comply with ADA requirements to meet the existing grade.
2. Areas shown thus: I I shall have a medium to heavy broom
texture finish, perpendicular to the oxis of the ramp.
3. Areas shown thus: I::::: ::':~:"~l are the minimum required for a complete ramp
-installation ond shall be concrete class 52D-C-2500.
4. If obstructions such as inlets, utility poles, fire hydrants, etc., are encountered, the ramp
locations may be adjusted upon the approval of the Resident Engineer or Locel Agency Inspector.
No utility box covers, grodes, etc. shall be allowed within the ramp area ond lending.
5. Adjoining slape beyond ramp shell not exceed 2D: 1 (57.).
6. Landing crass slope and longitudinal slope shall be 27. max except at mid-block curb ramps.
7. All projects (new construction & olteretion), the lower end of 4B-inch width of the romp shali
be fiush and free of abrupt changes between the bottom of the ramp end the street
pavement surface.
8. There shal! be a minimum of 6-inches and 0 maximum of a-inches separation between the face
of the curb and any given point of the nearest edge of the truncated domes.
9. The ramp longitudinal slope shall be 27. minimum and 8.33% maximum. Design of the ramp shal1
not exceed 7.5% to ensure that the constructed slope does not exceed 8.33%. Romp cross-slope
she!! be 270 maximum.
10. Exceptions may be allowed in existing construction and elterations upon City Engineer approval thot
full compliance is technically infeasible.
Revised:
CITY OF
PUBLIC
CITY ENGINEER Date:
GENERAL NOTES
FOR CURB RAMPS
C HULA VISTA
WORKS DEPARTMENT
eves
29
SHEET' or 2
4-10
Revised:
E
E'"":'
"
0'-
-'+
""N
00
~~
E"
E'-
""
~-=
o~
+
DETAIL 1
1219,2 mm 4 ft,
UNCA TED DOMES @ 40.6 mm to 61,0 mm SPACING C
1.6 in. to 2.4 in.
@@@@@@@@@@@@@@@@@@@@@@@@
@@ @@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@
E 0-
"
E E'"
'E '" E;;;
'E "" OU
'" .<
0 -"-
0 "''''
~ ~ o~
~ -"
N < e:;
U E .
E z N
=> ~o
E ~ 0-
...
"" @...
.,;
0 ~
"" -
40,6 mm to 61.0 mm
1.6 in. to 2.4 in.
16.5 mm
0.65 in)
Minimum
E . E
E.E ='
E
u:~ 'E
~o Si
00000 00
0000 0
00.0
00
PLAN - TI LE
NOT TO SCALE
NOTES
1. Detectabie werning surfece celar shell be yellew
conferming te federal standards 5958 Table IV. color
Ne. 33538. '
Color shall be homogeneous throughout the tile.
2. Trunceted dome top diemeter of 50% of the bese
diameter minimum to 65% of the base diameter maximum.
3. During end efter the tile instelletion end the concrete
curing stege. it is imperative thet there is na welking.
leaning or external forces placed on the tile to rock
the tile, causing a void between the underside of tile
and concrete.
4. The truncated dome shell be Armeur Tile ar an approved
equivelent.
See note # 2
12.7 mm cYz in.) R
E
"
E
'c""":'
.- "
:>'-
E3.
E
, .
.'
'-'!
;:;
DETAIL 1
NOT TO SCALE
DIE:
PATTERN, SIZE &
ORIENTATION ARE
PER MANUF ACTIURER'S
RECOMMENDATION
22.9 mm to 35.6 mm
(0,90 in. to 1.4 in.)
CITY ENGINEER Date:
#3
CITY OF
PUBLIC
CHULA VISTA
WORKS DEPARTMENT
eves
29
TRUNCATED DOME
INEl'zarz
4-11
"
ATTACHMENT J....
ADA PEDESTRIAN CURB RAMPS
IMPLEMENTATION PROCEDURE
The City is committed to assuring its public rights-of-way are accessible to all
individuals. This memorandum sets forth the City's implementation procedure on curb
ramps and shall be used in the new construction and alterations of City-owned or leased
facilities and projects within public rights-of-way.
This procedure is specific to curb ramps only. The overall street and sidewalk design is
required to comply with the ADAJADAAG, the CBC, and other adopted governing laws
and regulations.
The implementation procedure for these new curb ramps standards is set forth below:
Curb Ramp - (New Construction and Alteration):
1. Implementation:
1) Design phase: projects that have not been subrnitted for plan
check/review shall comply with the new City standard curb ramp
drawings.
2) Plan check/review phase: projects in plan check/review phase for
the improvement plan shall comply with the new City standard
curb ramp drawings unless undue burden can be demonstrated to
the City Engineer.
3) Projects with improvement plan approved and construction
pe=it issued shall not be required to comply with the new City
standard curb ramp drawings.
C:\Documents and Settings\LombardolMy DocumentslPed Ramp Implementation Policy 1 Revised.doc
4-12
SUBDIVISION MANUAL
SECTION 3: GENERAL DESIGN CRITERIA
Section 3.400 Page 13
Revised 11/14/2005
(8)
(9)
(10)
(11 )
(12)
(13)
(14)
(15)
c) A turnaround shall be provided at the location of the gate. The size and
location of said turn-around and gate, shall be approved by the City
Engineer.
Compound curves shall not be allowed.
ATTACtIf1ENT 2-
The maximum centerline grade for permanent cul-de-sac streets within the
turnaround area shall be 5%, the maximurn centerline grade for temporary
cul-de-sacs shall be 8%.
The minimum gutter grade in the turn around segments of cul-de-sacs shall
be 1%.
The maximum longitudinal street grade or cross slope at 90 degrees to a
cross gutter shall be 3% for 25 feet (8m) from any edge of the cross gutter.
This grade rnay be increased at residential intersections, subject to approval
of the City Engineer, if the intersection is designed as a maximum
comfortable acceleration sag vertical curve designed for a minimum speed of
25 mph (40kph) [i.e., Length of vertical curve = 3.125 feet x Difference in
approach grades] and the maximum cross slope in any driving lane is 5%.
The maximum grade at any intersection of two streets shall be &% 4% within
the intersection and for at least 50 feet ft7m1 (15m) past the nearest curb
lines of the intersecting street as long as all applicable ADA requirements fef
EiEJe'Nall\s, otc. are met to the satisfaction of the Citv Enqineer. The City
Enqineer mav approve an increase of this qrade to 6% maximum. on a case
by case basis. takinq into consideration each project's unique conditions as
lono as all applicable ADA requirements are met to the satisfaction of the City
Enqineer.
Pavement cross slopes shall be in accordance with CVDS 1 through 4. The
minimum cross slope shall be 2% except at intersections where the cross
slope may be reduced to 1 %. The maxirnum cross slope shall be 5% on any
street whose cross section varies from said construction standards.
Portland Cement Concrete monolithic curbs, gutters, and sidewalks are
required along all streets with the exception that the City Engineer may
approve reduction of sidewalk requirements in those areas that are deemed
unnecessary by the City Engineer.
Pedestrian rarnps in accordance with the San Diogo Ro~ional City of Chula
Vista Standard Drawings shall be constructed in the following locations on all
streets unless otherwise approved by the City Engineer:
a) All curb returns
b) At t-intersections opposite one curb return.
(16) Driveway approaches for all residential and commercial applications shall
conform to CVCS1, unless otherwise approved by the City Engineer.
4-13
SUBDIVISION MANUAL
SECTION 3: GENERAL DESIGN CRITERIA
Section 3-400 Page 14
Revised 11/14/2005
(17) Cross gutters will not be allowed at signalized intersections unless otherwise
approved by the City Engineer.
(18) Curb returns shall be checl{eE! fer sonstruGtaeilit'j'. 'oil/hen the ferA')s are
"warped" in the fiela, it will result in severe !jraae breaks, eaE! E!Faina!3e, ami a
poer E!rivin!3 lane. The calculates PI ef Ihe curb return shall be delermined
from tho oxlondod curb gmE!e ef Iho main slreet. Tho straight graE!e froA') tRe
PCR 10 the calculated PI of tho curb return shall be shO'Nn on tho plan. The
!jraae ereaks frOA') thlE: grade and the grado ef Ihe langont portion of tRe surb
at tho PCR shall not exceeE! 1 ~/.. The cure return shall be aesigned in a
~
(19) The maximum grade along the curb of a curb return measured from PCR to
PCR shall not exceed e.% 3% and the sisewalk in all places pedestrian
pathwav within the curb ramp shall not exceed 8.33%. The 3% maximum
arade alona the curb return mav be exceeded as lona as the proposed
desian provides adeauate curb return arade breaks. aood drainaae. aood
drivina conditions. and complv with all applicable ADA reauirements to the
satisfaction of the City Enaineer.
(20) Lighted sag vertical curves, when sight distance requirements do not govern,
shall be of sufficient length to produce no perceptible acceleration. The
minimum length of vertical curve shall be L=1.2 AV2, where L is the length of
the vertical curve in feet, A is the algebraic difference in grades in decimal
and V is the design speed in miles per hour. This formula may be at
intersections for Residential and Class III Street classifications, or equivalent,
only if other design options are not feasible.
(21) The safe speed of vertical curves, as designed, shall be shown on the plans
(V=X mph (or kph) and should equal or exceed the design speed for the
classification of the road.
(22) In new subdivisions and roadways, median drainage shall be provided per
CVD-ST11-Alternate A
(23) Bus Turnout Criteria - Bus turnouts should be considered if one or more of
the following factors are present:
a) Location convenient to park & ride facilities, intermodal transfer facilities,
and/or transfer facilities between bus services.
b) Location serves major pedestrian traffic generators (i.e. village centers,
shopping malls, schools, transit centers, hospitals, etc.)
c) Transit route dwell time exceeds 30 seconds.
d) Posted traffic speed limit is greater than 40 mph.
e) Bus volumes are 5 or more per peak hour.
f) Passenger volumes exceed 20 boardings per hour.
4-14
RESOLUTION NO.
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
APPROVING CHANGES TO THE CHULA VISTA CONSTRUCTION
STANDARDS AND SUBDIVISION MANUAL
WHEREAS, The Architectural and Transportation Barriers Compliance Board
(Access Board), is an independent federal agency devoted to accessibility issues
for people with disabilities. It is composed of representatives of disability groups,
the design professions, building code organizations and federal enforcement
agencies. Under the Americans with Disabilities Act (ADA), the Access Board is
charged with recommending accessibility guidelines to federal enforc=ent
agencies for all issues governed by the ADA. Once the Access Board
recommendations are adopted by the Department of Justice (DOJ), the guidelines
serve as the basis for enforceable standards for public agencies subj ect to the
ADA and the Architectural Barriers Act (ABA); and,
WHEREAS, In July of 2004, the Access Board published proposed accessibility
standards to update the standards adopted by the DOJ in 1994. The proposed
guidelines represent the cumulative efforts of the Access Board and a broad cross-
section of interested parties. After adoption, the standards were published for an
extended period for public review and comment before final publication by the
Access Board; and,
WHEREAS, Before publishing the final guidelines, the Access Board reviewed
over 2,500 comments received during the public comment period and
incorporated many of these recommendations into the guidelines. The proposed
guidelines have now been accepted by the DOJ and published as an Advanced
Notice of Proposed Rule Making (ANPRM). They are now undergoing an
additional period of public review and comment; and,
WHEREAS, The first Americans with Disabilities Act Accessibility Guidelines
(ADAAG) were adopted by the DOJ in 1994 and have served as guidance for the
City in all of its construction standards. The proposed changes to existing City
standards regarding curb ramp design are consistent with those guidelines and
also incorporate some recommendations from the Access Board's proposed
ADA/ABA Accessibility Guidelines and draft Public Rights-of-Way guidelines;
and,
WHEREAS, The Access Board's recommendations are not yet enforceable
regulations under the ADA. Nevertheless, staff recommends the City incorporate
some of the proposed changes now in anticipation of the various federal agencies
(including DOT and DOJ) ultimately approving the Access Board's
recommendations; and,
4-15
SECTION 1. NOW, THEREFORE, BE IT RESOLVED that the City
Council of the City of Chula Vista does hereby approves the changes to the Chula
Vista Construction Standards and Subdivision Manual attached hereto as Exhibits
"A" and "B", respectively.
Presented by:
Approved as to form by:
Sohaib Al-Agha
City Engineer
~
~ Moore
City Attorney
H:\ENGINEERIRESOSlResos2005\11-22-05IADA Changes Resolution.doc
.
.
4-16
.,
EXHIBIT ~
,
.'
. .
Monciithic curb if specified or required
~:,
,<>
~~
~
IE. of Retum
30Smm (12 in.) wide border with
6.35mm (1/+ in.) grooves approx.
19,1mm (3/+ in.) O.C.
1',-
Umit of ConstructionJ '-'-. '-.
Face of Curb
NOTE
1.22m
+ It) Z
t..:A
PlAN - rtPE A
Z
Up of Gutter
1. See Drawing eves- 29 for general notes.
2. For truncated domes detens, please see
Drowing CVCS-29.
3. Lending cross slope ond longitudinol slope shall be 2%.
+. Z side slape shall be 1 0: 1.
Monolithic curb if
specified or required
. rA 1.22m (+ It) Minim~
Transition cree:
R/W
305mm (12 in.) wide border with
6.35mm (1/+ in.) grooves approx.
19.1mm (3/+ in.) D.C.
R/W
Z + ft. Z Up (toe)
LA of gutter
PlAN
Top of curb
. .
"' '. " '. '. "' '. .
...., '. ....,...
'., '.. '.' '" '._ "_ '0' '._
Curb
ELEVATION
1YPE 8
Gutter flow
line
..
Curb
152mm
(6 in.)
122m, (+ ft.) min
--j Londing 30Smm.
... I 27.:1 (12 in.)
2:: Min
8.33:: Max
57. maximum gutter
apron slope at ramp
opening
Sidewalk
R/W
"
......,.
See Detaii 8
CVCS-29
See Type 8
Tnuncated
domes
SECTION A-A 609.6 mm
(2 ft)
NOTE
See Standard Drawing CVCS-29 for genera! notes.
Revised:
CITY ENGmEER Date:
CITY OF C HULA VISTA
PUB LlC WORKS DEPARTMENT
C URB RAMP-TYPES A and B eves
(New Construction) 25
4-17
.S
E::E '" '.'
N .5.'.
N..;.J "'0 .'
- "
"'-..;t ..5,.'
I' Landing , I
,.-A
.1
.,",'
"'"
a
;0
"
:c
UJ
z
1.22 m (4 ft.)
'-A
PLAN
1.22 m (4 ft.)
Transition area
Truncated dames
'"
"
:;:;
rn
'x
W
304,8 mm (12 in.)
wide border with
6.35 mm (1/4 in.)
grooves, 1 9.1 mm
(3/4 in.) O.C.
..................
..................
..................
..................
.................
z
Face of curb
Lip (toe) of Gutter
Tap of curb
Gutter ,flow line
'.
ELEVATION
1.22 m (4 ft.) min.
5% max. gutter
apron slope at
ramp opening
2% Max
2% Min
8..3.3% Max.
2' truncated
domes
Existing Pavement
'~ ' ," . .
...., ..' '" , ,A .
'PO:""'. .
,",' '.
--
--
4" Thick Min
SECTION A-A
Concrete
NOTES
1. See Standard Drawing CVCS-29 for general notes.
2. Type A-1 is a designation for ramp at curb return.
.3. Type B-1 is a designation for ramp at straight curb (shown abave).
4. Landing cross slope ond longitudinal slope shall be 2% max.
5. For truncated domes details, please see CVCS-Zg.
6. Z side slope shall be 10: 1.
Revised:
CITY
PUB LlC
OF C HULA VISTA
WORKS DEPARTMENT
eves
26
& B-1
existing Sidewalk)
CITY ENGINEER Date:
C URB RAMP-TYPE A-1
(For
12" wide border
See Detail A
CVCS-29
CT
Truncated domes
;t.
. .
CT
5% max gutter
opron slope. at
romp opening
2' truncated
dames
.~ .
--
, .
"~
See Detail 8
CVCS-29
Ai
t
r ~
............
............
::::::::::::
4'
A.+-J
PlAN
;t.
ELEVATION
t>
. .
.
Monolithic Curb
Meet sidewalk elevation
Back of Sidewalk
. I
Face of curb
(toe) of gutter
2.1. \A',n
~",,,, \Aa".
8..,)...J/. ~
......
Top of curb
.~---': ~:
;l>: ;b
. .
.
4'
CT
. Gutter Flow Line
4' min. Landing
6" \
2% Max
.
t>
. '.
4" Thick Min.
SECTION A-A
NOTES
1. Type C ramps are only to be used to mitigate conditions where inadequate
right-of-way exists. Type C shall only be used with the approval of the City Engineer.
2. See Standard Drawing CVCS-29 for general notes.
3. Landing cross slope and longitudinal slape shall be 2% max.
4. For truncated domes, piease see CVCS-29.
5. CT Curve Transition slope shall be 8.33% maximum.
Revised:
date:
Date:
CITY ENGINEER Date:
CITY
PUBLIC
OF C HULA VISTA
WORKS DEPARTMENT
eves
C URB RAMP-TYPE C
?7A
CURB
HEIGHTf.-f
t
12" WIDE BDRDER WITH 1/4"
GROOVES APPROK 3/4" O.C.
STANDARD SIDEWALK FlNISH
","~r:o
~<;~
~"-"-4<;;"f;J
TRUNCATED DDME
A-J
1::;";;~~:=r1
TRANSITION FROM 5:>:
TO EXISTING CURB
APRON SLOPE.
12:1
12: 1
4'
~'""~I
.' ....~~...~ \..
CLRB f
REMOVE 01< REPLACE ASPHALT
TO PROVIDE 5:>: MAX. SLOPE
IIITHIN 4' Of RAMP.
GUTTER
4' LANDING MIN.
12
1=-
. .
','
4"
1/Z" RADIUS
2' RAMP
SECTION A-A
NOTES:
1. T]?e C ramps are only to be used to mitigate conditions where inadequate right-of-way
. exist.. T)'Pe C shall only be used with the apprall<ll at the City Engineer.
2. See CVCS-Z9 tor General Note..
3. Lending cross slope and longitudinal slope shall be 2?- maximum.
4. For tn.Jncated domes, please see CVCS-29.
5. CT Curve Transition slope shall be 8.331. mcximum.
NOT TO SCALE
CITY OF -CHULA VISTA
PUBUC WORKS DEPARTMENT
PEDESTRIAN RAMP DETAIL
TYPE "e" MODIFIED
date: 3-23-94
Date: 6-21-01
CITY ENGINEER Date:
o
eves
278
2'(min.)~s: ,<:>,.......::,
. . .
..':.....'.....:.... :.....,..
. c
..;- .-
E
Monolithic curb
4'(min.)
See Note #2 R W
>-.
"
Existing Non-contiguous
Sidewalk
4'
<(
Truncated domes
Street
TYPICAL PLAN
Truncated domes
The ramp side flares and
grooves may be eliminated by the
Engineer and replaced by a
monolithic curb ~ush with the
existing ground and sidewalk.
A
~
12" wide 'border
See Detail C
CYCS-29
PLAN VIEW
5% max gutter \.
apron slope at
ramp opening
--
2' trun cated
domes
2% Min.
8.33% Max. I
4' min. Landing
2% Max
--
. I> .
I>
I> I>
. I> .'
L 4" Thick
I>
Min.
See Detail B
CYCS-29
SECTION A - A
NOTES
1. See CYCS-29 for general notes.
2. Landing cross slope and longitudinal slope shall be 2% max.
3. For truncated domes details, see CYCS-29.
Revised:
CITY OF C HULA
PUB Lie WORKS
VISTA
DEPARTMENT
CURB RAMP - TYPE D
eves
28
CITY ENGINEER Date:
ee note #6
.....,',1>.
,1>" "."
Remove & reconstruct
pavement as shown on
plans to provide 57.
max. slape within 4' of
sidewalk limit.
4' - 0" min.
Landing
12" wiqe border
with 1/4 groove. Line of Curb
aj,roxlmately 2~ .
3 4' 0 C /D Mm.
. . 8.337. Max.
A
Truncated domes
12"
B 2~ A.
~<VJj~:
~~
"'"
"5_
" .-
~ E
~:J
If)
5.0% m~
-
\ \
t> \ >, \
, b'
,t:>
, '
DETAIL A
12" wide border
DET AD. B
..
NOTES
1. Far construction of Curb Ramps on existing sidewalks, removal of additional
sidewalk maybe required to comply with ADA requirements to meet the existing grade.
2. Areas shown thus: I I shall hove c medium to heavy broom
texture finish, perpendicular to the axis of the ramp.
3. Areas shawn thus: I:'!i{:';~:<l are the minimum required for a complete ramp
"instaliatian and shall be concrete class 520-C-2500.
4. If obstructions such as .inlets, utility poles, fire hydrants. etc., are encountered, the ramp
locations may be adjusted upon the approval of the Resident Engineer or Local Agency Inspector.
No utility box covers, grades, etc. shall be allowed within the ramp area and landing.
5. Adjoining slape beyond ramp shall not exceed 20: 1 (57.).
6. Landing crass slape and longitudinal siope shall be 27. max except at mid-black curb ramps.
7. All projects (new construction & alteration), the lower end of 48-inch width of the ramp shall
be flush and free of abrupt changes between the bottom of the ramp and the street
pavement surface.
8. There shal! be a minimum of 6-inches and a maximum of 8-inches separation between the face
of the curb and any given point of the nearest edge of the truncated domes.
g. The ramp longitudinal slape sha"il be 27. minimum and 8.337. maximum. Design of the ramp shall
not exceed 7.5% to ensure that the constructed slope does not exceed 8.33%. Ramp cross-slope
shall be 2% J"Tlaximum.
10. Exceptions may be allowed in existing construction and alterations upon City Engineer approval that
full compliance is technica!ly infeasible.
Revised:
CITY
PUB LlC
CITY ENGINEER Date:
GENERAL NOTES
FOR CURB RAMPS
OF C HULA VISTA
WORKS DEPARTMENT
eves
29
SHED' \ OF'.%.
Revised:
E
E
c:
0'-
-'..,.
"'N
00
~-
E .
E.!:
'"
~.,...;
o~
..,.
DETAIL 1
1219,2 mm 4 ft.
UNCATED DOMES @ 40.6 mm to 61.0 mm SPACING C
'.6 in. to 2.4 in.
@@@@@@@@@@@@@@@@@@@@@@@@
@@ @@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@@
@@@@@@@@@@@@@@@@@@@@@@@@@@@
E .::::.
" U
E E'"
C '" E~
'E UJ OU
'" .<
0 -0-
C "''''
~ c o~
N ~ -,5
< E..,.
U E .
E :z '"
=> ",0
E f" c-
..,.
'" c.,E
.,;
0 "'
'"
40.6 mm to 61.0 mm
1.6 in. to 2.4 in.)
16.5 mm
0,65 in)
Minimum
E . E
E''; "
E
u:~ 'c
~o SE
PLAN - TILE
NOT TO SCALE
NOTES
1. Detectable warning surface calor shall be yellow
conforming to federal standards 5958 Table IV, calor
No. 33538. '
Color shall be homogeneous throughout the tile.
2. Truncated dome top diameter af 507. of the base
diameter minimum to 65% of the base diameter maximum.
3. During and after the tile installation and the concrete
curing stoge, .it is imperotive that there is no walking,
leaning or external forces p!aced on the tile to rock
the tile, causing a void between the underside of tHe
cnd concrete. .
4. The truncated dome shall be Armour Tile or an opproved
equivalent.
See note # 2
12.7 mm (Yz in.) R
E
"
E
'c;-:'
.- c:
."'-
E~
E
o
DETAIL 1
NOT TO SCALE
OTE:
PATTERN, SIZE &
ORIENTATION ARE
PER MANUF ACTLRER'S
RECOMMENDATION
22.9 mm to 35.6 mm
(0.90 in. to 1.4 in.)
CITY ENGINEER Date:
CITY OF
PUBLIC
..
.
"
'"
a
note # 3
CHULA VISTA
WORKS DEPARTMENT
eves
29
TRUNCATED DOME
~IIFI
EXHIBIT B
SUBDIVISION MANUAL
SECTION 3: GENERAL DESIGN CRITERIA
Section 3-400 Page 13
Revised 11/14/2005
c) A turnaround shall be provided at the location of the gate. The size and
location of said turn-around and gate, shall be approved by the City
Engineer.
(8) CornfJound curves shall not be allowed.
(9) The maximum centerline grade for permanent cul-de-sac streets within the
turnaround area shall be 5%, the maximum centerline grade for temporary
cul-de-sacs shall be 8%.
(10) The minimum gutter grade in the turn around segments of cul-de-sacs shall
be 1%.
(11) The maximum longitudinal street grade or cross slope at 90 degrees to a
cross gutter shall be 3% for 25 feet (8m) from any edge of the cross gutter.
This grade may be increased at residential intersections, subject to approval
of the City Engineer, if the intersection is designed as a maximum
comfortable acceleration sag vertical curve designed for a minimum speed of
25 mph (40kph) [i.e., Length of vertical curve = 3.125 feet x Difference in
approach grades] and the maximum cross slope in any driving iane is 5%.
(12) The maximum grade at any intersection of two streets shall be e.% 4% within
the intersection and for at ieast 50 feet f-t7m1 (15m) past the nearest curb
lines of the intersecting street as long as all applicable ADA requirements fef
s;idoWQII~s, oto. are met to the satisfaction of the City Enqineer. The City
Enqineer mav approve an increase of this qrade to 6% maximum. on a case
bv case basis. takinq into consideration each proiect's unique conditions as
lono as all applicable ADA requirements are met to the satisfaction of the City
Enoineer.
(13) Pavement cross slopes shall be in accordance with CVDS 1 through 4. The
minimum cross slope shall be 2% except at intersections where the cross
slope may be reduced to 1%. The maximum cross slope shall be 5% on any
street whose cross section varies from said construction standards.
(14) Portland Cement Concrete monolithic curbs, gutters, and sidewalks are
required along all streets with the exception that the City Engineer may
approve reduction of sidewaik requirements in those areas that are deemed
unnecessary by the City Engineer.
(15) Pedestrian ramps in accordance with the San Diogo Rogional City of Chula
Vista Standard Drawings shall be constructed in the following locations on all
streets unless otherwise approved by the City Engineer:
a) All curb returns
b) At t-intersections opposite one curb return.
(16) Driveway approaches for all residential and commercial applications shall
conform to CVCS1, unless otherwise approved by the City Engineer.
4-24
SUBDIVISION MANUAL
SECTION 3: GENERAL DESIGN CRITERIA
Section 3-400 Page 14
Revised 11/14/2005
(17) Cross gutters will not be allowed at signalized intersections unless otherwise
approved by the City Engineer.
(18) Curb returns shall so checkes for constrlJstability. WheR tho fOrFr-Is OrG
"war!3od" in the fiels, it will result iR sovere ~rGso brGaks, sas araina!je, ORa a
poor ari'Jin!j lano. Tho calculated PI of tho surb return shall so deterFRIRod
From the extendoa curb !jraao of the malR street. The str3i~ht !jrado from tho
PCR te the calclJlatea PI of the clJrb return SA:311 be shown on the plan. The
!jmde breahs froFR this !jrase and the ~raae of the tangent portion of the curb
at tho PCR sAall not excoes 1 ~/". The slJrb return shall be desl~nes iR a
~
(19) The maximum grade along the curb of a curb return measured from PCR to
PCR shall not exceed e.% 3% and the sisowall< in 011 !3laoee pedestrian
pathwav within the curb ramp shall not exceed 8.33%. The 3% maximum
orade alono the curb return mav be exceeded as lone as the proposed
desion provides ade~uate curb return orade breaks. oood drail9aoe. oood
dr/vino conditions. and comply with all applicable ADA reouirements to the
satisfaction of the City Enoineer.
(20) Lighted sag vertical curves, when sight distance requirements do not govern,
shall be of sufficient length to produce no perceptible acceleration. The
minimum length of vertical curve shall be L=1.2 AV2, where L is the length of
the vertical curve in feet, A is the algebraic difference in grades in decimal
and V is the design speed in miles per hour. This fonmula may be at
intersections for Residential and Class III Street classifications, or equivalent,
only if other design options are not feasible.
(21) The safe speed of vertical curves, as designed, shall be shown on the plans
(V=X mph (or kph) and should equal or exceed the design speed for the
classification of the road.
(22) In new subdivisions and roadways, median drainage shall be provided per
CVD-ST11-Alternate A
(23) Bus Turnout Criteria - Bus turnouts should be considered if one or more of
the following factors are present:
a) Location convenient to park & ride facilities, intermodal transfer facilities,
and/or transfer facilities between bus services.
b) Location serves major pedestrian traffic generators (I.e. village centers,
shopping malls, schools, transit centers, hospitals, etc.)
c) Transit route dwell time exceeds 30 seconds.
d) Posted traffic speed limit is greater than 40 mph.
e) Bus volumes are 5 or more per peak hour.
f) Passenger volumes exceed 20 boardings per hour.
4-25
Page 1, Item 5
Meeting Date: 11/22/05
COUNCIL AGENDA STATEMENT
ITEM TITLE: FORMATION OF THE COMMUNITY FACILITIES DISTRICT
A) Resolution of the City Council of the City of Chula Vista,
California, Acting in Its Capacity as the Legislative Body of Community
Facilities District No. 13-1 (Otay Ranch Village Seven) Declaring the Results
of a Special Election in Such Community Facilities District
B) Ordinance of the City ofChula Vista, California, Authorizing
the Levy of a Special Tax in Community Facilities District No. 13-1 (Otay
Ranch Village Seven)
SUBMITTED BY:
City Engineer ~~
City Manager .f ~ 1R
&4
REVIEWED BY:
(4/Sths Vote: Yes_NoX)
On September 13, 2005 Council approved the Resolution of Intention to establish Community
Facilities District No. 13-1 (CFD No. 13-1) and set the public hearing for October 25,2005. On
October 25,2005 the Council considered the approval of two Resolutions: 1) to form and establish a
Community Facilities District No. 13-1 and 2) declaring necessity to incur bonded indebtedness. On
November 1,2005 a special election of eligible property owners was held at the City Clerk's office
for the purpose of voting on the formation of the CFD No. 13-1.
Tonight's action will continue the formal proceedings by (a) certifying the election results, and (b)
introducing and waiving the first reading of the ordinance authorizing the levy of special taxes within
CFD No. 13-1.
BOARDS/COMMISSIONS RECOMMENDATION: Not applicable.
RECOMMENDATION: That Council:
. Approve the Resolution acting in its capacity as the legislative body of
Community Facilities District No. 13-1 (Otay Ranch Village Seven), declaring the
results of a special election in such Community Facilities District.
. Introduce the first reading of the ordinance, authorizing the levy of a special tax
in such Community Facilities District.
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Page 2, Item.S
Meeting Date: 11/22/05
Backe:round
As noted before, on October 25,2005, Council held a public hearing pertaining to the formation of
CFD No. 13-1, the levy of special taxes within and the necessity to incur a bonded indebtedness of
the district. Following the public hearing, Council adopted resolutions that made preliminary
findings, passed upon the protests, approved the Special Tax Report and formed CFD No. 13-1. This
action authorized the submittal, to the qualified electors within CFD No. 13-1, of ballot measures to
authorize the levy of special taxes within CFD No. 13-1, authorize the issuance of bonds ofCFD No.
13-1 and establish an appropriations limit for CFD No. 13-1.
The public hearing was held pursuant to the provisions of the "Mello-Roos Community Facilities
Act of 1982." Community Facilities Districts such as CFD No. 13-1 provide the necessary funding
mechanism for the acquisition or construction of public improvements by levying an annual "special
tax," which is collected from the property owners in conjunction with the property taxes.
On November I, 2005, in the City Clerk's office, the City Clerk, acting as the election official,
conducted a special election and the qualified electors of CFD No. 13-1 (i.e., the owners of land
within the district) voted to authorize the levy of special taxes on property of CFD No. 13-1, to
authorize the issuance of bonds ofCFD No. 13-1, and to establish an appropriations limit for CFD
No. 13-1. The City Clerk and the Special Tax Consultant presided over the proceedings, verified the
eligible voters, verified signatures, and presented the election ballots. The results of the special
election show 100% of the votes were cast in favor of authorizing the levy of the proposed special
tax, the issuance of the bonds secured by such special taxes and the establishment of an
appropriations limit for CFD No. 13-1.
There is no direct cost to the City. The expenses related to district administration (including levying
and collecting the special taxes) will be funded by CFD No. 13-1. The ultimate security for the bonds
are the properties located within the district, not the City's General Fund or its ability to tax property
within itsjurisdiction. CFD No. 13-1 has been formed in conformance with the "City ofChula Vista
Statement of Goals and Policies Regarding the Establishment of Community Facilities Districts"
(CFD Policy) as adopted on January 13,1998 and amended on July 28,1998.
CFD No. 13-1 is consistent with established ordinances and Council Policies. In addition, staff has
met with the developer to discuss their concerns, clarify the intent of the policies and ordinances, and
review the methodology for the apportionment ofthe special taxes. All of the issues raised by the
developer have been discussed and solutions, satisfactory to all parties, have been incorporated in the
"Amended Rate and Method of Apportionment" (RMA).
The Resolution and Ordinance
There is one Resolution and one Ordinance on today' s agenda, which, if adopted, will accomplish
the following:
A) The Resolution will declare and certify the results of a special election for Community Facilities
District No. 13-1 (Otay Ranch Village Seven).
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Page 3, Item 5
Meeting Date: 11/22/05
B) The Ordinance is the first reading of an Ordinance by the City authorizing the levy of a special tax
in CFD No. 131.
Notice
The property owners within the district were notified of the election and voting procedures that took
place on November 1,2005 in the City Clerk's office. The summary of the ordinance has been
prepared by the City Clerk and will be published in an adjudicated newspaper of general circulation
between the first and second reading of the ordinance for CFD No. 13-1.
Future Actions
On December 6,2005 the City Clerk shall place the second reading on the City Council's agenda and
upon approval, the City Clerk will then cause the publication of a public notice of the Ordinance,
specifying the approval, formation and levy of a special tax. In early 2006, the City Council will
consider hearing the formal actions approving the necessary bond documents pertaining to CFD
No.13-I. These documents will be the Preliminary Official Statement, Bond Indenture, Market
Absorption Analysis, Appraisal, Acquisition Financing Agreement and other pertinent documents
related to the bond sale.
Fiscal Impact:
There will be no direct fiscal impact to the City. 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 developer will pay the full cost of staff time for district formation
and administration activities. Staff anticipates that most of CFD No. 13-1 administration will be
contracted out. CFD No. 13-1 administration cost is estimated at $75,000 annually.
In accordance with the CFD Policy, as consideration for the City's agreement to use the City's
bonding capacity to provide the financing mechanism for the construction of the proposed
improvements, the developer will pay one percent (I %) of the total bond authorization. Said
requirement will be memorialized in the AcquisitionlFinancing Agreement. Based on a bond sale
amount of $15.7 million said monetary compensation would be $157,000. Said amount shall be paid
prior to bond sale (scheduled for early 2006) and will be deposited into the General Fund. The CFD
Policy also stipulates that said compensation is not eligible for financing by CFD No. l3-I.
Attachment
Exhibit A - Amended Rate and Method of Apportionment for CFD No. 13-1
J:IEngineerIAGENDAICAS2005111-22-05ICFD 131lCAS _ CFD 131.doc
5-3
WBD1320170 1
EXHIBIT A
AMENDED RATE AND METHOD OF APPORTIONMENT FOR
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 13-1
(OTAY RANCH VILLAGE SEVEN)
A-I
5-4
AMENDED RATE AND METHOD OF APPORTIONMENT
FOR CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 13-1
(Otay Ranch Village 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. 13-1 (CFD No. 13-1)
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. 13-1, 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 of California.
"Administrative Expense Requirement" means an annual amount equal to $75,000, or
such lesser amount as may be designated by written instruction from an Authorized
Representative 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. 13-1 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 of remitting 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.
13-1 or any designee thereof of complying with arbitrage rebate requirements; the costs to
the City, CFD No. 13-1 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. 13-1 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
City of Chu/o Vista
Community Facilities District No. J 3-1
Otay Ranch Vil/a?;e Seven
5-5
August 30, 2005
Amended October 3. 2005
PO?;, /
Expenses shall also include amounts estimated or advanced by the City or CFD No. 13-1
for any other administrative purposes, 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 Indenture.
"Backup Special Tax" means the Backup Special Tax amount set forth in Section C.1.b.
"Bonds" means any bonds or other debt (as defined in the Act), whether in one or more
series, issued by CFD No. 13-1 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. 13-1" means City of Chula Vista, Community Facilities District No. 13-1.
"City" means the City of Chula Vista.
"Community Purpose Facility Property" means all Assessor's Parcels which are (a)
classified as community purpose facilities and meet the requirements of City of Chula Vista
Ordinance No. 2002-2883 as amended on November 5, 2002 or (b) designated on an "A"
Map or a Final Subdivision Map as a community purpose facility.
"Contingent Taxable Property" means all Assessor's Parcels of Public Property, Property
Owner Association Property, Community Purpose Facility Property, Open Space or other
property that would otherwise be classified as Exempt Property pursuant to the provisions
City of Chula Vista
Community Facilities District No. J 3-1
Otay Ranch VillaRe Seven
5-6
August 3D, 2005
Amended October 3, 2005
PaRe 2
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.I for Zone A or Zone B as applicable.
"Council" meaos the City Council of the City, acting as the legislative body of
CFD No. 13-1.
"County" meaos the County of Sao 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.
"Exempt Property" meaos all Assessors' Parcels that are exempt from the Special Tax
pursuaot 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 pursuaot to
the Subdivision Map Act (California Government Code Section 66410 et seq.) or
recordation of a condominium plao pursuaot 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" meaos the period starting July I aod ending on the following June 30.
"Indenture" meaos the indenture, fiscal agent agreement, trust agreement, resolution or
other instrument pursuaot to which Bonds are issued, as modified, amended aod/or
supplemented from time to time, and aoy instnunent replacing or supplementing the same.
"Land Use Class" meaos aoy of the classes listed in Table I of Section C.I.a.
"Lot(s)" meaos an individual legal lot created by a Final Subdivision Map for which a
building permit for residential construction has been or could be issued. Notwithstaoding
the foregoing, in the case of ao individual legal lot created by such a Final Subdivision Map
upon which condominium units are entitled to be developed but for which a condominium
plao 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 shall 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
accordaoce with the provisions of Section C, which may be levied in aoy Fiscal Year on
aoy Assessor's Parcel of Taxable Property.
City of ChuZa Vista
Community Facilities District No. j 3-1
Otay Ranch Villa!?e Seven
5-7
August 30. 2005
Amended October 3. 2005
Fa!?e 3
"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. 13-1 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. 13-1 which is (a) owned by a property owner association or (b) designated with
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. 13-1. 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. 13-1.
"Public Property" means any property within the boundaries of CFD No. 13-1 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 of living area within the
perimeter of a residential structure, not including any carport, walkway, garage, overhang,
patio, enclosed patio, or similar area. The determination of Residential Floor Area shall be
made by the CFD Administrator by reference to appropriate records kept by the City's
City of Chula Vista
Community Facilities District No. 13-1
Otay Ranch Villa~e Seven
5-8
August 30. 2005
Amended October 3. 2005
Pa~e 4
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. 13-1 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 financed
by CFD No. 13-1 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. 13-1; less (vi) a credit
for Available Funds.
"State" means the State of California.
"Taxable Property" means all of the Assessor's Parcels within the bOlmdaries of
CFD No. 13-1 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. 13-1 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.
City of Cht/la Vista
Community Facilities District No. J 3-1
Otay Ranch Villa!?e Seven
5-9
At/gust 30. 2005
Amended October 3. 2005
PaRe 5
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 I or (2) the Backup Special Tax computed pursuant to b. on
next page.
a. Assi!!oed Special Tax
The Assigned Special Tax for each Assessor's Parcel of Developed Property is
shown in Table 1.
TABLE!
Assigned Special Tax for Developed Property
within Zone A and Zone B
Land Use
Class DescriDtioo Assi!med Special Tax
$2,750 per unit plus $.45 per
I Residential Property square foot of Residential Floor
Area
2 Non-Residential $6,000 per Acre
Propertv
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
$59,505 x A
B=
------------------------
L
City of Chula Vista
Community Facilities District No. 13-[
Otay Ranch Villa?,e Seven
5-10
August 30, 2005
Amended October 3, 2005
Pa?,e 6
Zone B
$37,818 x A
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 $59,505 for Zone A and $37,818 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.
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 $59,505 per Acre for Zone A and
$37,818 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.
City of Chula Vista
Community Facilities District No. /3-/
Otay Ranch Villa!?e Seven
5-11
August 30. 2005
Amended October 3. 2005
Pa!?e 7
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
1. The CFD Administrator shall classify the following as Exempt Property: (i)
Public Property, (ii) Property Owner Association Property, (iii) Community
Purpose Facility Property (iv) Open Space and (v) Assessor's Parcels with public
or utility easements making impractical their utilization for other than the
purposes set forth in the easement; provided, however, that no such classification
shall reduce the sum of all Taxable Property to less than 10.56 Acres for Zone A
and 20.81 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 10.56 Acres for Zone A and 20.81 Acres for Zone B
will be classified as Contingent Taxable Property and shall be taxed pursuant to
the fourth step of Section D. Exempt status for purposes of this paragraph will be
assigned by the CFD 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
City of Chu/a Vista
Community Facilities District No. 13-[
Otay Ranch Villa!!:e Seven
5-12
August 30, 2005
Amended October 3, 2005
Pa!!:e8
which is classified as Contingent Taxable Property pursuant to E.I above shall be
prepaid in full by the seller pursuant to Section H.l, 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.I. 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 CFD Administrator regarding such
error. If following such consultation, the CFD Administrator determines that an error has
occurred; the CFD Administrator may amend the amount of the Special Tax levied on such
Assessor's Parcel. If following such consultation and action (if any by the CFD
Administrator), the landowner or resident believes such error still exists, such person may
file a written notice with the City Clerk of the City 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 of CFD No. 13-1 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. 13-1, may directly
bill the SpeCial Tax, may collect Special Taxes at a different time or in a different manner
if necessary to meet its financial obligations, and may covenant to foreclose and may
actually foreclose on Assessor's Parcels of Taxable Property that are delinquent in the
payment of SpeCial Taxes.
Tenders of Bonds may be accepted for payment of Special Taxes upon the terms and
conditions established by the Council pursuant to the Act. However, the use of Bond
tenders shall only be allowed on a case-by-case basis as specifically approved by the
Council.
City oJChuZa Vista
Community Facilities District No. 13-/
Otay Ranch Villa"e Seven
S-13
August 30, 2005
Amended October 3, 2005
Pa"e 9
H. PREPAYMENT OF SPECIAL TAX
The following definition applies to this Section H:
"CFD Public Facilities" means those public facilities authorized to be fmanced by
CFD No. 13-1.
"CFD Public Facilities Costs" means either $ 15.5 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.
City of Chula Vista
Community Facilities District No. 13-1
Otay Ranch Village Seven
5-14
August 30. 2005
Amended October 3, 2005
Pa"e 10
The Prepayment Amount (defined below) shall be calculated as summarized below
(capitalized tenns as defmed below):
Bond Redemption Amount
plus Redemption Premium
plus Future Facilities Amount
plus Defeasance Amount
plus Prepayment Fees and Expenses
less Reserve Fund Credit
less Capitalized Interest Credit
Total: equals Prepayment Amount
As of the proposed date of prepayment, the Prepayment Amount (defined below) shall be
calculated as follows:
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 Ta:'( for tbat Assessor's Parcel as though it was already designated as
Developed Property, based upon the building pennit 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 1 by tbe sum of
the total expected Maximum Annual Special Tax revenues which may be levied
within CFD No. 13-1 excluding any Assessors Parcels for which tbe 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 autborized to be issued for CFD No. 13-1 have not been issued, then
compute the Future Facilities Costs.
6. Multiply tbe quotient computed pursuant to step 2 by tbe amount detennined
pursuant to step 5 to compute the amount of Future Facilities Costs to be allocated to
such Assessor's Parcel (the "Future Facilities Amount").
City of Chula Vista
Community Facilities District No. 13-1
Otay Ranch Village Seven
5-15
August 30, 2005
Amended October 3, 2005
Page 11
7. Compute the amount needed to pay interest on the Bond Redemption Amount ITom
the first bond interest and/or principal payment date following the current Fiscal
Year until the earliest redemption date for the Outstanding Bonds.
8. Confirm that no Special Tax delinquencies apply to such Assessor's Parcel.
9. Determine the Special Taxes levied on the Assessor's Parcel in the current Fiscal
Year, which have not yet been paid.
10. Determine the fees and expenses of CFD No. 13-1, including but not limited to, the
costs of computation of the prepayment, the costs to invest the prepayment proceeds,
the costs of redeeming Bonds ITom the proceeds of such prepayment, and the cost of
recording any notices to evidence the prepayment and the redemption (the
"Prepayment Fees and Expenses").
11. Compute the amount the CFD Administrator reasonably expects to derive ITom the
reinvestment of the prepayment amount less the Prepayment Fees and Expenses, as
determined pursuant to step 10, ITom the date of prepayment until the redemption
date for the Outstanding Bonds to be redeemed with the prepayment.
12. Add the amounts computed pursuant to steps 7 and 9 and subtract the amount
computed pursuant to step 11 (the "Defeasance Amount").
13. The reserve fund credit (the "Reserve Fund Credit") shall equal the lesser of: (a) the
expected reduction in the reserve requirement (as defined in the Indenture), if any,
associated with the redemption of Outstanding Bonds as a result of the prepayment,
or (b) the amount derived by subtracting the new reserve requirement (as defined in
the Indenture) in effect after the redemption of Outstanding Bonds as a result of the
prepayment ITom 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. 13-1. The
amount computed pursuant to step 6 shall be deposited in the Construction Fund.
City of Chu/a Vista
Community Facilities District No. 13-[
Otay Ranch Vi/lage Seven
5-16
August 30, 2005
Amended October 3, 2005
Pa?;e 12
The Prepayment Amount may be sufficient to redeem other than a $5,000 increment of
Bonds. In such cases, the increment above $5,000 or integral multiple thereof will be
retained in the appropriate fund established under the Indenture to be used with the next
prepayment of bonds or to make debt service payments.
As a result of the payment of the current Fiscal Year's Special Tax levy as determined
under step 9 above, the CFD Administrator shall remove the current Fiscal Year's Special
Tax levy for such Assessor's Parcel 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. 13-1 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 H
1; except that a partial prepayment shall be calculated according to the following formula:
PP = (PE-A x F) + A
These terms have the following meaning:
PP = the partial prepayment
PE = the Prepayment Amount calculated according to Section H.I, 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.
City ofChula Vista
Community Facilities District No. 13-1
Otay Ranch Village Seven
~-17
August 30. 2005
Amended October 3. 2005
Page 13
With respect to any Assessor's Parcel that is partially prepaid, the City shall (i) distribute
the funds remitted to it according to Step 16 of Section H.I, and (ii) indicate in the records
ofCFD No. 13-1, 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.
1. TER1\1 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.
City of Chu/a Vista
Community Facilities District No. /3-1
Otay Ranch Villa!;e Seven
5-18
August 30. 2005
Amended October 3, 2005
Pa!;e /4
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("I
RESOLUTION NO.
RESOLUTION OF THE CITY OF CHULA VISTA, CALIFORNIA, ACTING
IN ITS CAPACITY AS THE LEGISLATIVE BODY OF COMMUNITY
FACILITIES DISTRICT NO. 13-1 (OTA Y RANCH VILLAGE SEVEN)
DECLARING THE RESULTS OF A SPECIAL ELECTION IN SUCH
COMMUNITY FACILITIES DISTRICT
WHEREAS, the CITY COUNCIL of the CITY OF CHULA VISTA, CALIFORNIA (the
"City Council"), has previously undertaken proceedings to create and did establish a Community
Facilities District pursuant to the terms and provisions of the "Mello-Roos Community Facilities
Act of 1982," being Chapter 2.5, Part 1, Division 2, Title 5 of the Government Code of the State
of California (the "Act") and the City of Chula Vista Community Facilities District Ordinance
enacted pursuant to the powers reserved by the City of Chula Vista under Sections 3, 5 and 7 of
Article XI of the Constitution of the State of California (the "Ordinance") (the Act and the
Ordinance may be referred to collectively as the "Community Facilities District Law"). This
Community Facilities District shall hereinafter be referred to as COMMUNITY FACILITIES
DISTRICT NO. 13-1 (OTA Y RANCH VILLAGE SEVEN) (the "District"); and,
WHEREAS, this City Council did call for and order to be held an election to submit to
the qualified electors of the District separate propositions relating to the levy of special taxes
within the District, the issuance of bonds to be secured by the levy of special taxes within the
District and the establishment of an appropriations limit for the District; and,
WHEREAS, at this time said election has been held and the measures voted upon and
each such measure did receive the favorable 2/3's vote of the qualified electors, and this City
Council desires to declare the results of the election in accordance with the provisions of the
Elections Code of the State of California.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CHULA VISTA,
CALIFORNIA, ACTING AS THE LEGISLATIVE BODY OF COMMUNITY FACILITIES
DISTRICT NO. 13-1 (OTAY RANCH VILLAGE SEVEN), DOES HEREBY RESOLVE,
DECLARE, FIND, DETERMINE AND ORDER AS FOLLOWS:
SECTION 1. The above recitals are all true and correct.
SECTION 2. This City Council hereby receives and approves the CERTIFICATE OF
ELECTION OFFICIAL AND STATEMENT OF VOTES CAST, as submitted by the City Clerk,
acting in her capacity as the Election official, said Statement setting forth the number of votes
cast in the election, the measures voted upon, and the number of votes given for and/or against
the measures voted upon. A copy of said Certificate and Statement is attached hereto, marked
Exhibit "A", referenced and so incorporated.
WBD\320168.1
5 - 2 01
SECTION 3. The City Clerk is hereby directed, pursuant to the provlSlons of the
Elections Code of the State of California, to enter in the minutes the results of the election as set
forth in said STATEMENT OF VOTES CAST.
PREPARED BY:
APPROVED AS TO FORM BY:
Sohaib Al-Agha
City Engineer
(~4)frI-(}<U!)
City omey
J:\attorneylreso\CFDlCFD 13-[ to Certify Election
WBD\320!68.!
5-212
EXHIBIT "A"
CERTIFICATE OF ELECTION OFFICIAL
AND STATEMENT OF VOTES CAST
STATE OF CALIFORNIA )
COUNTY OF SAN DIEGO ) ss.
CITY OF CHULA VISTA)
The undersigned, ELECTION OFFICIAL OF THE CITY OF CHULA VISTA, COUNTY OF SAN
DIEGO, STATE OF CALIFORNIA, DOES HEREBY CERTIFY that pursuant to the provisions of
Section 53326 of the Government Code and Division 12, commencing with Section 17000 of the
Elections Code of the State of California, I did canvass the returns of the votes cast at the
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 13-1
(OTA Y RANCH VILLAGE SEVEN)
SPECIAL ELECTION
in said City, held November 1, 2005.
I FURTHER CERTIFY that this Statement of Votes Cast shows the whole number of votes cast in said
District in said City, and the whole number of votes cast for the Measures in said District in said City,
and the totals of the respective columns and the totals as shown for the Measures are full, true and
correct.
1.
VOTES CAST ON PROPOSITION A:
YES
NO
2.
VOTES CAST ON PROPOSITION B:
YES
NO
3.
VOTES CAST ON PROPOSITION C:
YES
NO
WITNESS my hand this
day of
,2005.
CITY CLERK
ELECTION OFFICIAL
CITY OF CHULA VISTA
STATE OF CALIFORNIA
E~~~WBD\3201681
ORDINANCE NO.
ORDINANCE OF THE CITY OF CHULA VISTA, CALIFORNIA
AUTHORIZING THE LEVY OF A SPECIAL TAX IN COMMUNITY
FACILITIES DISTRICT NO. 13-1 (OT A Y RANCH VILLAGE SEVEN)
WHEREAS, the CITY COUNCIL of the CITY OF CHULA VISTA, CALIFORNIA (the
"City Council"), has initiated proceedings, held a public hearing, conducted an election and
received a favorable vote from the qualified electors authorizing the levy of special taxes in a
community facilities district, all as authorized pursuant to the te=s and provisions of the
"Mello-Roos Community Facilities Act of 1982", being Chapter 2.5, Part 1. Division 2, Title 5
of the Government Code of the State of California (the "Act") and the City of Chula Vista
Community Facilities District Ordinance enacted pursuant to the powers reserved by the City of
Chula Vista under Sections 3, 5 and 7 of Article XI of the Constitution of the State of California
(the "Ordinance") (the Act and the Ordinance may be referred to collectively as the "Community
Facilities District Law"). This Community Facilities District is designated as COMMUNITY
FACILITIES DISTRICT NO. 13-1 (OTA Y RANCH VILLAGE ELEVEN) (the "District").
The City Council of the City of Chula Vista, ordain as follows:
SECTION 1. This City Council does, by the passage of this ordinance, authorize the
levy of special taxes on taxable properties located in the District pursuant to the Amended Rate
and Method of Apportionment of Special Taxes as set forth in Exhibit "A" attached hereto and
incorporated herein by this reference (the "Amended Rate and Method of Apportionment").
SECTION 2. This City Council, acting as the legislative body of the District, is hereby
further authorized, by Resolution, to annually dete=ine the special tax to be levied within the
District for the then current tax year or future tax years; provided, however, the special tax to be
levied shall not exceed the maximum special tax authorized to be levied pursuant to the
Amended Rate and Method of Apportionment.
SECTION 3. The special taxes herein authorized to be levied, to the extent possible,
shall be collected in the same manner as ad valorem property taxes and shall be subject to the
same penalties, procedure, sale and lien priority in any case of delinquency as applicable for ad
valorem taxes; provided, however, the District may utilize a direct billing procedure for any
special taxes that cannot be collected on the County tax roll or may, by resolution, elect to collect
the special taxes at a different time or in a different manner if necessary to meet its financial
obligations.
SECTION 4. The special taxes authorized to be levied shall be secured by the lien
imposed pursuant to Sections 3114.5 and 3115.5 of the Streets and Highways Code of the State
of California, which lien shall be a continuing lien and shall secure each levy of the special tax.
The lien of the special tax shall continue in force and effect until the special tax obligation is
prepaid, pe=anently satisfied and canceled in accordance with Section 53344 of the
Government Code of the State of California or until the special tax ceases to be levied by the
City Council in the manner provided in Section 53330.5 of said Government Code.
WBD1320170.1
5-231
SECTION 5. This Ordinance shall be effective thirty (30) days after its adoption.
Within fifteen (15) days after its adoption, the City Clerk shall cause this Ordinance to be
published in a newspaper of general circulation in the City pursuant to the provisions of Chula
Vista's City Charter, Section 312(b).
Introduced at a regular meeting of the City Council of the City of Chula Vista, California, on
November 22,2005;
Enacted at a regular meeting of the City Council of the City of Chula Vista, California, held on
the 6th day of December, 2005, by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
ATTEST
APPROVED AS TO FORM:
~,.,~oecJ
oor
Attorney
Sohaib AI-Agha
City Engineer
WBD\320170.1
5-242
WBD\320170. 1
EXHIBIT A
AMENDED RATE AND METHOD OF APPORTIONMENT FOR
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 13-1
(OTAY RANCH VILLAGE SEVEN)
A-I
5-25
COUNCIL AGENDA STATEMENT
Item
Meeting Date
&
11/22/05
SUBMITTED BY:
Resolution authorizing the application and, if awarded, acceptance of an
FY2006/07 Bicycle Transportation Account (BTA) program grant from the
California Department of Transportation to fund bicycle facilities on Industrial
Boulevard; and authorizing the commitment of matching funds therefore.
City Engineer ~1f'\ tA
/l"J 7rP
City Manager j I foe. I'.,
(4/5ths Vote: Yes _No..xJ
ITEM TITLE:
REVIEWED BY:
BACKGROUND: With a steady growth in bicycle usage and the demand for new bikeways and routes since
1996, the Bikeway Master Plan was updated in January 2005 in order to locate, develop and encourage the use
of the City's bikeway system. The plan identified a key project that will develop and improve bicycle facilities
along Industrial Boulevard.
RECOMMENDATION: That Council adopt a resolution:
. Authorizing the application and, if awarded, acceptance of an FY2006/07 Bicycle Transportation
Account (BT A) program grant from the California Department of Transportation; and
. Authorizing the commitment of$125,000 in matching funds from the available balance of the
TransNet fund.
BOARDS/COMMISSIONS: N/A
DISCUSSION:
Bicycle use for both recreation and commuting purposes has increased significantly in Chula Vista and
surrounding regions in recent years. There has been steady growth in bicycle use for reasons such as physical
fitness, recreation, concern for rising fuel costs and the environment. These interests have resulted in increased
public demand for bikeways and routes where bicycles can be ridden with ease and relative safety.
The City's newly-adopted 2005 Bikeway Master Plan's objectives include fostering the development of an
interconnecting bikeway system throughout the region. The master plan identifies and prioritizes eighteen (18)
key projects for development throughout the City.
With the recent award of a Smart Growth Incentive Program grant to improve the Palomar Gateway area, street
and bicycle lane improvements will be provided along Industrial Boulevard. The City proposes extending
those improvements from the Palomar Gateway project area southward to Main Street, as identified in the
"Industrial Boulevard from L Street to Main Street" project of the 2005 Bikeway Master Plan. The additional
proposed improvements would include bike lane, curb, and gutter from Ada Street to Main Street and are
estimated at $1,225,000 for construction, design, engineering, and administrative costs.
Staff recommends pursuing grant funding for this project from the FY2006/07 Bicycle Transportation Account
(BTA) program of the Department of Transportation, in the amount of $1,100,000. The BTA Program
requires the commitment of a 10% City match of total project costs. Staff recommends the commitment of
$125,000 from available TransNet infrastructure fund revenue to help fund the project. This action will have
the advantage ofleveraging grant funds from the Smart Growth Incentive Program, resulting in an estimated
6-1
Page 2, Hemic
Meeting Date 11/22/05
savings of $100-150,000 to the proposed project. It will also complete the planned amenities along the
Industrial Boulevard corridor between Palomar and Main Street.
The project will be included in the FY 2007 Capital Improvement Program (CIP), and project design is
expected to begin in FY2007 to be coordinated with the Palomar Gateway Project improvements. Other
projects contained in the 2005 Bikeway Master Plan are projected for completion in FY2007 through FY2010.
FISCAL IMPACT: There is no net impact to the General Fund. If the resolution is adopted, the City will
apply for Bicycle Transportation Account (BTA) funding in the amount of$l.l million, and commit a match
of $125,000 ITom available FY2006/07 TransNet funds to meet the total project cost of $1,225,000. If
awarded, staffwill return to Council with a recommendation to create the new CIP proj ect and appropriate the
grant funds and the match.
6-2
RESOLUTION NO.
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA AUTHORIZING THE APPLICATION AND,
IF AWARDED, ACCEPTANCE OF AN FY2006/07
BICYCLE TRANSPORTATION ACCOUNT (BTA)
PROGRAM GRANT FROM THE CALIFORNIA
DEPARTMENT OF TRANSPORTATION TO FUND
BICYCLE FACILITIES ON INDUSTRIAL BOULEVARD;
AND AUTHORIZING THE COMMITMENT OF MATCHING
FUNDS THEREFOR.
WHEREAS, bicycle use for recreation and commuting purposes has increased
significantly in Chula Vista in recent years and there has been a subsequent increase in
pUblic demand for bikeways and routes within the City; and
WHEREAS, newly adopted 2005 Bikeway Master Plan objectives foster the
development of an interconnecting bikeway system and identify eighteen (18) key
bikeway projects throughout the City; and
WHEREAS, one of the identified projects will provide new bike lane, curb and
gutter along Industrial Boulevard from Ada Street to Main Street; and
WHEREAS, staff recommends pursuing grant funding for the project from the
FY2006/07 Bicycle Transportation Account (BTA) program of the Department of
Transportation; and
WHEREAS, grant requirements call for the commitment of a minimum 10% local
match;
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula
Vista does hereby:
1. Authorize the filing of an application and, if awarded, acceptance of an
FY2006/07 Bicycle Transportation Account (BT A) Program grant from the
California Department of Transportation (Caltrans); and
2. Authorize the commitment of $125,000 in matching funds from the available
balance of the TransNet fund.
Presented by
Approved as to form by
Sohaib AI-Agha
City Engineer
6-3
COUNCIL AGENDA STATEMENT
Item: '7
Meeting Date: 11/22/05
ITEM TITLE:
Resolution approving the second amendment to the agreement
with Erickson-Hall Construction Co. which will increase the Guaranteed
Maximum Price (GMP) for the design and construction of Harborside
Park (CIP PR249) located on Oxford Street in Western Chula Vista,
amend the substantial and final completion, authorizing the Mayor to
execute said amendment and authorizing the transfer of funds from the
"Western Chula Vista Infrastructure Program (GGI88)" to the
"Harborside Park (PR249)" as necessary to complete the project.
SUBMITTED BY:
Director of General Services ),..Yr-
/,({! p;J \J
City Manager if ~ 1\
(4/5ths Vote: Yes l No~
REVIEWED BY:
The City Council previously approved a Design Build Agreement with Erickson-Hall
Construction Co. on October 5,2004 and established the Guaranteed Maximum Price (GMP) at
$1,987,030 on May 17, 2005 by Resolution 2005-160. The project is currently in the
construction phase. Due to unanticipated materials found on the site at the onset of construction,
it has become necessary to increase the GMP to cover expenses necessary for proper material
removal. An additional appropriation is also necessary to cover proj ected staff cost through the
end of the project.
RECOMMENDATION:
That the City Council approve:
. The second amendment of the Design Build Agreement with Erickson-Hall Construction
Co. which will increase the Guaranteed Maximum Price (GMP) for the design and
construction of Harbors ide Park (CIP PR249)
. Amending the substantial and final completion dates
. Authorizing the Mayor to execute said amendment
. Appropriating additional funds necessary to complete the project
BOARDS/COMMISSIONS RECOMMENDATION: Not applicable.
BACKGROUND:
On October 5, 2004 City Council approved an agreement with Erickson-Hall Construction Co.
by Resolution 2004-317 for the services required to design and construct a completed and fully
functional 5.21-acre, Harborside Park and established the Guaranteed Maximum Price (GMP) at
$1,987,030 on May 17, 2005 by Resolution 2005-160. At the onset of construction, unanticipated
debris material were discovered on site which required the need for additional work and
expenditures necessary to properly remove the encountered debris and trash while continuing the
progress of the project.
7-1
Page 2, Item:
Meeting Date: 11/22/05
rJ
PROJECT SCOPE AND CONTRACTUAL REOUIREMENTS
The Design-Build Agreement with Erickson-Hall Construction Co. provides the City with a fully
functional Harborside Park including the facilities and site-work required to provide park service
to residents of that community as well as other residents of the City.
The Second Amendment (Exhibit A) to the Design Build Agreement between the City of Chula
Vista and Erickson-Hall Construction Co. will include increasing the GMP from $1,987,030 to
$2,045,028 consistent with unanticipated cost of debris removal in the amount of $57,998
(Attachment 1). Pursuant to Section 14 of the Design Build agreement, staff and Design Builder
have made every effort to determine a fair and equitable price for the additional work.
The Substantial and Final completion dates will be amended to include 14 calendar days due to
delays associated with the additional work and 31 days of non-compensable time extension for
additional time during the design phase. The revised Substantial Completion date is January 5,
2006 and the revised Final Completion date is February 4, 2006.
In addition, the staff time eligible for reimbursement is higher than originally anticipated. Based
on the number of hours to date and projected time to be spent on the project through its
completion, staff is recommending an additional appropriation in the amount of $40,000. Any
remaining balance at the end of the proj ect will be returned.
FINANCING
Harborside Park is part of the Western Chula Vista Infrastructure Financing Program. This is a
program that Council adopted with the Fiscal Year 2003/04 Capital Improvement Program
Budget.
At this time, staff is recommending transferring the amount of$97,998 fTom the "Western Chula
Vista InfTastructure Program (GG 188)" to the "Harborside Park (PR249)" as necessary to
complete the project.
FISCAL IMPACT:
PROJECT COSTS TO DATE
GMP $2,045,028
City Staff Costs $100,000
Consultant and Oversight (inc!. Special Inspections) $80,000
City Contingency $20,000
FF&E $5,000
TOTAL PROJECT COSTS TO DATE $2,250,028
7-2
Page 3, Item: 1]
Meeting Date: 11/22/05
PROJECT FUNDS
Existing Appropriation $2,152,030
Transfer Request:
From "Western Chula Vista Infrastructure Program (GG188)" $97,998
TOTAL PROJECT FUNDS $2,250,028
Staff is recommending increasing the contract amount to incorporate the GMP of $2,045,028.
The GMP includes, but is not limited to, design services, general conditions, insurance, bonds,
construction management, the cost for all labor, equipment, and material to design and build a
fully functional park in accordance with all applicable building codes and additional work in the
amount of $57,998. Including the increased GMP and additional staff costs, the total project cost
is $2,250,028. Approval of tonight's resolution will approve the second amendment to the
agreement with Erickson-Hall Construction Co. to increase the GMP to $2,045,028 for the
design, construction and additional work of Harborside Park (CIP PR249), amend the substantial
and final completion dates, authorize the Mayor to execute said amendment and authorize the
transfer of funds in the amount of $97,998 from the "Western Chula Vista InfTastructure
Program (GG 188)" to the "Harborside Park (PR249)" as necessary to complete the project.
Attachment I - Cost Breakdown of Additional Work
Exhibit A - Second Amendment to the Design Build Agreement and Revised Exhibit 2
J:\General Services\GS Administration\Council Agenda\Harborside Park\Harborside Second Amendment AIl3.doc
7-3
Attachment 1
,=~
ERICKSON-HALL
CON S T Rue T ION co.
August 23, 2005
City of Chula Vista
Attn: Matt Little
1800 Maxwell Drive
Chula Vista, CA
RE: Harborside Park
690 Oxford Street
Chula Vista, CA
SUBJECT: Unforeseen Debris
We are forwarding for your review and approval, one (1) copy of our Cost Proposal
#01 for the following:
Unforeseen site conditions. Remove encountered buried debris and trash by
mechanically screening top 1 ft of existing soils. Replace screened soils back onsite.
Haul screened debris to landfill using City dump pass. Haul undocumentented surface
trash and construction debris placed onsite by others during design phase. Cost
includes additional general conditions overhead for 14 calendar days due to delays
associated with this work. All unspent GC monies to be returned to City should our
original GMP contrad general conditions not be completely expended
Performance of the above-defined work will increase the contract in the amount of
$57998.00 and is expected to extend the completion date of the contract by 14
Calendar Days.
If you have any questions please contact me..
Sincerely, _ ","~=.-
.-' _;.::c. z:./....:--:;.:;~>-
~.---
z:.~
--
c.
Nathan Complin
Project Manager
500 Corporate Drive. ~s,ondido. CA 92029.1517 Tel: (760) 796.7700 Fax: (760) 796~7750
7-4
I~
ERICKSON-HALL
CON ST R U CTI 0 N CO.
November 16,2005
City of Chula Vista
Attn: Matt Little
1800 Maxwell Road
Chula Vista, CA
RE. EHCC Project #2422
Harborside Park
690 Oxford Street
Chuta Vista, CA 91911
Erickson-Hall Construction Co. is requesting a 31 caiendar day time extension to the
contract for referenced project.
Durin9 the design phase, additional time was required to complete the design that met
the City's goals for the pari< construction and tight budget. The results of this extra
collaborative effort were positive as can be seen by the final design drawings. Please
process a no cost change order for the 31 caiendar days.
...-~
Sincerely,. .../
",':Z'C;../r
....
-~., ...-
Nathar(Complin
Project Manager
NC/trr
500 Corporate DriYe. Escondido, CA 92029., 517 Tel: (760) 796.7700 F,u:: (760) 796.7750
7-5
Cost Proposal
To: Matt Little
Project Title: City of Chula Vista Harborside Park
Cost Proposal No. 01
j
DESCRIPTION OF WORK:
Unforseen site conditions. Remove encountered burned debris and trash by mechanically screening
top 1 ft of existing soils. Replace screened soils back onsite. Haul screened debris to landfill uning City dump pass.
Haul undocumentented surface trash and construction debris placed onsite by others dunng design phase.
Cost includes additional general conditions overhead for 14 calendar days due to delays associated with this work.
All unspent GC monies to be returned to City should our onginal GMP contract general conditions not be completely
excended.
Prime Contractor's Work Revisions/Comments
1 Direct Material $ 3,220.00
2 Sales Tax on Material N/A INC
3 Equipment Rental $ -
4 Sales tax an Rental $ -
5 Equipment ownership and operating expenses $ -
6 Add lines 1 through 5 $ 3,22000
7 Material and Equipment mark-up NIA INC
8 Sub-Total (lines 6 and 7) $ 3,220.00
9 Direct Labor $ 5,880.00
10 Insurance, taxes and fringe benefits N/A INC
11 Add Lines 9 and 10 $ 5,880.00
12 labor mark-up N/A INC
13 Sub. Total (lines 8, 11, and 12) $ 9,100.00
Subcontractor's Work Revisions/Comments
14 Subcontractor cdsf proposal: & breakdowns attached if applicable to' Cost ProposaL "', ,
I -, ' ., .'
thru-
26 Subcontractor Work totals itemized, berow: ," .: ',' " "," ,'" " '
26.1 Whitson CM $ 45,162.39
26.2 $ -
26.3 $ -
26.4 $ -
26.5 $ -
26.6 $ -
26.7 $ -
26.8 $ -
26,9 $ -
26.10 $ -
27 Subcontractor's Work (Add lines 26 above) $ 45,162.39
28 Prime Contractor's markup on Subcontractor 7% $ 3,161.37
29 Add lines 27 and 28 $ 48,323.76
30 TOTAL Prime & Subcontractors (Lines 13 and 29) $ 57,423.76
31 Bond 1.00% $ 574.24
32 TOTAL $ 57,997.99
Estimated Time Extension requested for the work and justification for time extension:
14 calendar days deiay. Work directly impacts critical path of . ct sched
Signature of Preparer
7-6
RESOLUTION 2005-
RESOLUTION APPROVING THE SECOND AMENDMENT TO THE
AGREEMENT WITH ERICKSON-HALL CONSTRUCTION CO. WHICH
WILL INCREASE THE GUARANTEED MAXIMUM PRICE (GMP) FOR THE
DESIGN AND CONSTRUCTION OF HARBORSIDE PARK (CIP PR249)
LOCATED ON OXFORD STREET IN WESTERN CHULA VISTA, AMEND
THE SUBSTANTIAL AND FINAL COMPLETION DATES, AUTHORIZING
THE MAYOR TO EXECUTE SAID AMENDMENT AND AUTHORIZING
THE TRANSFER OF FUNDS FROM THE "WESTERN CHULA VISTA
INFRASTRUCTURE PROGRAM (GG188)" TO THE "HARBORSIDE PARK
(PR249)" AS NECESSARY TO COMPLETE THE PROJECT.
WHEREAS, on October 5, 2004 City Council approved an agreement with Erickson-Hall
Construction Co. by Resolution 2004-317 for the services required to design and construct a
completed and fully functional5.21-acre Harborside Park; and
WHEREAS, the Agreement was amended to establish the Guaranteed Maximum Price
(GMP) at $1,987,030 on May 17, 2005 by Resolution 2005-160; and
WHEREAS, at the onset of construction, unanticipated materials were discovered which
required the need for additional work and expenditures necessary to properly remove the trash
and debris while continuing the progress of the project; and
WHEREAS, the Second Amendment (Exhibit A) to the Design Build Agreement
between the City of Chula Vista and Erickson-Hall Construction Co. will include increasing the
GMP from $1,987,030 to $2,045,028 consistent with unanticipated cost of material removal in
the amount of$57,998; and
WHEREAS, Pursuant to Section 14 of the Design Build agreement, staff and Design
Builder have made every effort to determine a fair and equitable price for the additional work;
and
WHEREAS, the Second Amendment also revises the Substantial Completion date to
January 5, 2006 and Final Completion date to February 4,2006.
WHEREAS, the staff time eligible for reimbursement is higher than originally
anticipated. Based on the number of hours to date and projected time to be spent on the project
through its completion, staff is recommending an additional appropriation in the amount of
$40,000; and
WHEREAS, staff is recommending transferring the amount of $97,998 from the
"Western Chula Vista Infrastructure Program (GG188)" to the "Harborside Park (PR249)" as
necessary to complete the project; and
7-7
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula
Vista does hereby approve the second amendment of the Design Build Agreement raising the
GMP to $2,045,028 for the services required to design and construct Harborside Park (CIP
PR249) located on Oxford Street in Western Chula Vista, transferring funds therefore and
authorizing the Mayor to execute said amendment.
Presented by
Approved as to form by
Jack Griffin
Director of General Services
~~fdi+ 1M
City Attorney
M:\General Services\GS Administration\Council Agenda\Harborside Park\Harborside Second Amendment Reso Fina1.doc
.
.
.
.
7-8
THE ATTACHED AGREEMENT HAS BEEN REVIEWED
AND APPROVED AS TO FORM BY THE CITY
ATTORNEY'S OFFICE AND WILL BE
FORMALL Y SIGNED UPON APPROVAL BY
THE CITY COUNCIL
::5dtUw!Me-
Ann oore
City Attorney
Dated: 11/14/05
SECOND AMENDMENT TO THE AGREEMENT WITH
ERICKSON-HALL CONSTRUCTION CO. FOR THE DESIGN
AND CONSTRUCTION OF HARBORSIDE PARK (CIP PR249)
7-9
Second Amendment To
the Design Build Agreement between the City of Chula Vista
and Erickson-Hall Construction Co.
For Design and Construction of Harborside Park
This Second Amendment is made and entered into this 22nd day of November 2005 by and
between the City of Chula Vista (herein "City"), a municipal corporation, and Erickson-Hall
Construction Co. (herein "Design Builder or DIE"). City and Design Builder are sometimes
hereinafter referred to as Parties ("Parties")
RECITALS
WHEREAS, the City and DIE entered into an agreement ("Original Agreement") dated October
5, 2004 and approved by City Council Resolution 2004-317, whereby D/B provides design and
construction services to the City for the construction of a fully functional park including the
facilities and site-work; and
WHEREAS, the First Amendment to the Design Build Agreement between the City of Chula
Vista and Erickson-Hall Construction Co. was approved by City Council Resolution 2005-160
which contained a guaranteed maximum price not to exceed $1,987,030; and
WHEREAS, due to unanticipated materials found on the site at the onset of construction, it has
become necessary to increase the GMP to cover expenses necessary for proper material removal;
and
WHEREAS the parties now desire to enter the Second Amendment to the Agreement to increase
the contract amount to incorporate the guaranteed maximum price of $2,045,028 for a fully
functional 5 .21-acre park, Harborside Park.
NOW, THEREFORE, in consideration of the recitals and the mutual obligation of the Parties set
forth herein, the City and Design Builder agree as follows:
1. Section 1 of Original Agreement, entitled General Scope of Work to be Performed by
DIE, is hereby amended as follows:
1.3.1 Perform all services, work and obligations as described herein for the not
to exceed amount of $1,987,030 $2,045,028 which shall include Design
Services and General Conditions necessary to provide a fully completed
and functional Project. DIE shall perform all Design Services and General
Conditions for the not to exceed amount of $214,462 as outlined in the
Design Build Fee Structure (Exhibit 2). At 90% complete construction
documents a Guaranteed Maximum Price (GMP) will be established
pursuant to Section 13 of this Agreement, which will include, but not be
limited to, the cost for all labor, equipment, and material to design and
build a fully functional park in accordance with all applicable rules,
7-10
regulations, and laws. The D/B fee shall be based upon a sliding scale as
outlined in the Design Build Fee Structure (Exhibit 2). [Commentl]Any costs
incurred by DIB in excess of said GMP shall be the sole responsibility of
the DIB, unless a change order is approved by the City pursuant to
Sections 9 and 14 of this agreement. All funds remaining in the GMP at
the completion of the project shall belong to the City.
1.3.2 Substantial Completion:
Achieve "Substantial Completion" (as defmed m 916.1) no later than
January 5, 2006.
1.3.3. Achieve "Final Completion" (as defmed in 916.2) No later than February
4,2006.
2. Section 13 of the Original Agreement, entitled D/B GMP for Services and
Reimbursements, is hereby amended to read as follows:
13.1.1 The GMP shall not exceed $1,987,930 $2,045,028 for the Park and
include within said GMP shall be no more than $214,462 for Design
Services and General Conditions as previously identified in Section 1.3.1
of this agreement.
3. Section 11 of the Original Agreement, entitled Insurance, is hereby amended to read
as follows:
11.3.1.5 Builder's Risk Propertv Insurance:
The City of Chula Vista will provide coverage for "all risk" Builder's Risk Insurance,
excluding the peril of earthquake, and subject to other policy terms, conditions and
exclusions, Coverage will be provided for the Full Hard Cost Replacement Cost of
Materials, Equipment and fixtures destined to become a permanent part of the
structure, Property in Transit, and Property in Offsite Storage for Harborside Park
construction in an amount not to exceed $+.-9 $2.0 million. Contractors and
Subcontractors will be added to policy as Loss Payees as their interest may appear.
4. Exhibit 2 of the Original Agreement shall be substituted with the Revised Exhibit 2.
5. Except as expressly provided herein all other provisions of the Original Agreement
and the First Amendment shall remain in full force and affect.
7-11
Signature Page to the Second Amendment 10
the Design Build Agreement between the City of Chula Vista
and Erickson-Hall Construction Co,
For Design and Construction of Harbors ide Park
City of Chula Vista
Erickson-Hall Construction Co,
by
Stephen C. PadilJa, Mayor
~A/-
by
Nam and Title I' -
';".,
... '0"
Date
ATTEST:
Susan Bigelow, City Clerk
Approved in form by:
Ann Moore, City Attorney
J;\Ganer.a1 SCJ\'it:a\OS .\dminislralionICauncil AG~nda\HllrborJjdc: Park\Harborside Sccund ,\nu:mhncr!I nnd SISMlUlc 1'O1&:1: dn:
7-12
,
COUNCil AGENDA STATEMENT
Item: '?!
Meeting Date: November 22. 2005
REVIEWED BY:
Resolution amending the FY06 Library
Department budget by appropriating unanticipated Even Start
grant augmentation funds in the amount of $15,833 for
expenditures associated with the Chula Vista Literacy Team's
Even Start Family Literacy grant.
Assistant City Manager/Library Directo~
City Manager{Jr llf (4I5ths Vote: YES X NO ->
ITEM TITLE:
SUBMITTED BY:
The California Department of Education has advised the Chula Vista Public Library that its
four-year Even Start grant in the amount of $166,667 has been augmented by $15,833 for
FY06. These funds must therefore be appropriated.
STAFF RECOMMENDATION: That Council adopt the resolution amending the FY06
Library Department budget by appropriating unanticipated Even Start grant augmentation
funds in the amount of $15,833 for expenditures associated with the Chula Vista Literacy
Team's Even Start Family Literacy grant.
BOARD/COMMISSION RECOMMENDATION: N/A
DISCUSSION: In September 2003, the Chula Vista Public Library, in collaboration with the
Chula Vista Elementary School District, was awarded a four-year California Department of
Education Even Start Familv Literacv Prooram grant. Even Start is a federally funded,
intergenerational family literacy program. It is designed to provide intensive in-home and
center-based services to parents and their young children considered at high risk for future
academic failure and continuing cycles of poverty.
The Library partners with the Chula Vista Elementary School District, which is the primary
agency providing Even Start family literacy services. The Library intends to pass $12,333 in
grant augmentation funds through to the District to pay for program activities and supplies.
The remaining $3,500 will be combined with $1,000 in the existing Even Start budget to extend
the hours of a current staff instructor by .10 FTE for the fiscal year 2005-06.
FISCAL IMPACT: An additional $15,833 will be appropriated into the current year Even
Start grant budget.
8-1
RESOLUTION NO. 2005-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA AMENDING THE FY06 LIBRARY
DEPARTMENT BUDGET BY APPROPRIATING
UNANTICIPATED EVEN START GRANT AUGMENTATION
FUNDS IN THE AMOUNT OF $15,833 FOR EXPENDITURES
ASSOCIATED WITH THE CHULA VISTA LITERACY
TEAM'S EVE)! START FAMILY LITERACY GRANT
WHEREAS, in September 2003, the Chula Vista Public Library, in collaboration with the
Chula Vista Elementary School District, was awarded a four-year California Department of
Education "Even Start Family Literacy Program" grant ("Even Start"); and
WHEREAS, Even Start is a federally funded, intergenerational family literacy program;
and
WHEREAS, Even Start is designed to provide intensive in-home and center-based
services to parents and their young children considered at high risk for future academic failure
and continuing cycles of poverty; and
WHEREAS, the Library partners with the Chula Vista Elementary School District, which
is the primary agency providing Even Start family literacy services; and
WHEREAS, the California Department of Education has advised the Chula Vista Public
Library that its four-year Even Start grant in the amount of $166,667 has been augmented by
$15,833 for FY06, which funds must therefore be appropriated; and
WHEREAS, the Library intends to pass $12,333 in grant augmentation funds through to
the District to pay for program activities and supplies; and
WHEREAS, the remaining $3,500 will be combined with $1,000 in the existing Even
Start budget to extend the hours of current staff instructor by .10 FTE for the fiscal year 2005-06.
NOW, THEREFORE, BE IT RESOLVED the City Council of the City of Chula Vista
does hereby adopt the resolution amending the FY06 Library Department budget by accepting
and appropriating unanticipated Even Start grant augmentation funds in the amount of$15,833
for expenditures associated with the Chula Vista Literacy Team's Even Start Family Literacy
grant.
(
Presented by
David Palmer
Assistant City Manager
J:\Attomey\Reso\grants\FY06 Library budget for Even Start Family Jiteracy
8"':'2
COUNCIL AGENDA STATEMENT
Item: '1
Meeting Date: November 22. 2005
SUBMITTED BY:
Resolution reclassifying a Librarian III position to Senior
Librarian in the Library Department budget.
Assistant City Manager Palm~
City Manager n-PK (4/5ths Vote: Yes _ No.1LJ
ITEM TITLE:
REVIEWED BY:
A Librarian III currently manages the EastLake Branch Library. Due to increased
patronage, the Library is requesting that this position be reclassified to a Senior Librarian.
STAFF RECOMMENDATION: That Council approves reclassifying a Librarian III
to Senior Librarian in the Library Department.
BOARDS/COMMISSIONS RECOMMENDATIONS: n/a
DISCUSSION:
The continued growth of eastern Chula Vista has contributed to increased usage of the
EastLake Branch Library. During the first four months of FY 06, the branch has
experienced a 25.5% increase in circulation compared to the same period last year and is
on track to circulate over 150,000 items in FY 2006. As a result, the department is
reallocating hourly staff from other facilities to EastLake in order to keep up with user
demand.
However, increased staffing, patronage and circulation means that the branch manager
must deal with many more complex issues. Therefore, it is more appropriate that a
Senior Librarian, who is a middle manager, administer the branch.
FISCAL IMPACT:
There is no fiscal impact for FY 06 and FY 07 since the library will absorb the additional
costs, $6,366.76 and $12,458.02 respectively, through salary savings.
9-1
RESOLUTION NO. 2005-
RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF CHULA VISTA RECLASSIFYING A LIBRARIAN III
POSITION TO SENIOR LIBRARIAN IN THE LIBRARY
DEPARTMENT BUDGET
WHEREAS, the continued growth of eastern ChuIa Vista has contributed to increased
usage of the Eastlake Branch Library; and
WHEREAS, during the tirst four months of FY06, the branch has experienced a
25.5% increase in circulation compared to the same period last year and is on track to circulate over
150,000 items in FY2006; and
WHEREAS, the department is reallocating hourly staff from other facilities to
Eastlake in order to keep up with user demand; and
WHEREAS, a Librarian III currently manages the Eastlake Branch Library; and
WHEREAS, increased staffing, patronage and circulation means that the branch
manager must deal with many more complex issues; and
WHEREAS, it is more appropriate that a Senior Librarian, who is a middle manager,
administer the branch; and
WHEREAS, there is no fiscal impact for FY06 and FY07 since the Library will
absorb the additional costs through salary savings.
NOW, THEREFORE, BE IT RESOLVED the City Council of the City ofChula Vista
does hereby approve reclassifYing a Librarian III to Senior Librarian in the Library Department.
Presented by
Approved as to form by
~~1'~ IWf
A oore
ty Attorney
David Palmer
Assistant City Manager
MTTORNEYlRESO\CLASSIFICATION\reclassification -libraI)' I 12205
1
9-2
COUNCIL AGENDA STATEMENT
Item: 10
Meeting Date: November 22, 2006
ITEM TITLE:
Resolution approving the Addendum to the
Memorandum of Understanding between the City ofChula Vista
and the Chula Vista Elementary School District regarding joint
operation of DASH and STRETCH after school programs and
appropriating funds therefore.
Assistant City Manager palme~
City Manager 11 t..... r~ (4/5ths Vote: Yes l No_)
SUBMITTED BY:
REVIEWED BY:
The current MOU between the City and the Chula Vista Elementary School District, in
effect until June 30, 2006, authorizes the operation of two after school programs at
elementary school sites. The STRETCH Program, with its emphasis on literacy and arts
enrichment, is currently offered at seven district schools. The MOU also authorizes the
operation of a structured sports and recreation program called DASH (Dynamic After
School Hours), at 25 district schools,
The intent of this report is to present an Addendum to the MOU between the City and the
Chula Vista Elementary School District for FY 2005-06 (Attachment A). The Chula
Vista Elementary School District Board is expected to vote on the Addendum to the
MOU at their November 15, 2006 meeting.
STAFF RECOMMENDATION: That Council approve the Addendum to the
Memorandum of Understanding between the City of Chula Vista and the Chula Vista
Elementary School District regarding joint operation of the DASH (Dynamic After
School Hours) and STRETCH (Safe Time for Recreation, Enrichment and Tutoring for
Children) after school programs, and amend the Library Department FY 05/06 budget by
appropriating an additional $43,472. The revenue to offset these additional expenses will
be received from the Chula Vista Elementary School District via a California 21 sl
Century Community Learning Center grant, and trom the California Department of
Education After School Education and Safety Program.
BOARDS/COMMISSIONS RECOMMENDATIONS: nla
DISCUSSION:
Since 1999, the City and the Chula Vista Elementary School District have collaborated to
provide after school progranuning at elementary schools within the City. Due to the
overwhelming demand trom parents for after school programming, and the huge
popularity of both the DASH and STRETCH programs, over the years we have grown
from serving 6 school sites in 1999 to 32 schools in 2006. (Attachment 'B') The after
school program partnership has been in receipt of State grant funding since 1999. We
anticipate continued State support for after school progranuning.
10-1
Item: 10 , Page 2
Meeting Date: 11/22/2005
Last year, the District received California 21 st Century Community Learning Center grant
funds specifically targeted at three schools that had become eligible for them, based on
their demographics. As a result, in January 'OS, those schools were designated as
"DASH Plus" sites, in which the hours of service, the curriculum provided, the number of
students served, and the number of staff were expanded from the regular DASH program,
One of those schools, Hilltop Elementary, is now eligible to receive a one-time
augmentation oflast year's grant funds in the amount of$22,063, The principal of Hilltop
specifically requested that the augmentation be used to increase the number of students
served by DASH Plus, with the full understanding that the increased service level was
only possible for the remainder of the school year. Regular DASH sites serve 50 students
per day; DASH Plus sites serve 60 students per day. The augmentation at Hilltop will
allow us to serve 80 students per day for the remainder of the '06 school year, (The other
two new DASH Plus schools also received one-time augmentation monies, but their
principals elected to spend the funds on alternative programs that do not involve the
DASH program.)
The Chula Vista Elementary School District has also received notification from the
California Department of Education that it is eligible to receive additional grant funds
from the After School Education and Safety (ASES) Program. These funds are awarded
to selected Title I schools in three-year funding cycles. Our seven STRETCH schools are
all on various ASES funding cycles. Two of them, Lorna Verde and Mueller Elementary,
are now eligible for funds to expand existing after school programming, Both schools
currently serve 60 students per day. They will both increase to 80 students per day (and
next school year, Mueller will be increased to 100) for the remainder of the three-year
cycle. The other STRETCH sites serve a range from 60 to 100 students.
Due to receipt of these grant funds, the City and the District are now prepared to execute
an Addendum to the Memorandum of Understanding for FY 2005-06, The Addendum,
which has been prepared in conjunction with the City Attorney's office, authorizes:
· Expansion of the DASH Plus program at Hilltop Elementary from 60 to 80
students per day, from November 29th through the end of the 05-06 school year
only. Hilltop will receive an additional DASH Leader, and additional hours for
the Site Lead. (This requires an additional.51 FTE DASH Leaders.)
· Expansion of the STRETCH program at Lorna Verde and Mueller Elementary
Schools, increasing the service from 60 children per day to 80 children per day,
Each site will receive an additional Youth Leader and additional hours for the Site
Coordinator. (This requires an additional .84 FTE Youth Leaders and .12 FTE
Site Coordinators.)
10-2
Item: I D , Page 3
Meeting Date: 11/22/2005
FISCAL IMPACT:
Approval of tonight's resolution will result in no net impact to the general fund. In fiscal
year 2006 the City will receive a one-time appropriation of $22,063 from 21 st Century
Learning to offset the increased costs for hourly DASH staffing at Hilltop Elementary.
The City will also receive $21,409 in fiscal year 2006 from ASES to offset the increased
costs for hourly STRETCH staffing for Lorna Verde Elementary and Mueller
Elementary. In fiscal year 2007 City will receive full year funding, $50,276, from ASES
to offset the costs of increasing the capacity of the STRETCH program at Lorna Verde
Elementary and Mueller Elementary. These funds will be received via the Chula Vista
Elementary School District.
10-3
RESOLUTION NO. 2005-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHlJLA VISTA APPROVING THE ADDENDUM TO THE
MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY
OF CHULA VISTA AND THE CHULA VISTA ELEMENTARY
SCHOOL DISTRICT REGARDING JOINT OPERATION OF THE
DASH AND STRETCH AFTER SCHOOL PROGRAMS AND
APPROPRIATING FUNDS THEREFOR
WHEREAS, the current Memorandum of Understanding ("MOU") between the City
and the Chula Vista Elementary School. District, in effect until June 30, 2006, authorizes the
operation of two after school programs at elementary school sites. The STRETCH Program, with its
emphasis on literacy and arts enrichment, is currently offered at seven district schools. The existing
MOU also authorizes the operation of a structured sports and recreation program called DASH
(Dynamic After School Hours), at 25 district schools; and
WHEREAS, the intent of this report is to present an Addendum to the MOU between
the City and the Chula Vista Elementary School District for FY 2005-06; and
WHEREAS, the District received California 21 st Century Community Leaming Center
grant funds specifically targeted at three schools that had become eligible for them, based on
their demographics; and
WHEREAS, as a result, in January 2005, those schools were designated as "DASH Plus"
sites, in which the hours of service, the curriculum provided, the number of students served, and
the number of staff were expended from the regular DASH program; and
WHEREAS, the Chula Vista Elementary School District also received notification from
the California Department of Education that they are eligible to receive additional grant funds
from the After School Education and Safety (ASES) Program; and
WHEREAS, these funds are awarded to selected Title I schools in three-year funding
cycles; and
WHEREAS, the City's seven STRETCH schools are all on various ASES funding cycles;
and
WHEREAS, due to receipt of these grant funds, the City and the District are now
prepared to execute an Addendum to the Memorandum of Understanding for FY 2005-06 and
such Addendum authorizes the following:
1
10-4
· Expansion of the DASH Plus program at Hilltop Elementary from 60 to 80
students per day, from November 29th through the end of the 05-06 school
year only, Hilltop will receive an additional DASH Leader, and additional
hours for the Site Lead. (This requires an additional .51 FTE DASH
Leaders.)
· Expansion of the STRETCH program at Lorna Verde and Mueller
Elementary Schools, increasing the service from 60 children per day to 80
children per day. Each site will receive an additional Youth Leader and
additional hours for the Site Coordinator. (This requires an additional .84
FTE Youth Leaders and .12 FTE Site Coordinators.)
WHEREAS, an additional $43,472 will be appropriated into the current year
Library budget; and
WHEREAS, the After School Education and Safety Program revenue will be
incorporated into the FY 06/07 MOU with the Chula Vista Elementary School District.
NOW, THEREFORE, BE IT RESOLVED the City Council of the CityofChula Vista
does hereby approve the Addendum to the Memorandum of Understanding between the City of
Chula Vista and the Chula Vista Elementary School District regarding joint operation of the DASH
after school recreational program, and the STRETCH after school programs, a copy of which shall
be kept on file in the office of the City Clerk.
BE IT FURTHER RESOLVED the City Council of the City of Chula Vista does
hereby amend the Library Department FY 05/06 budget by appropriating an additional $43,472 for
the DASH and STRETCH after school programs.
Presented by
Approved as to form by
. 5Lu.... ~RJl
Ann Moore "':1&:$1.
City Attorney
David Palmer
Assistant City Manager
j:\attomeylresoIMOUlAddendum MOU STRETCH and DASH 05-06
2
10-5
THE ATTACHED AGREEMENT HAS BEEN REVIEWED
AND APPROVED AS TO FORM BY THE CITY
ATTORNEY'S OFFICE AND WILL BE
FORMALL Y SIGNED UPON APPROVAL BY
THE CITY COUNCIL
~~A~
Ann Moore ~ ~
City Attorney
Dated: 11/14/05
ADDENDUM TO THE MOD WITH
CV ELEMENTARY SCHOOL DISTRICT
10-6
Attachment "A"
ADDENDUM TO
THE MEMORANDUM OF UNDERSTANDING
BETWEEN
THE CITY OF CHULA VISTA
AND
CHULA VISTA ELEMENTARY SCHOOL DISTRICT
This Addendum to the MOD is entered into by the City of Chula Vista and the Chula
Vista Elementary School District.
This Addendum augments the existing agreement to operate an after school recreational
program ("DASH" - Dynamic After School Hours), and an extended school day
educational program (STRETCH - Safe Time for Recreation, Emichment and Tutoring
for CHildren) in Chula Vista Elementary School District schools in FY 200S-2006.
The parties agree that in addition to the responsibilities outlined in the current MOD, the
Chula Vista Elementary School District's additional responsibilities shall be to:
u Provide the City of Chula Vista with an additional $22,063 in FY 200S-2006 towards
the cost of operating an expanded DASH Plus program at Hilltop Elementary School,
and an additional $21,409 towards the cost of an expanded STRETCH Program at
Lorna Verde and Mueller Elementary Schools. Additional funds shall be payable
upon receipt of two separate City of Chula Vista invoices in June 2006.
The parties agree that in addition to the responsibilities outlined in the current agreement,
the City of Chula Vista's additional responsibilities shall be to:
RE the DASH Program at Hilltop Elementary School:
u Recruit, hire, and train additional part-time DASH Leaders and extend the prep time
of the Lead staff (an additional.Sl FTE DASH Leaders)
u Recruit and serve an additional 20 children per day for the remainder of the OS-06
school year
RE the STRETCH Program at Lorna Verde and Mueller Elementary Schools:
u Recruit, hire, and train additional part-time Youth Leaders and extend the prep time
of the Site Coordinators (an additional .84 FTE Youth Leaders and .12 FTE Site
Coordinators)
u Recruit and serve an additional 20 children per school per day.
All other terms and conditions of the original MOD remain in full force and effect for the
duration of the MOD.
CHDLA VISTA ELEMENTARY
SCHOOL DISTRICT
CITY OF CHDLA VISTA
By:
By:
Date:
Date:
10-7
Attachment "B"
The City operates the DASH Program in the following Chula Vista Elementary School
District schools:
I. Allen
2. Arroyo Vista
3. Casillas
4. Chula Vista Hills
5. Clear View
6. Cook (DASH Plus since '04-05)
7. Discovery
8. EastLake
9. Greg Rogers
10. Halecrest
11. Hedenkamp
12. Heritage
13. Hilltop (DASH Plus since '04-05)
14. Kellogg
15. Liberty
16. McMillin
1 7. Marshall
18. Olympic View
19. Palomar (DASH Plus since (00)
20. Parkview
21. Rosebank
22. Salt Creek
23. Tiffany
24. Valle Lindo (DASH Plus since '04-05)
25. Veterans
The City operates the STRETCH Program in the following Chula Vista Elementary
School District schools:
1. Harborside
2. Lauderbach
3. Lorna Verde
4. Montgomery
5. Mueller
6. Otay
7. Rice
The remaining CVESD schools within the City of Chula Vista are covered by District
agreements with the following agencies:
1. Castle Park- YMCA
2. Chula Vista Learning Community Charter- YMCA
3. Feaster-Edison- Boys & Girls Club Program
4. Rom- YMCA
5. Vista Square- YMCA
10-8
RESOLUTION NO. 2005-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA WAIVING A POTENTIAL CONFLICT OF
INTEREST WITH RESPECT TO PROPOSED
REPRESENTATION OF FLIER'S INCORPORATED
WHEREAS, Glen R. Googins was employed as an attorney for the City of Chula Vista
from 1993 to 2004; and
WHEREAS, under California Rules of Professional Conduct 3-310(E), an attorney "shall
not, without the informed written consent, of the. . . former client, accept employment adverse to
a . . . former client where by, reason of the representation of the former client, the attorney has
obtained confidential information material to the employment."; and
WHEREAS, Fliers Incorporated proposes to retain Mr. Googins in connection with
representation related to the General Plan Update. The scope of the representation is outlined in a
letter from Mr. Googins to the City Attorney dated, November 16, 2005 (a copy of which is
attached hereto as Exhibit A).
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula
Vista does hereby waive any potential conflict of interest related to the specific scope of
representation outlined in the November 16, 2005 letter from Mr. Googins. The City reserves the
right to disqualify Mr. Googins from additional representation of Fliers Incorporated beyond the
scope of the November 16, 2005 letter.
Presented by
Approved as to form by
Ann Moore
City Attorney
/!i.f~
oore
Ity Attorney
/0.1-1
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VIA FAX; HARDCOPY TO FOLLOW VIA U.S. MAIL
November 16, 2005
Ann Moore
City Attorney
City ofChula Vista
276 Fourth Avenue
Chula Vista, CA 91910
RE: Request for Determination of No Conflict of Interest With Respect to Prospective
Representation of Flier's Incorporated
Dear Ann:
Mr. Earl Tritt, President of Flier's rncorporated (.'Fliers"), has asked me to represent Fliers in connection
with the City's General Plan Update process and its potential impacts on the development potential of
approximately 60 acres of land Incated off Main Street within the City (the "Property"). The purpose of
this letter is to request that your office confirm my preliminary determination that this representation does
not present a conflict of interest that must be waived pursuant to California Rules of Professional Conduct
Rule 3-31 0(0), or constitute a prohibited activity pursuant to Chula Vista Municipal Code Section
2.28.050.B.5.
The Property is comprised of multiple contiguous parcels located immediately south of Main Street,
between Fourth Avenue (to the east and north) and Broadway/Beyer Boulevard (to the west), extending
south to the City of San Diego border. The Property is currently dedicated in part to agricultural uscs, in
part to truck storage~ and in part to a soils and rock stockpiling. mixing and distribution business
conducted by Hanson Aggregates. Other portions of the property are unused "open space". All, or
substantially all, ofthe Property is zoned ILP. The Property is also located within the Southwest
Redevelopment Project Area.
In terms of the General Plan Update. the Property is located within the Southwest P/anninR Area. Main
Street District. In its current draft the GPU "preferred plan" appears to designate a significant portion of
the southern tvvo-thirds of Property as "open space" or "open space preserve". In contrast, all three
"alternative" land use plans that are analyzed in the ErR propose that a "limited industrial" land use
designation be applied to a significant portions of this acreage. The text excerpts within the EIR's Project
Description Sections that appear to support the "limited industrial" alternative read as follows: "'Provide
for additiona{ land uses, within areas currently subject to resource extraction, beh~ieen Beyer Way and
Broadway." Both the preferred plan and the analyzed alternatives appear to retain a floating Community
Park designation 'Iin the area" of the Property.
EXHIBIT A
/a./ - 2..
Ms. Ann Moore
November 16, 2005
Page 2 of2
The Property is currently owned by the Nelson Family Trust and/or affiliates thereof. Fliers has indicated
that it has been engaged by the Trust to represent their mutual interests, with FI iers taking the lead.
Fliers' current objective is to analyze the potential impacts of the GPU on the Property and. if appropriate.
to persuade the City to approve anyone of the alternative "'limited industria'" land use designations in
order to better preserve the Property's potential for future redevelopment. Fliers would like to engage me
to help with this effort.
r am seeking confinnation from your office that my representation does not pose a contlict that must be
waived. My preliminary detennination is that it does not pose slIch a conflict. The matter is not
inherently "adversell to the City in that the engagement involves an effort to persuade the City to make a
policy decision that has not yet been made. Fliers has expressed 00 intent to challenge a City Council
decision to approve the "preferred plan" nor would I be involved in any such action if such a challenge
were pursued. During my time at the City I never worked on the GPU. Nor did I work on any matter
involving the Property. As a result~ I have no confidential information regarding the City that is material
to my proposed employment. Final1y, since it has been well over a year since I worked for the City. there
should be no remaining "Iobbyist" restrictions on my conduct pursuant to Section 2.28 of the municipal
code.
Ann. please do not hesitate to call me with any questions that you may have. The best number to reach
me at today is 619.838.3312. Given the schedule for GPU consideration and approval (as you know the
Planning Commission hearing is scheduled for December 8th) I would appreciate a response as 500n as
possible.
Thank you for your consideration of this request.
cc. Mr. Ear! Trit4 President, Flier's Incorporated
/0./-3
COUNCIL AGENDA STATEMENT
Item II
Meeting Date: 11/22/05
ITEM TITLE:
Resolution Establishing a capital improvement project entitled CMP
Storm Drain Pipe Rehabilitation Program (DR-165) Project and
transferring existing funds from CIP "Western Chula Vista Infrastructure"
(GG-188) to DR-165 for said purpose.
Resolution Rejecting the August 17 and the September 7,2005 bids for
CMP Storm Drain Pipe Rehabilitation Program (DR-165).
Resolution Accepting the October 12, 2005 bids and awarding a
construction contract for the CMP Storm Drain Pipe Rehabilitation
Program (DR-I 65) Project.
SUBMITTED BY:
Director of Gener~l Services (:s-(J
City Manager '~ ~ YK
(4/Sths Vote: Yes X No ~
REVIEWED BY:
As part of an ongoing program to rehabilitate corrugated metal drainage pipe (CMF) throughout
the City, staff has identified a number of storm drain facilities, which are deteriorated and are in
need of rehabilitation. CMP Storm Drain Pipe Rehabilitation Program (DR-165) Project will
remove and replace those drainage facilities at three locations, which are in need of
rehabilitation.
RECOMMENDATION: That Council adopt the resolutions.
BOARDS/COMMISSIONS: Not applicable.
DISCUSSION:
CIP ESTABLISHMENT
The City's Corrugated Metal Pipe (CMF) rehabilitation program was budgeted for in the FY
2004/2005 budget process and is part of the Western Chula Vista Infrastructure Financing
Program whereby $3,000,000 was designated for CMF RehabilitationlReplacement. Staff is
recommending the establishment of a new capital improvement project specific to providing the
needed rehabilitation to drain facilities, at three locations which are now deteriorated. The
approval of the resolution will authorize the transfer of existing funds in the amount of $343,994
from CIP GG-188 "Western Chula Vista Infrastructure" to DR-165 for said purpose.
This project will replace approximately 430 linear feet of CMP. One-hundred percent (100%) of
the proposed project will occur on the west side of Chula Vista. The project will rehabilitate
three locations of the City's system of corrugated metal storm drain pipes (Attachment I). The
general scope of the project involves the removal and replacement of existing corrugated metal
pipe, including all labor, material, equipment, tools, transportation, mobilization, traffic control,
removal and disposal of existing improvements, and other work necessary to construct the
proj ect in accordance with City standards.
11-1
Page 2, Item II
Meeting Date 11/22/05
BID REJECTION
Historically the rehabilitation of CMP in the City has been done through two methods. One
method is the replacement of existing corrugated metal pipe with pipe made from other
materials. This involves digging a trench along the length of the pipe being replaced. A second,
more specialized trench-less method is the installation of a resin-impregnated tube into the
existing corrugated metal pipe. Said tube would then be pushed against the walls of the existing
pipe and allowed to cure. Hence the name of the method Cured In Place Pipe (CIPP). The
majority of our previous bids had specified both methods in each contract.
On July 12, 2005, after the first time the Project was advertised with both methods in the
specifications, General Service staff received no bids. Past contractors were consulted and staff
determined that the advertisement of a project with both methods specified was undesirable.
Contractors did not bid on the project because their profit is reduced when both methods are
being required. New project specifications were written to only include the sites were trenching
was required. The CIPP sites will be addressed in a separate contract in the near future. On
August 17, 2005, General Service received two bids for this project, however, we found both
contractors to be non-responsive due to errors in their bid documents. On September 7, 2005,
General Service staff received three bids for the CMP Storm Drain Pipe Rehabilitation project.
Staff found two bids to be non-responsive, again due to errors in their bid documents and one
contractor's license was not current and active. Orion Construction's price was over the project
budget but responsive. The scope of the project, however, was reduced due to a pipe failure at
one of the project sites which was replaced by City crews. At this time, staff recommends that
Council reject the bids received on August 17,2005 and September 7,2005.
BID OPEN DATE CONTRACTOR R/NR BID AMOUNT
July 12, 2005 No bids submitted No bids submitted
August 17, 2005 Metropolitan Construction NR-E $ 241,701.25
Orion Construction NR-E $ 388,430.00
September 7, 2005 Metropolitan Construction NR-E $ 278,851.75
CH& D Construction NR-E,L $ 239,535.00
Orion Construction R $ 383,430.00
R=Responsive / NR=Non-Responsive / E=Errors / L=License not current
BID ACCEPTANCE
On October 12, 2005, General Service staff received and opened bids from two contractors as
follows:
CONTRACTOR BID AMOUNT
1. Metropolitan Construction, Spring Valley, California $194,774.00
2. Palm Engineering, San Diego, California $247,300.00
11-2
Page 3, Item II
Meeting Date 11/22/05
The low bid by $194,774 is approximately 3% below the Engineer's estimate of $200,000. The
Engineer's estimate was based on average prices for similar types of work completed during the
last two years. References provided by the contractor have been reviewed and their work record
found to be satisfactory. The Contractor's license is current. After reviewing the low bid, staff
recommends awarding a $194,774 contract to Metropolitan Construction, Spring Valley,
California.
CONTRACT AMOUNT REVISION
The contract documents allow the City to decrease or increase the unit quantity for the
rehabilitation of additional pipes without a change in the contract unit price bid by the
Contractor.
DISCLOSURE STATEMENT
Attached is a copy of the contractor's Disclosure Statement (Attachment 2).
ENVIRONMENTAL STATUS
The Environmental Review Coordinator has reviewed the proposed project for compliance with
the California Environmental Quality Act (CEQA) and has determined that the project qualifies
for a Class 1 (c) (Existing Facilities) categorical exemption pursuant to Section 15301 of the
State CEQA Guidelines. Thus, no further environmental review is necessary.
STAFF COSTS
Rehabilitation projects are typically more complicated than new construction because more
controlling factors exist. The research is more extensive because little or no information exist on
older pipes and surrounding improvements. Right of way and easements determination, location
of property lines and access to the project sites become issues that take more time than usual.
Many times the pipe to be rehabilitated is under private & public improvements such as
landscape & irrigation, fences, retaining walls, concrete pads, steep slopes, utilities and other
improvements that require more design time to address all issues specific to the site (see tables
below).
Easement and ROW determination difficult due to scarce
monumentation information, property access difficulty due to private
fence over existing easement, steep slope within project site,
SURVEY $ 38,998.00 'Cuyamaca project site located in two different subdivisions, survey require
Avenue more time to tied down both subdivisions. Drainage easements
never been field surveyed, shown only on maps, project required
easements to be located in the ground.
Easement and ROW determination difficult due to scarce
monumentation information, property access difficult due to private
Minot Avenue fence over existing easement, heavy brush cover, drainage
easements never been field surveyed, shown only on maps, project
required easements to be located in the ground.
11-3
Page 4, Item II
Meeting Date 11/22/05
Easement and ROW determination difficult due to scarce
monumentation Information, property access difficult, steep slope
Monserate within project site, heavy brush cover, project site located in two
Avenue different subdivisions, survey require more time to tied down both
subdivision, drainage easements never been field surveyed, shown
only on maps, project required easements to be located in the
qround.
Easement and ROW determination difficult due to scarce
Guava monumentation information, property access difficulty due to private
fence over existing easement, heavy brush cover, drainage
Avenue easements never been field surveyed, shown only on maps, project
required easements to be located in the ground.
Field conditions different from old improvement plans, existing
cleanout buried, additional grading design due to undocumented fill
'Cuyamaca and unpermitted retaining wall, existing surface drainage pattern
Avenue inadequate, portion of existing pipe located on a steep slope, and
design of driveway necessary for installation of proposed pipe
Field conditions different from old improvement plans, existing
Minot Avenue surface drainage pattern inadequate, and design of driveway
necessary for installation of proposed pipe.
DESIGN $ 59,457.00 Field conditions different from old improvement plans, existing
Monserate surface drainage pattern inadequate, and design of a driveway,
Avenue sidewalk, and curb-outlet necessary for the installation of proposed
pipe. Special structural design for modified outlet required.
Field conditions different from old improvement plans, existing pipe
Guava under existing CMU wall, proximity to dwelling structures, existing
Avenue surface drainage pattern inadequate, and design of a driveway,
sidewalk, and curb-outlet necessary for the installation of proposed
oioe.
. Cuyamaca Avenue: pipe failure, City forces completed construction of this project site.
In addition to pre-construction activities, increased staff time is also required to inspect these
types of construction projects because of the same issues. $21,545 is estimated for Construction
Inspection, Geotechnical investigations and administrative staff. The controlling factors stated
above are all within each rehabilitation area and directly affect the staff cost for this project.
The staff cost of this project is also higher than usual because re-bidding process described.
All these different staff components total $120,000. All funds not used will be returned for use
in other locations as necessary.
11-4
Page 5, Item II
Meeting Date 11/22/05
FISCAL IMPACT:
At this time, staff recommends a transfer in the amount of $343,994 to establish capital
improvement project DRI65 and provide the necessary to funds to complete the project.
FUl'H)S REQUIRED FOR PROJECT
A. Contract Amount $194,774.00
B. Contingencies (approximately 15%) $29,220.00
C. Staff Costs (Survey, Design & Inspection) $120,000.00
TOTAL $343,994.00
FUNDS AVAILABLE FOR PROJECT
A. Transfer from in GG188 Western Chula Vista Infrastructure Program $343,994.00
TOTAL $343,994
There is no impact on the General Fund as the funds for these improvements have been provided
for as part of the Western Chula Vista Infrastructure Financing Program. Upon completion of
the project, the improvements will require only routine City drainage maintenance.
Attachments: I - Table I - Location & Sizes of Drainage Pipes to be Replaced
2 - Contractor's Disclosure Statement
M:\General Services\GS Administration\Council Agenda\DRl65 CMP Storm Drain Rehab\DR165 Storm Drain Pipe Rehabilitation
A113revised.doc
11-5
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tlTTA,CHMENT ~ /..-
City of Chula Vista Disclosure Statement
Pursuant to Council Policy 101-01, prior to any action upon matters that will require discretionary action
by tbe Council, Planning Commission and all otber official bodies of tbe City, a statement of disclosure of
certain ownership or financial interests, payments, or campaign contributions for a City of ChuIa Vista
election must be filed. The following information must be disclosed:
1. List tbe names of all persons having a fmancial interest in tbe property tbat is tbe subject of tbe
application or tbe contract, e.g., owner, applicant, contractor, subcontractor, material supplier.
J~ O. (')(h-z...
(JVt~1J.m&, m. Dfh'7
2. If any person" identified pursuant to (I) above is a corporation or partnership, list tbe names of all
individuals witb a $2000 investment in tbe business (corporation/partnership) entity.
J~e. h. D-rhL.-
'_ Y\~ 'lY\. DV-l-Cz...
3. If any person" identified pursuant to (1) above is a non-profit organization or trust, list tbe names
of any person serving as director of tbe non-profit organization or as trustee or beneficiary or
trustor of the trust.
4. Please identify every person, including any agents, employees, consultants, or independent
contractors you have assigned to represent you before tbe City in this matter.
<...b (). ()(-h'L..
tALlli-c-m ~Ol)""
5. Has any person" associated witb this contract had any financial dealings with an official" of tbe
City of Chula Vista as it relates to this contract witbin tbe past 12 months? Yes_ NoX
N:\EngineerIDESIGN\DRI65\CONTRACT SPECS NO CUY tJi;;:2AIDR 165 MINW AGE Boiler.06.09.05 NLINNING.doc
If Yes, briefly descD"'e the nature of the financial interest the official" may bave in this contract.
6. Have you made a contribution of more than $250 within 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 item of equivalent value) to an official" of the City
of Chula Vista in the past twelve (12) months? (Thjs 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: ['L+ I \ I ?-rJ:;b'
Signature of C tractor/Applicant
Jo~. O. Dy.:\,L..
Print or type name of Contractor/Applicant
, 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 of a board, commission, or committee of the City, employee, or staff members.
N:\EngineerIDESIGN\DRI65\CONTRACT SPECS NO CUY J:he&IDR 165 MINWAGE Boiler.06.09.05 NLINNING.doc
RESOLUTION NO. 2005-
RESOLUTION ESTABLISHING A CAPITAL IMPROVEMENT
PROJECT ENTITLED CMP STORM DRAIN PIPE REHABILITATION
PROGRAM (DR-165) PROJECT AND TRANSFERRING EXISTING
FUNDS FROM CIP "WESTERN CHULA VISTA
INFRASTRUCTURE" (GG-188) TO DR-165 FOR SAID PURPOSE.
WHEREAS, as part of an ongoing program to rehabilitate corrugated metal drainage pipe
(CMP) throughout the City, staff has identified a number of storm drain facilities, which are
deteriorated and are in need of rehabilitation. CMP Storm Drain Pipe Rehabilitation Program
(DR-165) Project will remove and replace those drainage facilities at three locations, which are
in need of rehabilitation; and
WHEREAS, staff is recommending the establishment of a new capital improvement
project specific to providing the needed rehabilitation to drain facilities, at three locations which
are now deteriorated; and
WHEREAS, the general scope of the project involves the removal and replacement of
existing corrugated metal pipe, including all labor, material, equipment, tools, transportation,
mobilization, traffic control, removal and disposal of existing improvements, and other work
necessary to construct the project in accordance with City standards; and
WHEREAS, the Environmental Review Coordinator has reviewed the proposed project
for compliance with the California Environmental Quality Act (CEQA) and has determined that
the project qualifies for a Class I (c) (Existing Facilities) categorical exemption pursuant to
Section 15301 of the State CEQA Guidelines. Thus, no further environmental review is
necessary; and
WHEREAS, there is no impact on the General Fund as the funds for these improvements
have been provided for as part of the Western Chula Vista Infrastructure Financing Program; and
WHEREAS, staff recommends the transfer of existing funds in the amount of $343,994
from CIP GG-188 "Western Chula Vista Infrastructure" to DR-165 for said purpose.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula
Vista does hereby authorize establishing a capital improvement project entitled CMP Storm
11-9
Drain Pipe Rehabilitation Program (DR-165) Project and transferring existing funds in the
amount of $343,994 from ClP "Western Chula Vista Infrastructure" (GG-188) to DR-165 for
said purpose.
Presented by
Jack GriffIn
Director of General Services
J:\attomey\reso\finance\Storm Drain -DR165 1
11-10
RESOLUTION NO. 2005-
RESOLUTION REJECTING THE AUGUST 17 AND THE
SEPTEMBER 7, 2005 BIDS FOR CMP STORM DRAIN PIPE
REHABILITATION PROGRAM (DR-165).
WHEREAS, as part of an ongoing program to rehabilitate corrugated metal drainage pipe
(CMP) throughout the City, staff has identified a number of storm drain facilities, which are
deteriorated and are in need of rehabilitation. CMP Storm Drain Pipe Rehabilitation Program
(DR-165) Project will remove and replace those drainage facilities at three locations, which are
in need of rehabilitation; and
WHEREAS, this project will replace approximately 430 linear feet of CMP; and
WHEREAS, on July 12, 2005, after the first time the Project was advertised with both
methods in the specifications, General Service staff received no bids; and
WHEREAS, on August 17, 2005, General Service received two bids for this project,
however, staff found both contractors to be non-responsive due to errors in their bid documents;
and
WHEREAS, on September 7, 2005, General Service staff received three bids for the
CMP Storm Drain Pipe Rehabilitation project. Staff found two bids to be non-responsive, again
due to errors in their bid documents and one contractor's license was not current and active, the
third bid was over the project budget; and
WHEREAS, at this time, staff recommends that Council reject the bids received on
August 17,2005 and September 7, 2005.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula
Vista does hereby reject the August 17 and the September 7, 2005 bids for CMP Storm Drain
Pipe Rehabilitation Program (DR-165).
Presented by
Approved as to form by
~~
Jack Griffin
Director of General Services
J:\attomey\reso\finance\Storrn Drain DR165 2
11-11
RESOLUTION NO. 2005-_
RESOLUTION ACCEPTING THE OCTOBER 12, 2005 BIDS AND
A W ARDlNG A CONSTRUCTION CONTRACT FOR THE CMP
STORM DRAIN PIPE REHABILITATION PROGRAM (DR-165)
PROJECT.
WHEREAS, as part of an ongoing program to rehabilitate corrugated metal drainage pipe
(CMP) throughout the City, staff has identified a number of storm drain facilities, which are
deteriorated and are in need of rehabilitation. CMP Storm Drain Pipe Rehabilitation Program
(DR-165) Project will remove and replace those drainage facilities at three locations, which are
in need of rehabilitation; and
WHEREAS, this project will replace approximately 430 linear feet of CMP; and
WHEREAS, on July 12, 2005, after the first time the Project was advertised with both
methods in the specifications, General Service staff received no bids; and
WHEREAS, on August 17, 2005, General Service received two bids for this project,
however, staff found both contractors to be non-responsive due to errors in their bid documents;
and
WHEREAS, on September 7, 2005, General Service staff received three bids for the
CMP Storm Drain Pipe Rehabilitation project. Staff found two bids to be non-responsive, again
due to errors in their bid documents and one contractor's license was not current and active, and
staff found the third bid to be over-budget; and
WHEREAS, on October 12, 2005, General Service staff received and opened bids from
two contractors as follows:
CONTRACTOR BID AMOUNT
1. Metropolitan Construction, Spring Valley, California $194,774.00
2. Palm Engineering, San Diego, California $247,300.00
WHEREAS, the low bid submitted by Metropolitan Construction (the "Contractor"), in
the amount of $194,774, is approximately 3% below the Engineer's estimate of $200,000; and
WHEREAS, references provided by the Contractor have been reviewed and its work
record found to be satisfactory and the Contractor's license is current; and
WHEREAS, the Environmental Review Coordinator has reviewed the proposed project
for compliance with the California Environmental Quality Act (CEQA) and has determined that
the project qualifies for a Class 1 (c) (Existing Facilities) categorical exemption pursuant to
11-12
Section 15301 of the State CEQA Guidelines. Thus, no further environmental revIew IS
necessary; and
WHEREAS, rehabilitation projects are typically more complicated than new construction
because more controlling factors exist, thus staff cost of this proj ect is also higher than usual
because of the re-bidding process.
NOW, TIffiREFORE, BE IT RESOLVED that the City Council of the City of Chula
Vista does hereby accept the October 12, 2005 bids and award a construction contract to
Metropolitan Construction, Spring Valley, California in the amount of $194,774 for the CMP
Storm Drain Pipe Rehabilitation Program (DR-165) Project.
Presented by
A roved as to form by
Jack Griffin
Director of General Services'
11-13
COUNCIL AGENDA STATEMENT
Item
Meeting Date:
I'd..-
11/22/05
ITEM TITLE:
Resolution Accepting bids, awarding a contract for the
"Pavement Rehabilitation Program FY04/05 Overlay in the City of Chula
Vista, California" project, a component of the 2005 Pavement
Rehabilitation project (STL-310) and authorizing the expenditure of all
available contingencies.
Resolution Authorizing a budget transfer in the amount of
$144,358 nom the Parks Parking Lot project (PR-236) to the "Pavement
Rehabilitation Program FY04/05 Overlay in the City of Chula Vista,
California" project, a component of the 2005 Pavement Rehabilitation
project (STL-31 0) as necessary to complete the project.
SUBMITTED BY:
Director of Gene~~~ Services a '*
City Manager ';11 ~ JlK
,
(4/5ths Vote: Yes-LNo->
REVIEWED BY:
On October 26, 2005, the Director of General Services received sealed bids for the "Pavement
Rehabilitation Program FY04/05 Overlay in the City of Chula Vista, California" project, a
component of the 2005 Pavement Rehabilitation project (STL-31O). The work consists of the
application of Asphalt Rubber Aggregate Membrane (ARAM) seal coat and pavement overlay on
various pavement locations in the City of Chula Vista, California. Work for this project also
includes the following: removal/replacement of failed pavement, striping, traffic control, and
other miscellaneous work, and all labor, material, equipment, and transportation necessary for the
proj ect.
RECOMMENDATION: That Council accept bids, and award the contract for the "Pavement
Rehabilitation Program FY04/05 Overlay in the City of Chula Vista, California" project, a
component of the 2005 Pavement Rehabilitation project (STL-310), to Koch-Armstrong General
Engineering, Inc. for $519,451.90, and authorize the expenditure of all available contingencies.
BOARDS/COMMISSIONS RECOMMENDATION: Not applicable.
DISCUSSION: Included in the FY2004-05 CIF Budget is a project for the rehabilitation of
deteriorating pavement throughout the city. Public Works Operations and Engineering, through
the Pavement Management System, developed a priority list of streets to be included in the
program. The total budget for the Pavement Rehabilitation Program FY2004/2005 is $3,500,000
nom Transnet Funds and includes overlay, chip seals, and slurry seals as maintenance strategies.
The ARAM pavement seal and overlay project will use $527,094.00 of the annual pavement
program funds and $144,358.00 nom the Parks Parking Lot Renovation project.
The total funding amount of $700,000.00 consists of the following: $519,451.90 is proposed to
be awarded to the contractor, Koch-Armstrong General Engineering, Inc., $20,000.00 shall be
12-1
Page 2, Item I A.
Meeting Date: 11/22/05
used for construction soils and pavement testing, $80,000.00 for City staff time (survey,
inspections, and design), and contingencies in the amount of$80,548.10.
The pavement rehabilitation project consists of utilizing the application of Asphalt Rubber
Aggregate Membrane (ARAM) seal coat on various pavement locations in the City of Chula
Vista, California. Typically, this maintenance strategy is performed on pavements, which have a
pavement condition necessitating rehabilitation beyond a slurry seal, but not requiring an overlay.
The purpose of this strategy is to prolong the pavement life of a street, prior to further
deterioration and the necessity for an overlay. This proj ect includes pavement overlay, the
application of ARAM seal coat, crack filler, striping and markings, traffic control, and other
miscellaneous work, and all labor, material, equipment, and transportation necessary for the
project, and described in these documents. The majority of the streets included with this project
are locations, which were included with previous projects as Priority 2 locations, but were not
completed with each respective project. The $144,358.00 from the Parks Parking Lot
Renovation project will be used for pavement rehabilitation of the Eucalyptus Park parking lot.
.
In addition, approval of this resolution authorizes the expenditure of all available contingencies
for the project. According to City Council Policy No. 574-01, if a change order exceeds the
cumulative contract change order aggregate amount allowable to be approved by the Director of
Public Works Operations, City Council approval is required. However, approval of tonight's
resolution will increase the Director of Public Works Operations' authority to approve change
orders as necessary up to the contingency amount of $80,548.10, authorizing staff to expend all
available contingencies and increase the value of the contract as necessary due to unforeseen
circumstances. Unforeseen circumstances (i.e. poor sub grade, utility conflicts, increase of dig-
out quantities, etc.) may cause an increase in quantities beyond what was anticipated during the
preparation of the proj ect specifications. A typical "unforeseen circumstance" situation occurs
during the dig-out process as pavement distress areas are repaired (dig-outs). Often times,
additional areas are repaired beyond what is anticipated due to the failing area increasing in size.
As a result, additional material is required to repair the areas and may lead to a necessary
"Change Order" to the contract. This is a typical situation with all pavement rehabilitation
projects.
.
Project Design staff has prepared specifications and advertised the project. Staff received and
opened 2 bids on October 26, 2005. Appendix "A" shows the list of streets included in the
project. The City received the following bids:
CONTRACTOR BID AMOUNT
1. Koch-Armstrong General Engineering, Inc. $519,451.90
2. Frank & Son Paving, Inc. $534,553.00
.
The low bid submitted by Koch-Armstrong General Engineering, Inc. exceeds the Engineer's
estimate of $464,417.00 by $55,034.90 (12%). The Engineer's estimate was based on an
expectation of unit prices based on past projects. However, we have noticed an increase in
12-2
Page 3, Item JL
Meeting Date: 11/22/05
materials costs throughout the City, thus resulting in higher bids than anticipated. Staff has
verified the references provided by the contractor and their work has been satisfactory.
Disclosure Statement
Appendix "B" is a copy of the contractor's Disclosure Statement.
Environmental Status
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 1 categorical exemption pursuant to Section 15301 (Existing Facilities) of the State CEQA
Guidelines. Thus, no further environmental review is necessary.
Wage Statement
Contractors bidding this proj ect are not required to pay prevailing wages to persons employed by
them for the work under this proj ect.
Proiect Budget Transfer
The City's budget transfer policy calls for City Council's approval for transfers more than
$15,000 between project budgets. Transfer of funds in the amount of $144,358 from the Parks
Parking Lot project (PR-236) available. balance will provide sufficient funds necessary to
complete the "Pavement Rehabilitation Program FY04/05 Overlay in the City of Chula Vista,
California" proj ect.
FISCAL IMPACT:
FUNDS REQUIRED FOR PROJECT
A. Contract Amount (American Asphalt South, Inc.) $519,451.90
B. Contingencies (Approx. 15%) $80,548.10
C. Staff Costs, Design & Inspection $80,000.00
D. Construction Testing $20,000.00
TOTAL FUNDS REQUIRED FOR CONSTRUCTION $700,000.00
FUNDS AVAILABLE FOR PROJECT
STL310 (Transnet Funds) $555,642.00
Parks Parking Lot Renovation $144,358.00
TOTAL FUNDS AVAILABLE FOR CONSTRUCTION $700,000.00
Upon completion of the project, the improvements will reqUIre only routine City street
maintenance.
Attachments: A.
B.
List of streets to be rehabilitated.
Contractor's Disclosure Statement
M:\General Services\GS Administration\Council Agenda\STL.310 Overlay\STL310 Rev Al13 l03105.doc
12-3
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12-4
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ATTACHMENT P
City of Chula Vista Disclosure Statement
Pursuant to Council Policy 101-0 1, 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 [mancial interests, payments, or campaign contributions for a City of Chula Vista
election must be filed. The following information must be disclosed:
1. List the names of all persons having a financial interest in the property that is the subject of the
ap lication or the contract, e.g., owner, applicant, con tor, subcontractor, material supplier.
. . . ~ICtL
i'~ceJf:{'lM: Sat jlfu .
2. If any person' identified pursuant to (1) above is a corporation or partnership, list the names of all
rnn_wiili.$2",. =_'~~~~~,.
~ )\/IC[filSl~ll(,Cy;{I-/-rrR ~ ,
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
trusto: of the trust.
~OY"le-
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.
jJ~fJO~
5. Has any person' associated with this contract had any financial dealings with an official" of the
City of Chula Vista as it relates to this contract within the past 12 months? Yes_ NoL
M:IGeneral ServicesIDesignlSTL31 OlSTL310 overlay-contralg;;-c 5
If Yes, briefly describe the nature of the financial interest the official" may have in this contract
6. Have you made a contribution of more than $250 within the past twelve (12) months to a current
member of the Chula Vista City Council? No X Yes _ If yes, which Council member?
7. Have you provided more than $340 (or an item of equivalent value) to an official" of the City
ofChula Vista in the past twelve (12) months? (This includes being a source of income, money to
retire a legal debt, gift, 10aI)-, etc.) Yes _ No X-
If Yes, which official" and what was the nature of item provided?
Date:()('k6.r P{(J/2i05
v Sttr~+(1ry
,
Person is defmed 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 of a board, commission, or committee of the City, employee, or staff members.
M:IGeneral ServicesIDesignlSTL31 OlSTL31 0 OverlaY-ContraJ~o~ 6
RESOLUTION NO. 2005-_
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA
ACCEPTING BIDS, AWARDING A CONTRACT FOR THE "PAVEMENT
REHABILITATION PROGRAM FY 04/05 OVERLAY IN THE CITY OF
CHULA VISTA, CALIFORNIA" PROJECT, A COMPONENT OF THE 2005
PAVEMENT REHABILITATION PROJECT (STL-31O) AND AUTHORIZING
THE EXPENDITURE OF ALL AVAILABLE CONTINGENCIES AS
NECESSARY TO COMPLETE THE PROJECT.
WHEREAS, City staff has prepared specifications for the "Pavement Rehabilitation
Program FY 04/05 Overlay in the City of Chula Vista, California" project and advertised the
proj ect; and
WHEREAS, On October 26, 2005, the Director of General Services received sealed bids
for the "Pavement Rehabilitation Program FY 04/05 Overlay in the City of Chula Vista,
California" project a component of the 2005 Pavement Rehabilitation project (STL-31 0); and
WHEREAS, the work to be done consists of the application of Asphalt Rubber Aggregate
Membrane (ARAM) seal pavement coats on various pavement locations in the City of Chula
Vista, California; and
WHEREAS, due to unforeseen circumstances, which occur during the dig out process of
the pavement rehabilitation, the scope of the rehabilitation sometimes increases once the
subgrade of the pavement area is exposed and poor soil conditions are encountered; and
WHEREAS, as a result of these circumstances, dig out quantities exceed what was
anticipated, which was originally based on surface evaluation by City staff prior to the dig out
process; and
WHEREAS, staff recommends authorization to increase the value of the contract to
expend all available funds for this project due to unforeseen circumstances up to the contingency
amount of$80,548.10; and
WHEREAS, staff has verified the references provided by the contractor and their work
has been satisfactory; and
WHEREAS, staff has reviewed the low bid and is recommending awarding the contract
to Koch-Armstrong General Engineering, Inc. of San Diego, California; 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 1 categorical exemption pursuant to Section 15301 of the State
CEQA Guidelines; and
12-7
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City ofChula Vista does
hereby accept bids, authorizing staff to increase value of the contract to expend all available
funds and awarding a contract for the "Pavement Rehabilitation Program FY 04/05 Overlay in
the City of Chula Vista, California" to Koch-Armstrong General Engineering, Inc. of San Diego,
California.
Presented by
Approved as to form by
~~)
Ci Attorney
Jack Griffm
Director of General Services
12-8
RESOLUTION NO. 2005-
RESOLUTION AUTHORIZING A BUDGET TRANSFER IN THE
AMOUNT OF $144,358 FROM THE PARKS PARKING LOT
PROJECT (PR-236) TO THE "PAVEMENT REHABILITATION
PROGRAM FY04/05 OVERLAY IN THE CITY OF CHULA VISTA,
CALIFORNIA" PROJECT, A COMPONENT OF THE 2005
PAVEMENT REHABILITATION PROJECT (STL-3l0) AS
NECESSARY TO COMPLETE THE PROJECT.
WHEREAS, The total budget for the Pavement Rehabilitation Program FY2004/2005 is
$3,500,000 from Transnet Funds and includes overlay, chip seals, and slurry seals as
maintenance strategies; and
WHEREAS, The ARAM pavement seal and overlay project will use $527,094.00 of the
annual pavement program funds and $144,358.00 from the Parks Parking Lot Renovation fund;
and
WHEREAS, The total funding amount of $700,000.00 consists of the following: $519,451.90 is
proposed to be awarded to the contractor, Koch-Armstrong General Engineering, Inc.,
$20,000.00 shall be used for construction soils and pavement testing, $80,000.00 for City staff
time (survey, inspections, and design), and contingencies in the amount of $80,548.1 0; and
WHEREAS, The City's budget transfer polj.cy calls for City Council's approval for
transfers more than $15,000 between project budgets; and
WHEREAS, Staff recommends the transfer of funds in the amount of $144,358 from the
Parks Parking Lot project (PR-236) available balance which will provide sufficient funds
necessary to complete the "Pavement Rehabilitation Program FY04/05 Overlay in the City of
ChuIa Vista, California" project; and
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula
Vista does hereby athorize a budget transfer in the amount of $144,358 from the Parks Parking
Lot project (PR-236) to the "Pavement Rehabilitation Program FY04/05 Overlay in the City of
Chula Vista, California" project, a component of the 2005 Pavement Rehabilitation project
(STL-3l0) as necessary to complete the project.
Jack Griffin
Director of General Services
Approved as to form by
~
AlJri/ 00
qjY.Y Attorney
Presented by
12-9
COUNCIL AGENDA STATEMENT
Item
Meeting Date
/3
11/22/05
ITEM TITLE:
Staff Report on Utility Undergrounding Program Funding and Priorities
SUBMITTED BY:
City Engineer ~ ,
City Manager rf~ PK:
(4/5ths Vote: Yes NoX)
REVIEWED BY:
In August 2005 an Infonnation Item was presented to Council regarding the City's Utility
Undergrounding Program, This item discussed the estimated costs for the Undergrounding Districts
that have not yet been constructed and the ramifications of expediting the design and construction of
L Street from Monserate Avenue to Nacion Avenue. This report provides more details on said
project and the overall City Utility Undergrounding Program. Staff has subsequently met with
representatives of the property owners in the L Street Undergrounding District, as well as the utility
companies and is presenting the following report outlining currently projected schedules and costs
involved for the recommended alternative.
RECOMMENDATIONS: That Council accept the staffreport.
BOARDS/ COMMISSIONS RECOMMENDATION: Not applicable.
DISCUSSION:
Back!!round
The City's policy regarding the undergrounding of utilities is addressed in Chapter 15.32 of the
Municipal Code. All new developments in the City must have underground utilities, which shall
include electrical, communications and cable television services. Such utilities can be
undergrounded in existing areas with overhead utilities through formation of Utility Undergrounding
Districts. A public hearing is held for all property owners within the boundary of the proposed
district, which is then formed through the adoption of a Council resolution. San Diego Gas &
Electric (SDG&E) generally takes the lead in the design and construction of undergrounding projects
in developed areas, although SBC, Cox Communications and other cable companies are also
involved. Actual design and construction activity is subj ect to SDG&E staffing and scheduling. The
funding and execution of such Undergrounding Districts must comply with Rule 20 of the California
Public Utilities Commission. Rule 20A provides for the undergrounding of existing overhead
electrical facilities at SDG&E's expense where both the City and SDG&E agree that it is in the
general public interest. Rule 20B provides for the undergrounding of existing electrical facilities at
the expense of either a group of property owners or a municipality.
Under!!round Conversion Pro!!ram
The City's Utility Underground Conversion Program was instituted in 1968. The Council approved
subsequent Utility Undergrounding Programs in 1979, 1984 and 1991. Streets were selected for the
13-1
Page 2, Item I)
Meeting Date 11/22/05
Undergrounding Program in accordance with the City's rating system, which was originally
approved by Council in November 1972 and revised in July 1979 (Attachment A). The streets in the
1991 program included Fourth Avenue, E Street, F Street, Palomar Street, Broadway, Main Street, L
Street, Otay Lakes Road and J Street. An update to the Undergrounding Program was included as an
Attachment to Ordinance 2746, which was adopted on September IS, 1998 (Attachment B). This
did not revise the City's list of priorities, but presented a schedule for the completion of the priority
projects. Since that date, the City has added one undergrounding project at Council's request,
Quintard Street !Tom Third A venue to Orange A venue. This District was formed in November 2002
and construction has since been completed.
The district formation process has been completed for all 15 projects included on the 1998 list
(Attachment B) and construction has been completed on 9. As noted above, one additional project
was completed at Council's request, bringing the totals to 16 identified projects, 10 completed to
date. Target project dates shown in the 1998 list have been modified through the years due to
competing priorities and in consideration of available funding. The following table reflects the
projects remaining !Tom the 1998 list that have been officially established as Utility Undergrounding
Districts by Council with the most recent estimated construction dates and costs. Note that the three J
Street projects have been combined into two larger projects.
Fourth Avenue !Tom L Street to Oran e Avenue
L Street !Tom Monserate Avenue to Nacion Avenue
includes Nolan Wa
L Street !Tom Broadwa to Third Avenue
'J Street !Tom Broadwa to Hillto Drive
J Street !Tom Hillto Drive to Lori Lane
Total Estimated Cost 2005 Dollars
2013
2014
2015
$2,009,000
$2,038,259
$1,553,320
$10,221,579
The Fourth Avenue Undergrounding District construction is currently in progress. This project is
being done in conjunction with STL-291, Fourth Avenue Sidewalk Improvements between L Street
and Orange Avenue. SDG&E has completed the initial design for this project, and the 30 percent
design has been provided to the utility companies for comments. The construction ofthis project is
scheduled for completion by mid-2007.
In addition to citywide undergrounding projects, the City entered into a Memorandum of
Understanding (MOD) with SDG&E on October 12, 2004 that included agreements regarding the
undergrounding of the BayfTont 13 8KV transmission lines. On November 9, 2004 Council approved
two new ten-year !Tanchise agreements with SDG&E for the provision of gas and electrical service.
Both the MOU and the electrical franchise agreement affirmed the importance of under grounding
said transmission lines along the BayfTont as a major utility priority of the City. In the MOU, the
I Although all construction work is scheduled for completion by the end of2007, funding will not be deducted from
the 20A funds until 2008 as shown on Attachment'C. '
13-2
Page 3, Item I")
Meeting Date 11/22/05
City agreed to designate its entire unspent 20A allocation for Bayfi-ont undergrounding, in addition to
half its $2 million annual allocation from 2004 to 2013. Approximately $6.7 million out of the
City's allocation balance of$8.7 million (as of March 31, 2005) is set-aside for the Bayfi-ont Project.
It is currently estimated that the total Proj ect cost will be approximately $17 million. As further
discussed in the MOU, the City may borrow ahead a maximum of$10 million (5-year allocation)
interest-free to finance the Bayfront Undergrounding Project. Due to the structure of the MOU, the
Bayfront project is tracked separately from citywide projects. Attachment C provides a detailed
breakdown of the funding projections.
Current Issues and Recommended Action Plan
Residents within the boundary ofthe proposed district on L Street from Monserate to Nacion have
requested that the City expedite the undergrounding oftheir utilities. Staff has investigated several
options and recommends that the next two Undergrounding Districts be completed in the following
order to fulfill commitments made to residents:
I. Complete the construction of the Fourth Avenue Undergrounding District
2. Design/construct L Street District from Monserate Avenue to Nacion Avenue
This recommended action plan would expedite construction of the L Street District between
Monserate Avenue and Nacion Avenue without disrupting the construction of the Fourth Avenue
Project and disappointing the property owners along Fourth Avenue who have already been notified
of the construction schedule for this project. It is important to note that this L Street project also
includes Nolan Way. The schedule for each project is dependent on SDG&E's workload and the
amount of 20A funds that are available each year. After discussions with SDG&E and the other
utilities representatives, staff concluded that the L Street District, between Monserate and Nacion
Avenues can be designed in 2006 and completed in 2007. Two representatives of the property
owners participated in said discussions with SDG&E and concurred with the recommended schedule.
Next Steps
Staff has met with a group of property owners from Alpine and Minot Avenues who have requested
that their streets be included on a priority list for utility undergrounding. It does not appear that their
neighborhood would have a high ranking based on the City's existing criteria and the Rule 20A
regulations, which give priority to streets with heavy volumes of traffic, a heavy concentration of
overhead electrical facilities or location in civic or recreational areas. Staff is currently working
with these property owners in an attempt to address their main concern, which involves pavement
rehabilitation.
However, given this neighborhood request, continuing competing priorities and the fact that the
project priority list has not been updated since 1998, it is recommended that staff return to Council in
2006 so that Council can have the opportunity to:
1. Consider the current big picture regarding remaining overhead utilities;
2. Discuss funding options;
3. Revisit the rating criteria in consideration of current Council priorities; and,
13-3
Page 4, Item /3
Meeting Date 11/22/05
4. Create an updated citywide priority list for utility undergrounding projects.
FISCAL IMPACT:
Selection of the recommended action plan will not have any fiscal impact on the City.
.
Attachments:
A. Rating System for Undergrounding of Utilities
B. Utility Undergrounding Table included as part of Ordinance 2746
C. Utility Undergrounding Program Funding Projections
.
J:IEngineerIAOENDAICAS2005111-22-05IUtiIity UndergroundinglUtiIity Undergrounding ReportDOC
13-4
AnACHMENT A
June 20, 1979
~
Sheet 1 of 3 Sheets
RATING SYSTEM FOR uNDERGROUNDING OF UTILITIES
TRANSMISSION AND DISTRIBUTION FACILITIES PROIECrS
A. EXPOSURE
1. Traffic
Assign one point for every 2,000 ADT. Use estimated post-construction ADT
for projects under construction, or financed and scheduled for construction within
two years.
MAXIMUM POINT VALUE - l5.1x>ints
"
2. Entrance to City
Assign 5 points for segment approximately one-quarter mile in length and
terminating at a freeway interchange (either existing or under cqnstruction).
FIXED POINT VALUE - 5 points
(fotal Al plus A2 = a maximum of 20 points)
B. AESTHETIC BENEFIT
1. Assign a maximum of 10 points on the basis of the evaluating group's perception
of the BENEFIT of undergrounding the segment. The points are to be assigned
based on a comparative evaluation of the characteristics of the segment. Factors
to be considered include but are not limited to:
a. Number 0& ,Signs
b. Width of Street
c. Number of Poles, height & diameter
d. Number of Crossarms
e. Number of Circuits
f. Height and Location of Existing Buildings (setbacks)
g. Character of adjacent proPerties (residential, commercial, etc.)
h. Presence of Street Trees
MAXIMUM POINT VALUE - 10 points
(continued on next page)
13-5
PAGE 2
2. Parks and Public Buildings
Assign points dependent upon size, aesthetic value, and location of park or public
building relative to project area (Note: Normal points for principal park or
building frontage, 3 points; side exposure, 1 point).
MAXIMUM POINT VALUE - 5 points
(Total Item BI plus Item B2 - Maximum 15 points)
C. RELATIONSHIP TO APPROVED UNDERGROUNDING DISTRIcrlPREVIOUSLY
UNDERGROUNDED FACILITIES
1.
Assign 5 points to the project if it extends either an approved undergrounding
district or a previously undergrounded facility.
.
FIXED POINT VALUE - 5 points
2. Assign 10 points to the project if it is a closing link between any combination of
approved undergrounding district(s) and/or previously undergrounded facilities.
FIXED POINT VALUE - 10 points
3. Where the proposed project intersects either an approved undergrounding district
or a previously undergrounded facility, assign one point to each leg (whether to
the right or to the left).
MAXIMUM POINT VALUE - 4 points
4. Assign a maximum of 5 points to' the project if there is either an approved
undergrounding district, or previously undergrounded facilities exist along one
side of the subject street segment.
,
,
MAXIMUM POINT VALUE - 5 points
(Total Item CI plus Item C2 plus Item C3 plus Item C4 = a maximum 12 points)
D. ASSOCIATED CONSTRUCTION
Assign 15 points to a street segment scheduled for widening during the current or next
fiscal year.
FIXED POINT VALUE - 15 points
(continued on next page)
13-6
PAGE 3
E. PROPERTY OWNER FUNDING .
Assign a maximum of 10 points where property owners formally agree to finance a
significant share of undergrounding the distribution and/or transmission facilities.
MAXIMUM POINT VALUE - 10 points
SB/A-113SIUNDRGRND.SMN
101591
,
,
13-7
ATTACHMENT
B
Ordinance 2746
Page 10
CITY OF CHULA VISTA
UTILITY UNDER GROUNDING PROGRAM
UTILITY UNDERGROUNDING PROJECTS TO BE COMPLETED BY END OF 1999:
STREET LIMITS DISTRICT NUMBER
liE" Street Broadway to T oyan Lane 123
Main Street Industrial Boulevard to Third Avenue 126
Otay Lakes Road Ridgeback to Apache Drive 129
Palomar Street I 5 to Industrial Boulevard 127
FUTURE UTILITY UNDERGROUNDING PROJECTS TO BE COMPLETED IN 2000:
STREET LIMITS ESTIMA TED COST
Broadway "C" Street to "E" Street $513,000
Fourth Avenue "H" Street to "L" Street $ 1 ,000,000
Orange Avenue Palomar Street to Fourth Avenue $ 440,000
TOTAL $1,953,000
FUTURE UTILITY UNDERGROUNDING PROJECTS TO BE COMPLETED IN 2001:
STREET LIMITS ESTIMATED COST
Otay Lakes Road Bonita Road to Camino Del Cerro Grande $2,250,000
FUTURE UTILITY UNDERGROUNDING PROJECTS TO BE COMPLETED IN 2002:
STREET LIMITS ESTIMA TED COST
Fourth Avenue "L" Street to Orange Avenue $1,150,000
"L" Street Monserate Avenue to Nacion Avenue $340,000
"L" Street Broadway to Third Avenue $ 700,000
TOT AL $ 2, 190,000
FUTURE UTILITY UNDERGROUNOING PROJECTS TO BE COMPLETED IN 2003:
STREET LIMITS ESTIMA TED COST
Olay Lakes Road Camino Del Cerro Grande to Ridgeback Road $2,100,000
TOTAL $2,100,000
FUTURE UTILITY UNDERGROUNDING PROJECTS TO BE COMPLETED IN 2004:
STREET LIMITS ESTIMA TED COST
"J" Street East of Broadway to Third Avenue $700,000
"J" Street East of Nacion Avenue to West of Lori Lane $290,000
.. J" Street Third Avenue to First Avenue $475,000
TOTAL $1 ,465,00D
13-8
ATTACHMENT C
UTILITY UNDERGROUNDING PROGRAM
FUNDING PROJECTIONS
FUND ALLOCATION SUMMARY FOR BAYFRONT UNDERGROUNDING
Allocation 2004-2007
$4,737,049 $4,737,049
2004-2007 $4,000,000 $8,737,049
2008 $1,000,000 $17,000,000 ($7,262,951) *
Unspent 20A Allocation 12/03
Bayfront Undergrounding
Allocation 2009-2012
Total
$8,000,000
$17,'737 4~ !$17,OOO~OOO
$737,049
* This funding needs will be met through the borrow-forward provision in the MOU. It is anticipated
that the total amount borrowed in 2008 will be repaid by 2012, leaving approximately $737,049 for
allocation to citywide utility undergrounding projects.
FUND ALLOCATION SUMMARY FOR CITYWIDE PROJECTS
Description Allocation Fund PrC)Iec:t Cost RemaIning
Year Allocation l2005 $\ Funds
Allocation 2004-2006 $3,000,000 $3,000,00
Fourth Ave. from l. St. to Orange 2007 $1,000,000 $2,967,000 $1,0~3,OOO
AVe.
L St. from Monserate Ave to Nacioh 2008 $1,000,000 $1,654,000 $379,000
(includes Nolan Way)
L St. from Broadway to Third Ave. 2013 $2,737,049 $2,009,000 $1,107,049
J St. from Broadway to Third Ave. 2014 $2,000,000 $2,038,259 $1,068,790
J St. from Hilltop Drive to Third Ave. 2015 $2,000,000 $1,553,320 $1,515,470
Total $11.737.049 $10.221,579
J:\Engineer\AGENDA\CAS2005\ 11-01-05\Utillty UndergroundinglAttachment C_,ev.doc
13-9
Item / if
Meeting Date 11/22/05
COUNCIL AGENDA STATEMENT
ITEM TITLE:
A) Resolution of the City Council of the City of Chula Vista,
California, approving the form of the Second Amendment to the
AcquisitionlFinancing Agreement for Community Facilities District No.
2001-I(San Miguel Ranch)
B) Resolution ofthe City Council of the City ofChula Vista,
acting in its capacity as the legislative body of Community Facilities District
No. 200 I-I (San Miguel Ranch), Authorizing and providing for the issuance
of special tax bonds of such Community Facilities District for Improvement
Area B thereof, Approving the form of Bond Indenture, Bond Purchase
Contract and other documents related thereto and authorizing certain actions
in connection with the issuance of such bonds
SUBMITTED BY:
City Engineer ~
Director ofFinance.~.
/:'/7 Q
City Manager'J!. .r' t:..
(4/Sths Vote: Yes_No.XJ
REVIEWED BY:
On December 4,2001 the Council held the public hearing forming and establishing Improvement
AreaB in Community Facilities District No. 2001-1(CFD No. 2001-1). The district was formed for
the purpose of providing for the financing and acquisition of certain authorized public facilities
including a significant portion of Mount Miguel Road. On December 17, 2001 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 for Improvement Areas A and B, and heard the first reading of the
ordinance to authorize the Levy of a Special Tax in Improvement Areas A and B. On November 14,
2003 Council approved the first amendment to the AcquisitionlFinancing Agreement for CFD No.
2001-1. On January 25, 2005 a Public Hearing was held to modify the facilities to be financed by
Improvement Area B, revise the Rate and Method of Apportionment for Improvement Area B and to
annex property into Improvement Area B. On February 8, 2005 Council heard the election results,
which approved these modifications.
Tonight, Council will consider I) approving the Second Amendment of the Acquisition/Finance
Agreement with NNP- Trimark San Miguel Ranch, LLC. This amendment will include the addition
ofthree traffic signals, revise text for DIF sub accounts and add certain public facilities and parks as
eligible facilities. In addition, Council will consider 2) the authorization of the issuance of special
tax bonds ofCFD No. 2001-1 Improvement Area B in the amount of$14,000,000 and approving the
form of certain documents related to the issuance of the bonds including a Bond Indenture, Bond
Purchase Contract and Preliminary Official Statement.
/J./-/
Page 2, Item---1B--
Meeting Date 11/22/05
RECOMMENDATION: That Council:
. Approve the Resolution (A) approving the Second Amendment to 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 Community Facilities District No. 2001-1, and
. Approve the Resolution (B) authorizing the issuance of Bonds, approving the form of the
Bond Indenture, Bond Purchase Contract and other documents for Community Facilities
District No. 2001-1 Improvement Area B and authorizing certain actions in connection
therewith.
BOARDS/COMMISSIONS RECOMMENDATION: Not applicable.
DISCUSSION:
Back!!round
CFD No. 2001-1 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. Bonds were sold for $14,425,000 on August 1,2002 for Improvement Area A. Most ofthe
reimbursable base increment has been paid for Improvement Area A. The remaining Improvement
Area A funds are reserved for retention payment at the time the City accepts the acquired facilities.
On October 14,2003 Council approved the first amendment to the AcquisitionlFinancing Agreement
for CFD No. 2001-1. On January 25,2005 a Public Hearing was held to modify the facilities to be
financed within Improvement Area B, revise the Rate and Method of Apportionment for
Improvement Area B, and to annex property into Improvement Area B. On February 8, 2005
Council heard the election results, which approved these modifications..
Improvement Area B Boundaries
Exhibit I (attached) represents the recorded amended boundaries ofCFD No. 2001-1, which includes
all parcels located within San Miguel Ranch. This exhibit also depicts the boundaries of each of the
Improvement Areas A and B designated within CFD No. 2001-1. Improvement Area B is divided
into two distinct areas and uses, one being residential and one being commercial. The western
portion, which is solely residential, is bordered on the north by the existing, unincorporated
residential area of Sunnyside, to the west and south by Proctor Valley Road, and to the east by the
proposed South Bay Expressway alignment. The southeastern portion is a commercial site bordered
to the west by Mt. Miguel Road, to the north by Proctor Valley Road, to the east by residential multi-
family in San Miguel Ranch, and to the south by Mackenzie Creek Park and Marshall Elementary
School.
/ L/ -.:2..
Page 3, Item /!:f
Meeting Date 11/22/05
Development at buildout within Improvement Area B as described within the appraisal will contain
286 single- family detached residences and 14.4 commercial acres.
Currently, in Improvement Area B, the ownership is as follows:
. Proctor Valley West Partners, LLC, owns 112.15 acres with plans to build 286 single-family
units.
. McMillin San Miguel Ranch, LLC, owns 14.40 acres with plans to construct a retail
commercial site.
The Improvements
Improvement Area A bonds were sold on August 1,2002. In April of2005, Proctor Valley West
Partners, LLC, requested to have bonds sold for Improvement Area B. Preliminary estimates show
that the maximum tax revenue (using the proposed taxes) from all the taxable properties within
Improvement Area B would support a total bonded indebtedness of approximately $12.2 million
(assuming a 5.35% interest rate and a 30-year term on the bonds). This borrowing will finance
approximately $10.4 million in facilities (i.e., grading, landscaping, streets, utilities, drainage, sewer,
etc).
The developer is proposing the financing of backbone and associated improvements (i.e., grading,
sewer, streets, dry utilities, etc.) as described below. CFD policy requires a determination of the
priority for the acquisition of improvements by a CFD. Staff, consultants, and land developers have
prioritized the developer's list ofprojects as follows:
A. Prioritv Items:
. San Miguel Ranch Road
. Proctor Valley Road (West)
. Those Facilities to be financed from the Proceeds of Public Facilities Development
Impact Fees payable as a condition of development of property within CFD No. 2001-
I.
. Those Facilities to be financed from the Proceeds of the development portion of the
Park Acquisition and Development Fees payable as a condition of development of
property within CFD No. 2001-1.
Special Tax Report
A copy of the Amended Special Tax Report Community Facilities District No. 2001-1 for San
Miguel Ranch 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 "Amended Rate
and Method of Apportionment" (RMA) for Improvement Area B (previously approved by Council
on December 15,2004) that establishes the procedures for levying the special taxes in CFD No.
2001-1.
1~-3
Page 4, Item I ~
Meeting Date 11/22/05
City Financial Criteria
Value to Lien Ratio: The City's Statement of Goals and Policies for Community Facilities Districts
("CFD policy") requires a minimum value to lien ratio of 4: I. 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. "
Bruce W. Hull & Associates conducted an appraisal (dated August 1,2005) on the property.
Exhibit 2 illustrates an Improvement Area B bond sale of$12.2 million, resulting in an overall lien
ratio of9.12:1, thereby meeting the City's financial criteria for value to lien.
Resolution
There are two resolutions on today's agenda that, if adopted, will accomplish the following:
(A) The RESOLUTION APPROVING THE SECOND AMENDMENT TO THE
ACQUISITION/FINANCING AGREEMENT for Community Facilities District No.
2001-1 (San Miguel Ranch) is the formal action approving the Amended
AcquisitionlFinance Agreement (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.
· This amendment will allow additional facilities as follow:
o Those facilities to be financed from the proceeds of the development
portion of the Park Facilities Acquisition and Development Fee (PAD).
o Those facilities to be financed from the proceeds of Public Facilities
Development Impact Fees (PFDIF).
o Traffic Signals at Proctor Valley Road at San Miguel Ranch Road,
A venida Loretta at San Miguel Ranch Road and Circulo Altamira at San
Miguel Ranch Road.
· This amendment will allow the City ofChula Vista to use bond proceeds to build
its own TDIF facilities and authorize the transfer of TDIF credit from
/4-4
Page 5, Item I t-/
Meeting Date 11/22/05
Improvement Area A to the commercial property in Improvement Area B.
(B) THE RESOLUTION AUTHORIZING THE ISSUANCE OF BONDS AND APPROVING THE
FORM OF CERTAIN RELATED DOCUMENTS" authorizes the issuance oflimited obligation
bonds, pursuant to the Mello-Roos Act in a principal amount not to exceed $14,000,000. 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
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 Contract (Exhibit 6) authorizing 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
$181,500.
. Continuing Disclosure Agreement between the City and U.S. Bank Trust National
Association, as dissemination agent, pursuant to which 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 ref1ecting financial difficulties ofCFD No. 2001-1
It should be noted that Council would only be approving the form ofthe 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 are permitted
which would result in the annual interest rate on the bonds to exceed 6.5 %.
Future Actions
Adoptions of tonight's Resolutions will approve the Second Amendment to the
Acquisition/Financing Agreement for CFD No. 2001-1 and authorize the issuance of bonds, as well
as approve the form ofrelated documents. The issuance of the bonds is anticipated in November
2005.
FISCAL IMP ACT:
The City's General Fund receives 1% ofthe bond sale amount in accordance with the CFD Policy for
the use ofthe 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
14-~
.
14
Page 6, Item
Meeting Date 11/22/05
Reimbursement Agreement. The developer will pay for the full cost recovery of stafftime involved
in district formation and administration activities. Staff anticipates that much ofCFD No. 2001-1
Improvement Area B's administration will be contracted out.
Attachments
Exhibit 1: Recorded Amended Boundary Map for CFD No. 2001-1
Exhibit 2: Estimated Value to Lien Ratios Based on Appraisal
Exhibit,: Preliminary Official Statement for CFD No. 2001-1
Exhibit~: Bond Indenture for CFD No. 2001-1
ExhibitS: Bond Purchase Contract for CFD No. 2001-1
J:\Engineer\AGENDA\CAS2005\1 1-22-05\CFD2001-I\CAS 11-01-05 Bond Docs and Amend AFA Rev2.doc
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- U EXFlIBIT ~?
Stradling Yocca Carlson & Rauth
Draft ofAugu:H lf}, r:::p.ntp.mhpr 29,1 2005
PRELIMINARY OFFICIAL STATEMENT DATED
OCTOBER, 2005
NEW ISSUE - BOOK-ENTRY-ONLY NO RATING
In the opinion of Best Best & Krieger LLP, Bond Counsel, based on an analysis of existing fC1';t,ls. regy/ations, rulings and court decisions,
and assummg, among other matters, comR/iance 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 opmion 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 adiustea current earnings in calculating federal
corporate alternative minimum taxable income. Bond Counsel expresses no ol!inion regarding any other f!deral or state income tax
consequences relating to the ownership or disposition of, or the accrual or receipt olinterest on, the Bonds. See' TAX MAITERS" herein.
.
$
$11.835 000'
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 2001-1
(SAN MIGUEL RANCH)
2005 IMPROVEMENT AREA B SPECIAL TAX BONDS
Dated: Date of Delivery Due: September 1, as shown on the inside cover page
The City of Chula Vista Community Facilities District No. 2001-1 (San Miguel Ranch) 2005 Improvement Area B Special Tax
Bonds (the '"Bonds") are being issued and delivered to finance various public improvements needed to develop property located within
Improvement Area B of Community Facilities District No. 2001-1 (San Miguel Ranch) (the "District"). The District has been formed by and is
located in the City of Chula 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 g1
~. 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 Improvement Area B of 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 amended rate and method of apportionment approved by the City Council of the City and the
qualified electors within Improvement Area B. See "SOURCES OF PAYMENT FOR TIlE 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 I. Principal of and interest on the Bonds will be paid by the Fiscal Agent to DTC for
subsequent disbursement to DTC 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
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 special tax obligations of the District payable solely from Special Taxes and other amounts held under the Indenture as
more fully described herein.
The Bonds are subject to optional redemption. extraordinary mandatory redemption and mandatory sinking fund redemption prior to
maturity as set forth herein. See "TIfE BONDS-Redemption of Bonds" herein.
CERTAIN EVENTS COULD AFFECT TIlE ABILITY OF TIlE DISTRICT TO PAY TIlE PRINCIPAL OF AND
INTEREST ON TIlE BONDS WHEN DUE. TIlE PURCHASE OF TIlE BONDS INVOLVES SIGNIFICANT RISKS, AND TIlE
BONDS ARE NOT SUITABLE INVESTMENTS FOR ALL INVESTORS. SEE TIlE SECTION OF TIllS OFFICIAL STATEMENT
ENTITLED "SPECIAL RISK FACTORS" FOR A DISCUSSION OF CERTAIN RISK FACTORS THAT SHOULD BE
CONSIDERED, IN ADDmON TO THE OTIlER MATTERS SET FORTH IIEREIN, IN EVALUATING TIlE INVESTMENT
QUALITY OF TIlE 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 infonned investment
decision.
MATURITY SCHEDULE
(See Inside Cover Page)
The Bonds are offered when, as and if issued and accepted by the Underwriter, subject to approval as to their legality by Best Best &
Krieger LLP, 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 _Nnvpmhpr ---J 2005.
Stone & Youngberg LLC
.. ."1 ~:illjl'.!fj''). stJhJa.st 16 s'tarigs.
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DOCSOC/1124509v~,102224'-0155
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Dated: -Novemher _.2005
DOCSOC/l124509v4,t;!;!W'10221J'_O 155
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Stradling Yocca Carlson & Rauth
Draft ofAug1l5t lfASp.ntp.mher 29 2005
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f-<.s.c DOCSOC/1124509v~5102224"-0155
Stradling Yocca Carlson & Rauth
Draft ofAlIgNst lD,Sp-ntp.mhp1' 29 2005
PRELIMINARY OFFICIAL STATEMENT DATED OCTOBER, 2005
NEW ISSUE - BOOK-ENTRY-ONLY NO RATING
In the opinion of Best Best & Krieger LLP, Bond Counsel, based on an analysis of existing laws. re~lations, rn/ings and court decisions,
and assumzng. among other matters, coml?liance with certain covenants, interest on the Bonds is excluded from gross income for federal
income tax purposes under Section 103 o/the Internal Revenue Code of 1986 and is exemptfrom State of California personal income taxes. In
the further opmion 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 adjustea current earnings in calculating jederal
corporate alternative minimum taxable income. Bond Counsel expresses no oRinion regarding an}' other f!deral or state income tax
consequences relating to the ownership or disposition of, or the accrual or receipt of interest on, the Bonas. See ' TAX MA ITERS" herein.
.
$
$11 R35000'
CITYOFCHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 2001-1
(SAN MIGUEL RANCH)
2005 IMPROVEMENT AREA B SPECIAL TAX BONDS
Dated: Date of Delivery Due: September 1, as shown on the inside cover page
The City of Chula Vista Community Facilities District No. 2001-1 (San Miguel Ranch) 2005 Improvement Area B Special Tax
Bonds (the "Bonds") are being issued and delivered to finance various public improvements needed to develop property located within
Improvement Area B of Community Facilities District No. 2001-1 (San Miguel Ranch) (the "District"). The District has been formed by and is
located in the City of Chula Vista (the "City"), County of San Diego, California.
The Bonds are authorized to be issued pursuant to the Mello-RoDS Community Facilities Act of 1982, as amended (Sections 53311 gJ
@. 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 Improvement Area B of 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 amended rate and method of apportionment approved by the City Council of the City and the
qualified electors within Improvement Area B. 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 fonn 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 OTC or as otherwise described herein. Interest on the Bonds will be payable on March 1, 2006 and
semiannually thereafter on each September I and March I. Principal of and interest on the Bonds will be paid by the Fiscal Agent to DTC for
subsequent disbursement to DTC 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
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 special tax obligations of the District payable solely from Special Taxes and other amounts held under the Indenture as
more fUlly described 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.
CERTAIN EVENTS COULD AFFECT TIlE ABILITY OF TIlE DISTRICT TO PAY THE PRINCIPAL OF AND
INTEREST ON THE BONDS WIlEN DUE. TIlE PURCHASE OF TIlE BONDS INVOLVES SIGNIFICANT RISKS, AND THE
BONDS ARE NOT SUITABLE INVESTMENTS FOR ALL INVESTORS. SEE TIlE SECTION OF TIllS OFFICIAL STATEMENT
ENTITLED "SPECIAL RISK FACTORS" FOR A DISCUSSION OF CERTAIN RISK FACTORS THAT SHOULD BE
CONSIDERED, IN ADDITION TO TIlE OTHER MAITERS SET FORTH HEREIN, IN EVALUATING TIlE 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 infonnation essential to the making of an infonned investment
decision.
MATURITY SCHEDULE
(See Inside Cover Page)
The Bonds are offered when, as and if issued and accepted by the Underwriter, subject to approval as to their legality by Best Best &
Krieger LLP, 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 DIC in New York, New York, on or
about _Nnvpmhpr ,2005.
Stone & Youngberg LLC
/ If-II
Dated: _Nnvpmher .2005
DOCSOC/1124509v~5!0222"_0155
///-(..1-
Stradling Yocca Carlson & Rauth
Draft of A NgNst ]U,Sentemher 29 2005
MATURITY SCHEDULE
(Base CUSIP: )1
Maturity Maturity
Date Principal Interest Date Principal Interest
(September 1) Amount Rate Price CUS/P' (September 1) Amount Rate Price CUS/pl
$ % $ %
$
$
% Tenn Bonds due September 1, _Price: _% - CUSIPt:
% Term Bonds due September I, _ Price: _% - CUSIpt:
Copyright 2005, American Bankers Association. CUSI? data herein is provided by Standard & Poor's. CUS]P Service Bureau, a division.
of The McGraw-Hill Companies, Inc. Neither the Underwriter nor the District tokes any responsibility for the accuracy of such data.
DOCSOC!l124509v~'IO'n4<-OI55
IIf -/3
.
CITY OF CHULA VISTA, CALIFORNIA
CITY COUNCIL
Stephen C. Padilla, Mayor
Paitv Davis.. Denutv Mavor
Steve Castaneda, De"Hty MayarPatty D.-:is, Councilmember
Jolm McCann, Councilmember
Jerry Rindone, Councilmember
CITY STAFF
David D. Rowlands, Jr., City Manager
Sid P,fems, .:\ssistant City },{anager
GeeFge KFeffifJI, l~ssiSHmt Chy 11aftager
Cheryl Frueht"r, .'\nsiotant City Maaager
Ann Moore, City Attorney
Maria Kachadoorian, Director of Finance
Susan Bigelow, City Clerk
Alex AI-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
DOCSOCllI24509v41....W;/02224,_0155
/4 -Itf
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 27A of the United States Securities Act of 1933, as amended. Such statements are
generally identifiable by the tenninology 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."
DOCSOCIl124509v~<;lOn,.<;-o 155
/ ~-/5'
.
THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS
CONTAINED IN SUCH FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND
UNKNOWN RlSKS, 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 DISTRlCT 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 WHICH STABILIZE OR MAINTAIN
THE MARKET PRICE OF SUCH BONDS AT A LEVEL ABOVE THAT WHICH MIGHT
OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF
COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
THE BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, IN RELIANCE UPON AN EXEMPTION CONTAINED IN SUCH
ACT. THE BONDS HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES LAWS OF ANY STATE.
DOCSOCilI24509v~51R222"_OI55
/Sf-/b
TABLE OF CONTENTS
Page
INTRODUCTION .............................................................................................................................................. +~
General..... .................... ....... ..... ............................ ........ ............. ......... ........ ....... ........... ....... ........ ................. +~
The District ....... ........... .......,..... ..... ............. ............ ............... ........... ............. .............. ................ ...... .......... +~
Sources of Payment for the Bonds ..........................................................................,.................................... ~
Description of the Bonds. ...... ....... ............ ...... .......... ............. ......... .......... ................. ........ ....... .................... 42,
Tax Matters........ ................... ...... ....... ................................ .......................... ...... ....... ........................... ........ ~I!
Professionals Involved in the Offering ........................................................................................................~I!
Continuing Disclosure. ......... ............. .......... ...................... ................. ......... .................................... ............. ~I!
Bond Owners' Risks .......... ............... .............................. ....................................... ............... .......... ............. ~I!
F OIward Looking Statements.......... .................... ......... ............... .................... ............. ................... .............61
Other Infonnation .. ...... ...... ............. ................... ...... ....... ............ ............. ...... ............. ................... ..............61
ESTIMATED SOURCES AND USES OF FUNDS ..........................................................................................'7,a
THE BONDS ...................................................................................................................................................... '7,a
Authority for Issuance.... ...... ........ ....... .......... ..................... .................. ........ ...... ....... ................ ............ ....... '7,a
Purpose of the Bonds.. ......... ............. .......... ...... .... ............ ........... ........ ........ ..... ...... ......................... ............ '7,a
Description of the Bonds...... .......... .... .......... ......... ............ ........... ..... ........... ...... ........... ........ .......... ............. '7,a
Redemption of Bonds... ...... ............... .......... ......... ............. ................ ........... ................ ........ ........... .............82
Notice and Selection of Bonds for Redemption....................................................................................... +011
Notice of Redemption .............................................................................................................................. +011
Effect of Redemption......................................................................... ...................................................... HU
Transfer and Exchange of Bonds. ........ ................................ ........... ..... ........... .......... ................ ......... ...... +211
Debt Service Schedule for the Bonds....................................................................................................... -814
SOURCES OF PAYMENT FOR THE BONDS ............................................................................................-814
Limited Obligations ................................................................................................................................. -814
Special Taxes....... ........................................ ......... .......... ............. ...... .......... ..... ............. ...... ........... ......... +415
Reserve Fund....... ........... ........... ........ .................. ........................ .................. ....... ....... ........ ........ ............ +92!l
Issuance of Parity Bonds. ........... ..... ................... ........ ............. ..... .................. ....... ....... ........ ........ ............ +92!l
THE COMMUNITY FACILITIES DISTRICT .............................................................................................W21
General Description of the District and Improvement Area B.................................................................W21
Description of Authorized Facilities..... .......... ...................... ................ .......... .......... ................ ............... W21
Status of Facilities ........ ........ .............. .......... ...................... ................................ ....................... ............... W22
Principal Taxpayers........ ....................................... ............. .......................... ...... ..... ................................. U22
Estimated Direct and Overlapping Indebtedness ..................................................................................... U23
Expected Tax Burden...... ......... ....... ................... ....... ................... ...... ............ ....... ....... ......... ................... nzs
Estimated V alue-to- Lien Ratios..... ................. ........... ............. ........................ ............. ............................ B2Ii
Permitted Land Use.............. ................... .............................. ............. ..... ........ ........... ............... ............... ;!622
THE DEVELOPMENT AND PROPERTY OWNERSHIP ...........................................................................;!622
General Description and Location ofImprovement Area B ....................................................................R3J)
The De'lolevefS ............... ...................................... ....... ...................................... ......................... 27Develoner 30
The C;ommercial Develnner . ........................... ......30
Development Plan................. ......... ....... .......... ............ ................. ...... ............. ....... ........ ....... .......... ......... ;;83J.
Merchant Builders................. ................ ............. ......................... ................................ .......... .......... ......... ;;832
Financing Plan ........... ........... ......................... ...... ................. ................... ....... .................. ........... ............ ;W;ll
Merchant Builder Financing .............. ................... ................ .......... ...... ............ ........ ................. .............. 39M
Status of Entitlement Approvals........ .......... ................. .................. ...... ....... ...... ....... ............................... ~ 35
Environmental Constraints .............. ............................ ................................. ...... ...................................... ~35
Inftastructure Requirements and Construction Status.................. .................................. .................... ...... ~ 35
Potential Limitations on Development.. .......... ............................. ............................................ .......... ...... :;;!Jii
Appraisal...... .............. ........... ................ ................ ................... ........... ............ ....... ............... ............ ....... :H.11
Market Absorption Study........... ........................... ................ ................................. ............... ............. ...... 34.18
DOCSOC/1124509v~<102174<-OI55
/i~/7
TABLE OF CONTENTS
Page
SPECIAL RISK FACTORS ........................................................................................................................... 34J2
Concentration of Ownership ........... ..... .............. ...................... ....... ........... ............... ................ ...... ......... 35J2
Limited Obligations. ...... ....... ....................... .................. .............. ................ ......... ....... ............... ....... ...... 35J2
Insufficiency of Special Taxes........ ..... ................. ................ .......... ........... ..... .......... ................ ...... ......... 3MJI
Special Tax Delinquencies.... ................... .................... ............................ ............. ....... ................ ..... ....... 36411
Failure to Develop Properties ..................................................................................................................36411
Future Land Use Regulations and Growth Control Initiatives................................................................. 3'742
Endangered Species ..... ...... ............. ...... ......... ....................... .......... ................ .......... ...... .......... ............... 3842
Water Availability .................................................................................................................................... 38~
Natural Disasters ................ ............. ..... .............. .................. ........... ................ .......... ...... ......... ................ 394.1
Hazardous Substances.... ....... ....................... .................. .......... .................... ......... ....... ........ ........ ...... ...... 39!1!1
Parity Taxes, Special Assessments and Land Development Costs ..........................................................4Q44
Disclosures to Future Purchasers ................. .................. .............. ............... .......... ....... ..... ........... ...... ...... 41-4S
Non-Cash Payments of Special Taxes ..................................................................................................... 4J-4S
Payment of the Special Tax is not a Personal Obligation of the Owners................................................. 41-46
Land Values ............................................................................................................................................. e46
TeFfofism............ ...... ...... ........ ........... ....................... ................ ................ ............... ..... ....... ........ ...... ........... 12
FDIC/Federal Government Interests in Properties...................................................................................4341
Bankruptcy and Foreclosure. ............. ...... ............. ....... ............. ............ ................ ............... ....... ....... ...... 44;1J!
No Acceleration Provision.............. ............ ................ ...... ............. ................ ............. .............. ...... ......... 4M2
Loss of Tax Exemption ...... ................ .................. ........ ........ .................... .......... ..... ............. .............. ...... 4S4'!
Limitations on Remedies ... ..... ................ ....... ................... ................ .............. ............ ............. ....... ......... 4M2
Limited Secondary Market.. ........... ................ ................... ...... .............. ............ ........... ........ ............. ....... 4M2
Proposition 218 ....... ........... ..... ..................... ..................... .......... .................... ..... ........... ...... .......... ......... 46511
Ballot Initiatives. .......... ........ ........... ..................... ........ ........... .............. ............. ........ ............. .......... ....... 4+51
CONTINUING DISCLOSURE...................................................................................................................... 4+51
TAX MA TTERS............................................................................................................................................. 4&52
LEGAL MA TTERS........................................................................................................................................ 4953
LITIGATION ................................................................................................................................................. 4953
NO RATING .................................................................................................................................................. ~5!!
UNDERWRITING ......................................................................................................................................... ~5!!
FINANCIAL INTERESTS ............................................................................................................................. ~5!!
PENDING LEGISLA TION ............................................................................................................................ ~5!!
ADDITIONAL INFORMA TION................................................................................................................... ~5!!
APPENDIX A
APPENDIX B
APPENDIX C
APPENDIX D
APPENDIX E
APPENDIX F
APPENDIX G
APPENDIX H
APPENDIX I
AMENDED RATE AND METHOD OF APPORTIONMENT OF SPECIAL
TAX..................................................................................................................................A-!
SUMMARY OF MARKET ABSORPTION STUDy..................................................... B-1
APPRAISAL REPORT .................................................................................................... C-!
INFORMATION REGARDING THE CITY OF CHULA VISTA.................................D-l
SUMMARY OF INDENTURE ....................................................................................... E-!
CONTINUING DISCLOSURE AGREEMENT OF THE DISTRICT .............................F-l
CONTINUING DISCLOSURE AGREEMENT OF THE DEVELOPER.......................G.I
FORM OF OPINION OF BOND COUNSEL .................................................................H-l
DTC AND THE BOOK ENTRY SYSTEM ..................................................................... I-I
ii
DOCSOCIl124509v4.Q;!;!4S51022?4,_O 155
I ij...-tl
DOCSOCIl124509v~<IO'n4<-O 155
[AERIAL PHOTO]
/1/-19
$ 11 1135.000'
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 2001-1
(SAN MIGUEL RANCH)
2005IMPROVEMENT AREA B 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 AppendixE-"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 $ 11 1135.000' City of Chula Vista Community Facilities
District No.2001-1 (San Miguel Ranch), 2005 Improvement Area B 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 Improvement Area B
("Improvement Area B") of Community Facilities District No. 2001-1 (San Miguel Ranch) (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 I, 2006.
The Bonds are authorized to be issued pursuant to the Act (as defined herein) and a Bond
Indenture (the "Indenture") dated as of November I, 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 finance the cost of eligible public facilities and services. Generally, the legislative body of the
local agency which forms a community facilities district acts on behalf of such district as its
. Preliminary, subject to change.
nnC'~or./11 14":;;OQv.l:j;/D2"4.c;_01.c;.c;
~
I if.- ;J.()
legislative body. Subject to approval by two-thirds of the votes cast at an election and compliance
with the other provisions of the Act, a legislative body of a local agency may issue bonds for a
community facilities district and may levy and collect a special tax within such district 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, designating Improvement Area A and Improvement Area B therein 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 December 12, 2001, at an
election held pursuant to the Act, the landowners who comprised the qualified voters of Improvement
Area B authorized the District to incur bonded indebtedness in the aggregate principal amount not to
exceed $11,999,9996.000.000 to be secured by the levy of Special Taxes on taxable property within
Improvement Area B. On that same date, the landowners within Improvement Area B approved the
rate and method of apportionment of the Special Taxes on land within Improvement Area B of the
District to pay the principal of and interest on the bonds of the District issued for Improvement
Area B. On February 1, 2005, the landowners of Improvement Area B elected to amend the then
existing rate and method of apportionment of special tax" and increase the maximum amount of
indehtedness the District could incur from $6.000.000 to $14 000.000. The Amended 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 738 acres and is located east of
Interstate 805 approximately seven miles southeast of downtown San Diego.
The District is divided into two Improvement Areas: Improvement Area B which consists of
approximately 282 gross acres and Improvement Area A which consists of the balance of the acreage
within the District. The Bonds will be secured by Special Taxes levied on property within
Improvement Area B only. A 14.3 acre commercial parcel (the "Commercial Parcel") is located
within the physical boundaries of Improvement Area B.
The land use entitlements for Improvement Area B permit development in sub-areas known
as "planning areas." Based on current land use approvals and projections, the land within
Improvement Area B (excluding the Commercial Parcel) is expected to be developed into 286
detached residential units. See "THE DEVELOPMENT AND PROPERTY OWNERSHIP-
Potential Limitations on Development."
As of September 1,2005, grading of the land within Improvement Area B had commenced
and construction of infrastructure (utilities, roads, sidewalks, etc.) is expected to be completed in
March 2006. Model homes within certain planning areas of Improvement Area B are expected to be
in place by the end of Anri! 2006 with the sale of homes to commence shortly
thereafter. For a more detailed description of development activity within Improvement Area B, see
"THE COMMUNITY FACILITIES DISTRICT-Status of Public Improvements."
De....2IepersDeveloner and Commercial Develnner. The master developers of the property in
Improvement Area B are Proctor Valley West Partners, ~a Delaware limited liability company
~
nO("S~/1124.c;nqv.c;/n'"4';;:-01';;:'''
/4 -:,2/
,
("Preeter YaJleythe "Develoner") and McMillin San Miguel Ranch, LLC, a Delaware limited
liability company ("MeMiIIiB." aHa tegether with PFeetar Yalley, Ifte "De-:elofJers"). Praelar
VaJleythe "Commercial Develoner"). The Develoner will be responsible for developing the
residential portion of Improvement Area B and MeMillinthe Commercial Develoner will be
responsible for developing the Commercial Parcel. For certain information concerning the
DevelafJersDeveloner and the Commercial Develoner, see "THE DEVELOPMENT AND
PROPERTY OWNERSHIP-The DevelafJeFsDeveloner" and" The Commercial Develoner."
Ptoaetar YalleyThe Develoner currently owns four planning areas consisting of
approximately 173 taxable acres within Improvement Area B. Preetar VaJley has eampletea saJes
e4The Commercial Develoner has entered into nurchase contracts to transfer these four
planning areas to variollsthree merchant builders. all of which are memhers of the Develoner, 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 Improvement Area B and has concluded, based upon the
assumptions and lintiting conditions contained in the Appraisal that as of August 1, 2005, the
aggregate value of such land was $111,275,000. The Sullivan Group Real Estate Advisors (the
"Market Absorption Consultant") has prepared a Market Aoalysis and Absorption Projection report
(the "Market Absorption Study") for the purpose of developing a build out projection for the 286 for-
sale residential units planned, but not yet sold, in Improvement Area B as of June 30, 2005. The
Market Absorption Study concludes that the residential units within Improvement Area B should be
built out in the 20eS 2een006-2008 period assuming continued development with no stops due to
unanticipated market or business factors. 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 Improvement Area B
pursuant to the Act and in accordance with the Rate and Method. See "SOURCES OF PAYMENT
FOR THE BONDS-Special Taxes" and Appendix A-"AMENDED RATE AND METHOD OF
APPORTIONMENT OF SPECIAL TAX." Under the Indenture, the District has pledged to repay
the Bonds fiom the Special Tax Revenues remaining after the funding of the annual Administrative
Expense Requirement of $75,000 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 defmed 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."
nOc.snC'/11'4.41tf)Qv~IO'''4c;;_n1.c;.c;
~
1'7"- ~*
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 Improvement Area B 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 Improvement Area B. 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
ARE SPECIAL OBLIGATIONS OF THE DISTRICT PAYABLE SOLELY FROM SPECIAL
TAXES 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.
~
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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 earnings 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
the City Attorney, and for the Underwriter by Stradling Y occa Carlson & Rauth, a Professional
Corporation, Newport Beach, California, as Underwriter's Counsel. Other 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 Preeter Valley the Develoner 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 certain fmancial
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 15c2-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 Preeter
VaHe;<the Develoner 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
nOC'~OC'/1124.c;nqv.c;10222<1.c;_011iij.c;
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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 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."
THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS
CONTAINED IN SUCH FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND
UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE
ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS DESCRIBED TO BE
MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR
ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING
STATEMENTS. THE DISTRICT DOES NOT PLAN TO ISSUE ANY UPDATES OR
REVISIONS TO THE FORWARD-LOOKING STATEMENTS SET FORTH IN THIS OFFICIAL
STATEMENT.
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 defmed 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 ITom the City at 276 Fourth Avenue, Chula Vista, CA 91910, Attention:
Director of Finance.
z
nOc.sorf111.4'iOt)v.l\/O"'4.c:;_01 ::;::;
/-71 --r.:lS-
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
.
Project Fund
Capitalized Interest Sub-Account Interest Account(l)
Reserve Fund
Cost ofIssuance Fund
Underwriter's Discount
Administrative Expense Fund
TOTAL USES
$
$
(1) Represents gross funded capitalized interest on the Bonds through September 1, 2006.
THE BONDS
Authority for Issuance
The Bonds in the aggregate principal amount of $ 11.835.000' 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) finance the costs of constructing and
acquiring certain public facilities related to the proposed development within Improvement Area B
(See "THE COMMUNITY FACILITIES DISTRICT-Description of Authorized Facilities");
(ii) pay costs related to the issuance of the Bonds; (iii) fund the Reserve Fund for the Bonds in the
initial amount of $ 801.057.50'; 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
. Preliminary, subject to change.
nor.~or/1124.,OQv.,!022?:4"-Ol.c;.c:;
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DTC. See Appendix I-"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
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 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 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
%
2
nOC~O(",/111:4~09v~Jn'''d.c:;_01 c;.c:;
/7'-~ 7
.
Extraordinary Mandatory Redemptionfrom 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
September I, 20_ 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.
Mandatory Sinking Fund Redemption. The Bonds maturing on September I, 20_ are
subject to mandatory sinking fund redemption, in part, by lot, on September I in each year
commencing 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
$
t
t Final Maturity
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The Bonds maturing on September I, 20_ are subject to mandatory sinking fund
redemption, in part, by lot, on September I in each year commencing September I, 20_, at a
redemption price equal to the principal amount ofthe 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
$
t
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
principal amount of the Bonds to be redeemed, the maturities ftom which such Bonds are to be
redeemed and the principal amount of the Bonds to be redeemed ftom 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:
11
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;4'.-;2.1
(a) the redemption date; (b) the redemption price; (c) the bond registration numbers, dates of maturity
and CUSIP numbers of the Bonds to be redeemed, and in the case of Bonds to be redeemed in part,
the respective principal portions to be redeemed; provided, however, that whenever any call includes
all Bonds of a maturity, the numbers of the Bonds of such maturity need not be stated; (d) that such
Bonds must be surrendered at the Principal Corporate Trust Office of the Fiscal Agent; (e) that
further interest on such Bonds will not accrue ftom and after the designated redemption date; (I) 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.
.
Notice from DTC 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 assigmnent 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 ftom 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.
nOc.SOC/11?4.1;jn9v.c;;n???:4.c;_01.1;j.l;j
12
lif -30
, ,
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
regulations 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
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.
nor~orI11'4.o;09v.c:;1021:24.o;_fl1':::;.c:;
13.
/4-.::1/
Debt Service Schedule for the Bonds
.'>e7'i6d Ell/ling
(Seplt!lIIhe !)
+&tal
Period Endin~
(Sen/ember 1)
.
2!lllii
2illI1
2llil8
2illI.2
2ill..O.
20.11
Zill1
2JI.U
noC'sor/11?d.l:\OQv.:i\1n2224oC;_01 ~'"
.D1'ineipal
8n ilonds
$
$
Princinal
on Rondft
.s
InkFe5t
an .Bands
$
$
lnteref;t
on Hondo;:
.s
1.4
/J/ - 3J..
-i
Tela/ Debt SeA'ice
Bn il8nds
$
~
Total Debt Service
on Bondft
$
(1)
2JI14
2ill..S
Zfllii
lI!l1
l!!.1l!
2JI12
2Jl2Jl
2!lll
2fi2.2
2JW
2JI24
2JI2S
2JI2!i
2JI21
2!I2H
2Jl22
2JIJIl
2Jlli
2JI32
2!Ill
2I!J.4
.2Jl35.
Th.tal
-S
-S
-S
(I) To be paid from capitalized interest.
SOURCES OF PAYMENT FOR THE BONDS
Limited Obligations
The Bonds are special, limited obligations ofthe 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. Special Taxes do
not include any amounts received by the District with respect to property within Improvement
Area A. 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
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. Special Tax Revenues are
defmed 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.
l5.
norsor.t1 t,.:t.c;Ol)v.c;IO'''4.&:;_01.c:;.c:;;
/~~33
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 SPECIAL TAXES
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 and hnprovement Area-RA and hnprovement Area B therein on December 4,
200 I for the purpose of financing the acquisition, construction and installation of various public
improvements to serve the District. At a special election held on December 12, 2001, the owners of
the property within hnprovement Area B authorized the District to incur indebtedness secured by
Special Taxes levied on property in hnprovement Area B in an amount not to exceed
$11,QQQ,OOO,6.000.000 and approved a rate and method or apportionment which authorized the
Special Tax to be levied to repay District indebtedness for hnprovement Area B, including the
Bonds. At a special election on February I, 2005, the landowners within Improvement Area B
approved the ?.menaea Rate and Method which amended the original rate and method of
apportionment of Special Taxes, and authorized the District to increase the maximum amount of
indehtedness the District could incur from $6.000.000 to $14.000.000.
.
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 Improvement Area B 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, 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 Appendix A-"AMENDED RATE AND METHOD OF
APPORTIONMENT OF SPECIAL TAX" hereto. There is no assurance that the Special Tax
proceeds will, in all circumstances, be adequate to pay the principal of and interest on the Bonds
when due. See "SPECIAL RISK FACTORS-Insufficiency of Special Taxes" herein.
Rate and Method Under the Rate and Method, all Taxable Property within hnprovement
Area B 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 I or Zone 2. 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
Commercial Property shall be the greater of (1) the Assigned Special Tax described below or (2) the
Backup Special Tax computed as described below.
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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
Description
Residential Property
Assigned Annual Special Tax
$475.00 per unit plus $!h+4JlJ12. per
square foot of Residential Floor Area
$4,000 per Acre of Commercial
Pronertv
2
Commercial Property
When a Final Subdivision Map is recorded within Zone I or Zone 2, the Backup Special Tax
for Assessor's Parcels classified as Residential Property or Commercial 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 1
$10,444 x A
B=
----------------
L
Zone 4~
$4,444 x A
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 Commercial Property or for each Assessor's Parcel of
Undeveloped Property to be classified as Commercial Property within the Final Subdivision Map
area, the Backup Special Tax shall be determined by multiplying $10,444 for Zone I and $4,444 for
Zone 2 by the total Acreage of each Assessor's parcels of the Commercial and Undeveloped Property
to be classified as Commercial Property within the Final Subdivision Map area.
11
norsnr/11 '4tiiOQv';;/02224.;-01 ';;.1\
/~-,.-.35
Notwithstanding the foregoing, if Assessor's Parcels of Residential Property, Commercial
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 $10,444 per acre for Zone I and $4,444 per acre for Zone 2.
Commencing with Fiscal Year 2005-06 and for each following Fiscal Year, the City Council
shall determine the Special Tax Requirement (as 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 I and Zone 2 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 I and Zone 2, 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
Property whose Maximum Annual Special Tax is derived by the application of the Backup Special
Tax shall be increased Proportionately trom 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 each
Assessor's Parcel 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.
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 T=es. 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 Redemption from Special T= Prepayment."
nnC'SO""/1124~oqv.c;/O""41;j_n1.c:::"
1J!
/4f'~ 3 fA
A required prepayment of Special Taxes 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, Preeter Valleyllu:
Develoner has agreed to comply with the policy and Preeler Valleythe Develoner and the City
expect that the current merchant builders will also agree to comply with the policy. Preeler
1,LaHeyThe Develoner has agreed with the City to require all additional merchant builders to comply
with this policy. Based on estimated retail home sales prices, Preeter Valleythe Develoner and the
Merchant Builders (as 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 +..e+1Ji8%. 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. Tbe 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 [mancial obligations.
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 maximum 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 trom parcels on which a completed structure is located to less than
I 10% 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 FACTORS-Non-Cash Payment of Special Taxes."
Although the Special Taxes constitute liens on taxed parcels within Improvement Area B,
they do not constitute a personal indebtedness of the owners of such property within Improvement
Area B. Moreover, other liens for taxes and assessments already exist on the property located within
Improvement Area B 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 financially able to pay the annual Special Taxes or that they
will pay such taxes even if financially able to do so, all as more fully described in the section of this
Official Statement entitled "SPECIAL RISK FACTORS."
12
nor.~nr/l1 ?4.c:;OIJvI;j102224.1:i_Ol t:;.c:;
/~ -37
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 Appendix E-"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 Improvement Area B 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
proceedings against (i) properties under common ownership with delinquent Special Taxes in the
aggregate of $5,000 or more by the October I 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-Dther 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
F ACTORS---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.
nOrSnc./11'-4.c:;OOv.c;102??41\_01.c;.Iii
2JI
/ J,f-34
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
Improvement Area B, 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 trom the
balance in the Reserve Fund, but in no event shall such amount be less than zero. See Appendix E-
"SUMMARY OF INDENTURE" herein.
Issuance of Parity Bonds
The District has covenanted in the Indenture not to issue any other obligations to fmance
additional public improvements which are payable trom the Special Taxes levied on land within
Improvement Area B 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 trom issuing
and selling, pursuant to law, refunding bonds or other refunding obligations payable tram 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 and Improvement Area B
The District consists of approximately 738 gross acres and is located in the easterly portion
of the City, approximately seven miles southeast of downtown San Diego. The District is divided
into two Improvement Areas: Improvement Area A and Improvement Area B. The Bonds will be
secured by Special Taxes levied on certain property within Improvement Area B, and none of the
special taxes trom Improvement Area A is pledged and available to repay the Bonds. Improvement
Area B consists of approximately 282 gross acres of land proposed for 286 residential units and one
commercial development. The residential areas planned for Improvement Area B are divided into
four residential "planning areas" which, at buildout, are expected to be developed into 286 single
21
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/"/ - ;;'1
.
family detached residential units. The Commercial Parcel is expected to be developed into an
approximately 103,000 square- foot shopping center anchored by a grocery store.
Prseter ValleyThe Develoner currently owns four planning areas within Improvement
Area B. PFseter Valley plans t8 sell The Develoner h9!i entered into nllTchase contracts to
transfer such planning areas for the development of 286 single family attached units to three
merchant builders when the lots are develoned into hlue-ton condition. 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 I below, to serve property within
Improvement Area B. In addition to or in substitution for the Facilities listed below, the City and the
De'/elsjJersDeveloner may agree to finance additional or different eligible Facilities.
TABLE I
ESTIMATED COSTS OF PUBLIC FACILITIES
Projects
Cost
Estimati1)
Portion to hp naid
from Rnnd..(1)
Portion to bp. Paid
hv np.vpllJner and
Other ,f;OUI'Cef
San Miguel Ranch Road ITDlF\
San MifJllel Ranch Road lNon- TDTF)
$
4,846,Z83Ml2.
1152
1 550 406
~ 3619052
1 550 406
$
--'I
o
Proctor Valley Road .waflflNnn~TnlF\
Facilitie!; finan~ed hv the Pnhlir. Facilitip.~
Develnnment Imoaet Fee
Fadlitip.!iI financed hv thE" Park
Asses!'iiment Develonment Imnact Fee
Facilities :ffem.financed hv the
Trammnrtatinn Development Impact
1'eee.F.".oe
1,639,629~
!I'M
1.782 094 --'I
1 680 802 --"
1.134 848 --'I
1 680 802
1 134.848
_1,666,903~
Z
254 798
--1i22
~
Faeili!ieG ftem Parle !.eEfllioi!isB and ~1,Q8Q,222~
De...elsjJmeBt ImjJaet FeesTOT A I.S ~
FaeiIities Hem Piseal Defieit Impaet Pees
TOT.\!.
~. 10022000
Z86.QQ(
$931991'
~
699
(I) Costs shown may not represent total cost of improvement and soft costs. The Ar'nniJi:ition/Fin9nr'inp Aprppmpnt for the
nidrir't rfp<i!r'rihpli: th.. nrioritv ofthp Proipr'h
Sources: De, elsflefSopvp'onpr and McGill Martin Self, Inc.
Status of Facilities
The status of certain of the Facilities serving Improvement Area Bas of September I, 2005 is
summarized in Table 2 below.
on("'sor/1124~Oqv~/01224~_01 ~I\
22
I if -tfo
TABLE 2
STATUS OF FACILITIES
(As of September 1, 2005)
Public Improvement
San Miguel Ranch Road (IDfF!
San Mipuel Ranch Road (Non-TUfF)
Proctor Valley Road WefWNon- IDfF!
Facilities financed hv the Puhlic Facilities DeveIonment
Imuset Fee
Facilities financed hv the Park Assessment nevelnoment
TmnadFee
Facilities tfemfinanced hv the Trammortation
Development Impact J'eesEi:J:
Faeilities ftem Park ~'\eflHisitieR ana De~/elefJHleRt IfHfJH8t
J'ees
Yaeilhies Hem Fiseel Deiieit Imf)aet Fees
TOTAL
Source: De.elal'er npvplnnpr
Principal Taxpayers
hIttI
Budget
Spent to
Date
%
Complete
$1,816,28,;}J $
1 550 406
1,639,629U!
%
1 6HO H02
1 B4 H4H
1,666,993255
1,989,222
286.999
$9,1993910 $
=%
Table 3 below sets forth the percentage of the Special Taxes that the property owners in
Improvement Area B would pay in Fiscal Year ~2006-O6!11 based on a projected Special Tax
levy of $1,9G6,6~5876.058 and the ownership/development status of land within Improvement
Area B as of August I, 2GG5, the date afvel". "sea in the ;'.ppI'aisal.15. 2005.
23.
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.
TABLE 3
PROJECTED PRINCIPAL TAXPAYERS FOR
FISCAL YEAR 2005 Ofi2006-07
Planning Area
Ownell)
Developer Affiliated Builders
Proctor Valley West Partners, LLC
Proctor Valley West Partners, LLC
Proctor Valley West Partners, LLC
Proctor Valley West Partners, LLC
Subtotal
J-I
J-2
K
L
Commercial
McMillin San Miguel Rancb, LLC
Subtotal
.
TOTAL(')
Fiscal Year
199-5 961006-07 Special
Ta;1l~J
% of Total
$131,297JM.!J!1i
119,929~
~~
196.871354090
$~
~~
$$n,73!i~
$1 oo~ ~1!i876 058
13.03%
14.00
28.40
40.42
95.85%
4.15%
41!\ol..
10000%
(I) Ownership information from l..ppfBisa1thp n..vplnnpr as of August +-~ 2005.
(2) Estimated Special Tax Levy for Fiscal Year ~2006-G4tfi1 based on Undeveloped Property Special Tax.
(3) Amount adjusted due to rounding
Source: McGill Martin Self, Inc.
Estimated Direct and Overlapping Indebtedness
Within Improvement Area B'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 Improvement Area B and others have
authorized but unissued bonds which, if issued, will also be secured by taxes and assessments levied
on parcels within Improvement Area B. The approximate amount of the direct and overlapping debt
secured by such taxes and assessments on the parcels within Improvement Area B 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.
.
nOc.s.or/11'4i\n()v.l;jIn'-'?c1'\~n1 c;.c;
24
IJ/ ~t/~
TABLE 4
DIRECTOR AND OVERLAPPING DEBT SUMMARY
CITY OF CHULA VISTA COMMUNITY FACILITIES DISTRICT NO. 2001-1
(SAN MIGUEL RANCH)
IMPROVEMENT AREA B
2004.05' ,ncal Secured A.s~p.ssP.rI Valuation- $11.092.824
DlRFCT AND OVFRLAPPINr. TAX AND ASSFSSMFNT DFBT.
Metronnlitan Water District
Otav Municinal Water District 1 n No 27
Southwestern Cnmmunitv ColleJJ'p. nidrir.t
Swpp.twatpr Union High S("hnol Oidrid
Chols Vista Citv School District
C'itv orChll)a Vida Cnmmnnitv Facilities Oidril'"t No 2001.1 fAR
TOTAL DlRFCT AND OVFRLAPPINr.TAX AND ASSFSSMFNT DFBT
0/0 Annlicahlp.
0.001%
0164
o 01H
0044
0062
100
OVFRLAPPINr. r.FNFRAL FUND DFBT.
San nip!)'o Canotv ~eneral Fund OhlifJldinns
San niepo Canotv Pend"" Ohlip"atinn!lil
San Diepo Canotv Sunerintendent of Schools Ohlip'ations
Otav Mnnicinal Water District Certificates of Particinatinn
SOllthwpdern Cnmmnnitv Cnllpoe District C'.eneral Fund Ohlip'ations
Sweetwater Un inn "iph School Certificates of Particinatinn
Chllla Vida (",itv School Didri~t ("n>npral Fund Ohli!7atinn~
Citv nfC'hnla Vida f:pnpral Fund Ohlit'atinn~
Citv of C:hnla Vida Ppnllilion OhlifJation~
TOTAL r.ROSS OVFRLAPPINr. GFNFRAL FUND DFBT
I,plIiIlIiI' Otav Mllnidnal Watpr District C-prtifir.atplIiI of Partirination
TOTAL NFT OVFRLAPPINr. r.FNFRAI FUND DFBT
00040/..
0004
0004
0.06H
0041
0.04H
o 06'i
0076
0076
r.ROSS COMBlNFD TOT A T DFBT
NFT COMB INFO TOTAL DFBT
Ratiollil to 2004-05 As~essp.d Valuation'
nirpr.t Deht 106 70%
Total nirer.t and OvprlanninfJ Tay and Assessmpnt Deht 107990la
Gros~ Comhined Total Deht . ............... 110.470;"
Npt Comhined Total Deht 110 :'no/..
[TO COME]
STATF SCHOOL BIJILDlNr. AID RFPAVABI.F AS OF 6/10/05' $0
(I)
(Z)
neht R/lIO~
$ 4194
16126
11 27H
16.351
54.520
11 R:1~ 000 (1)
$11 979669
$ 1 H 1HH
50 090
5H
17456
1099
H 770
72 HIO
96 094
H964
$274 t H4
174'i6
$256 72H
$12 251 H'il (2)
$12 216197
Jnl"lmfp!IiI Rnnd!lil
F,yrludp.!IiI t::n: IInd rpvpnllP IIntil"inatinn nntp!IiI pntprnri!lilp rpvpnllP mnrh'lIuP rpvpnllP IInd tllY IIlInl"lItinn hnnd.. IInd
nnn_hnndpd l"anitaIIPlup. nhliuatinnllil
The authorized but unissued debt of existing community facilities districts with boundaries
overlapping Improvement Area B as of August 1,2005 is summarized in Table 5 below. In addition,
other local agencies whose boundaries encompass aU or a portion of Improvement Area B may form
other community facilities districts or assessment districts.
2.5
norSOC'/11 ?:44;nQv4;/n1.1.1.44;_n1 4;4;
I if~lfd
TABLE 5
.
SUMMARY OF OVERLAPPING COMMUNITY FACILITIES DISTRICTS
Final D~veloped
Undeveloped Map Residential NfJNl'iDn-
Land Property Special Residenti41
Speci4/ Tax Special TaxPer Special Tax Au.thorized
District Pu.rpose Per Acre Tax(4} Sq.Ft. Per Acre Debt
Chula Vista Elementary CFD No. 13(1) Elementary Schools $-- NIA $0.2[37 $-- $250,000,000
Sweetwater High School CFD No. 13(1) Higb Schools NIA 0.2746 250,000,000
(1) On July I 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 ofa parcel at the rate of2% per annum.
Source: McGiJI Martin Self, Inc.
.
Expected Tax Burden
It is expected that the total tax burden on residential units in Improvement Area B will be
slightly less than 2% of the initial sales price of the units. Table 6 below sets forth an estimated
property tax bill for a typical single family detached unit of 3,916 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 ~ 1.68%.
nnC'~OC'/11 '4~nQv~/02224.c;;_01.c:;.I\
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TABLE 6
SAMPLE PROPERTY TAX BILL
PROJECTED FOR FISCAL YEAR 2005-06
TYPICAL SINGLE FAMILY DETACHED AND !.TTl.CHED UNITSill'!II
House Square Footage(Weighted Average)
Base Sales Price
Total Assessed Value(1)
Basic Levy(2)
MWD
Chula Vista Elementary School District G.O. Bond
Sweetwater High School District G.O. Bond
Southwestern Community College G.O. Bond
Otay Water ID #27
Total Taxes Based on Assessed Value
Chula Vista Elementary CFD No. 13
Clml. Vi,ta Hementaf}' CfD No. 13 C.O. Creait
Sweetwater Union High School CFD No. 13
Sweetwater UHSD No. 13 G.O. Credit
City of Chula Vista CFD 200 I-I Improvement Area B
Mosquito/Rat Control
MWD Water Standby Charge
Otay Water Availability
CWA Water Availability
Total Assessments and Parcel Charges
Total All Property Taxes
Total Effective Tax Rate
Estimated Value-to-Lien Ratios
Percent of Total Single Family
Assessed Valuation Detached Unit
3,916
$ 869,815.00
$ 862,815.00
1.00000 $ 8,628.15
0.00580 23.31
0.02811 112.99
0.01818 73.08
0.01301 52.29
0.01200 48.23
1.07710% $ 8,938.06
$ 836.85
($112.99)
1,075.33
(73.08)
3,686.12
2.29
11.50
10.00
10.00
$ 5,116.035,559.02
$11 JR1 9RI4.497.07
-8H'1Ji8%
The value of the land within Improvement Area B is significant because in the event of a
delinquency in the payment of Special Taxes the District may foreclose only against delinquent
parcels in Improvement Area B. Table 7 summarizes the estimated appraised value-to-lien ratios for
property in Improvement Area B based on the principal amount of the Bonds and the projected
Special Tax levy for fiscal year 200S-06 based on the land use a5 sf }\"1;"ot I, 2()QS aaa a5samin1; ao
fuF!hefand statlls of development v:ithia Improvemeat :'.rea B after sueh date. as of AUI'ust 1.
2Jill5.
The appraised value of the land within Improvement Area B, based on the assumptions and
limiting conditions contained in the Appraisal, was $1I1,27S,OOO as of Augnst I, 200S. The
estimated appraised value-to-lien ratio for the property within Improvement Area B currently subject
to the levy of the Special Tax, based upon land values and property ownership described in the
Appraisal, is approxmoately '9.40' to I as shown in Table 7 below. The estimated appraised
. Preliminary, subject ro change.
n
nor~or/11 ?.t.::;OQv.c;I021.24,:;:-01.c;.I;j
/ /f-J/S-
value-to-lien ratio for the land owned by the Developers arcDeveloDer and the Commercial
DeveloDer is approximately -MD.' to I based on the assumptions set forth in Table 7. Table 7
does not include the overlapping debt which is payable trom taxes and assessments on land within
Improvement Area B, which, as set forth in Table 4 above, was estimated at $ 144.669' for
fiscal year 2005-06, not including the anticipated amount of the Bonds. If the overlapping debt
payable trom taxes and assessments were included, the estimated appraised value-to-lien ratio for the
District as a whole would be -2.28' to I rather than the -MD.' to I shown in Table 7.
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 Improvement Area B. The information in the Annual 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 $ .11.092.824.
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 -JI.23.' to 1.
,
.
. Preliminary, subject to change.
nor~or.11124.c;;nqv"102224.c;_01 Iii'i
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Permitted Land Use
Table 8 below describes the currently approved land uses within Improvement Area B.
TABLE 8
LAND USE SUMMARY IMPROVEMENT AREA B OF
COMMUNITY FACILITIES DISTRICT NO. 2001-1
IMPROVEMENT AREA B
Use
Residential
Commercial
Open Space and Parks
Total
Acres
Dwelling
Units
173.7
14.3
95.0
2J!2.j)
286
THE DEVELOPMENT AND PROPERTY OWNERSHIP
Except for the information under the captions "-Appraisal" and "-Market Absorption
Study, " the De'..elepel'SDeveloner. the Commercial Develoner and the Merchant Builders provided
the information in this section.
The information herein regarding ownership of property in Improvement Area B 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
Improvement Area B or a development or any interest therein at any time.
.
No assurance can be given that the proposed development within Improvement Area B 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 Improvement Area B will become more diversified
Although planning for the development of Improvement Area B 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
Improvement Area B 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 Improvement Area B. 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 DC;B!af1el'sDevelont~r the Commercial DeVidnner. 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. "
30
DOCSOCIl124509v~,IO'''",-OI55
.
IIf -1/4
General Description and Location of Improvement Area B
Improvement Area B comprises approximately 282 gross acres in the City of Chula Vista.
Improvement Area B is located east of Interstate 805, along the north side of H Street at Mount
Miguel Road. Current residential developments in the area include Otay Ranch, Lomas Verdes,
Rancho Del Rey, Sunbow, Eastlake, Rolling Hills Ranch and San Miguel Ranch. Improvement
Area B is bounded to the north by generally undeveloped lands and the area known as Bonita in
unincorporated San Diego County, beyond which is Sweetwater Park and the Sweetwater Reservoir.
East of Improvement Area B is the master-planned community of Rolling Hills Ranch in the City,
beyond which are undeveloped unincorporated County lands. South of Improvement Area B is the
master planned communities of Eastlake and Rancho Del Ray, beyond which is Otay Ranch and
Lomas Verdes. To the west is existing housing on unincorporated County land also in the area
known as Bonita.
The DevclopeFsDeveloner
Proeter Valley West Partners, LLC, a DelaYo'er. limiteR liability eempOHY ("Prester
Valley"),The Develoner currently is the owner of four planning areas in Improvement Area B.
Preeter ValleyThe Develoner purchased the property in August 2004. The members of Preeter
.v.aHeythe Develoner are Trimark Pacific-Montecito LLC ("Trim ark"), as managing member, Shea
Proctor Valley, LLC ("Shea") and Buie Area K LLC f"Buie"t Preeter ValleyThe Develoner was
formed to acquire and develop 286 residential units in Improvement Area B.
Trimark Pacific Homes ("Trimark Pacific") is the project manager and general contractor for
the 286 residential units in Improvement Area B. Trimark Pacific is a California home builder which
focuses on two business lines: production home building and land development. Trimark Pacific
was started in 1992 as Trimark Development Company, operating as a full service homebuilding
subsidiary of Weyerhaeuser Company. Between 1993 and 1996 Trimark Pacific completed over 900
single family homes. The projects were located in Southern and Northern California and ranged in
size from less than 20 units to over 190 units. As a separate product line in coastal Southern
California, Trimark Pacific also developed high end semi-custom housing ranging in price from
$800,000 to $1,500,000. In addition to its single family activity, Trimark Pacific acquired,
refurbished and sold over 200 condominium units.
Trimark Pacific started operations as an independent entity in June of 1997 when Trimark
principals formed TPH LLC ("TPH") and its building subsidiary, Trimark Pacific. TPH is co-owned
by Trimark Ventures and Cargill Financial Services, a subsidiary of Cargill, a large, privately-owned
company, with annual revenues over $~ 1!Lbillion. Since September of 1997, Trimark Pacific has
closed escrow on and purchased approximately ~~ residential lots, including three master-
planned communities. Trimark Pacific's projected sales volume for fiscal 2991 was iR e"eess ef
~2005 is $325 million. Trimark Pacific currently has offices in Los Angeles, Orange County,
Riverside County. San Diego County and Kona, Hawaii.
The Commercial Oeveloner
McMillin San Miguel Ranch, LLC, a Delaware limited liability company ("McMillin")
currently is the owner of the Commercial Parcel in Improvement Area B. McMillin purchased the
Commercial Parcel in December 2004. The members of McMillin are McMillin Management
Services, LP, as managing member and McMillin Companies, LLC ("McMillin Companies").
31
DOCSOC/l124509v~".2224'-0155
/i/.-J/9
.
McMillin Companies is a privately held entity beneficially owned entirely by the McMillin
family headed BY ~acey L. "Corky" McMillin. Ce~' MeMiIIiR started the McMillin organization
42 years ago as a real estate development and construction company. Today, the Cerky McMillin
Companies operates in five areas including land development, home building, commercial, realty,
and mortgage. GeffiyThe McMillin Companies is San Diego's largest and oldest, privately owned
locally based developer of mixed-use projects.
~te.MjIliB has aeY/eIsf'eEl se~,'eF8.] master 191anilea eaHlffiHIlities iR S01ltHem Califemia,
iRelHdiRg ~eripfJs RaReh, Ranehe Del Rey, BeRita LeRg CflfIyeR, OrWlge Creat, Temelai Hills and
CalaYlerR I. Other 13Fejeets dey:elef'ea ana eefBpleteEl ey ~fe~filIiB in the City iaslaae Benita Lang
CaRyeR, BeRita Highlands, and Teffa Ne'/a.
McMiHin rommercial is one of five core divisions of the McMilJin Comnanies and is
resnonsihle for the acouisition and develnnment of all research and develonment. office. and
commercial retail nrniects for the McMillin Comnanies. McMillin Commercial has
condrllcted in excess of 75 buildimJs totalinp" over 4.5 million !innaTe feet inclndinp' more than
$200 million in turnkey p"overnment nroiects. Durin!J' the nast 14 veariiil McMillin C;ommercial
has develoned and sold over 10 million sail are feet of land and has heen recognbed as the
larpest commercial develoner in San Diepo CODOtv bv the San Diepo Business .Journal and the
San Die-po Danv Transcrint.
Development Plan
The approved tentative tract map applicable to Improvement Area B allows for the
development of 286 dwelling units and 14 acres of commercial/administrative uses. Upon buildout,
development within Improvement Area B is anticipated to include 286 single family detached homes,
along with approximately 14 acres of commercial/administrative uses consisting of an approximately
103,000 square-foot shopping center anchored by a grocery store.
Praster Valley has seldThe neveloner has entered into nurchase contracts to transfer the
four planning areas in Improvement Area B to three merchant builders. Mel\filliBThe three
merchant blinders are Trimark. Shea and Rllie. Trimark. Shea and Ruie are collectivelv
referred to herein as the "Merchant RuiJders". I,ots will be delivered to the Merchant RuiJders
in a blue-ton condition The Develoner exnects to deliver the lots to the merchant bunders in
November 2005. The r.ommercial Develoner currently owns the Commercial Parcel within
Improvement Area B which is subject to Special Taxes levied in Improvement Area B. Leta will Be
delivered t8 the mereR8Rt EJ1:lilaers in a blHe tap eenaitisR. Preater Valley elCfJeets 18 deliver the lets
to the merehant BHildcfS in late 2005.As of Sentember 1. 2005 develonment of the r.ommercial
Parcel had not he-pun. The Commercial neveloner exnects to hegin rOllgh pradinp' the
Commercial Parcel in earlv November 2005 and exnects to comnlete develonment of the
Commercial Parcel in .June 2006. As of Sentemher 27. 2005. the Commercial Develoner had
entered into leases with three tenants. constituting annroximatelv 9.962 sallare feet of pross
leaseable area and has sip-ned letters of intent with five tenants. constitntinp annroximatelv
59.501 satlare feet of fJrOSS leaseable area. The neveloner exnects to lease the remaining
annroximatelv :\4.200 san are feet of pross leaseable area hv
32
DOCSOC/1124509v~"'""24"_0155
/ 7/':"'$"Q
Table 9 below summarizes proposed development witbin Improvement Area B subject to tbe
Special Taxes.
TABLE 9
SUMMARY OF PROPOSED DEVELOPMENT
Planning
Areas
Product Type
Lot Size
Proposed Merchant Builder
Proposed
Number of
Units
J2
K
L
1!l.SED
62..SEIl
23..SEI1
14..SED
Proposed
Square Footage
Range
1 1';;0_1790
:1 040_1 670
1 RIIO-4 no
1 R00-4410
Projected
Home Prices
Jl
rfn/s('rp.
rllI/Sf'rp.
rfn/sf'rp
rllI/lIl'rp
Shea IIemeriTrimark
Trim9.r~( PaeifieSh.ea
Buie-Heffies
Shea-Hemes
~qll 000_1 Oq.c; 000
R94000_1 471 noo
1 11:1 000_1 "" noo
1 t.c;?: 000_1 471 noo
('S",iflJ! eia!/
.iiui.istratile
PareeIs Net Parcel Size
I'fflposed
rmnHu>rrinl neve/opel'
Proposed
Square Footage
~
SR/J! ~e PrnnnflPd
flP1Jp/nnmpnl
H.Ju:r.es
McMillin
103,000
Sbnnnlno ('pntpr
Merchant Builders
The mercheRt IH,ildcrGMerchant Builders within Improvement Area B tbat are expected to
be responsible for at least 10% of tbe projected fiscal year 2005 062006-07 Special Tax levy are
discussed in greater detail below. Prester ValleyThe Develoner intends to complete tbe land
development process and sell all ofilie developable laBAthe residential narcels witbin Improvement
Area f. te merohant imiIders B to the Merchant Builders.
Trimark P-aeifia. Planning Area HI is exnected to be owned by Trimark Pasifia. See "THE
DEVELOPMENT AND PROPERTY OWNERSHIP-The Da';elopersDeveloner" above for a
description of Trimark Paeifie's related entitv which is the nroiect manap'er and penera]
contractor for the rlevelonment in Tmnrovement Area R.
Construction of model homes in Planning Area J;;l is expected to commence in
;w%November 2005 witb homes being offered for sale shortly tbereafter. At buildout, Planning
Area J;;l is expected to consist of 111 detached residential units on 7,000 square foot lots. Such
units are expected to range in size ftom -3.150 square feet to -3.790 square feet and range
in price ftom $ 913 000 to $ .1.095.000.
Shea Hemes. Planning AreaAI:t:a.s H~ and L are expected to owned by Shea Homes Limited
Partnership, a California limited partnership ("Shea Homes"). Shea Homes and related entities have
eight operating divisions throughout California, Arizona, Nortb 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 Manufacturing,
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 ofthe Shea family.
33
DOCSOC/I124509v4mW,IO'U4,-O 155
/1/--5'1
.
Construction of model homes in Planning Area J.l-~ is expected to commence in
;!oo&Decemher 2005. Shortly thereafter homes will be offered for sale. At buildout, Planning
Area J.l-~ is expected to consist of .69. detached residential units on 7,000 square foot lots. Such
units are expected to range in size ITom -3.040 square feet to -3.670 square feet and range
in price ITom $ 894.000 to $ .1.473.000.
Construction of model homes in Planning Area L is expected to commence in
;!OO6Novemher 2005 with homes offered for sale shortly thereafter. At buildout, Planning Area L is
expected to consist of 14 detached residential units on 20,000 square foot lots. Such units are
expected to range in size ITom -3.800 square feet to 1.430 square feet and range in price
ITom $ 1.152 000 to $ .1.473.000.
Buie Hames. Planning Area K is expected to be owned by Buie Hemes. [Description of
Buie to come]
Construction of model homes in Planning Area K is expected to commence in 2006 with
homes being offered for sale shortly thereafter. At buildout, Planning Area K is expected to consist
of 21 detached residential units on 15,000 and 20000 square foot lots. Such units are expected
to range in size ITom -3.860 square feet to 1.130 square feet and range in price ITom
$ 1.123.000 to $ .1.220.000.
Financing Plan
The development of San Miguel Ranch will require a large expenditure of funds to fully
develop the property and all of the attendant inITastructure. Roughly 28% 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
Precter Valley the Develoner 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 P-reeter VaIIeythe Develoner'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 Deve.finer has financed the deve]oDment of the nrODertv in the District with an
acnnhition and develnnment loan (the "neve.Dner Loan") in the stated nrincinal amount of
StiR.OOO.noo from Wells Farpo Rank. The Develoner Loan is secured hv a first lien deed of
trust on the Deve]oner's nronertv within the District The interest rate on the Develoner I,oan
is o/,.. The term of the Develoner Loan eynires on . As of
Sentemher 1. 2005 the outstandin9 nrindnal balance of the Develoner T loan was $;
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 financing 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.
34
DOCSOClI124509v~'lOn2"_O 155
/7'" ....5".)..
TABLE 10
PROCTOR V.\LLEYTHE DEVELOPRR'S SOURCES AND USES OF FUNDS
(in thousands)
SsN. ees 8f ~r:'lt1Ids
Csl~1'ffia.- Y.M.
~
(rleINaI)
Calends, Y.ea,
1996 and Be} 8ftd
(_~'2eted)
Tatal S8HFees ~ ~ ~
!.rse Qf' .C'a1Hls
$ $ $
~ ~ ~
$ $ $
~
$
$
$
35
DOCSOC/1124509v4h!;!;!#'10221",-O 155
/"/>$3
-
$
~
Sourceft of Fundft
Canital ffiouitv)
Wells Farpo T,oan
CFD Reimhursement
Total Sources
U~e of Fund.,
Land
Finance
~
Site Tmnrovements - Private
Site Tmnrovement - CFD
Permits & Fees - Private
Permits & Fees - CFD
Proiect Tndirects:
Proiect Overhead
Total Use of Funds
Difference
Merchant Builder Financing
Remainder of
Calendar Year 2005
Actual thrnuI!h 8/31
Proiected 9//-12/31
$ 36.986.978
62110.000
-
$ 99.096.978
$ 75.083 320
2.758.885
1.114.082
8.281.747
4134.178
703.380
=
2.236.790
985.000
$ 95.297.382
$ 3.799596
Calp-ndar Yp-ar
2006
fPro;p-cted)
$ 0
5.890.000
10.022.699
$15.912.699
$
261.630
-.II
5.643.872
2.817374
407 773
3.071.147
228.947
330.000
$ 12.760.743
$ 3.151.956
Total..
$ 36.986.978
68.000 000
10.022.699
$115.009.677
$ 75.083.320
3.020.515
1.114.082
13.925.619
6.951.552
1.111.153
3.071.147
2.465 737
1.315.000
$108.058.125
$ 6.951 552
Trimark 1't13ifie. As of September I, 2005, Trimark Paoi!ie expects the remaining intract,
home construction, carrying, marketing and miscellaneous costs to complete Planning Area J;!J. to be
approximately $-2Ji million. Trimark Paei!ie plans to fmance its proposed development of
Planning Area 12, in paFI, wit!! 1 throu"h a loan from Wells Far"o Bank.
Bule Hemcs. As of Sentemher 1. 2005. Ruie exnects the remaininp intra~t. home
condruction. carrYing. marketing and miscellaneous cods for Planninp' Area K to he
annroximatelv $J5 minion. Ruie Dlans to finance its nronosed develonment ofPlanninp' Area K
throuP'h a loan from Wells Farpo Rank.
ShJ!iL. As of September I, 2005, Hllie I1amesSlwl expects the remaining intract, home
construction, carrying, marketing and miscellaneous costs for Planning .'\fea KAreas .12 and I, to be
approximately $ 12 million. Hllie HemesSlwl plans to finance its proposed development of
Planning Area K Ihfallgh .Shea Hames. .A,s af SeptelHeer I, 2003, Shea
Heme8 BKfJeets the remaiaiag imraet, heme eeaStRieaea, eaFfjlHg, fflarketing lHla miseellane8Hs
easts far Planning fd'cas J1 ana L ta be appraJdmately $_ millian. Shea Hames plans ta !inanee its
prapagea ee'lelaplHent sf Planning r"eas J1 ana L thrSllgh Areas.12 and L
through a loan from Lowe Enternrises.
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
DOCSOCIl124509v~,1022"<_OI55
36
If/~:r'f
under its existing loans or will have sufficient internal funds to finance its 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
Improvement Area B 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 on Improvement Area B. The SPA Plan was adopted by the City
on November 24, 1998 by Resolution No. 19275. Under the SPA Plan, Improvement Area B is
designated for residential and commercial development, open space lands and both major circulation
and internal streets.
Tentative Tract Map 99-04 for San Miguel Ranch which includes Improvement Area A and
Improvement Area B was approved by the City Council on February 29, 2000. The Final "A" Map
for Improvement Area A RIIB hH]3revemeftt Area B was recorded on August 10, 2004.
The Devela]3em aelieyeDeveloner believe. that all discretionary approvals required for the
development of Improvement Area B have been obtained.
Environmental Constraints
San Miguel Ranch has undergone extensive environmental and biological review and has
received the necessary permits for the development of the entire property covered by the tentative
map. These include take authorizations from the United States Fish and Wildlife and the California
Department of Fish and Game for endangered species, and all applicable wetland permits from the
Army Corp of Engineers and California Department of Fish and Game.
Infrastructure Requirements and Construction Status
The infrastructure requirements for San Miguel Ranch can be broken into tflreetwo categories
as follows:
Majar Bse.'ehan" 111ft sstruetu1"e. [TO Cm.fE]
Mainr Backhone lnfrafi:tructure. The pradimJ' of the oroied '!iii annroximatelv R50/0
comnlete. The balance of the nToiect p'radinp includinp the flnishinp of the final nads in
Planninp Areas.n .12 and I J is exnected to he bv the end of Octo her 2005. The backbone storm
drain '!iii comnleted throllP'h San Mipuel Ranch Road (formallv Mi. Mipuel Road) with the final
comnletion of the dorm drain ""trails underway. The backbone sewer. water and drv ntilities
are currentlv heinp' installed in San Mipnel Ranch Road and slIch imnrovemenh are exnected
to commenc bv the end of Novemher 2005 in Avenida Loretta. Pavinf! of San Mit!uel Ranch
Road is nroiected to bep'in in November 2005 and navinv for Avenida Loretta is nroiected to
hepin in March 2006. Road imnrovements to Proctor Vallev Road are nroiected to hepin in
December 2005.
37
DOCSOC/1124509v~"02224,-OI55
/~-""55'
Minor Backbone Infrastructure. [TO COME]The remainin.. infrastructure consists of
slODe and common area landscaninp' and the indallation of entrv monllmenh and commnnitv
si{rnave. These elements are exnected to he started in stapes hepinninp' in November 2005 and
are nrniected to he comnlete hv .June 2006.
Intractlrifrastructure. Single-family lots in the community are planned to be delivered to
merelllmt IHlii<!emthe Merchant Ruilders rough graded and blue-topped with the intract streets
undercut. Wet and dry utilities will be stubbed to the tract boundaries. The Merchant Builders will
be responsible for completing intract street improvements, utilities and intract 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, identify any potential threshold problems and address implementation
measures to avoid level of service problems.
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 "0" 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 '0' 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 '0' 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 Improvement Area B, even if the
traffic congestion leading to such moratorium occurs outside of the Improvement Area B area.
38
DOCSOC!1124509v~<;/R"'''_0155
/ 0/ - ;$"t.,.
Throughout the fall of 2002 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. [NERD UPDATE FROM CITY]
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
District. 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. Under the Monitorinp Propram all of the
nermits for T mnrovement A rea Bare currentlv available.
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 Mder the GMOC.
A development slowdown beyond or a moratorium on development could adversely impact
the rate of development in Improvement Area B 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.
Con...truction ofSR12i Rridpp-. The comnletion of rlevelonment in Tmnrovement Area R
is denendent unon the construction of a hridpe crossinp SR125 and connectinp Mi. Milmel
Road with San Mip'uel Ranch Road. The condrnction of the hridp'e affects the h:suance and
timiD!! of huildinp' nermih for residential units in Tmnrovement Area B. The issuance of
huildinp" nermits for model homes in Tmnrovement A rea R can occur "rior to construction or
comnletion of the hridp'e. The construction drawinp's for the hridp'e have heen comnleted and
annroved and the schedule calls for construction to hep'in in Oetoher 2005 with comnletion hv
earlv Anril 2006. Construction of the model homes is exnected to commence in Novemher and
construction of residential units is exnected to commence in Anri) 2006. The Develoner does
not exnect the construction of the hridp'e to have a material imnact on the timinp' of
construction of residential units in Tmnrovement Area R.
Appraisal
The information regarding ownership of property in Improvement Area B 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 of land within Improvement
39
DOCSOC/I124509v~'/02224,-0155
/4-S-7
.
Area B or a development or any interest therein at any time. Development may also be abandoned at
any time.
The Appraiser valued certain property within Improvement Area B, taking into consideration
the lien of the Improvement Area B Special Taxes, based upon a number of assumptions and limiting
conditions contained in the Appraisal as set forth in Appendix C. 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 Improvement Area B, analyzes the market for similar properties and
compares these properties to the properties in Improvement Area B. The Appraiser is of the opinion
that the aggregate "as is" value of the land within Improvement Area B as of August 1, 2005,
assuming the completion of all improvements to be financed with proceeds of the Bonds was
$111,275,000.
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 uom
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 Improvement Area B 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 (i.e., construction
will proceed as proposed with no limitations on development occurring). See "-Potential
Limitations on Development" above.
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 Improvement Area B
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 June 30, ~2005 for Improvement Area B 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 Improvement Area B 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 2007 with
most of the sales occurring in 2006, and with final absorption occurring in late 2997.2008. The
Market Absorption Study projects that, of the 286 single family detached units within Improvement
Area B that are subject to the Special Tax, U will be absorbed in 29G5, 1892006. in
;!OO62007 and 8S 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 inuastructure necessary to develop will be provided in a timely manner, that
the developers and merchant builders in Improvement Area B 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
DOCSOCII124509V~'IO"2J'_OI55
40
/9"''fi8
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 is not realized. See
Appendix B-"SUMMARY OF MARKET ABSORPTION STUDY."
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 Improvement Area B to pay their
Special Taxes when due. Such failures to pay Special Taxes could result in the inability of the
District to make full and punctual payments of debt service on the Bonds. In addition, the occurrence
of one or more of the events discussed herein could adversely affect the value of the property in
Improvement Area B. See "Land Values" and "Limited Secondary Market" below.
Concentration of Ownership
As of the date of the Appraisal, all of the land within Improvement Area B remaining subject
to the Special Tax levy was owned or controlled by the DeveloperoDeveloner and the Commercial
Develoner. 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 DeveloperoDeveloner and Commercial Develoner. See "THE COMMUNITY
F ACILITIES 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 Improvement Area B. 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 crom 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
41
DOCSOC/1124509v~"'",n",-0155
/~----$(l
District's income, receipts or revenues, except the Special Taxes and other amounts pledged under
the Indenture.
Insufficiency of Special Taxes
Under the Rate and Method, the annual amount of Special Tax to be levied on each taxable
parcel in Improvement Area B 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 Appendix A-"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
100.94 acres in Zone I and 9.63 acres in Zone 2.
If a substantial portion of land within Improvement Area B 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 Improvement Area B 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, ftom which funds necessary for the payment
of principal of, and interest on, the Bonds are derived, are customarily billed to the properties within
Improvement Area B 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 Der"ielapersDeveloner. the Commercial nevelooer nor the Merchant Builders
are currently delinquent or hashave 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
inftastructure and development in Improvement Area B as planned, or substantial delays in the
completion of the planned inftastructure and development due to litigation or other causes may
reduce the value of the property within Improvement Area B and increase the length of time during
.
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DOCSOClI124509v4,l;!;!;!#<;10227.4<;-0155
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which Special Taxes will be payable from undeveloped property, and may affect the willingness and
ability of the owners of such undeveloped property within Improvement Area B to pay the Special
Taxes when due.
Land development is subject to comprehensive federal, State and local regulations. Approval
is required from various agencies in connection with the layout and design of developments, the
nature and extent of improvements, construction activity, land use, zoning, school and health
requirements, as well as numerous other matters. There is always the possibility that such approvals
will not be obtained or, if obtained, will not be obtained on a timely basis. Failure to obtain any such
agency approval or satisfy such governmental requirements would adversely affect planned land
development. Finally, development ofland is subject to economic considerations.
Additionally, the DevelspersDeveloner. the Commercial Develoner and the Merchant
Builders may need to obtain fmancing to complete their development activities within Improvement
Area B. 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 DevelspersDeveloner the Commercial
Develoner 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 Improvement Area B may be adversely affected
by existing or future governmental policies, or both, restricting or controlling the development of
land in Improvement Area B. See "THE DEVELOPMENT AND PROPERTY OWNERSHIP-
Potential Limitations on Development" for a discussion of certain potential limitations on the ability
of the DevelspefSDeveloner. the Commercial Develoner and Merchant Builders to complete the
projected development of Improvement Area B. Specifically, investors should consider the broad
power of the City to halt or delay "B" map approval under its Growth Management Ordinance.
There can be no assurance that the owners of the land in Improvement Area B 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 Improvement Area B 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.
Bondowners should assume that any event that significantly impacts the ability to develop
land in Improvement Area B would cause the property values within Improvement Area B to
decrease substantially from those estimated by the Appraiser and could affect the willingness and
ability of the owners ofland within hnprovement Area B 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
43
DOCSOCI1124509v~'10222",-O 155
1~-61
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
Improvement Area B 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 Improvement Area B 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
Improvement Area B 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 Improvement Area B 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 Improvement Area B 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 Improvement Area B 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 Improvement Area B 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 Improvement
Area B 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 Improvement Area B 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 Improvement Area B to decrease substantially from that
contained in the Appraisal.
44
DOCSOC/I124509v~</O"14<_0155
I~-' .)-.
Endangered Species
In recent years 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 Improvement Area B 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 Improvement Area B 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.
The Developer and the City believe that the Water District will be able to provide water to
Improvement Area B 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 Improvement Area B. A
slowdown or stoppage in the continued development of Improvement Area B 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
Improvement Area B, like all California communities, 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 Improvement Area B. In addition, land susceptible to seismic activity may be subject to
liquefaction during the occurrence of such event. Portions of Southern California are subject to
wildfires. In October 2003, over 200,000 acres and over two thousand homes were destroyed in
wildfires in San Diego County. The land within Improvement Area B was not affected by these
wildfires.
45
DOCSOCIl124509v~5IOn145-0155
/JI .-,6.3
In the event of a severe earthquake, fire, flood or other natural disaster, there may be
significant damage to both property and inftastructure in Improvement Area B. As a result, a
substantial portion of the property owners may be unable or unwilling to pay the Special Taxes when
due. In addition, the value of land in Improvement Area B 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 substance on a parcel may result in a reduction in its value. In
general, the owners and operators of a parcel may be required by law to remedy conditions of the
parcel relating to releases or threatened releases of hazardous substances. The Federal
Comprehensive Environmental Response, Compensation and Liability Act of 1980, sometimes
referred to as "CERCLA" or the "Superfund Act," is the most well-known and widely applicable of
these laws, but California laws with regard to hazardous substances are also stringent and similar.
Under many of these laws, the owner or operator is obligated to remedy a hazardous substance
condition of property whether 'or not the owner or operator has anything to do with creating or
handling the hazardous substance. The effect, therefore, should any of the taxed parcels be affected
by a hazardous substance, is to reduce the marketability and value of the parcel by the costs of
remedying the condition, because the purchaser, upon becoming 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 ftom the existence, currently, on the parcel of a substance presently classified as hazardous
but which has not been released or the release of which is not presently threatened, or may arise in
the future resulting ftom the existence, currently on the parcel of a substance not presently classified
as hazardous but which may in the future be so classified. Further, such liabilities may arise not
simply ftom the existence of a hazardous substance but ftom the method of handling it. All of these
possibilities could significantly affect the value of a parcel that is realizable upon a delinquency.
None of the City, the De':elol"ersDevelooer. the Commercial Develooer or the Merchant
Builders has knowledge of any hazardous substances being located on the property within
Improvement Area B.
Parity Taxes, Special Assessments and Land Development Costs
Property within Improvement Area B is subject to the lien of taxes and assessments imposed
by public agencies and several overlapping districts also having jurisdiction over the land within
Improvement Area B. See "THE COMMUNITY F ACILITIES DISTRICT-Estimated Direct and
Overlapping Indebtedness."
The Special Taxes and any penalties thereon will constitute a lien against the lots and parcels
of land on which they will be annually imposed until they are paid. Such lien is on a parity with all
special taxes and special assessments levied by the City and other agencies and is co-equal to and
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 "_
Bankruptcy and Foreclosure" below.
46
DOCSOC/l124509v~'/02"4'_OI55
I~--{,I/
Development of land within Improvement Area B is contingent upon construction or
acquisition of major public improvements such as arterial streets, water distribution facilities, sewage
collection and transmission facilities, drainage and flood protection facilities, gas, telephone and
electrical facilities, schools, parks and street lighting, as well as local in-tract improvements and
on-site grading and related improvements. Certain of these improvements have been acquired and/or
completed; however, there can be no assurance 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 and off-site improvements could
increase the public and private debt for which the land within Improvement Area B is security. This
increased debt could reduce the ability or desire of the property owners to pay the annual Special
Taxes levied against the property. In that event there could be a default in the payment of principal
of, and 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 Improvement Area B. In addition, the landowners within Improvement
Area B 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 Improvement Area B described herein.
Disclosures to Future Purchasers
The willingness or ability of an 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
against each parcel within Improvement Area B. While title companies normally refer to such
notices in title reports, there can be no guarantee that such reference will be made or, if made, that a
prospective purchaser or lender will consider such Special Tax obligation in the purchase of a
property within Improvement Area B or lending of money thereon.
The Act requires the subdivider (or its agent or representative) of a subdivision to notify a
prospective purchaser or long-term lessor of any lot, parcel, or unit subject to a 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.
Non-Cash Payments of Special Taxes
Under the Act, the City Council as the legjslative 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 partial
payment of any installment of the Special Taxes or the interest or penalties thereon. A Bond so
tendered is to be accepted at par and credit is to be given for any interest accrued thereon to the date
47
DOCSOCll124509v~<;102224<;-0155
tl9;p" S"
of the tender. Thus, if Bonds can be purchased in the secondary market at a discount, it may be to
the advantage of an owner of a taxable parcel 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 parcels 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 Parity Bonds when due.
Payment of the Special Tax is not a Personal Obligation of the Owners
An owner of a taxable parcel is not personally obligated to pay the Special Tax. Rather, the
Special Tax is an obligation which is secured only by a lien against the taxable parcel. If the value of
a taxable parcel is not sufficient, taking into account other liens imposed by public agencies, to
secure fully the Special Tax, the District has no recourse against the owner.
Land Values
The value of the property within Improvement Area B 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 military 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
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 I, 2005 the value of the land within
Improvement Area B was $111,275,000. 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 Develsf3emDeveloner or
the Merchant Builders to obtain any needed development approval or permit, the presence of
hazardous substances within Improvement Area B, the listing of endangered species or the
determination that habitat for endangered or threatened species exists within Improvement Area B, 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 Improvement Area B to its highest
48
DOCSOCI1124509v~,1O"24<_0155
19'-r6~
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 Improvement
Area B 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."
T errorislB
Neither the City aor the De'..elopers ellR premet the eeeaomie effeet of the ongeiag threat ef
tefferism aaa the reSJ30Bse af the Uaitea States gs.:eFFlHi8at therete, theagh imfJRsts seHlE! Be
sigaifieaat. Ne aSSllfaaBe eaR be given that the ake.t aRa iamreet 6ease~ellees ef military aaa/er
tefrarfst activities iR this ealill!Iy er abreaa will aet have an effect ea the aevelopmeat of
lmprevemeat }"rea B er the preperty eWflcrD in Improvemeat Afca B, ......hich may inel"ae, among
ether eff-cets, a slewdEI'TvR in fleme sales aRa a aeerease in hm.a .,'alHes iH I-HifJrs'/emeat ..\rea B.
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 Improvement Area B 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 ITom real property taxes assessed on any basis other than property value. According to the
Policy Statement, the FDIC will pay its property tax obligations when they become due and payable
and will pay claims for delinquent property taxes as promptly as is consistent with sound business
practice and the orderly administration of the institution's affairs, unless abandonment of the FDIC's
interest in the property is appropriate. The FDIC will pay claims for interest on delinquent property
taxes owed at the rate provided under state law, to the extent the interest payment obligation is
secured by a valid lien. The FDIC will not pay any amounts in the nature of fines or penalties and
will not pay nor recognize liens for such amounts. If any property taxes (including interest) on
FDIC-owned property are secured by a valid lien (in effect before the property became owned by the
FDIC), the FDIC will pay those claims. The Policy Statement further provides that no property of
the FDIC is subject to levy, attachment, garnishment, foreclosure or sale without the FDIC's consent.
49
DOCSOCI1124509v~<;IO>nJ<-OI55
/L/;~~ 7
In addition, the FDIC will not pennit 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 fonnula which detennines 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 Improvement
Area B 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 ftom being applied to pay interest on the Bonds and/or to redeem Bonds
if bankruptcy proceedings were brought by or against the De','elepersDeveloner or a Merchant
Builder and if the court found that the DevelepersDeveloner or a Merchant Builder had an interest in
such moneys within the meaning of Section 54l(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
delay would increase the likelihood of a delay or default in payment of delinquent Special Tax
instalIments 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 GlasDlv 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.
50
DOCSOC!1124509v~"""'4'_OI55
/7/...~8
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 Refonn Act of 1994 (the "Bankruptcy Refonn 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 filing of the petition [by a debtor in bankruptcy court]." This amendment effectively
makes the Glasnlv holding inoperative as it relates to ad valorem real property taxes. However, it is
possible that the original rationale of the Glasnlv 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 filing of a petition in
bankruptcy. Glasnlv is controlling precedent on bankruptcy courts in the State. If the Glasnlv
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
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.
51
DOCSOC/I124509v~::;Jn"'4.1:j-0155
I'I:~/~f
.
Bond Counsel has limited its opmlOn as to the enforceability of the Bonds and of the
Indenture to the extent that enforceability may be limited by bankruptcy, insolvency, reorganization,
fraudulent conveyance or transfer, moratorium, or other similar laws affecting generally the
enforcement of 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 Dcyelsl'ers and the Merehaat BaildersDeveloner 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 couId 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 XIIlC and Article JCIIID 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 of litigation 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 JCIII states that ". . . the initiative power shall not be
prohibited or otherwise limited in matters of reducing or repealing any local tax, assessment, fee or
charge." The Act provides for a procedure which includes notice, hearing, protest and voting
requirements to alter the rate and method of apportionment of an existing special tax. However, the
Act prohibits a legislative body from adopting any resolution to reduce the rate of any special tax or
terminate the levy of any special tax pledged to repay any debt incurred pursuant to the Act unless
such legislative body determines that the reduction or termination of the special tax would not
interfere with the timely retirement of that debt. On July I, 1997, a bill was signed into law by the
Governor ofthe 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."
52
DOCSOC/1124509v~'lOn14';_OI55
/ '" ---7 j
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 ofthe 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 hnprovement Area B 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 XIlI A, Article XIlI 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 hnprovement Area B to complete
the remaining proposed development. See "SPECIAL RISK F ACTORS--Failure to Develop
Properties" herein.
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 I of each year, beginning February I, 2006, and is to include
audited financial statements of the City. The requirement that the City file its audited financial
53
DOCSOC/I124509v~'102"4"-OI55
/'fr --7/
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 inclusion of this information 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), PFGster Valleyim
DeveloDer will enter into a Continuing Disclosure Agreement (the "Developer Disclosure
Agreement") covenanting to provide Semi-Annual Reports not later than May I and November I of
each year beginning May I, 2006. The Semi-Annual Reports provided by PreetGr Valloytlll:
DeveloDer are to contain the [mancial 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 [mancial statements for the prior calendar year if audited
financial statements are prepared. Preeter ValloyThe DeveloDer has not failed to comply in all
material respects with any undertaking under Rule 15cI2-12. Ceffiorstefle IuIs flGt f'ro-:ieusly eatorea
mte an HluleFtakin.g 1ffiaer Rl:lle 15e2 12.
.
The obligations of Proster Valloythe DeveloDer 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. Each suoo
lanaGwflorThe DeveloDer has also agreed that if it sells or transfers an ownership interest in any
property in Improvement Area B 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.
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 eamings 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.
54
DOCSOC/1124509v~,,"2n4,-O 155
/~-7~
The Code imposes various restrictions, conditions and requirements relating to the exclusion
ftom 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 ftom 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 ftom gross
income for federal income tax purposes and is exempt ftom 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,
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 ftom 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 financial information contained in the
remainder of this Official Statement.
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/1(-- 7:3
.
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 infonnation 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.
FINANCIAL INTERESTS
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.
56
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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. 2001-1 (SAN MIGUEL
RANCH)
By:
Assistant Director of Finance
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/1-75"
APPENDIX A
AMENDED RATE AND METHOD OF APPORTIONMENT FOR
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 2001-1,
IMPROVEMENT AREA B
(San Miguel Ranch)
A Special Tax as hereinafter defIned shall be levied on all Assessor's Parcels of Taxable Property
within the CityofChula Vista Community Facilities District No. 2001-1 ("CFD No. 2001-1
Improvement Area B") and collected each Fiscal Year commencing in Fiscal Year 2005-06, in an
amount determined by the City Council through the application of the appropriate Special Tax for
"Developed Property," and "Undeveloped Property as described below. All of the real property in
Improvement Area B, 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 tenns hereinafter set forth have the following meanings:
'" A' Map" shall mean a master fInal subdivision or parcel map, fIled in accordance with the
Subdivision Map Act and the Chula Vista Municipal Code, which subdivides the land or a
portion thereof shown on a tentative map into "super block" lots corresponding to units or
phasing of a combination of units as shown on such tentative map and which may further
show open space lot dedications, backbone street dedications and utility easements required
to serve such "super block" lots.
"Acre or Acreage" means the land area of an Assessor's Parcel as shown on an Assessor's
Parcel Map, or if the land area is not shown on an Assessor's Parcel Map, the land area
shown on the applicable fmal map, parcel map, condominium plan, record of survey, or other
recorded document creating or describing the parcel. If the preceding maps are not available,
the Acreage shall be detennined by the City Engineer.
"Act" means the Mello-Roos Community Facilities Act of 1982, as amended, being
Chapter 2.5, Division 2 ofTitIe 5 of the Government Code of the State ofCalifomia.
"Administrative Expenses" means the following actual or reasonably estimated costs
directly related to the administration of Improvement Area B ofCFD No. 2001-1 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 of remitting 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. 2001-1, or any designee thereof of complying with arbitrage rebate
requirements; the costs to the City, CFD No. 2001-1, or any designee thereof of complying
with disclosure requirements associated with applicable federal and 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, CFD
No. 2001-1, or any designee thereof related to an appeal of the Special Tax; and the costs
A-I
DOCSOC/l124509v4/;!;!W,102224,-O 155
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associated with the release of funds from an escrow account, if any. Administrative
Expenses shall also include amounts estimated or advanced by the City or CFD No. 200 I-I,
Improvement Area B for any other administrative purposes ofCFD No. 2001-1, including
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 on 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 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 the Indenture in excess of the reserve requirement as defined in such Indenture, delinquent
Special Tax payments, the 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 Indenture.
"Backup Special Tax" means the Special Tax amount set forth in Section C.1.b.
"Bonds" means any bonds or other debt (as defined in the Act), whether in one or more
series, issued by CFD No. 2001-1 for Improvement Area B under the Act.
"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. 2001-1" means City ofChula Vista, Community Facilities District No. 2001-1
(San Miguel Ranch).
"City" means the City ofChula Vista.
"Commercial Property" means all Assessor's Parcels of Developed Property for which a
building permit has been issued for purposes of constructing one or more non-residential
structures, excluding Community Purpose Facility Property.
"Community Purpose Facility Property" means all Assessor's Parcels which are
(a) classified as community purpose facilities and meet the requirements of City ofChula
Vista Ordinance No. 2002-2883 as amended on November 5, 2002 or (b) designated with
specific boundaries and acreage on an 'A' Map or Final Subdivision Map as a community
purpose facility.
"Council" means the City Council of the City, acting as the legislative body ofCFD
No. 2001-1.
"County" means the County of San Diego.
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"Developed Property" means, for each Fiscal Year, all Taxable Property for which a
building permit for new construction was issued prior to March I of the prior Fiscal Year.
.
"Exempt Property" means all Assessor's Parcels that are exempt from the levy of the
Special Tax pursuant to the provisions of Section E.
"Final Map" means a subdivision of property created by recordation of a final 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 ofa 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.
.
"Improvement Area B" means Improvement Area B ofCFD No. 2001-1.
"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.
"Lot(s)" means an individual legal lot created by a Final Map for which a building permit for
residential construction has been or could be issued.
"Master Developer" means the owner of the predominant amount of Undeveloped Property
in Improvement Area B.
"Maximum Annual Special Tax" means the maximum annual Special Tax, determined in
accordance with the provisions of Section C , that may be levied in any Fiscal Year on any
Assessor's Parcel of Taxable Property.
"Outstanding Bonds" means all Bonds which remain outstanding.
"Property Owner Association Property" means any property within the boundaries of
CFD No. 2001-1 which is (a) owned by a property owner association or (b) is designated
with specific boundaries and acreage on an 'A' Map or Final Subdivision Map as property
owner association property. As used in this defmition, a property owner association property
includes any master or sub-association.
"Proportionately" means for Developed Property that the ratio of the actual Special Tax
levy to the Assigned Special Tax or Backup Special Tax is equal for all Assessor's Parcels of
Developed Property within Improvement Area B. For Undeveloped Property
"Proportionately" means that the ratio of the actual Special Tax levy per Acre to the
Maximum Annual Special Tax per Acre is equal for all Assessor's Parcels of Undeveloped
Property within Improvement Area B.
"Public Property" means any property within the boundaries ofCFD No. 2001-1 that which
(a) is owned by a public agency, (b) has been irrevocably offered for dedication, prior to June
I st of the preceding Fiscal Year, to a public agency or (c) is designated with specific
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boundaries and acreage on an 'A' Map or Final Subdivision Map as property which will be
owned by a public agency. For purposes of this definition, a public agency includes the
federal 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 of living area within the perimeter
of a residential structure, not including any carport, walkway, garage, overhang, patio,
enclosed patio, or similar area. The determination of Residential Floor Area shall be made
by reference to appropriate records kept by the City's Building Department. Residential
Floor Area will be based on the building permit(s) issued for each dwelling unit prior to it
being classified as Residential Property, and shall not change as a result of additions or
modifications made after such classification as 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 required in any Fiscal Year for CFD
No. 2001-1, Improvement Area B to: (i) pay annual debt service on all Outstanding Bonds;
(ii) pay periodic costs on the Bonds, including but not limited to, credit enhancement and
rebate payments on the Bonds; (iii) pay Administrative Expenses; (iv) pay any amounts
required to establish or replenish any reserve funds for all Outstanding Bonds in accordance
with the Indenture; (v) and pay directly for acquisition and/or construction of public
improvements which are authorized to be financed by CFD No. 2001-1 for Improvement
Area B; (vi) less a credit for Available Funds.
"State" means the State of California.
"Taxable Property" means all of the Assessor's Parcels within the boundaries of
Improvement Area B which 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 Indenture.
"Undeveloped Property" means, for each Fiscal Year, all Taxable Property not classified as
Developed Property.
"Zone I" means a specific geographic area as depicted in Exhibit A attached hereto.
"Zone 2" means a specific geographic area as depicted in Exhibit A attached hereto.
B. ASSIGNMENT TO LAND USE CATEGORIES
Each Fiscal Year, all Taxable Property within Improvement Area B shall be classified as
Developed Property or Undeveloped Property and shall be subject to the levy of annual
Special Taxes determined pursuant to Sections C and D below. Furthermore, Developed
Property shall be classified as Residential Property or Commercial Property.
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.
C. MAXIMUM ANNUAL SPECIAL TAX RATE
1. Developed Property
The Maximwn Annual Special Tax for each Assessor's Parcel of Residential
Property or Commercial Property that is classified as Developed Property shall be the
greater of (I) the Assigned Special Tax described in Table I below or (2) the amount
derived by application of the Backup Special Tax.
a. Assilmed Soecial Tax
The Assigned Special Tax for each Assessor's Parcel of Developed Property is
shown in Table 1.
TABLEt
Assigned Special Tax for Developed Property within Zone I and Zone 2
Land Use
Class
I
Descri !ion
Residential Property
Assi ned S ecial Tax
$475.00 per unit plus $0.82 per
square foot of Residential Floor
Area
$4,000 per Acre of Commercial
Pro e
2
Commercial Property
b. Backuo Soecial Tax
When a Final Map is recorded within Zone I or Zone 2, the Backup Special Tax for
Assessor's Parcels of Developed Property classified as Residential Property or
Commercial Property shall be determined as follows:
For each Assessor's Parcel of Developed Property classified as Residential Property
or for each Assessor's Parcel of Undeveloped Property to be classified as Residential
Property within the Final Map area, the Backup Special Tax shall be the rate per Lot
calculated according to the following formula:
Zone I
$10,444 x A
B=
------------------------
L
Zone 2
$4,444 x A
B=
------------------------
L
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The tenns 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 Map.
L = Lots in the Final Map which are classified or to be classified as
Residential Property.
For each Assessor's Parcel of Developed Property classified as Commercial Property
or for each Assessor's Parcel of Undeveloped Property to be classified as
Commercial Property within the Final Map area, the Backup Special Tax shall be
detennined by multiplying $10,444 for Zone I and $4,444 for Zone 2 by the total
Acreage of the Commercial Property and Undeveloped Property to be classified as
Commercial Property within the Final Map area.
Notwithstanding the foregoing, if Assessor's Parcels of Residential Property,
Commercial Property or Undeveloped Property for which the total Backup Special
Tax has been detennined are subsequently changed or modified by recordation of a
new or amended Final Map, then the total Backup Special Tax applicable to such
Assessor's Parcels shall be recalculated to equal the amount of total Backup Special
Tax that would have been generated if such change did not take place.
2. Undeveloped Property
The Maximum Annual Special Tax for each Assessor's Parcel classified as
Undeveloped Property shall be $10,444 per Acre for Zone I and $4,444 per Acre for
Zone 2.
D. METHOD OF APPORTIONMENT OF THE SPECIAL TAX
Commencing with Fiscal Year 2005-06 and for each following Fiscal Year, the Council shall
detennine 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 on each Assessor's Parcel of Developed Property 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, excluding any Assessor's Parcels classified as Undeveloped
Property pursuant to Section E, at 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 whose
Maximum Annual Special Tax is derived by the application of the Backup Special Tax and
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DOCSOCI1124509v~',"222",-0155
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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 each
Assessor's Parcel classified as Undeveloped Property pursuant to Section E at 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 in Improvement Area B.
E. EXEMPTIONS
I. The CFD Administrator shall classify as Exempt Property (i) Assessor's Parcels
defined as Public Property, (ii) Assessor's Parcels defmed as Property Owner Association
Property, (iii) Assessor's Parcels defmed as Community Purpose Facility Property or
(iv) Assessor's Parcels with public or utility easements making impractical their utilization
for other than the purposes set forth in the easement, provided that no such classification
would reduce the sum of all Taxable Property to less than 100.94 Acres in Zone I and 9.63
Acres in Zone 2. Assessor's Parcels which carmot be classified as Exempt Property because
such classification would reduce the Acreage of all Taxable Property to less than 100.94
Acres in Zone I and 9.63 Acres in Zone 2 will be classified as Undeveloped Property and
shall be taxed as such. Tax-exempt status for purposes of this paragraph will be assigned by
the CFD Administrator in the chronological order in which property becomes Exempt
Property.
2. The Maximum Annual Special Tax obligation for any Public Property which cannot
be classified as Exempt Property as described in the first paragraph of Section E shall be
prepaid in full by the seller pursuant to Section H. I, prior to the transfer/dedication of such
property. 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
Undeveloped 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 paragraph I 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
The Council shall establish as part of the proceedings and administration ofCFD No. 2001-1,
Improvement Area B a special three-member 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 may file a written notice with the Review/Appeal Committee appealing the amount of
the Special Tax levied on such Assessor's Parcel. 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
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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 sarne manner and at the sarne time as
ordinary ad valorem property taxes; provided, however, that CFD No. 2001-1, Improvement
Area B may directly bill the Special Tax, may collect Special Taxes at a different time or in a
different manner if necessary to meet its fmancial obligations, and may covenant to foreclose
and may actually foreclose on Assessor's Parcels which 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 defmition applies to this Section H:
"CFD Public Facilities" means those public facilities authorized to be financed by
Improvement Area B.
"CFD Public Facilities Costs" means either $9.75 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
by an Assessor's Parcel of Developed Property, Undeveloped Property for which a building
permit has been issued, or Public Property. The Maximum Annual Special Tax obligation
applicable to such Assessor's Parcel may be fully prepaid and the obligation of the
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DOCSOCfl124509v~'f02224'.0155
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Assessor's Parcel to pay the Special Tax pennanently satisfied as described herein; provided
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.
The Prepayment Amount (defmed below) shall be calculated as summarized below
(capitalized tenns as defmed 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 follows:
Paragraph No.:
I. For Assessor's Parcels of Developed Property, compute the Maximum Annual
Special Tax for the Assessor's Parcel to be prepaid. For Assessor's Parcels of
Undeveloped Property 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 pennit which has already been issued for that Assessor's
Parcel. For Assessor's Parcels of Public 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 paragraph I by the
sum of the total expected Maximum Annual Special Tax revenues which may be
levied within Improvement Area B excluding any Assessors Parcels for which the
Maximum Annual Special Tax obligation has been previously prepaid.
3. Multiply the quotient computed pursuant to paragraph 2 by the principal amount of
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 paragraph 3 by the
applicable redemption premium, if any, on the Outstanding Bonds to be redeemed
(the "Redemption Premium").
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5. If all the Bonds authorized to be issued for Improvement Area B have not been
issued, compute the Future Facilities Costs.
6. Multiply the quotient computed pursuant to paragraph 2 by the amount determined
pursuant to paragraph 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 ftom
the first bond interest and/or principal payment date following the current Fiscal Year
until the earliest redemption date for the Outstanding Bonds.
8. Confirm that no Special Tax delinquencies apply to such Assessor's Parcel.
9. Determine the Special Taxes levied on the Assessor's Parcel in the current Fiscal
Year which have not yet been paid.
10. Determine the fees and expenses of Improvement Area B, including but not limited
to, the costs of computation of the prepayment, the costs to invest the prepayment
proceeds, the costs of redeeming Bonds ftom 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 ftom the
reinvestment ofthe Prepayment Amount less the Prepayment Fees and Expenses as
determined pursuant to paragraph 10, ftom 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 paragraphs 7 and 9 and subtract the amount
computed pursuant to paragraph 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 ftom 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 and/or principal payment following the current Fiscal
Year, a capitalized interest credit shall be calculated by multiplying the quotient
computed pursuant to paragraph 2 by the expected balance in the capitalized interest
fund after such first interest and/or principal payment (the "Capitalized Interest
Credit").
15. The Maximum Annual Special Tax prepayment is equal to the sum of the amounts
computed pursuant to paragraphs 3, 4, 6, 10 and 12, less the amounts computed
pursuant to paragraphs 13 and 14 (the "Prepayment Amount").
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DOCSOC/l124509v4!;!;!;!#<;102224<;-O 155
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16. From the Prepayment Amount, the amounts computed pursuant to paragraphs 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 paragraph 10 shall be retained by CFD
No. 2001-1, Improvement Area B. The amount computed pursuant to paragraph 6
shall be deposited in the Construction Fund.
The Prepayment Amount may be insufficient to redeem other than a $5,000 increment of
Bonds. In such cases, the increment above $5,000 or integral multiple thereof will be
retained in the appropriate fund established under the Indenture to be used with the next
prepayment of bonds or to make debt service payments.
As a result of the payment of the current Fiscal Year's Special Tax levy as determined under
paragraph 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 Board 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. 2001-1, Improvement Area B both prior to and after the proposed prepayment is at
least 1.1 times the maximum annual debt service on all Outstanding Bonds.
Tenders of Bonds in prepayment of Maximum Annual Special Taxes may be accepted 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.
2. Prepayment in Part
The Maximum Annual Special Tax on an Assessor's Parcel of Developed Property or an
Assessor's Parcel of Undeveloped Property for which a building permit has been issued may
be partially prepaid. The amount of the prepayment shall be calculated as in Section H.I;
except that a partial prepayment shall be calculated according to the following formula:
PP = (PE X F) + A
These terms have the following meaning:
PP = the partial prepayment
PE = the Prepayment Amount calculated according to Section H.I, minus Prepayment Fees
and Expenses 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 pursuant to Step 10.
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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 Paragraph 16 of Section H.I, and (ii) indicate in the records
ofCFD No. 2001-1, Improvement Area B 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.
I. TERM OF MAXIMUM ANNUAL SPECIAL TAX
The Maximum Annual Special Tax shall be levied commencing in Fiscal Year 2005-06 to the
extent necessary to fully satisfY the Special Tax Requirement for a period no longer than
2041-42.
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APPENDIX B
SUMMARY OF MARKET ABSORPTION STUDY
B-1
DOCSOC!l124509v~,/02"4,_O 155
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DOCSOCIl124509v~,/O"14<-0155
APPENDIX C
APPRAISAL REPORT
C-l
/Y --!-1
.
APPENDIX D
INFORMATION REGARDING THE CITY OF CHULA VISTA
GENERAL INFORMATION
This appendix sets forth general information about the City ofChula Vista ("Chula Vista'').
The following information concerning Chula Vista, the County of San Diego (the "County "), the
State of California (the "State ") and the United States of America (the "United States '') are included
only for general background purposes.
General Description
Chula Vista is located on San Diego Bay in Southern California, 8 miles south of the City of
San Diego and 7 miles north of the Mexico border, in the area generally known as "South Bay."
Chula Vista's city limits cover approximately 50 square miles. Chula Vista was incorporated
March 17, 1911 and became a chartered city in 1949. Chula Vista operates under a Council-Manager
form of government and provides the following services: public safety, community services,
engineering services, planning services, public works, general administrative services and capital
improvements. With a January 2003 estimated population of 199,700, Chula Vista is the second
largest city in the County.
Population
The historic population of Chula Vista, the County and the State is shown below.
City of Chula Vista, County of San Diego and State of California
Population Estimates
Year City ofChula Vista County of San Diego State of California
1999 164,200 2,751,000 33,140,000
2000 171,700 2,805,900 33,753,000
2001 181,000 2,856,000 34,367,000
2002 190,300 2,908,500 35,000,000
2003 199,700 2,961,600 35,591,000
Source: California State Department of Finance, E-4 Revised Historical City, County and State Population Estimates, 1991-
2000, with 1990 and 2000 Census Counts and E-4 Population Estimates for cities, counties and the State, 2001-2003,
with 2000 DRU Benchmark.
DOCSOC/I124509v~"n'n4<_0155
D-I
/L/ -70
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
Single Family Units
Multifamily Units
Total Units
1999
1,796
750
2,546
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
Source: Construction Industry Research Board.
City of Chula Vista
Building Permit Valuations
1999 2000 2001 2002 2003
Residential
New Single Family $ 307,653,358 $ 319,085,986 $ 433,850,821 $ 413,647,842 $ 498,045,931
New Multifamily 53,470,818 74,634,324 107,731,702 47,388,930 118,687,194
Res. All. & Adds 5085.049 4.862 879 7 987.049 10.301.301 13 277 257
Total Residential 366,209,225 398,583,189 549,569,572 471,338,073 630,010,382
Nonresidential
New Commercial 17,213,869 17,916,085 22,139,245 20,926,638 54,744,910
New Industrial 7,909,587 17,418,207 2,139,313 737,651 7,071,470
New Other(l) 5,840,339 17,890,100 11,112,335 22,761,223 28,063,492
Alters. & Adds. 13552638 10 527 193 13091.600 19.367574 16290492
Total Non~Residential 38,516,433 63,751,585 48,482,493 63,793,086 106,170,157
Total All Building $ 404,725,658 $ 462,334,774 $ 598,052,065 $ 535,l3l,159 $ 736,180,539
(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 Permit Valuations. Totals may not add to
sums because of independent rounding.
Source: Construction Industry Research Board.
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Employment
The following table summarizes the labor force, employment and unemployment figures over
the period 1999 through 2003 for Chula Vista, the County, the State and the United States.
Chnla Vista, San Diego County, State of California and United States
Labor Force, Employment and Unemployment Yearly Average
.
Civilian Civilian Civilian Civilian
Year and Area Labor Force EmploymenlJ) Unemploymenl'J Unemployment Rate'J)
1999
Chu1a Vista 70,600 68,3000 2,300 3.3%
San Diego County 1,348,300 1,306,700 41,600 3.1%
California 16,375,600 15,522,300 853,300 5.2%
United States(') 139,368,000 133,488,000 5,880,000 4.2%
2000
Chula Vista 72,850 70,540 2,310 3.2%
San Diego County 1,391,100 1,349,400 41,700 3.0%
California 16,892,000 16,056,500 835,500 4.9%
United States(') 142,583,000 136,891,000 5,692,000 4.0%
2001
Chula Vista 74,250 71,710 2,540 3.4%
San Diego County 1,417,700 1,371,800 45,900 3.2%
California 17,171,600 16,249,100 922,500 5.4%
United States 143,734,000 136,933,000 6,801,000 4.7%
2002
Chula Vista 76,400 72,950 3,450 4.5%
San Diego County 1,458,000 1,395,000 62,400 4.3%
California 17,375,000 16,214,900 1,160,900 6.7%
United States 144,863,000 136,485,000 8,378,000 5.8%
2003
Chula Vista 77,680 74,180 3,500 4.5%
San Diego County 482,200 1,419,100 63,100 4.3%
California 17,460,000 16,282,700 1,177,300 6.7%
United States(4) I 46,S I 0,000 137,736,000 8,774,000 6.0%
(I) Includes persons involved in labor-management trade disputes.
(2) Includes aU 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.
(') Not strictly comparable with data for prior years
Source: State of California Employment Development Department, Labor Market Information Division, based on March 2003
benchmark and U.S. Department of Labar, Bureau of Labor Statistics.
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San Diego Metropolitan Statistical Area ("MSA"), which includes Chula Vista, civilian labor
force and wage and salary employment figures for calendar years 1999 through 2003 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 MSA
Civilian Labor Force, Employment and Unemployment
Annual Averages, March 2003 Benchmark
Title 1999 2000 2001 2002 2003
Civilian Labor Force 1,348,300 1,391,100 1,417,700 1,458,000 1,482,200
Civilian Employment 1,306,700 1,349,400 1,371,800 1,395,600 1,419,100
Civilian Unemployment 41,600 41,700 45,900 62,400 63,100
Civilian Unemployment Rate 3.1% 3.0% 3.2% 4.3% 4.3%
Total Fann 11,200 11,400 11,400 11,000 11 ,200
Total Nonfann 1,152,900 1,193,800 1,218,400 1,230,700 1,241,900
Total Private 953,500 987,200 1,004,700 1,011,000 1,022,100
Goods Producing 190,200 192,600 194,400 189,000 185,300
Natural Resources and Mining 300 300 300 300 300
Construction 67,000 69,700 75,100 76,400 79,600
Manufacturing 122,900 122,600 119,000 112,300 105,400
Service Providing 962,700 1,001,200 1,024,000 1,041,700 1,056,700
Trade, Transportation and Utilities 194,200 202,600 209,000 208,600 208,600
Wholesale Trade 36,800 39,100 41,500 41,300 41,300
Retail Trade 128,200 133,800 135,600 138,000 140,000
Transportation, Warehousing and Utilities 29,200 29,800 32,000 29,300 27,300
Utilities 5,900 5,700 6,900 6,300 6,100
Information 36,200 39,200 38,800 37,700 37,100
Financial Activities 70,400 71,200 72,000 75,000 80,500
Professional and Business Services 185,000 195,200 198,200 201,700 201,600
Educational and Health Services 112,200 115,300 116,000 119,700 122,000
Leisure and Hospitality 124,400 129,000 131,400 133,800 139,900
Other Services 40,900 42,200 44,900 45,600 47,200
Government 199,300 206,600 213,800 219,700 219,800
Total, All Industries 1,164,000 1,205,200 1,229,800 1,241,700 1,253,100
Note: The ''Total, All Industries" data is not directly comparable to the employment data found herein.
Source: State of California, Employment Development Department, Labor Market Information Division, San Diego MSA
Annual Average Labor Force and Industry Employment, March 2003 Benchmark.
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.
The following listings set forth Chula Vista's principal employers for fiscal year ending
June 30, 2003:
Chula Vista's Principal Employers
Business Industrial/Office
Name
BF Goodrich Aerospace Aerostructures Group
City ofChula Vista
Sharp Chula Vista Medical Center
Scripps Memorial Hospital
Ges Exposition Services. Inc.
United Parcel Service
Wal-MarI
Remedy Temporary Services, LLC
Raytheon Systems Company
Costco Wholesaler Corp #460
Sears Roebuck & Co.
Costco Wholesaler Corp #405
Bayview Behavioral Health Campus
Home Depot
American Fashion Inc.
GCE Industries Inc.
A TC Vancum of California
Target
MDI Interviewing Services, Inc.
Source: City ofChula Vista Finance Department.
Effective Buying Income
Type of Business
Aerospace Manufacturer
Municipality
Hospital
Hospital
Contractor - Specialty
Parcel Delivery Service
General Merchandise
Employment Services
Communications
General Merchandise
Department Store
General Merchandise
Hospital
Building Supplies/Hardware
Apparel Manufacturing
Engineering
Transit Company
Retail
Marketing
No. of Employees
2,418
1,215
1,110
818
705
466
375
352
292
281
262
237
236
235
229
222
214
204
200
"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 ftom all
sources and transfer payments (such as pensions and welfare assistance). Deducted ftom 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."
DOCSOCIl124509v41~~~.W;I022?4<-OI55
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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 1998 and 2002.
Chula Vista, San Diego County and California
Effective Buying Income(l)
Median
Household Percent of
Effective Buying Per Capita Effective Effective Buying Households
Income(2) Buying Income Income over $50,000
1998
Chula Vista $ 2,408,888 $14,187 $33,911 30.1%
San Diego County 46,056,143 16,101 36,296 32.8
California 551,999,317 16,299 37,091 34.6
1999
Chula Vista $ 2,629,899 $15,776 $37,725 35.4%
San Diego County 49,907,828 17,270 39,213 37.4
California 590,376,663 17,245 39,492 38.3
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
(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 offDod stamps, etc.) versus personal income.
(2) Dollars in thousands.
Source: "Survey of Buying Power," Sales & Marketing Management Magazine, dated 1999,2000,2001,2002 and 2003.
Sales Taxes
The following table shows taxable transactions in Chula Vista by type of business during
calendar years 1998 through 2002. As indicated below, total retail sales for Chula Vista in 1999
increased by approximately 10.30% over the 1998 level, in 2000 increased by approximately 10.44%
over the 1999 level, in 2001 increased approximately 4.98% over the 2000 level, and in 2002
increased approximately 2.42% over the 200 I level.
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A summary of historic taxable transactions for Chula Vista is shown in the following table.
City of Chula Vista
Taxable Transactions
(Dollars in thousands)
.
1998 1999 2000 2001 2002
Apparel Stores Group $ 63,414 $ 61,758 $ 66,598 $ 61,937 $ 67,035
General Merchandise Stores 382,944 439,731 495,679 524,942 525,423
Food Stores Group 81,006 85,662 90,487 92,224 99,897
Eating and Drinking Group 131,661 142,329 155,583 164,417 169,892
Household Group/Home Furn. Appli. 55,856 61,923 66,365 67,827 74,255
Building Material Group 75,812 87,902 102,370 97,827 91,235
Automotive Group 107,808 126,304 145,923 151,812 156,872
Service Stations 88,570 95,546 121,244 119,050 123,636
Other Retail Stores 133.463 139.837 157.152 183.303 205.564
Retail Stores Total $ 1,120,534 $ 1,240,992 $ 1,401,401 $1,463,409 $1,513,809
All Other Outlets 199.661 215.396 206.889 225.256 215.349
Total All Outlets $ 1120 195 $ ] 456 188 $ I 608 290 $1688665 $1729158
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 fiom 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 fiom 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.
Community Facilities
There are two acute-care hospitals, two psychiatric hospitals and three convalescent
hospitals, and more than 400 medical doctors and allied professionals in Chula Vista.
There are two daily, one weekly and one semi-weekly newspapers published and circulated
in Chula Vista. Chula Vista has one main public library and two branch libraries.
Recreational facilities within or near Chula Vista include twenty-four parks, four community
centers, six "tot lots," two ball fields, twenty-eight tennis courts, three golf courses, four municipal
swimming pools, two gymnasiums and boat launching facilities. Chula Vista's bayfiont area
contains a marina which houses 552 boats and miles of public beaches. Chula Vista also provides
many trails for bicycling, hiking and jogging.
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Chula Vista is also the home of the United States Olympic Training Center. This is the third
such training center in the nation and the only year round training facility. The center is located on a
150-acre site donated by EastLake Development Company adjacent to the Otay Lake reservoir.
Chula Vista has more than sixty churches and nearly 100 service, fraternal and CIVIC
organizations.
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 bus connections serve Chula Vista, and Southern Pacific Railway and San Diego's
Lindbergh International Airport are fifteen minutes to the north of Chula 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.
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.
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
.
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DOCSOC!1124509v~'lOnU'_0155
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.
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. 2001-1 (San Miguel
Ranch) (the "Issuer") and MuniFinancial as dissemination agent (the "Dissemination Agent"), in
connection with the issuance and delivery by the Issuer of its $ 2005 Improvement Area B
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 1. Puroose of the Disclosure Agreement. 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.
"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 ftom 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. 2001-1 (San Miguel Ranch).
"Improvement Area B" shall mean Improvement Area B of the District.
"Listed Events" shall mean any of the events listed in Section 5(a) of this Disclosure
Agreement.
"National Repository" shall mean any Nationally Recognized Municipal Securities
Information Repository for purpose of the Rule.
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"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 ReDorts.
(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 filing 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 I 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 (IS) 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 (IS) 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
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
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DOCSOC/1124509v~'102"4'_0155
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Dissemination Agent may conclusively rely upon such certification of the Issuer and shaIl 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 shaH send a
notice to each Repository, in substantiaIly 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.
SECTION 4. Content of Annual Reports. The Issuer's Annual Report shaH 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 shaH contain any unaudited financial statements of the Issuer in a format
similar to the financial statements, and the audited financial statements shall be filed in the same
manner as the Annual Report when they become available. Audited financial statements of the
Issuer shaH be audited by such auditor as shaH then be required or permitted by State law. Audited
financial statements, if prepared by the Issuer, shaIl be prepared in accordance with generaHy
accepted accounting principles as prescribed for governmental units by the Governmental
Accounting Standards Board; provided, however, that the Issuer may ITom time to time, if required
by federal or state legal requirements, modify the basis upon which its financial statements are
prepared. In the event that the Issuer shaH modify the basis upon which its financial statements are
prepared, the Issuer shaIl provide a notice of such modification to each Repository, including a
reference to the specific federal or state law or regulation specificaHy describing the legal
requirements for the change in accounting basis.
(b) Financial and Operating Data. The Annual Report shaH contain or incorporate by
reference the foHowing information:
(i) the principal amount of Bonds outstanding as of the September 2 preceding
the filing of the Annual Report;
(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 shaH include an update of Table 2 in the
Official Statement; provided however that such update wiH not be required after the
F-3
DOCSOCll124509v~<,"222",-0155
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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 Improvement Area B 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 Improvement Area B 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.
SECTION 5. ReDortinl! of Siwificant 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.
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(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 financial 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.
(11) 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 of a notice ITom 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).
(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 (t).
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(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 or (ii) 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.
(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)(I), (2) and (3) have been satisfied.
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(c) To the extent any amendment to this Disclosure Agreement results in a change in the
type of financial 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 fmancial information.
SECTION 9. Additional Information. Nothing in this Disclosure Agreement shall be
deemed to prevent the Issuer rrom 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
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 rrom 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
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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 F ourth Avenue
Chula Vista, California 9 I 9 I 0
Dissemination Agent:
MuniFinancial
27368 Via Industrial, Suite 110
Temecula, California 92590
Attention: Municipal Disclosure
SECTION 14. Countemarts. 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. 2001-1
(San Miguel Ranch)
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. 2001-1 (San Miguel Ranch)
Name of Bond Issue: $ City ofChula Vista Community Facilities District No. 2001-
;1 (San Miguel Ranch) $ 2005 Improvement Area B Special Tax
Bonds
Date ofIssuance: , 2005
NOTICE IS HEREBY GNEN that the Community Facilities District No.2001-1 (San
Miguel Ranch) located in the City of Chula 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:
MUNIFINANCIAL, as Dissemination Agent
cc: City of Chula Vista
Stone & Youngberg LLC
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.
APPENDIX G
CONTINUING DISCLOSURE AGREEMENT OF THE DEVELOPER
This Continuing Disclosure Agreement (the "Disclosure Agreement") dated as of November
I, 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. 2001-1
(San Miguel Ranch) (the "District") $ aggregate principal amount of its City ofChula Vista
Community Facilities District No. 2001-1 (San Miguel Ranch) 2005 Improvement Area B Special
Tax Bonds (the "Bonds"). The Bonds are being executed and delivered pursuant to an Indenture
dated as of November 1,2005 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. Puroose of the Disclosure AlITeement. 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 filed with the Developer and the City a written acceptance of such
designation.
"District" shall mean Community Facilities District No. 2001-1 (San Miguel Ranch).
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"Equity Securities" of any Person shall mean (a) all common stock, preferred stock,
participations, shares, general partnership 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.
"Improvement Area B" shall mean Improvement Area B of the District.
"Listed Event" shall mean any of the events listed in Section 5(a) of this Disclosure
Agreement.
"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 Agreement 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 company, partnership,
firm, association, Government Authority or any other Person whether acting in an individual
fiduciary, or other capacity.
"Repository" shall mean each National Repository and the 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.
"Semi-Annual Report" shall mean any Semi-Annual Report provided by the Developer
pursuant to, and as described in, Sections 3 and 4 of this Disclosure Agreement.
"State" shall mean the State of California.
"State Repository" shall mean any public or private repository or entity designed by the State
as a state repository for the purpose of the Rule and recognized as such by the Securities and
Exchange Commission. As ofthe date of this Disclosure Agreement, there is no State Repository.
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SECTION 3. Provision of Annual ReDorts.
(a) The Developer shall, or shall cause the Dissemination Agent to, not later than May I
and November I of each year, commencing May I, 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 ITom 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 ReDort. 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 Improvement Area B, 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
Improvement Area B, including the number of parcels for which building permits
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have been 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 Improvement Area B
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 or the time for construction
of any public or private improvements to be made by the Developer or any of its
Affiliates within Improvement Area B, other than the public improvements described
in (e) below (the "Developer Improvements").
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
Improvements").
f Any material amendments to land use entitlements for the property owned by the
Developer with Improvement Area B or Special Tax rate and method of
apportionment with respect to parcels within Improvement Area B 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 Affiliates no longer own land within Improvement Area B 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 Improvement
Area B 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 [mancial statements prepared and the audited
[mancial 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
financial 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 Improvements or the development of undeveloped parcels within
Improvement Area B, or litigation which would materially adversely affect the
[mancial condition of the Developer or its Affiliates that own property within
Improvement Area B.
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i. A payment default by the Developer on any loan made to the De'/clsj'lersDeveloner
(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 ITom the Municipal Securities Rulemaking Board. The
Developer shall clearly identifY each such other document so included by reference.
SECTION 5. Renortinl! of Significant 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):
1. Failure to pay any real property taxes, special taxes or assessments (including
any assessment installment) levied within Improvement Area B on a parcel owned by the
De'ielsJ3ersDeveloner or any of its Affiliates;
2. A payment default by the Developer or any Affiliate on any loan secured by
property within Improvement Area B 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
Improvement Area B may be adjudicated as bankrupt or discharged ITom 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 Renortinl! Obligation. 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 Improvement Area B 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 Deyeleperr.Develoner. If such
termination occurs prior to the final 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 manner 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
manner 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
infonnation or operating data being presented by the Developer. In addition, if the amendment
relates to the accounting principles to be followed in preparing financial 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 fonn and also, if feasible, in quantitative fonn) between the
financial statements as prepared on the basis of the new accounting principles and those prepared on
the basis of the fonner 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 Infonnation. Nothing in this Disclosure Agreement shall be
deemed to prevent the Developer from disseminating any other infonnation, using the means of
dissemination set forth in this Disclosure Agreement or any other means of communication, or
including any other infonnation 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 infonnation 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 infonnation 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 perfonnance 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 I I. Duties. Immunities and Liabilities of Dissemination A!!ent. 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, harmless against any loss, expense and liabilities which they may
incur arising out of or in the exercise or perfonnance 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 the Dissemination Agent'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 perfonnance of this
Disclosure Agreement.
The Dissemination Agent 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,
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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 indemnify and
hold harmless the Dissemination Agent to the extent described herein.
SECTION 12. ReDorting Obligation of DeveloDer's Transferees. The Developer shall, in
connection with any sale or transfer of ownership of land within Improvement Area B 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 Improvement Area B 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 finished 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 fmished lot condition, and the transferee is
not responsible for the construction or installation of some or all of the inftastructure 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 responsihle 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 ofthe County of San Diego.
SECTION 13. DeveloDer as IndeDendent 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:
G-8
DOCSOCI1124509v~<IO'''4'-O 155
/t/-115
District:
City ofChula 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
Participating Underwriter:
Stone & Youngberg LLC
One Ferry Building
San Francisco, CA 94 I I I
Attention: Research Department
SECTION 15. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of
the Deyelel'ersDeveloner, 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. Countemarts. 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.
r
1, a
By:
Its:
By:
Its:
U.S. BANK NATIONAL ASSOCIATION
By:
Its:
0-9
DOCSOCIl124509v4/;!;!;!.W;10222',_O 155
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EXHIBIT A
NOTICE TO REPOSITORIES OF FAILURE TO FILE SEMI-ANNUAL REPORT
Name of the Issuer:
Community Facilities District No. 2001-1 (Sao Miguel Raoch) City of
Chula Vista, California
Name of Bond Issue:
City of Chula Vista
Community Facilities District No. 2001-1
(Sao Miguel Raoch) 2005 Improvement Area B Special Tax Bonds
Date ofIssuaoce:
,2005
G-IO
DOCSOC/I124509v~"!On24"-OI55
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APPENDIX H
FORM OF OPINION OF BOND COUNSEL
Mayor and City Council
City ofChula Vista
276 Fourth Avenue
Chula Vista, CA
.
BOND OPINION
$
CITYOFCHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 2001-1
(SAN MIGUEL RANCH)
2005 IMPROVEMENT AREA B SPECIAL TAX BONDS
Ladies and Gentlemen:
We have acted as bond counsel in connection with the issuance by Community Facilities
District No. 2001-1 (EastLake - Woods, Vistas and Land Swap) 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. 2001-1 (San Miguel Ranch) 2005
Improvement Area B 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 Government 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 I, 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 OpinIOn, 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 duJy 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 Improvement Area B of the District and other funds available therefor
held under the Bond Indenture.
DOCSOC/I 124509v~51022?4<-0155
H-I
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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.
Weare 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.
Weare 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 Hand
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
H-2
DOCSOC/1124509v4mW'101n4<-O 155
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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
New 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 trom 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 trom 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, trom the Direct or Indirect
Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership
interests in the Bonds are to be accomplished by entries made on the books of Direct and Indirect
Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive bonds
representing their ownership interests in Bonds, except in the event that use of the book-entry system
for the Bonds is discontinued.
To facilitate subsequent transfers, all Bonds deposited by Direct Participants with DTC are
registered in the name of DTC's partnership nominee, Cede & Co., or such other name as may be
I-I
DOCSOC/I124509v~,IO?"4'_OI55
/ 1L" -f:.z 0
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 ITom 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 ITom 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 ITom 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 of DTC,
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
1-2
DOCSOCIl124509v~'I02214'-0155
/~-/.AI
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 ftom sources that the District believes to be reliable, but the District takes no responsibility
for the accuracy thereof.
.
1-3
DOCSOC/1124509v~510222"-0155
/<!-/.J-A
EXHIBIT Lj
BOND INDENTURE
by and between
City Of Chula Vista
Community Facilities District No. 2001-1
(San Miguel Ranch)
and
u.S. Bank National Association,
As Fiscal Agent
Dated as of November 1, 2005
{11~ ~J
Re: $
City of Chula Vista
Community Facilities District No. 2001-1
(San Miguel Ranch)
2005 Improvement Area B Special Tax Bonds
WBD\317831.1
DRAFT 8/24/05
/if -(,)3
.
TABLE OF CONTENTS
Paee
ARTICLE I. DEFINITIONS............ ............ .... ..... .............. ... ...... '" ............... .... ... ...... ............1
SECTION 1.01 DEFINTI10NS....... ...... ... .... .... ..... ... ... ........... .... ..... .... .......... .............. ........... .... 1
ARTICLE ll. GENERAL AUTHORIZATION AND TERMS............................................ 13
SECTION 2.01 AMOUNT, ISSUANCE AND PURPOSE. .............................................................13
SECTION 2.02 TYPE AND NATURE OF BOND. ......................................................................13
SECTION 2.03 TERMS OF TIffi BONDs.................................................................................13
SECTION 2.04 DESCRIPTION OF BONDS; INTEREsT RATES. ...................................................14
SECTION 2.05 PAYMENT.... ........... ..... ....... .... ..... ..... .......... ... ............. ...... ......... ... .... ......... ..14
SECTION 2.06 EXECUTION OF BONDs. ................................................................................15
SECTION 2.07 ORDER TO PRINT ANDAUTIIENTICATEBoNDs...............................................15
SECTION 2.08 BOOKS OF REGISTRATION; BOOK ENTRY SYSTEM.......................................... 15
SECTION 2.09 EXCHANGE OF BONDs..................................................................................17
SECTION 2.10 NEGOTIABILITY, REGISTRATION AND TRANSFER OF BONDs............................ 17
SECTION 2.11 AUTIffiNTICATION.... ..... ............ .......... ........ ..... ... .... .... ....... ..... .... ....... ....... ... 17
ARTICLE ill. FUNDS AND ACCOUNTS...........................................................................19
SECTION 3.01 ESTABLISHMENT OF SPECIAL FUNDS. ............................................................19
SECTION 3.02 SPECIAL TAX FUND. ....................................................................................19
SECTION 3.03 DEBT SERVICE FUND. ... ....... ...... ......... ........ ... ...... ..... .... ..... ........ ...... ... .... .....21
A. Interest Account........................ ... .......................................... ............ ........................ 21
B. Principal Account. ............................................................... ......................................21
SECTION 3.04 COSTS OF ISSUANCE FuND..... .... ...... ... ................. .... ... ......... ... ................ .....21
SECTION 3 .05 PROJECT FUND.. ... ...... ....... ..... ..... ........... ........... ... ... ........ ..... .... ...... ..... ........ 21
SECTION 3 .06 RESERVE FUND ..... .......... ... ..... ....... ... ........... ... ... ... ... ..... ... ..... .... ... ........ .......22
SECTION 3.07 REBATE FUND. ... ..... ...... ....... ..... ......... ........ ... ...... ... ............. ... ... ..... ........ ..... 23
SECTION 3.08 REDEMPTION FUND. ... ....... .... ...... ..... ...... ...... .... .... ... .... ......... ....... ............ .... 24
SECTION 3 .09 ADMINISTRATIVE EXPENSE FUND. ...... ........... ..... .... ........... ..... .... ...... ............24
SECTION 3.10 INVESTMENT OF FUNDS. ..............................................................................24
SECTION 3.11 DIsposmoNoF BOND PROCEEDS. ...............................................................25
ARTICLE N. REDEMPTION...... .... ..... ... ...... .......... ... ... .......... ........... .... ............. ..... ..........26
SECTION 4.01 NOTICE OF REDEMPTION. .............................................................................26
A. Notice bv Mail to Bondholders: ................................................................................. 26
B. Further Notice:....................................... ...................................... ............................. 26
C. Failure to Receive Notice ..........................................................................................26
D. Certificate of Givinf! Notice....... ........ ............... ......... ........... ... ..... .... ............ ....... ...... 27
SECTION 4.02 EFFECT OF REDEMPTION................... ...... ............................... ... .... ............ .... 27
SECTION 4.03 REDEMPTION PRICES AND TERMS. ................................................................27
A. Ovtional Redemvtion................................................................................................. 27
B. Extraordinary Mandatorv Redemption. .....................................................................27
C. Mandatorv Sinkin~ Fund Redemption........................................................................ 28
E. Notice and Selection of Bonds for Redemption .......................................................... 29
(i)
WBD\317831.1
DRAFT 8/24/05
/Y ~/~ ~
TABLE OF CONfENTS
(Continued)
Pal!e
ARTICLE V. SUPPLEMENTAL INDENTURES........... .... ... .... ... .... .... ... ..... ..... ... ......... .... '" 30
SECTION 5.01 AMENDMENTS OR SUPPLEMENTS..... .................... .... .... ................ ........... ......30
ARTICLE VI. MISCELLANEOUS CONDITIONS ..........................................................32
SECTION 6.01 OWNERSHIP OF BONDS. ............................................................................... 32
SECTION 6.02 MUTILATED, LOST, DESTROYED OR STOLEN BONDs. ....................................32
SECTION 6.03 CANCELLATION OF BONDS. ... ........... .... ... .......... .... ...... ..... ............... ........ ..... 32
SECTION 6.04 COVENANTS.. ..... ....... ............. ... ... ... .... ......... ... ....... ..... ... ...... .... ....... ......... ... 32
SECTION 6.05 ARBITRAGE CERTIFICATE. .... ... ........ ........... ... ... ........... ........... ..... ... ...... ........35
SECTION 6.06 DEFEASANCE.. ......... ...... ....... ...... ... ... ... ....... .......... ........ ...... ....... .................36
SECTION 6.07 FISCAL AGENT......... ......... ..... ...... ........ ........ ... .......... .... ........... ......... ...........37
SECTION 6.08 LIABILITY OF FISCAL AGENT.. ... ..... ....... ........... ..... .... ........ ........ ....... .... .........38
SECTION 6.09 PROVISIONS CONS1TIUTE CONTRACT....... ...... ....... ... .... .... ... .......... ........... .....39
SECTION 6.10 CUSIP NUMBERS...... ........ ...... ........ ...... ....... ... ... ........ ... .... ................ .......... 40
SECTION 6.11 SEVERABILITY. ......... ....... ....... ........ ........... .................... ... ........ ........... ..... ...40
SECTION 6.12 UNCLAIMED MONEy....... ..... ........ ... ... .......... ... ....... ........ ............. ........... ......40
SECTION 6.13 NONPRESENTMENT OF BONDS. .....................................................................40
SECTION 6.14 CONTINUING DISCLOSURE. ....... ... ...... ... ... ....... ....... ... .......... ........ ....... ...........41
ARTICLE VII. BOND FORM ........... ............ ... ... ..... .... ......... ...... .... ..... ... ... ............. ............. 42
SECTION 7.01 FORM OF BONDS. ..... .... ... .......... ................... ............. .... ....... ..... ..... .............42
SECTION 7.02 TEMPORARY BONDs. ....... ....... ..... ....... ....... ..... ...... ..... .... ... ........ ...................42
ARTICLE VIII EVENT OF DEFAULT ................................................................................43
SECTION 8.01 EVENTS OF DEFAULT.. ... .......... ... ...... '" ... ............ ....... ..... ...... ....... ........... .....43
SECTION 8.02 APPLICATION OF REVENUES AND OTIlERFUNDS MTERDEFAULT .................. 43
EXHIBIT "A" - FORM OF BOND ... ........ ............. ... ..................... ........ .... ........ ..... ............. A-I
EXHIBIT "B" - ARBITRAGE REBATE INSTRUCTIONS... ....... B-ERROR! BOOKMARK NOT
DEFINED.
WBD\317831.1
DRAFT 8/24/05
(ii)
/~-/J,6-
BOND INDENTURE
This Bond Indenture dated as of November 1, 2005, is entered into by and between
Community Facilities District No. 2001-1 (San Miguel Ranch), 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:
"AcquisitionlFinancing Agreement" means that certain AcquisitionIFinancing Agreement made and
entered into on the 15th day of July, 2002 by and between the City, acting on behalf of itself and the
District, and NNP- Trimark San Miguel Ranch, LLC, a Delaware limited liability company, as
amended by that certain First Amendment to AcquisitionlFinancing Agreement made and entered into
on the _ day of October, 2005, by and between the City, acting on behalf of itself and the
District, and , as such agreement may be further amended rrom 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; 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 thereofrelated 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
and/or its successor). Administrative Expenses shall also
include Delinquency Collection Expenses.
WBD\317831.1
DRAFT 8/24/05
1
/~/.).h
"Administrative Expense Requirement" means an annual amount equal to $75,000, or such lessor
amount as may be designated by written instruction ITom 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, induding ITom 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 of Finance or Assistant
Director of Finance of the City, acting on behalf of the District, or any other person designated by the
City Council 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 2001-1 (San
Miguel Ranch) 2005 Improvement Area B Special Tax Bonds issued pursuant to this Indenture.
"Debt Service Fund" means the fund created and established pursuant to Section 3.01 hereof
"Bond Year" means each twelve-month period extending ITom September 2 in one calendar year to
September I of the succeeding calendar year, except in the case of the initial Bond Year which shall
be the period from the Delivery Date to 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.
"City" means the City of Chula Vista, California.
2
WBD\31783Ll
DRAFT 8/24/05
I~ -/J.-l
"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, as to the Bonds, all of the costs off ormation 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 and any Supplemental Indenture, the Bonds, and any and all other
agreements, instruments, certificates or other documents issued in connection therewith; any
computer and other expenses incurred in connection with the Bonds; the initial fees and expenses of
the Fiscal Agent (including without limitation, acceptance fees and first annual fees payable in
advance); and other fees and expenses incurred in connection with the 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.
"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.
"District" means Community Facilities District No. 2001-1 (San Miguel Ranch).
"DTC" shall mean The Depository Trust Company, New York, New York, and its successors and
assigns.
"Fiscal Agent" means U.S. Bank National Association, and any successor thereto.
WBD\317831.1
DRAFT 8124/05
3
/7'-/>>
"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.
"Improvement Area B" means Improvement Area B of the District.
"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,
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 1 and September 1 of each year, co=encing March 1, 2006.
"Investment Agreement" means any investment satisfYing the requirements of Paragraph 11 ofthe
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.
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"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:
I. 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):
.
I.
A. Direct obligations (other than an obligation subject to variation in principal
payment) of the United States of America ("United States Treasury Obligations");
B. Obligations fully and unconditionally guaranteed as to timely payment of
principal and interest by the United States of America;
C. Obligations fully and unconditionally guaranteed as to timely payment of
principal and interest by any agency or instrumentality of the United States of America
when such obligations are backed by the full faith and credit of the United States of
America, or
D. Evidences of ownership of proportionate interests in future interest and
principal payments on obligations described above held by a bank or trust company as
custodian, under which the owner of the investment is the real party in interest and
has the right to proceed directly and individually against the obligor and the
underlying government obligations are not available to any person claiming through
the custodian or to whom the custodian may be obligated.
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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)
(I) Consolidated debt obligations
D. Federal National Mortgage Association (FNMA)
(1) Senior debt obligations
(2) Mortgage-backed securities (excluded are stripped mortgage
securities which are purchased at prices exceeding their principal
amounts)
E. Student Loan Marketing Association (SLMA)
(1) Senior debt obligations (excluded are securities that do not have a
fixed par value and/or whose terms do not promise a fixed dollar
amount at maturity or call date)
F. Financing Corporation (FICO)
(1) Debt obligations
G. Resolution Funding Corporation (REFCORP)
(1) Debt obligations
4. Unsecured certificates of deposit, time deposits, and bankers' acceptances (having
maturities of not more than 3 0 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.
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7. Money market funds rated "AAm-I" 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 "A" by S&P, or better, or any obligation fully and unconditionally
guaranteed by any state, subdivision or agency whose unsecured general
obligation debt is so rated.
B. Direct general short-term obligations of any state agency or subdivision or
agency thereof described in paragraph A above and rated "A-I +" by S&P and
"Prime-I" by Moody's.
C. Special Revenue Bonds (as defined in the United States Bankruptcy Code) of
any state, state agency or subdivision described in paragraph A above and
rated "AA" or better by S&P and "AA" 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;
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 ofa
new Verification; and
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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 (I) any domestic bank, or domestic branch of a foreign bank, the long term debt
of which is rated at least "A" by S&P and Moody's; or (2) any broker-dealer with
"retail customers" or a related affiliate thereof which broker-dealer has, or the parent
company (which guarantees the provider) of which has, long-term debt rated at least
"A" by S&P and Moody's, which broker -dealer falls under the jurisdiction of the
Securities Investors Protection Corporation, or (3) any other entity rated "A" or
better by S&P and Moody's, provided that:
A. The market value of the collateral is maintained at levels and upon such
conditions as would be acceptable to S & P and Moody's to maintain an "A"
rating in an "p.:' 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
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 "A.3" by Moody's, as appropriate, the provider must, at the
direction of the District or the Fiscal Agent, within I 0 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 "p.:' 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.
II. 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:
8
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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 rree 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
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 "A3", 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);
9
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F. the investment agreement must provide that if during its term
(I) 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.
"Prepayments" means Special Tax Receipts 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 550 South Hope Street,
Suite 500, 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
AcquisitionlFinancing Agreement.
"Project Costs" means all expenses of and incidental to the construction, acquisition, or both, of the
Project.
"Project Fund" means the fund by that name established pursuant to Section 3.01 hereof
"Rebate Fund" means the fund by that name established pursuant to Section 3.0 I 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 3.0 I hereof
"Regulations" means the regulations promulgated under the Internal Revenue Code of 1986, as
amended.
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"Reserve Fund" means the fund by that name established pursuant to Section 3.01 hereof
"Reserve Requirement" means an amount initially equal to $ which amount shall, as of
any date of calculation, be equal to the lesser of (i) Maximum Annual Debt Service for the Bonds, (ii)
one hundred twenty-five percent (125%) of Average Annual Debt Service for the Bonds, or (iii) ten
percent (10%) of the original principal amount of the Bonds less original issue discount, if any, 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 Authority may designate in writing to the Trustee.
"Special Tax" means the Special Tax authorized to be levied in Improvement Area B 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
co=unity 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 co=unity facilities districts formed by the City to
administer the levy of special taxes within such co=unity 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 and received by the District,
and (b) the Delinquency Proceeds.
"Special Tax RMA" means the rate and method of apportionment of the Special Tax authorized to be
levied on property within Improvement Area B as approved at the special election held in the District
on February 1, 2005, as it may be modified ftom 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,
11
WBD\317831.1
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amendatory hereof or supplemental hereto; but only if and to the extent that such Supplemental
Indenture is specifically authorized hereunder.
"Tax Exempt" means, with reference to a Permitted Investment, a Permitted Investment the interest
earnings on which are excludable ITom gross income for federal income tax purposes pursuant to
Section 103(a) of the Code, other than one described in section 57(a)(5)(C) of the Code.
"Term Bonds" means the Bonds maturing on September 1, 20_ and 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(t) of the Code.
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ARTICLE n. GENERAL AUTHORIZATION AND TERMS
SECTION 2.01
Amount, Issuance and Purpose.
Pursuant to the provisions of the Act and the Registered Public Obligations Act of California
(Sections 5050 and following of the California Gove=ent Code), the Legislative Body has
authorized the issuance of the Bonds in an aggregate principal amount of$ . The Bonds
shall be designated City of ChuIa Vista Community Facilities District No. 200 I-I (San Miguel Ranch)
2005 Improvement Area B Special Tax Bonds. The purpose of the Bonds shall be to (a) pay for the
acquisition or construction of the Project, (b) fund the Reserve Fund, and (c) 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 rrom
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 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 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 rrom any source of income other than the Net Special Tax Revenue 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 rrom
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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Maturity Date
(September 1)
Principal
Amount
Interest
Rate(%)
Maturity Date
(S eptember 1)
Principal
Amount
Interest
Rate(% )
SECTION 2.04
Description of Bonds; Interest Rates.
The Bonds shall be issued in fully registered form in denominations of$5,000 or any integral
multiple thereof within a single maturity and shall be numbered as desired by the Fiscal Agent. The
Bonds shall be dated as of the Delivery, 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 (co=encing March 1, 2003 for the Bonds), until the principal sum of
that Bond has been paid; provided, however, that if at the maturity date of any Bond (or ifthe 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 trom 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 i=ediate1y succeeding Interest Payment Date, in which event
interest shall be payable from the Interest Payment Date i=ediately 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 trom the date ofthe Bonds; provided, however, that if
at the time of authentication of a Bond, interest is in default, interest on that Bond shall be payable
trom the last Interest Payment Date to which the interest has been paid or made available for
14
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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 a~ the owner of such Bond as of the close of business on the
Record Date i=ediately preceding such Interest Payment Date. Such interest shall be paid by check
of the Fiscal Agent mailed to such Bondowner at his or her address as it appears on the books of
registration as required by Section 2.08 or, upon the request in writing prior to the Record Date of a
Bondowner of at least $1,000,000 in aggregate principal amount of Bonds, by wire transfer in
i=ediately 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 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
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15
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the Depository, which may be the Depository, as determined from time to time pursuant to this
Section.
With respect to the Bonds registered in the name of the Nominee, neither the District nor the
Paying Agent shall have any responsibility or obligation to Participant or to any person on behalf of
which such a Participant holds an interest in the Bonds. Without limiting the immediately preceding
sentence, neither the District nor the Paying Agent shall have any responsibility or obligation (unless
the District is at such time the Depository) 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 Paying 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 ofthe 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
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.
date and amounts of such reduction in principal, but in such event the District records maintained by
the Paying Agent shall be conclusive as to what amounts are Outstanding on the Bond, except in the
case of final maturity, in which case the Bond must be presented to the Paying 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 such books of registration upon
surrender thereof to the Fiscal Agent, together with an assignment duIy executed by the Owner or bis
attorney or legal representative, in satisfactory form. Upon any such registration of transfer, a new
Bond or Bonds shall be authenticated and delivered in exchange for such Bond, in the name of the
transferee, of any denomination or denominations authorized by this Indenture, and in an aggregate
principal amount equal to the principal amount of such Bond or Bonds so surrendered. In all cases in
which Bonds shall be exchanged or transferred, the Fiscal Agent shall authenticate the Bonds in
accordance with the provisions of this Indenture. All Bonds surrendered in such exchange or transfer
shall forthwith be canceled. The Fiscal Agent may make a charge for every such exchange or
registration of transfer of Bonds sufficient to reimburse it for any tax or other governmental charge
required to be paid with respect to such exchange or registration or transfer.
SECTION 2.11
Authentication.
Only such of the Bonds as shall bear thereon a certificate of authentication substantially in the
form 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:
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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 Subaccount, and the Principal Account;
C. Rebate Fund;
D. Redemption Fund;
E. Project Fund;
F. Reserve Fund;
G. Administrative Expense Fund; and
.
H. Costs ofIssuance Fund.
SECTION 3.02 Special Tax Fund.
A. The District shall, no later than the tenth (10th) 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 Debt Service Fund and the
Administrative Expense Fund as set forth in written instructions ITom an Authorized Representative.
B. With the exception of Special Tax Revenues representing Prepayments which shall be
transferred pursuant to the provisions of Section 3. 02C below, the Special Tax Revenues deposited in
the Special Tax Fund shall be held in trust and deposited in the following accounts of the Special Tax
Fund or transferred to the following other funds and accounts on the dates and in the amounts set
forth in the following paragraphs and in the following order of priority:
1. The Fiscal Agent shall each Fiscal Year transfer to the Administrative Expense Fund
ITom 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 deposit in the Interest Account of the Debt Service Fund, on
each Interest Payment Date and date for redemption of the Bonds, an amount
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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 deposit in 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 transfer and
deposits required pursuant to I. 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
pursuant to paragraphs I. through 4. above, upon receipt of written instructions ITom
an Authorized Representative, the Fiscal Agent shall transfer ITom 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
pursuant to paragraphs I. through 5. above, upon receipt of a written request of an
Authorized Representative, the Fiscal Agent shall transfer ITom 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 ITom 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 pursuant to paragraphs I. 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 paragraphs I. through 6. above.
c. The Fiscal Agent shall, upon receipt of Special Tax Revenues representing Prepayments,
immediately transfer Prepayments to the Debt Service Fund for credit and deposit into the Interest
Account and the Principal Account and utilize such funds to redeem Bonds pursuant to Section 4.03
B( I) and 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.
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.
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
Subaccount, 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 on deposit in the Capitalized Interest Subaccount shall be used and
withdrawn to pay interest on the Bonds through October 1,2005 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 thereo~ (ii)
paying the principal of the Term Bonds upon the mandatory sinking fund redemption thereofpursuant
to this Indenture, or (iii) paying the principal of and premium (if any) on any Bonds upon the optional
or extraordinary mandatory redemption thereof pursuant to Section 4. 03A and B(1) of this Indenture.
SECTION 3.04
Costs of Issuance Fund.
The Fiscal Agent shall, upon the written reqUIsItIOn executed by an Authorized
Representative, disburse money from the Costs of Issuance Fund, if any, on such dates and in such
amounts as specified in such requisition to pay the Costs of Issuance related to each series of the
Bonds. Any amounts remaining on deposit in the Costs ofIssuance 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 Project Fund.
SECTION 3.05
Project Fund
.
A. The Fiscal Agent shall, from time to time, disburse monies from the Project Fund to
pay the Project Costs. Upon receipt of a payment request duly executed by an Authorized
Representative (which payment request shall not exceed the corresponding payment request provided
to the City under the Acquisition/Financing Agreement), the Fiscal Agent shall pay the Project Costs
from amounts in the Project Fund directly to the contractor(s) or such other person(s), corporation(s)
or entity(ies) specified in the payment request (including reimbursements, if any, to the District). The
Fiscal Agent may rely on an executed payment request as complete authorization for said payments.
B. After the final payment or reimbursement of all Project Costs, as certified by delivery
of a written notice from an Authorized Representative to the Fiscal Agent, the Fiscal Agent shall
transfer excess monies, if any, on deposit in, or subsequently deposited in, the Project Fund to the
Special Tax Fund or the Redemption Fund as an Authorized Representative may direct in writing and
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the Fiscal Agent shall apply the amount so transferred in accordance with Section 3.02 or 3.08 as
directed by the Authorized Representative.
C. After the final payment or reimbursement of all Project Costs, as certified by delivery
of a written notice ITom an Authorized Representative to the Fiscal Agent, the Fiscal Agent shall
transfer excess monies, if any, on deposit in, or subsequently deposited in, the Project Fund to the
Interest Account or Redemption Fund as an Authorized Representative may direct in writing and the
Fiscal Agent shall apply the amount so transferred in accordance with Section 3.03A or 3.08 as so
directed by such Authorized Representative.
On or after November 15, 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 Project Fund to fund Project Costs and directing the Fiscal Agent to transfer all such moneys to
the Redemption Fund for the purpose of redeeming Bonds prior to maturity pursuant to Section
4.03B(2). Upon receipt of such certificate, the Fiscal Agent shall transfer such moneys to the
Redemption Fund as so directed.
D. Notwithstanding anything herein to the contrary, if on the date which is three (3) years
ITom the Delivery Date of any series of the Bonds, any funds derived ITom the Bonds remain on
deposit in the Project Fund, the Fiscal Agent shall 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 such series of the
Bonds ITom 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 Authorized Investments in the Reserve Fund shall be valued at their fair market value at
least semi-annually on March I and September I. On any date after the transfers required by Section
3. 02B( I) and (2) 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 ITom the first
available monies in the Special Tax Fund an amount necessary to increase the balance therein to the
Reserve Requirement. If on September I, or the first Business Day thereafter if September I 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
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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.
.
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. Moneys
in the Rebate Fund shall be used to pay rebate to the United States government upon written
instruction from the District or as otherwise directed in writing by the District.
Notwithstanding the foregoing, 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 rrom gross income
of interest on the Bonds then Outstanding for federal income tax purposes.
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 written 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.
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SECTION 3.08
Redemption Fund.
Monies may be deposited by the District or the Fiscal Agent pursuant to the terms of Section
3.05 B 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 4.03 B(2) hereof 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 ITom 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 ITom time to time upon receipt by the Fiscal Agent of a written request
executed. by an Authorized Representative specifYing the name and address of the payee and the
amount of the Administrative Expense and a description thereof and further stating that such request
has not formed the basis of any prior request for payment.
SECTION 3.10
Investment of Funds.
Unless otherwise specified in this Indenture, monies in the Special Tax Fund, the Debt Service
Fund, the Project Fund, the Reserve Fund, the Costs 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 ITom
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:
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(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 II 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.
SECTION 3.11
Disposition of Bond Proceeds.
Upon the receipt of $ as sale proceeds for the Bonds (being the par amount of
$ less the underwriter's discount of $ ), the Fiscal Agent shall transfer or set
aside and deposit or cause to be deposited such funds as follows:
$
shall be deposited in the Project Fund;
$
shall be deposited in the Reserve Fund;
$
shall be deposited into the Costs ofIssuance Fund;
$ shall be deposited in the Capitalized Interest Subaccount of the Interest
Account of the Debt Service Fund; and
$ 75,000.00 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 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: (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 ofthe 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 4.0 lA 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 (1) 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 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 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 shalllook 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 umedeemed 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, 2011 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, 2010, from such maturities as are selected by the District, and by lot within a maturity, tram any
source of funds, at the following redemption prices (expressed as percentages of the principal amount
of the Bonds to be redeemed), together with accrued interest to the date of redemption:
Redemption Date
Redemption Price
September 1, 20_ and March 1, 20_
September 1, 20_andMarch 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
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from the 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
Principal Account of the Debt Service Fund pursuant to Section 3.02 C to redeem Bonds pursuant to
this Section 4.03 B(I). 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 I, 2006 through March I, 20_
September I, 20_ and March I, 20_
September I, 20_ and March I, 20_
September I, 20_ and thereafter
103%
102%
101%
100%
C. Mandatorv Sinking Fund Redemption
The Bonds maturing on September I, 20_ are subject to mandatory sinking fund redemption,
in part by lot, on September I in each year commencing 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 amount and in the years
shown on the following redemption schedule:
Redemption Date
(Sevtember I)
Principal
Amount
The Bonds maturing on September I, 20---, are subject to mandatory sinking fund redemption, in
part, by lot, on September I of each year commencing 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 in the following redemption schedule.
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.
Redemption Date
Sel'tember I)
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
(induding brokerage and other charges) thereof shall not exceed the principal amount thereof plus
accrued interest to the purchase date.
E. Notice and Selection of Bonds for Redemption.
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, the matnrities from which such Bonds are to be redeemed and the
principal amount of the Bonds to be redeemed from each such matnrity, 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. 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.
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ARTICLE V. SUPPLEMENTAL INDENTURES
SECTION 5.01
Amendments or Supplements.
The Legislative Body may, by adoption of a resolution ITom 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 of this Indenture relating to the Code as may be necessary or
appropriate to assure compliance with the Code and the exclusion ITom 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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Indenture to be mailed, postage prepaid, to all Bondowners at their addresses as they appear in the
bond register. Such notice shall briefly set forth the nature ofthe 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 of the copy thereofreferred
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 trom the Owners of the appropriate aggregate principal amount of
Bonds in instances where such consent is required pursuant to the provisions of this Section 5.0 I, 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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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 Stoleu 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, acting on behalf of 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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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 I of each year to determine the
amount of the Special Tax collected in the prior Fiscal Year and will co=ence and diligently pursue
to completion, judicial foreclosure proceedings against (i) properties under co=on ownership with
delinquent Special Taxes in the aggregate of$5,000 or more by October I following the close of the
Fiscal Year in which the Special Taxes were due, and (ii) against all properties with delinquent
Special Taxes in the aggregate of$2,500 or more by October I following the close of any Fiscal Year
if the amount of the Reserve Fund is less than the Reserve Requirement.
B. The District shall preserve and protect the security of the Bonds and the rights of the
Bondowners and defend their rights against all claims and demands of all persons. Until such time as
an amount has been set aside sufficient to pay Outstanding Bonds at maturity or to the date of
redemption if redeemed prior to maturity, plus unpaid interest thereon and 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, ITom the Special
Taxes which have, or purport to have, any lien upon the Special Taxes superior to or on a parity with
the lien of the Bonds herein authorized. Nothing in this Indenture shall prevent the District ITom
issuing and selling, pursuant to law, refunding bonds or other refunding obligations payable ITom 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.
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. Prior to July I 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 Improvement Area B for inclusion on the next real property tax roll. Upon completion
of the computation of the amount of the 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.
The District finds and determines that, historically, delinquencies in the payment of special
taxes authorized pursuant to the Act in co=unity facilities districts in Southern California have ITom
time to time been at levels requiring the levy of special taxes at the maximum authorized rates in order
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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 ITom one or more Special Tax Consultants which, when taken together, certify
that, on the basis of the parcels of land and improvements existing in Improvement Area B 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 gross debt service
on all Bonds to remain Outstanding after the reduction is approved and will not reduce the Maximum
Annual Special Tax payable ITom parcels on which a completed structure is located to less than 110%
of Maximum Annual 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, ITom 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 ITom 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.
H. The District covenants that it will not take any action, or fail to take any action, if any such
action or failure to take action would adversely affect the exclusion from gross income of the interest
on the Bonds under Section 103 of the Code. The 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
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34
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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
trom 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 trom 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 trom 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.
1. Not later than October 30th of each year, co=encing 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
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
Tax Certificate.
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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 an escrow bank appointed by the District, in trust, noncallable
Permitted Investments of the type described in subparagraph I of the definition
thereof, in such amount as an Independent Accountant shall determine (as set forth in
a verification report ITom 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;
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 of the 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 ITom gross
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/~r/0!
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 certified public
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, 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 of transfer and exchange of Bonds presented to it for such purposes, to provide for the
cancellation of Bonds all as provided in this Indenture, and to provide for the authentication of
Bonds, and shall perform all other duties assigned to or imposed on it as provided in this Indenture.
The Fiscal Agent shall keep accurate records of all Bonds paid and discharged by it.
The District shall from time to time, subject to any agreement between the District and the
Fiscal Agent then in force, pay to the Fiscal Agent compensation for its services, reimburse the Fiscal
Agent for all its advances and expenditures, including, but not limited to, advances to and fees and
expenses of independent accountants or counsel employed by it in the exercise and performance of its
powers and duties hereunder, and indemnify and hold the Fiscal Agent, its officers, directors, agents
and employees, harmless from and against losses, claims, expenses and liabilities not arising from its
own negligence or willful misconduct which it may incur in the exercise and performance of its
powers and duties hereunder. Such obligations shall survive the termination or discharge of this
Indenture.
The District may at any time at its sole discretion remove the Fiscal Agent initially appointed,
and any successor thereto, by delivering to the Fiscal Agent a written notice of its decision to remove
the Fiscal Agent and may appoint a successor or successors thereto, provided that any such
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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 in the office of the Fiscal Agent. 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 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 io 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
hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed)
may, in the absence of bad faith on the part of the Fiscal Agent, be deemed to be conclusively proved
and established by a written certificate of the District, and such certificate shall be full warrant to the
Fiscal Agent for any action taken or suffered under the provisions of this Indenture upon the faith
thereof, but in its discretion the Fiscal Agent may, in lieu thereof, accept other evidence of such
matter or may require such additional evidence of such matter or may require such additional
evidence as to it may seem reasonable.
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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
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.
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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 any of the officers or agents thereof because 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.
SECTION 6.13
N onpresentment 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
40
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.
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 Fiscal Agent (the "Continuing Disclosure Agreement"). Notwithstanding any
other provision of this Indenture, failure of the District to comply with the Continuing Disclosure
Agreement shall not be considered an breach of the provisions of this Indenture.
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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 of this Indenture as may be appropriate. Every
temporary Bond shall be executed by the District in substantially the same manner as provided in
Section 2.06 hereof. If the District issues one or more temporary Bonds, it will execute and furnish
definitive Bonds without delay upon the request of any Owner and thereupon the temporary bonds
may be surrendered for cancellation at the Principal Corporate Trust Office of the Fiscal Agent, and
the District shall deliver in exchange for such temporary bonds an equal aggregate principal amount of
definitive Bonds of the same interest rates and maturities. Until so exchanged, the temporary bonds
shall be entitled to the same benefits under this Indenture as definitive Bonds issued hereunder.
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ARTICLE VITI 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
30-day period unless waived by the Fiscal Agent) shall not constitute an Event of
Default under this Indenture if the District shall co=ence to cure such default within
said thirty (30) day period and thereafter diligently and in good faith shall cure such
default within a reasonable period of time; or
(d) The filing by the District of a petition or answer seeking reorganization or
arrangement under the federal bankruptcy laws or any other applicable law of the
United States of America, or if a court of competent jurisdiction shall approve a
petition, filed with or without the consent of the District, seeking reorganization under
the federal bankruptcy laws or any other applicable law of the United States of
America, or if, under the provisions of any other law for the relief or aid of debtors,
any court of competent jurisdiction shall assume custody or control of the District or
of the whole or any substantial part of its property.
SECTION 8.02
Application of Revenues and Other Funds After Default
If a default in the payment of the Bonds shall occur and be continuing, all revenues and any
other funds then held or thereafter received under any of the provisions of this Indenture shall be
applied as follows and in the following order:
A. To the payment of any expenses necessary in the opinion of the District to protect the
interest of the owners of the Bonds and payment of reasonable charges and expenses
of the Fiscal Agent (including reasonable fees and disbursements of its counsel)
incurred in and about the performance of its powers and duties under this Indenture;
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B. To the payment of the principal of and interest then due with respect to the Bonds
(upon presentation of the Bonds to be paid, and stamping thereon of the payment if
only partially paid, or surrender thereof if fully paid) subject to the provisions of this
Indenture, as follows:
First: To the payment to the persons entitled thereto of all installments of interest
then due in the order of the maturity of such installments, and, if the amount available
shall not be sufficient to pay in full any installment or installments maturing on the
same date, then to the payment thereof ratably, according to the amounts due thereon,
to the persons entitled thereto, without any discrimination or preference; and
Second: To the payment to the persons entitled thereto of the unpaid principal of
any Bonds which shall have become due, whether at maturity or by call for
redemption, with interest on the overdue principal at the rate borne by the
respective Bonds on the date of maturity ofredemption, 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.
44
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IN WITNESS WHEREOF, the District and the Fiscal Agent have executed this Bond Indenture
effective the date first above written.
COMMUNITYFACllJTIES DISTRICT NO. 2001-1 (SAN
NllGUEL RANCH)
By:
DIRECTOR OF FINANCE
.
u.S. BANK NATIONAL ASSOCIATION,
as Fiscal Agent
By:
AUTHORIZED OFFICER
S - 1
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EXHffiIT "A" - FORM OF BOND
United States of America
State of California
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 2001-1
(SAN MIGUEL RANCH)
2005 IMPROVEMENT AREA B SPECIAL TAX BONDS
Interest Rate
Maturity Date
Bond Date
CUSIP No.
Registered Owner:
Cede & Co.
Principal Amount:
City of Chula Vista Community Facilities District No. 2001-1 (San Miguel Ranch) (the "District"),
situated in ChuJa 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 request in writing prior to the Record Date received from a registered owner of at least
$1,000,000 in aggregate principal amount of the Bonds, by wire transfer in immediately available
funds to an account in the United States of America designated by such registered owner.
B-1
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.
This Bond is one of a duly authorized issue of the "City of Chula Vista Community Facilities District
No. 200 I-I (San Miguel Ranch) 2005 Improvement Area B Special Tax Bonds" (the "Bonds") issued
in the aggregate principal amount of$ pursuant to the Mello-Roos Community Facilities
Act of 1982, constituting Sections 53311, et seq. ofthe California Government Code, as amended
(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, for the purpose of financing certain public improvements
including street and road facilities 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 October I,
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 trom, 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 offoreclosure of the lien of the Special Tax to the
amount of such lien and penalties thereon (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 thereofis 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 I following the close of the Fiscal Year in
which the Special Taxes were due, and (ii) against all properties with delinquent Special Taxes in the
aggregate of$2,500 or more by October I following the close of any fiscal year if the amount in the
Reserve Fund is less than the Reserve Requirement.
The Bonds 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 1,20-,
trom 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:
B-2
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Redemption Date
Redemption Price
September 1, 20_ and March 1, 20_
September 1, 20_andMarch 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 proceeds of 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 I, 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 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 in the following redemption schedule.
Redemption Date
rSentember 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 ofthe 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
(S eptember 1)
Principal
Amount
B-3
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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
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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IN WITNESS WHEREOF, the City ofChula Vista, for and on behalf of the City ofChula Vista
Community Facilities District No. 2001-1 (San Miguel Ranch), has caused this Bond to be dated as
of , 2005 and to be signed by the Mayor of the City of Chula Vista by her manual
signature and attested by the City Clerk by her manual signature.
City Clerk, City of Chula Vista, for and on
behalf of the City of Chula Vista Community
Facilities District No. 2001-1 (San Miguel
Ranch)
Mayor, City of Chula Vista, for and on behalf
of the City ofChula Vista Community Facilities
District No. 2001-1 (San Miguel Ranch)
B - 5
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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
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 appointe 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
B-6
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EXHIBIT S
Stradling Yocca Carlson & Rauth
Draft of 10110105
$
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 2001-1
(SAN MIGUEL RANCH)
2005 IMPROVEMENT AREA B SPECIAL TAX BONDS
BOND PURCHASE AGREEMENT
,2005
Community Facilities District No. 2001-1
(San Miguel Ranch)
City ofChula 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. 2001-1 (San Miguel Ranch) (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.
1. 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. 2001-1 (San Miguel Ranch) 2005 Improvement Area B 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 subject 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 Improvement Area B of the
District in accordance with Resolution No. 2001-415 adopted by the City Council on December 4,
2001 (the "Resolution of Formation"), Ordinance No. 2850 enacted on January 15, 2002 (the
"Special Tax Ordinance") and Resolution No. 2005-041 adopted by the City Council on February 8,
DOCSOC/I129372v3/022245-0155
/'-1' _/77
2005 (the "Resolution of Change Proceedings"). Proceeds of the sale of the Bonds will be used in
accordance with the Bond Indenture and the Mello-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 ofIssuance, the Resolution of Formation, the Resolution of
Change Proceedings, 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 shall 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 Proctor Valley West Partners, 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 final and accurate as of its date.
(c) Subsequent to its receipt of a certificate ITom the District deeming the
Preliminary Official Statement for the Bonds, dated , 2005 (which Preliminary Official
Statement, together with the cover page and all 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 15c2-12 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 15c2-12) 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 defined) 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 p\ITPoses of Rule 15c2-12 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 15c2-12.
2
DOCSOCII129372v31022245-0155
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(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 (ii) 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") and Amendment to Notice of Special
Tax Lien (the "Amendment to Notice of Special Tax Lien") (such District Resolutions, Notice of
Special Tax Lien and Amendment to 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
(iii) 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
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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 and Amendment to 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 of its
obligations contained in, and the taking of any and all action as may be necessary to carry 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
DOCSOC/11293 nv3/022245-0155
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/~-/fo
misleading, the District shall forthwith notify the Underwriter of any such event of which it has
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;
5
DOCSOCIl129372v3/022245-0155
/'1 ~/fl
.
(Ie) Any 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;
(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 Obligations 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
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DOCSOCIl 1293 72v3/022245-0155
/~ --/ P .2...
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;
(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 ill 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.
7
DOCSOC/I129372v3/022245-0l55
/~~-/f3
.
(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
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 III
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:
(I) 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
8
DOCSOC/I129372v3/022245-0155
/~-/I</
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
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 April 24,2002
and the Amendment to Notice of Special Tax Lien which was recorded pursuant to Section 3114.5 of
the Code in the official records of the County of San Diego on February 15, 2005, 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 of the opinion that notwithstanding the filing of the Amendment to Notice
of Special Tax Lien beyond the 15-day period specified in Sections 3114.5 and 311 7.5 of the Code,
(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 sigoed 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
9
DOCSOCI1129372v3/022245-0155
/y-~/15
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;
(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");
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DOCSOClI129372v3/022245-0155
/y-//fP
(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
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;
11
DOCSOCIl129372v3!022245-0155
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(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
(15) Such additional legal opinions, 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 ofthe 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 Obligations. 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
12
DOCSOC/11293 72v3/022245-0 155
/~-/#
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
pay, any fees of the California Debt and Investment Advisory Commission, the cost of preparation of
any "blue sky" or legal investment memoranda and this Bond Purchase Agreement; expenses to
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 Representations 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 Agreements. 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. Governing Law. This Bond Purchase Agreement shall be governed by the laws of
the State of California.
13
DOCSOC/1129372v3/022245-0155
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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. 2001-I
(SAN MIGUEL RANCH)
By:
Assistant Director of Finance
14
DOCSOC/1129372v3/022245-0155
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EXHIBIT A
MATUJUTYSCHEDULE
CITY OF CHULA VISTA
COMMUNITY FACILITIES DISTRICT NO. 2001-1
(SAN MIGUEL RANCH)
2005 IMPROVEMENT AREA B SPECIAL TAX BONDS
Maturity Date
(September 1)
Principal
Coupon
Price
Par Amount $
Original Issue Discount
Underwriter's Discount
Purchase Price $
A-I
DOCSOClI129372v3/022245-0155
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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. 2001-1 (San
Miguel Ranch) 2005 Improvement Area B 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. 2001-1 (San Miguel Ranch) 2005 Improvement Area B 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. 2001-1 (San Miguel Ranch) (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
DOCSOC/1129372v3/022245-0155
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EXIllBIT 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
Chula Vista, California 91910
Re: $ City ofChula Vista Community Facilities District No. 2001-1 (San
Miguel Ranch) 2005 Improvement Area B Special Tax Bonds (the "Bonds")
Ladies and Gentlemen:
Proctor Valley West Partners, LLC, a Delaware limited liability company (the "Developer"),
hereby certifies that:
I. The Developer is the owner of certain of the land within Improvement Area B of
Community Facilities District No. 2001-1 (San Miguel Ranch) (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-I
DOCSOC/1129372v3/022245-0155
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.
.
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
Bonds when due and unless such action or suit is brought or filed 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 Statement 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, tbreatened
in which the Developer or any of its members may be adjudicated as bankrupt or
discharged ITom any or all of their debts or obligations or granted an extension of
time to pay its debts or a reorganization orreadjustment 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, tbreatened, 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
DOCSOC/1129372v3/022245-0155
C-2
/~-.Iff
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 of time, 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.
PROCTOR VALLEY WEST PARTNERS, LLC, a
Delaware limited liability company
By:
Name:
Its:
By:
Title:
Its:
C-3
DOCSOCIl129372v3/022245-0155
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EXHIBIT D
OPINION OF DEVELOPER COUNSEL
(I) The Developer is duly fonned, 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 perfonn its obligations under the
Acquisition/Financing Agreement, dated , 20---, and the Continuing Disclosure
Agreement dated as of November 1, 2005 (collectively, the "Developer Agreements"), has duly
authorized, executed, and delivered the Developer Agreements, and has authorized the perfonnance
of its respective duties and obligations thereunder.
.
(3) Each of the Developer Agreements constitutes a legaUy 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 perfonn 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, (d) seeks to effect a
reorganization or readjustment of the Developer's debts or (e) if determined 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 perfonn 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 fmancial 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 fmancial information contained therein, as to which no view or opinion is expressed).
D-l
DOCSOCll1293 72v3/022245-0 155
/~//?t.
RESOLUTION NO.
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA
VISTA, CALIFORNIA, APPROVING THE FORM OF THE SECOND
AMENDMENT TO ACQUISITIONIFINANCING AGREEMENT FOR
COMMUNITY FACILITIES DISTRICT NO. 2001-1 (SAN MIGUEL
RANCH)
WHEREAS, the CITY COUNCIL of the CITY OF CHULA VISTA,
CALIFORNIA, pursuant to the provisions of the Mello-Roos Community Facilities Act
of 1982, has undertaken proceedings to fonn and has fonned a community facilities
district and designated two improvement areas therein for the purpose of financing the
acquisition of certain works of improvement (the "Improvements"), together with
appurtenances, such community facilities district known and designated as
COMMUNITY FACILITIES DISTRICT NO. 2001-1 (SAN MIGUEL RANCH) (the
"Community Facilities District") and such improvement areas designated as
IMPROVEMENT AREA A and IMPROVEMENT AREA B; and,
WHEREAS, the City of Chula Vista (the "City") and NNP-Trimark San Miguel
Ranch, LLC (the "Developer"), entered into an Acquisition/Financing Agreement (the
"Acquisition Agreement") to establish the tenns and conditions upon which the
Improvements would be acquired by the City; and
WHEREAS, the City and the Developer subsequently entered into First
Amendment to AcquisitionlFinancing Agreement (the "First Amendment" and the
Acquisition Agreement as amended by the First Amendment, the "Amended Acquisition
Agreement"); and
WHEREAS, subsequent to the fonnation of the Community Facilities District and
entry by the City and the Developer into the Amended Acquisition Agreement, the
Developer requested that the City initiate proceedings to modifY the Improvements by
authorizing the financing by the Community Facilities District of certain additional
improvements for Improvement Area B thereto; to modifY the rate and method of
apportionment of the special taxes authorized to be levied within Improvement Area B
and to increase the maximum bonded indebtedness for Improvement Area B; and,
WHEREAS, the City Council did undertake proceedings to consider such
modifications and the qualified electors of Improvement Area B did approve such
modifications at a special election held on February 1,2005; and,
WHEREAS, the City and the Developer desire to amend the Acquisition
Agreement to incorporate the additional improvements among the Improvements
authorized to be constructed or acquired thereunder; and,
WHEREAS, subsequent to the fonnation of the Community Facilities District and
the entry by the City and the Developer into the Amended Acquisition Agreement,
WBD\320349.1
/y-/f 7
Proctor Valley became the owner of certain property within Improvement Area B (the
"Proctor Valley Property") and Proctor Valley will be the master developer of the Proctor
Valley Property; and,
.
WHEREAS, Proctor Valley will be constructing certain of the Improvements as a
part of its development of the Proctor Valley Property and, consequently, the City and the
Developer desire that Proctor Valley be a party to the Amended Acquisition Agreement;
and,
WHEREAS, for such purposes, the City, the Developer and Proctor Valley desire
to amend the Amended Acquisition Agreement by entering into the Second Amendment
to the AcquisitionlFinancing Agreement, the form of which has been presented to the
City Council (the "Second Amendment").
NOW, THEREFORE, BE IT RESOLVED AS FOLLOWS:
SECTION 1. The above recitals are all true and correct.
SECTION 2. The form of Second Amendment, 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 Best Best & Krieger LLP, as 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.
.
PREPARED BY:
APPROVED AS TO FORM BY:
Sohaib Al-Agha
City Engineering
WBD\320349.1
/~~/1Y
THE A TT ACHED 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
Dated: 11/17/05
SECOND AMENDMENT TO THE ACQUISITION/FINANCING
AGREEMENT FOR CFD NO. 2001-1 (SAN MIGUEL RANCH)
/y:---/r9'
SECOND AMENDMENT
TO
ACQUISITIONIFINANCING AGREEMENT
THIS SECOND AMENDMENT TO ACQUlSITION/FINANCING AGREEMENT,
dated as of November 22, 2005 (the "Second Amendment"), by and among the City of Chula
Vista, a charter city duly organized and validly existing under the Constitution and the laws of
the State of California (the "City"), acting for and on behalf of itself and Community Facilities
District No. 2001-1 (San Miguel Ranch) (the "Community Facilities District"), NNP-Trimark
San Miguel Ranch, LLC, a Delaware limited liability company (the "NNP- Trimark") and Procter
Valley West Properties, LLC, a Delaware limited liability company ("Proctor Valley" and
together with NNP-Trimark, the "Developers") is entered into by the parties hereto to amend that
certain AcquisitionlFinancing Agreement, dated as of July 1, 2002, by and between the City and
NNP-Trimark, as subsequently amended by Resolution No. 2003-437 of the City Council of the
City adopted October 14, 2003 (as amended, the "Acquisition Agreement"). Capitalized terms
used in this Second Amendment shall have the meanings given such terms in the Acquisition
Agreement unless otherwise provided for herein or the context of the use of any such capitalized
term requires otherwise.
RECITALS
WHEREAS, City formed the Community Facilities District and designated two
improvement areas therein as Improvement Areas A and B thereto (each an "Improvement Area"
and collectively the "Improvement Areas") under the terms and conditions of the "Mello-Roos
Community Facilities Act of 1982," as amended (Government Code Section 53311 and
following) (the "Act"), for the acquisition of certain public improvements, together with
appurtenances and appurtenant work within the jurisdictional limits of said City (each, an
"Improvement Area" and together, the "Improvement Areas"); and,
WHEREAS, the City and NNP-Trimark entered into the Acquisition Agreement to,
among other things, establish the terms and conditions pursuant to which the City would acquire
certain Improvements constructed by NNP-Trimark from proceeds of bonds issued by the
Community Facilities District for such purpose; and,
WHEREAS, subsequent to the formation of the Community Facilities District and the
entry by the City and NNP-Trimark into the Acquisition Agreement, Proctor Valley became the
owner of the property within Improvement Area B (the "Proctor Valley Property") with the
exception of the commercial property subsequently redesignated from Improvement Area A to
Improvement Area B and owned by McMillin San Miguel Ranch LLC (the "Commercial
Property") and Proctor Valley will be the master developer of the Proctor Valley Property; and,
WHEREAS, Proctor Valley will be constructing certain of the Improvements as a part of
its development of the Proctor Valley Property and, consequently, the City and the Developers
desire that Proctor Valley be a party to the Acquisition Agreement as amended by this Second
Amendment (as amended, the "Second Amended Acquisition Agreement"); and,
1
WBD\319618.5
/~-~O()
.
WHEREAS, subsequent to the fonnation of the Community Facilities District and the
entry by the City and NNP-Trimark into the Acquisition Agreement, the Developers requested
that the City initiate proceedings to modify the Improvements by authorizing the financing by the
Community Facilities District of certain additional improvements for Improvement Area B; to
modify the rate and method of apportionment of the special taxes authorized to be levied within
the Community Facilities District and to increase the maximum bonded indebtedness for
Improvement Area B; and,
.
WHEREAS, the City Council did undertake proceedings to consider such modifications
and the qualified electors of Improvement Area B did approve such modifications at a special
election held on February 1,2005; and,
WHEREAS, the City and the Developers desire to amend the Acquisition Agreement to
incorporate the additional Improvements among the Improvements authorized to be constructed
or acquired thereunder; and,
.
WHEREAS, included among the additional Improvements authorized to be financed by
the Community Facilities District are the transportation facilities (the "Transportation Facilities")
identified in Section 3.54.030 of the Chula Vista Municipal Code (the "Municipal Code"), other
public facilities (the "Public Facilities") identified in Section 3.50.030 of the Municipal Code;
and park development improvements (the "Park Development Improvements") identified in
Section 17.10.050 of the Municipal Code; and,
.
WHEREAS, NNP-Trimark has requested that (a) $300,000 of unexpended proceeds of
the City of Chula Vista Community Facilities District No. 2001-1 (San Miguel Ranch) 2002
Improvement Area A Special Tax Bonds (the "Improvement Area A Bonds") be set aside in a
sub-account to be used to finance the acquisition or construction of Transportation Facilities; (b)
an additional $1,086,478 of the proceeds of the bonds to be issued for Improvement Area B be
set aside to finance the acquisition or construction of Transportation Facilities and (c) a credit in
the aggregate amount of $1,386,478 (the "Commercial Property CFD TDIF Credit") be applied
against the development impact fee obligation imposed pursuant to Chapter 3.54 of the
Municipal Code ("Chapter 3.54") for the development of the commercial property located at Lot
11 of Map 14261 and Parcel 2 of Parcel Map 16033 (the "Commercial Property"); and
WHEREAS, the City and NNP-Trimark desire that the Acquisition Agreement be
amended to implement the request described in the preceding recital; and
WHEREAS, the City and the Developers desire that the Acquisition Agreement be
further amended to provide that the Community Facilities District finance the acquisition or
construction of Transportation Facilities in an amount equal to the estimated development impact
fee obligation imposed pursuant to Chapter 3.54 for the development of the residential property
within Improvement Area B (the "Funded Improvement Area B Residential Property TDIF
Program Obligation"); and
WHEREAS, if and to the extent that the Purchase Price for Transportation Facilities to be
constructed by the Developers and acquired by the City pursuant to the provisions of the Second
2
WBD131961S.5
/5/--<. OJ
.
Amended Acquisition Agreement is less than the sum of (a) the Commercial Property CFD TDIF
Credit and (b) the Funded Improvement Area B Residential Property TDIF Program Obligation,
to provide that funds in an amount equal to the balance of such sum 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, the City and Proctor Valley further desire that the Acquisition Agreement be
amended to provide that:
A. the Community Facilities District finance the acquisition or construction of Public
Facilities in an amount equal to the sum of (i) the estimated development impact fee obligation
imposed pursuant to Chapter 3.50 of the Municipal Code ("Chapter 3.50") for all residential
development throughout Improvement Area B (the "Funded Improvement Area B Residential
Property PFDIF Program Obligation") and (ii) $113,522 of such development impact fee
obligation for the Commercial Property (the "Limited Funded Improvement Area B Commercial
Property PFDIF Program Obligation" and together, the "Aggregate Funded Improvement Area B
PFDIF Program Obligation") and to provide that funds in an amount equal to the Aggregate
Funded Improvement Area B PFDIF Program Obligation be set aside from the proceeds of
Bonds issued by the Community Facilities District for Improvement Area B to enable the City to
utilize such funds to acquire or construct Public Facilities; and,
B. the Community Facilities District finance the acquisition or construction of Park
Development Improvements in an amount equal to the estimated in-lieu fees for park
development improvements imposed pursuant to Chapter 17.10 of the Municipal Code ("Chapter
17.10") for the development throughout Improvement Area B (the "Funded Improvement Area B
PDF Program Obligation") and to provide that funds in an amount equal to the Funded
Improvement Area B PDF Program Obligation be set aside from the proceeds of Bonds issued
by the Community Facilities District for Improvement Area B to enable the City to utilize such
funds to acquire or construct Park Development Improvements.
NOW, THEREFORE, IT IS MUTUALLY AGREED between the respective parties as follows:
SECTION 1. Recitals. The above recitals are all true and correct.
SECTION 2. Amendment to Exhibit A. Exhibit A to the Acquisition Agreement is
hereby amended in its entirety to read as set forth in Attachment 1 hereto which is incorporated
herein by the reference.
SECTION 3. Priority of Payment of Purchase Price for Improvements. Section
7(f)(i)(b) of the Acquisition Agreement shall be amended in its entirety to read as follows:
"b. Payment from the Bonds issued for Improvement Area B (the
"Improvement Area B Bonds").
(1) Priority 1: Improvement Nos. [this will correspond to the
Transportation Facilities, the Public Facilities and the Park Development
Improvements identified in Exhibit A]
WBD\319618.5
3
/~ -.)().2-
(2) Priority 2:
Improvements]"
Improvement Nos. [this will correspond to all other
SECTION 4. Development Impact Fee Credit, Payment and Reimbursement.
Section 21 of the Acquisition Agreement shall be amended in its entirety to read as follows:
"The Improvements include the Transportation Facilities identified in
Exhibit A that are otherwise eligible to be financed through the City's traffic
facilities development impact fee program (the ''TDIF Program") set forth in
Chapter 3.54, the Public Facilities identified in Exhibit A are otherwise eligible to
be financed through the City's public facilities development impact fee program
(the "PFDIF Program") set forth in Chapter 3.50 and the Park Development
Improvements that are otherwise eligible to be financed through the City's park
development improvement in lieu fee program (the "PDF Program") set forth in
Chapter 17.10. Except as supplemented herein, credits against the TDIF Program,
the PFDIF Program or the PDF Program fee obligation, as applicable, for
development within the Community Facilities District shall be granted in
accordance with the applicable City ordinances, regulations and policies.
Proceeds of the Improvement Area A Bonds in the amount of $300,000
originally budgeted for the construction of Improvements other than Traffic
Facilities to be constructed by NNP-Trimark (the "Improvement Area A Bonds
Commercial Property TDIF Deposit") remain unexpended as a result of savings in
the cost of construction of such Improvements. Such proceeds have been set aside
by the Community Facilities District in a separate account within the Acquisition
Fund established pursuant to the Bond Indenture, dated as of July I, 2002 (the
"Improvement Area A Bonds Indenture"), by and between the Community
Facilities District and U.S. Bank, N.A. related to the Improvement Area A Bonds
to be utilized to fund Transportation Facilities to be acquired or constructed by the
City. 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 costs incurred by the City for the
acquisition or construction of other Transportation Facilities. A credit in the
amount of the Improvement Area A Bonds Commercial Property TDIF Deposit
shall be granted to the Commercial Property against TDIF Program obligation
applicable to such property.
Proceeds of the Improvement Area B Bonds in an amount equal to
$1,086,478.00 (the "Improvement Area B Bonds Commercial Property TDIF
Deposit" and, together with the Improvement Area A Bonds Commercial
Property TDIF Deposit, the "Aggregate Commercial Property TDIF Deposit")
shall be deposited and set aside in a separate account of the Project Fund (the
''Transportation Facilities Account") to be established pursuant to the Bond
Indenture by and between the District and U.S. Bank National Association, as
fiscal agent (the "Improvement Area B Bonds Indenture"). Except as otherwise
4
WBD\319618.5
/~-~05
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
Improvement Area B Bonds Commercial Property TDIF Deposit in the
Transportation Facilities Account, such amount shall be credited against the
actual TDIF Program obligation applicable to the Commercial Property. If and to
the extent that the actual TDIF Program obligation for the Commercial Property
(the "Actual Commercial Property TDIF Program Obligation") exceeds the sum
of (a) the Aggregate Commercial Property TDIF Deposit and (b) a separate
$313,522 cash credit applicable to the Commercial Property (collectively, the
"Aggregate Commercial Property TDIF Credit"), the amount of the Actual
Commercial Property TDIF Program Obligation in excess of the Aggregate
Commercial Property TDIF Credit shall be payable pursuant to the provisions of
Chapter 3.54. If and to the extent that the Actual Commercial Property TDIF
Program Obligation is less than the Aggregate Commercial Property TDIF Credit,
such surplus shall be transferred to the Project Fund and used pursuant to the
Improvement Area B Bonds Indenture.
Proceeds of the Improvement Area B Bonds (the "Improvement Area B
Bonds TDIF Deposit") in an amount equal to the Funded Improvement Area B
Residential Property TDIF Program Obligation shall be deposited and set aside in
the Transportation Facilities Account. 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 Improvement Area B Bonds
TDIF Deposit in the Transportation Facilities Account, such amount shall be
credited against the actual TDIF obligation applicable to all properties within
Improvement Area B excluding the Commercial Property (the "Actual
Improvement Area B Residential Property TDIF Program Obligation"). If and to
the extent that the Actual Improvement Area B Residential Property TDIF
Program Obligation exceeds the amount of the Improvement Area B Bonds TDIF
Deposit, the Actual Improvement Area B Residential Property TDIF Program
Obligation in excess of the Improvement Area B Bonds TDIF Deposit shall be
payable pursuant to the provisions of Chapter 3.54. If and to the extent that the
Actual Improvement Area B Residential Property TDIF Program Obligation is
less than the Improvement Area B Bonds TDIF Deposit, such surplus shall be
transferred to the Project Fund and used pursuant to the Improvement Area B
Bonds Indenture.
Proceeds of the Improvement Area B Bonds (the "PFDIF Deposit") in an
amount equal to the estimated Aggregate Funded Improvement Area B PFDIF
Program Obligation shall be deposited and set aside in a separate account of the
Project Fund (the "Public Facilities Account") to be established pursuant to the
Improvement Area B Bonds Indenture. Except as otherwise provided in this
WBD\319618.5
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paragraph, the use of PFDIF Deposit 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 Deposit in the Public Facilities Account, an amount
equal to the Funded Improvement Area B Residential Property PFDIF Program
Obligation shall be credited against the actual aggregate PFDIF obligation for all
properties within Improvement Area B excluding the Commercial Property (the
"Actual Improvement Area B Residential Property PFDIF Program Obligation")
and an amount equal to the Limited Funded Improvement Area B Commercial
Property PFDIF Program Obligation shall be credited against the actual aggregate
Commercial Property PFDIF obligation (the "Actual Improvement Area B
Commercial Property PFDIF Program Obligation"). If and to the extent that the
Actual Improvement Area B Residential Property PFDIF Program Obligation
exceeds the amount of the Funded Improvement Area B Residential Property
PFDIF Program Obligation, the Actual Improvement Area B Residential Property
PFDIF Program Obligatiop in excess of the Funded Improvement Area B
Residential Property PFDIF Program Obligation shall be payable pursuant to the
provisions of Chapter 3.50. If and to the extent that the Actual Improvement Area
B Residential Property PFDIF Program Obligation is less than the Funded
Improvement Area B Residential Property PFDIF Program Obligation, such
surplus shall be transferred to the Project Fund and used pursuant to the
Improvement Area B Bonds Indenture. If and to the extent that the Actual
Improvement Area B Commercial Property PFDIF Program Obligation exceeds
the amount of the Limited Funded Improvement Area B Commercial Property
PFDIF Program Obligation, the Actual Improvement Area B Commercial
Property PFDIF Program Obligation in excess of the Limited Funded
Improvement Area B Commercial Property PFDIF Program Obligation shall be
payable pursuant to the provisions of Chapter 3.50. If and to the extent that the
Actual Improvement Area B Commercial Property PFDIF Program Obligation is
less than the Limited Funded Improvement Area B Commercial Property PFDIF
Program Obligation, such surplus shall be transferred to the Project Fund and
used pursuant to the Improvement Area B Bonds Indenture.
.
.
.
Proceeds of the Improvement Area B Bonds (the "PDF Deposit") in an
amount equal to the Fund Improvement Area B PDF Program Obligation shall be
deposited and set aside in a separate account of the Project Fund (the "Park
Development Improvements Account") to be established pursuant to the
Improvement Area B Bonds Indenture. Except as otherwise provided in this
paragraph, the use of the PDF Deposit shall be restricted to payment of costs
incurred by the City for the acquisition or construction of Park Development
Improvements. Upon the deposit of the PDF Deposit in the Park Development
Improvements Account, such amount shall be credited against the actual park
development improvement fee obligation applicable to the property within
Improvement Area B (the "Actual Improvement Area B PDF Program
Obligation"). If and to the extent that the Actual Improvement Area B PDF
Program Obligation exceeds the amount of the PDF Deposit, the Actual
Improvement Area B PDF Program Obligation in excess of the PDF Deposit shall
WBD\31961S.5
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be payable pursuant to the provisions of Chapter 17.10. If and to the extent that
the Actual Improvement Area B PDF Program Obligation is less than the PDF
Deposit, such surplus shall be transferred to the Project Fund and used pursuant to
the Improvement Area B Bonds Indenture."
SECTION 4. Supplemental Bill for the Payment of Special Taxes. Developers
acknowledge that the rate and method of apportionment of special taxes for Improvement Area B
provides that such annual special tax (the "Improvement Area B Special Tax") shall be collected
in the same manner and at the same time as ordinary ad valorem property taxes; provided,
however, that the Community Facilities District may directly bill the Improvement Area B
Special Tax, may collect Improvement Area B Special Taxes at a different time or in a different
manner if necessary to meet its financial obligations. The City has represented to the Developers
that delinquencies in the payment of special taxes intended to be collected on property tax bills
have occurred in other community facilities districts formed by the City as a result of difficulties
experienced by the office of the Treasurer-Tax Collector of the County of San Diego (the "Tax
Collector") in the timely billing and collection of such special taxes. If and to the extent that the
Tax Collector fails, for whatever reason, to timely bill the full amount of the Improvement Area
B Special Taxes levied on properties owned by the Developers or any affiliate of the Developers
within Community Facilities District, the City, on behalf of Community Facilities District, may
elect to directly and separately bill ("Direct Bill") the Developers for such deficiency and
Developers agree to (a) pay such deficiency within the time period specified in such Direct Bill
which shall be no less than thirty calendar days from the date of mailing of such Direct Bill or
(b) provide the Director of Finance with proof of payment to the Tax Collector of such
deficiency in a form satisfactory to the Director of Finance. Should either Developer pay any
such deficiency directly to the City pursuant to a Direct Bill, the City agrees upon receipt of such
payment to timely submit an amendment of the Special Tax levy on such Developer's property
to the Tax Collector to reduce such levy by the amount of such payment.
Delinquency in the payment of a Direct Bill sent pursuant to the preceding paragraph
shall not be enforceable as a personal obligation of the applicable Developer but shall be
enforceable in the same manner as if such delinquency had been for the payment of special taxes
billed on the property tax bill.
SECTION 5. Effect of this Second Amendment on the Other Terms and Provisions
of the Acquisition Agreement. All terms and provisions of the Acquisition Agreement shall
remain in full force and legal effect except as expressly modified by the provisions of this
Second Amendment.
SECTION 6. General Provisions.
(a) The Acquisition Agreement as amended by this Second Amendment and the
agreements expressly referred to herein contain all of the agreements of the
parties hereto with respect to the matters contained herein and all other prior and
contemporaneous agreements, representations, negotiations and understandings of
the parties hereto, oral or written, are hereby superseded and merged herein. No
provision of this Second Amendment may be modified, waived, amended or
WBD\319618.5
7
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(c)
.
WBD\319618.5
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.
(b)
This Second Amendment has been reviewed by legal counsel for City and the
Developers and shall be deemed for all purposes to have been jointly drafted by
City and Developers. No presumption or rule that ambiguities shall be construed
against the drafting party shall apply to the interpretation or enforcement of this
Second Amendment. The language in all parts of this Second Amendment, 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 Second Amendment are for convenience only and
shall not be considered or referred to in resolving questions of construction.
Except as expressly provided otherwise in this Second Amendment, all provisions
of Sections 22 through 34 of the Acquisition Agreement shall apply to this
Second Amendment.
[Remainder of this page intentionally left blank]
8
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IN WITNESS WHEREOF the parties hereto have executed this Second Amendment on the date
above written.
"CITY"
CITY OF CHULA VISTA
STEPHEN C. PADILLA, MAYOR
CITY OF CHULA VISTA
STATE OF CALIFORNIA
ATTEST:
CITY OF CHULA VISTA
STATE OF CALIFORNIA
APPROVED AS TO FORM
ANN MOORE
CITY OF CHULA VISTA
STATE OF CALIFORNIA
"DEVELOPERS"
NNP-TRIMARK SAN MIGUEL RANCH, LLC, a Delaware
limited liability company
By:
By:
S - I
WBD\319618.5
/~-~of
PROCTOR V ALLEY WEST PARTNERS, LLC
a Delaware limited liability company
By: Trimark Pacific - Montecito, LLC,
a California limited liability company,
Managing Member
By: TPH, LLC,
a California limited liability company,
Member Manager
By; Trimark Ventures, Inc.,
a California corporation,
Member
By;
Stephen E. Hester
Executive Vice President
WBD\319618.S
8-2
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Exhibit A
ACQUISITION AND FINANCING AGREEMENT FOR CFD 2001-1 (SAN MIGUEL RANCH)
IMPROVEMENT DESCRIPTION AND ESTIMATED COSTS
Portion to be Paid Portion to be
from Paid from
Improvement Cost Improvement Improvement
Number Improvement Description 1 Estimate2 Area A Bonds Area B Bonds
1 East "H" Street Widening $ 789,000> $ 789,000 $ 0
2 Mount Miguel Road East 5,060,906 4,433,061 0
3 Proctor V allev Road East 459,153 459,153 0
4 Calle La Marina 3,661,229 3,661,229 0
5 Paseo Vera Cruz 717,259 717,259 0
6 Calle La Ouinta 974,186 974,186 0
7 Backbone Street Landscaping (Improvement Area A) 1,249,420 650,177 0
8 San Miguel Ranch Road(TDIF Eligible) 3,639,832 0 3,639,832
9 San Miguel Ranch Road(Non-TDIF) 1,317,512 0 1,317,512
10 Proctor Vallev Road West(Non-TDIF) 1,791,139 0 1,791,139
11 San Miguel Ranch Road Landscaping (Improvement 35,971 0 35,971
Area B)(TDIF Eligible)
12 San Miguel Ranch Road Landscaping (Improvement 251,811 0 251,811
Area B)(Non-TDIF Eligible)
13 Additional facilities to be financed from the proceeds of 530,000 530,000'" 0
Transportation Development Impact Fees (TDIF)
Improvement Area A
14 Additional facilities to be financed from the proceeds of 0 0 88,746
Transportation Development Impact Fees (TDIF)
Improvement Area B
15 Those facilities to be financed from the proceeds of Park 1,134,922 0 1,134,922
Facilities Development Impact Fees (PAD).
16 Those facilities to be financed from the proceeds of 1,680,802 0 1,640,762
Public Facilities DeveloDment ImDact Fees (PFDIF)
17 Traffic Signals- Mount Miguel Road at Plaza Palmera 150,000 150,000 0
18 Traffic Signals- Proctor Vallev Road at Mt. Miguel Road 125,000 125,000 0
19 Traffic Signals- Calle La Marina East at Mt. Miguel Road 125,000 125,000 0
20 Traffic Signals- Calle La Marina West at Mt. Miguel 125,000 125,000 0
Road
21 Traffic Signals- Mount Miguel Road at Paseo Veracruz 125,000 125,000 0
22 Traffic Signals- Proctor Valley Road at San Miguel 30,000 0 30,000
Ranch Road (TDIF Eligible)
23 Traffic Signals- Proctor Valley Road at San Miguel 105,000 0 105,000
Ranch Road(Non TDIF)
24 Traffic Signals- A venida Loretta at San Miguel Ranch 40,000 0 40,000
Road (TDIF Eligible)
25 Traffic Signals- A venida Loretta at San Miguel Ranch 149,176 0 149,176
Road (Non-TDIF)
26 Traffic Signals- Circulo Altamira at San Miguel Ranch 40,000 0 40,000
Road (TDIF Eligible)
27 Traffic Signals- Circulo Altamira at San Miguel Ranch 149,176 0 149,176
Road (Non-TDIF)
Totals $31,557,497 $12,864,065 $10,414,047
Sources: Developer, McGill Martin Self, Inc.
A-I
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Notes to Exhibit A:
1/ 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 Improvements and proposed Improvements may be added or deleted with the consent
of Developer and the City Engineer. Components of all roadway improvements eligible for
funding shall include (i) grading, (ii) wet and dry utilities within the right-of-way, (iii) storm
drain facilities, (iv) paving, (v) curb, gutter, sidewalk, medians, (vi) lighting, (vii) and all other
appurtenant improvements.
Y Cost estimates are preliminary and may be modified from time to time with the consent
of Developer and the City Engineer. The Purchase Price of an Improvement shall be based on
actual costs.
2! This total represents the total fair share audited cost which was financed from
Improvement Area A Bond Proceeds.
1/ $300,000 of this total was to be used by the City of Chula Vista towards the construction
of TDIF facilities which credit went towards commercial property in Improvement Area B.
$230,000 of this total was to be used by the City of Chula Vista towards the construction of
TDIF facilities which credit went towards Residential Property in Improvement Area A.
.
A- 2
WBD1319618.5
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RESOLUTION NO.
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA,
CALIFORNIA, ACTING IN ITS CAPACITY AS THE LEGISLATIVE BODY OF
COMMUNITY FACILITIES DISTRICT NO. 2001-1 (SAN MIGUEL RANCH),
AUTHORIZING AND PROVIDING FOR THE ISSUANCE OF SPECIAL TAX
BONDS OF SUCH COMMUNITY FACILITIES DISTRICT FOR IMPROVEMENT
AREA B THEREOF, 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 and designate improvement areas therein 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 designated as COMMUNITY
FACILITIES NO. 2001-1 (SAN MIGUEL RANCH) (the "Community Facilities District") and such
improvement areas designated as IMPROVEMENT AREA A and IMPROVEMENT AREA B, 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 each of
the improvement areas 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 ofChula 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 Improvement
Area B; and,
WHEREAS, the forms of the following documents have been presented to and considered for
approval by this City Council:
A.
Bond Indenture by and between the Community Facilities District and 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\320347.!
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C. Preliminary Official Statement containing information including but not limited to
the Community Facilities District, Improvement Area B 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 MuniFinancial, 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 of the 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 of the Bonds:
(a)
The Goals and Policies generally require that the full cash value of the properties
within Improvement Area B of the Community Facilities District subject to the levy
of the 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 Improvement
Area B or a special assessment levied on property within Improvement Area b
(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 Improvement Area B will be at
least 3 times the amount of such Land Secured Indebtedness.
.
The value of the property within Improvement Area B of the Community Facilities
District which will be subject 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 the Land
Secured Bonded Indebtedness allocable to each such property. The value of each
WBD\320347.1
2 /1-~/.3
such development area will be at least 4 times the Land Secured Indebtedness
allocable to each such area.
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 11340( 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 Improvement
Area B and the relative overall lack of diversity of ownership of property within
Improvement Area B, the pri vate sale of the 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 ofChula Vista Community Facilities District No. 2001-1 (San Migueal Ranch)
2005 Improvement Area B Special Tax Bonds" (the "Bonds") in an aggregate principal amount not
to exceed $14,000,000 are hereby authorized to be issued. The date, manner of payment, interest rate
or rates, interest payment dates, denominations, form, registration privileges, manner of execution,
place of payment, terms of redemption and other terms, covenants and conditions of the 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 $14,000,000, 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 twenty-five hundredths percent (98.25%) 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
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.
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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 of the Director of
Finance, another Authorized Officer pursuant to the Rule, shall be conclusive evidence of the
approval of the fmal 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 of the Bonds to Stone & Youngberg LLC (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 of the Community
Facilities District, are hereby authorized and directed to take such actions as are required under the
Bond Purchase Agreement and the Bond Indenture to complete all actions required to evidence the
delivery of the Bonds upon the receipt of the purchase price thereoffiom 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
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.
WBDlJ20J47.1
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SECTION 9. Effective Date. This resolution shall take effect from and after its adoption.
Presented by
Approved as to form by
Sohaib AI-Agha
City Engineering
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PAGE 1, ITEM NO.:
MEETING DATE:
/5
11/22/05
CITY COUNCIL AGENDA STATEMENT
ITEM TITLE: REPORT ON IMPLEMENTATION OF THE DOWNTOWN PROPERTY BASED
BUSINESS IMPROVEMENT DISTRICT (PBID) RENEWAL PROCESS AND
POTENTIAL BOUNDARY EXPANSION
SUBMITTED .71>/1"
BY: COMMUNITY DEVELOPMENT DIRECTOR
7 ~ f"'IZ- ~
REVIEWED BY: CITY MANAGER 1/ 1 hFK I
4/5THS VOTE: YES D NO 0
BACKGROUND
This report is to provide a status report and identify a key issue in the matter of the
renewal of the Property Based Business Improvement District (BPI D). It briefly addresses
the history of the PBID, its current renewal efforts and the issue of the possible expansion
of the District to include additional City properties
Property-Based Business Improvement District (PBID) was formed in 2001 to
proactively implement a number of enhancement services and programs within the
downtown core. Administered by the Downtown Business Association (DBA), the PBID
has, by all accounts, worked to create a cleaner, safer, and more attractive business
district. The PBID was inaugurated for a five-year term beginning in 2001. It was
established, in part, with the recognition that the City would no longer directly fund DBA
operations, as it had previously. Instead, the City is currently assessed by the District,
along with other benefiting property owners. The cost of assessments paid to the PBID
has been less than the City's previous commitments to the DBA.
The PBID is funded by annual assessments, derived from the area within the attached
map. There are currently two assessment tiers. The first of these is calculated from the
property frontage length for those properties fronting on Third Avenue between E Street
and H Street (the shaded parcels on the attached map). The second includes a far lower
rate, calculated on lot size, which is applied to properties within the district but not fronting
on Third (enclosed by the solid line on the attached map). For the last fiscal year, the
City's assessment was approximately $48,000 for all City and Redevelopment Agency
parcels within the District, which comprised vacant parcels, parking lots and Memorial
Park. This funding level comprises less than 15% of the District's revenue. By
comparison, the County of San Diego pays about $60,000 annually.
In order to continue operation, the PBID must be renewed by June 2006. Recognizing the
positive benefits of the PBID, in early May 2005 the City retained the services of the
15-1
PAGE 2, ITEM NO.: 1-5-
MEETING DATE: 11/22/05
Progressive Urban Management Associates (PUMA), a business consultant firm based in
Denver, Colorado, to assist in the PBID renewal effort. Formal Council consideration of its
vote -- as a property owner -- on the PBID renewal is slated for Spring 2006. Staff intends
to bring the matter back after ascertaining majority support by private property owners
within the District.
RECOMMENDATION
That the City Council accept staff's report.
BOARDS/COMMISSIONS RECOMMENDATION
The Downtown Business Association (DBA) recommends that the expansion of the
PBID boundary include the Library and Police Headquarters sites, which are not
currently within the District.
DISCUSSION
Since the approval of the PUMA contract in May, the DBA has worked with those City
departments, including Public Works, Recreation, Finance and Library, which contribute
services to downtown. From that interaction has come an assessment of its current and
past services, and a draft plan for the services that would be provided upon renewal. It
is the obligation of the PBID to provide those enhancements beyond the 'baseline' of
services otherwise provided by the City. For the most part these have been increased
frequency of maintenance in the right of way and marketing for the downtown
businesses.
The primary issue that is arising from the renewal effort is a possible expansion of the
District to include additional City properties. The Board proposes this expansion on four
rationales:
o A greater tie between the District and the City creates a stronger, unified image for
downtown
o Uses such as the Library are quasi-commercial "anchors" of the downtown, which
should be reflected in their inclusion in the District
o An increased commitment by the City will result in an enhanced partnership between
the City and the District
o Greater acreage within the District is needed for City parity with the assessment
currently paid by the County of San Diego. The County is currently the largest
ratepayer in the District, but it arguably has a lesser stake in the success of
Downtown.
/0 - .?-
PAGE 3, ITEM NO.: 15
MEETING DATE: 11/22/05
A fifth consideration is that, in light of the Exclusive Negotiating Agreements which the
City has entered on a number of parcels within the District, the City's assessment could
be reduced by approximately $10,000 in the foreseeable future, as those properties
could be converted to private ownership.
On basis of the foregoing rationale, the DBA proposes expansion of the District to include
the Police, and Library sites. These two sites are located adjacent to existing downtown
establishments and could possibly take advantage of some of the marketing efforts of the
District. The expansion to include such services as Library or Police would not be funded
from those department budgets, but rather would come from the City at large as a property
owner. The net fiscal effect of expansion options can be seen in the table below.
Current Annual City Assessment $48,000
Add the Librarv Site $17,000
Add the Police HQ Site $15,000
Total Potential Assessment $80,000
The DBA seeks to include the above additional City property in its renewal proposal to the
PBID property owners, and City staff supports the expansion to include those two sites.
This issue is somewhat urgent, as the Board needs to prepare petitions and conduct
voting on the District, beginning early in 2006, in order that all steps are completed before
the expiration of the cu rrent District.
FISCAL IMPACT
There is no immediate fiscal effect associated with this matter. However, the inclusion of
City properties within the district and the obligation to pay assessments to the district, if it is
successfully renewed, will have significant fiscal impacts beginning with the 2006-2007
budget year. This obligation will be outside the City's control.
Currently, the PBID assessment is approximately $48,000, of which City owned parcels
account for $31,000, and Redevelopment Agency owned parcels account for $17,000.
Adding the Library and Police properties to the District would increase these amounts as
indicated in the table in the preceding section of this report. Assuming the district renewal
is ultimately approved by landowner ballot, the City will be obligated to assessment
payments of approximately $80,000 per year, or $800,000 for the ten year renewal period.
This amount could be adjusted slightly upwards by a cost of living provision within the
district documents, which by law cannot exceed five percent and which in the last five
years have not exceeded four percent. These assessments would be paid from the
General Fund.
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MEETING DATE:
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LEGEND
Downtown Improvement District
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Mayor and City Council
City Of Chula Vista
276 Fourth Avenue
Chula Vista, Ca 91910
619.691.5044 - 619.476.5379 Fax
MEMO
CllY OF
CHUlA VISTA
Tuesday, November 15, 2005
TO:
Lorraine Bennett, City Clerk
FROM:
Zaneta Salde Encarnacion, Constituent S ices Manager
RE:
Youth Commission
Mayor Padilla would like to recommend the following students for appointment to the Youth
Commission:
Karina Liston (representative for Hilltop High)
Elizabeth Vargas (representative for Castle Park Middle)
Please place this on the next council agenda for ratification.
Thanks
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ClN OF
CHULA VISTA
Mayor and City Council
City Of Chula Vista
276 Fourth Avenue
Chula Vista, Ca 91910
619.691.5044 - 619.476.5379 Fax
RECE.IVED
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MEMO
Tuesday, November 01, 2005
TO:
Lorraine Bennett, City Clerk's Office
FROM:
Zaneta Salde Encarnacion, Constituent Services Manager
RE:
Charter Review Commission
Mayor Padilla would like to recommend Mr. Bill Richter to fill the vacancy on the Charter Review
Commission. Please place this on the next council agenda for ratification.
Please call me at x5812 should you have any questions.
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City of Chula Vista
COUNCILMEMBER JOHN McCANN
MEMORANDUM
DATE: November 17, 2005
TO: City Manager Dave Rowlands
FROM: Council member John McCann
SUBJECT: Proposed Ordinance Regulating Proximity of Sex Offender's to
Children's Facilities
In order to reduce the potential risk of harm to the children of our community from
sex offenders, I would like to propose that the City of Chula Vista work on
instituting an ordinance that regulates the proximity sex offenders could be in
relation to facilities designed for children.
Recently, the City of National City has instituted an ordinance (Ordinance No.
2005, amending NCMC Chapter 10.63) that prevents sex offenders from being
within 300 feet of a public or private school for children, a center or facility that
provides daycare or children's services, a video arcade, a playground, park or an
amusement center.
I would like City Staff to look into language that we could use, as well as
California law, in order to include an ordinance within the City of Chula Vista's
Municipal Code to limit sex offenders' proximity to children's facilities.
Thank you for your assistance on this matter; it is greatly appreciated.
JM:jm
/8