HomeMy WebLinkAbout2018-2401
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RESOLUTION NO. 2018-240
RESOLUTION OF THE MAYOR AND CITY COUNCIL OF THE CITY OF SAN
BERNARDINO, CALIFORNIA, DECLARING ITS INTENTION TO ESTABLISH
COMMUNITY FACILITIES DISTRICT NO. 2018-2 (VERDEMONT RANCH) OF THE
CITY OF SAN BERNARDINO TO AUTHORIZE THE LEVY OF A SPECIAL TAX TO
PAY THE COST OF ACQUIRING OR CONSTRUCTING CERTAIN FACILITIES, AND
TO PAY DEBT SERVICE ON BONDED INDEBTEDNESS
WHEREAS, the City of San Bernardino (the "City") received a petition signed by the
owner of more than ten percent of the land within the boundaries of the territory which is
proposed for inclusion in a proposed community facilities district, which petition meets the
requirements of Sections 53318 and 53319 of the Government Code of the State of California;
and
WHEREAS, the City Council of the City (the "City Council") desires to adopt this
resolution of intention as provided in Section 53321 of the Government Code of the State of
California to establish a community facilities district consisting of the territory described in
Attachment "A" hereto and incorporated herein by this reference, which the City Council hereby
determines shall be known as "Community Facilities District No. 2018-2 (Verdemont Ranch) of
the City of San Bernardino' ("Community Facilities District No. 2018-2" or the "District")
pursuant to the Mello -Roos Community Facilities Act of 1982, as amended, commencing with
Section 53311 of the Government Code (the "Act") to finance (1) the purchase, construction,
modification, expansion, improvement and/or rehabilitation of certain real or other tangible
property described in Attachment `B" hereto and incorporated herein by this reference, including
all furnishings, equipment and supplies related thereto (collectively, the "Facilities"), which
Facilities have a useful life of five years or longer, and (2) the incidental expenses to be incurred
in connection with financing the Facilities and forming and administering the District (the
"Incidental Expenses"); and
WHEREAS, the City Council further intends to approve an estimate of the costs of the
Facilities and the Incidental Expenses for Community Facilities District No. 2018-2; and
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WE
WHEREAS, it is the intention of the City Council to consider financing the Facilities
and the Incidental Expenses through the formation of Community Facilities District No. 2018-2
and the issuance of bonded indebtedness in an amount not to exceed $5,000,000 with respect to
the Facilities and the Incidental Expenses and the levy of a special tax to pay for the Facilities
and the Incidental Expenses (the "Special Tax") and to pay debt service on the bonded
indebtedness, provided that the bond sale and such Special Tax levy are approved at an election
to be held within the boundaries of Community Facilities District No. 2018-2;
BE IT RESOLVED BY THE MAYOR AND CITY COUNCIL OF THE CITY OF I
I SAN BERNARDINO AS FOLLOWS:
SECTION 1. The above recitals are true and correct.
SECTION 2. A community facilities district is proposed to be established under the
terms of the Act. It is further proposed that the boundaries of the community facilities district
shall be the legal boundaries as described in Attachment "A" hereto, which boundaries shall,
upon recordation of the boundary map for the District, include the entirety of any parcel subject
to taxation by the District, and as depicted on the map of the proposed Community Facilities
District No. 2018-2 which is on file with the City Clerk. The City Clerk is hereby directed to
sign the original map of the District and record it with all proper endorsements thereon with the
Assessor -Recorder -County Clerk of the County of San Bernardino within 15 days after the
adoption of this resolution, all as required by Section 3111 of the Streets and Highways Code of
the State of California.
SECTION 3. The name of the proposed community facilities district shall be I
"Community Facilities District No. 2018-2 (Verdemont Ranch) of the City of San Bernardino."
SECTION 4. The Facilities proposed to be provided within Community Facilities I
District No. 2018-2 are public facilities as defined in the Act, which the City is authorized by law
to construct, acquire, own and operate. The City Council hereby finds and determines that the
description of the Facilities herein is sufficiently informative to allow taxpayers within the
proposed District to understand what the funds of the District may be used to finance. The
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Incidental Expenses expected to be incurred include the cost of planning and designing the
Facilities, the costs of forming the District, issuing bonds and levying and collecting the Special
Tax within the proposed District. The Facilities may be acquired from one or more of the
property owners within the District as completed public improvements or may be constructed
from bond or Special Tax proceeds.
All or a portion of the Facilities may be purchased with District funds as completed
public facilities pursuant to Section 53314.9 or as discrete portions or phases pursuant to Section'
53313.51 of the Act and/or constructed with District funds pursuant to Section 53316.2 of the
Act. Any portion of the Facilities may be financed through a lease or lease -purchase
arrangement if the District hereafter determines that such arrangement is of benefit to the
District.
SECTION 5. Except where funds are otherwise available, it is the intention of the City
Council to levy annually in accordance with the procedures contained in the Act the Special Tax,
secured by recordation of a continuing lien against all nonexempt real property in the District,
sufficient to pay for: (i) the Facilities and Incidental Expenses; and (ii) the principal and interest
and other periodic costs on bonds or other indebtedness issued to finance the Facilities and
Incidental Expenses, including the establishment and replenishment of any reserve funds deemed
necessary by the District, and any remarketing, credit enhancement and liquidity facility fees
(including such fees for instruments which serve as the basis of a reserve fund in lieu of cash).
The rate and method of apportionment and manner of collection of the Special Tax are described
in detail in Attachment "C" attached hereto, which Attachment "C" is incorporated herein by this
reference. Attachment "C" allows each landowner within the District to estimate the maximum
amount of the Special Tax that may be levied against each parcel. In the first year in which such
Special Tax is levied, the levy shall include an amount sufficient to repay to the District all
amounts, if any, transferred to the District pursuant to Section 53314 of the Act and interest
thereon.
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If the Special Tax is levied against any parcel used for private residential purposes, (i) the
maximum Special Tax rate shall be specified as a dollar amount which shall be calculated and
established not later than the date on which the parcel is first subject to the Special Tax because
of its use for private residential purposes and shall not be increased over time, (ii) such Special
Tax not shall be levied after fiscal year 2059-60, as described in Attachment "C" hereto, and (iii)
under no circumstances will the Special Tax levied against any such parcel used for private
residential uses be increased as a consequence of delinquency or default by the owner or owners
of any other parcel or parcels within the District by more than ten percent (10%) above the
amount that would have been levied in that fiscal year had there never been any such
delinquencies or defaults.
The Special Tax is based on the expected demand that each parcel of real property within
proposed Community Facilities District No. 2018-2 will place on the Facilities and on the benefit
that each parcel derives from the right to access the Facilities. The City Council hereby
determines that the proposed Facilities are necessary to meet the increased demand placed upon
the City and the existing infrastructure in the City as a result of the development of the land
proposed for inclusion in the District. The City Council hereby determines the rate and method
of apportionment of the special tax with respect to the Special Tax set forth in Attachment "C" to
be reasonable. The Special Tax is apportioned to each parcel on the foregoing basis pursuant to
Section 53325.3 of the Act and such special tax is not on or based upon the value or ownership
of real property. In the event that a portion of the property within Community Facilities District
No. 2018-2 shall become for any reason exempt, wholly or partially, from the levy of the Special
Tax specified on Attachment "C," the City Council shall, on behalf of Community Facilities
District No. 2018-2, cause the levy to be increased, subject to the limitation of the maximum
Special Tax for a parcel as set forth in Attachment "C," to the extent necessary upon the
remaining property within proposed Community Facilities District No. 2018-2 which is not
exempt in order to yield the Special Tax revenues required for the purposes described in this
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Section 5. The obligation to pay the Special Tax may be prepaid only as set forth in Section G
I Attachment "C" hereto.
SECTION 6. A public hearing (the "Hearing") on the establishment of the proposed
Community Facilities District No. 2018-2, the proposed rate and method of apportionment of the
Special Tax and the proposed issuance of bonds to finance the Facilities and the Incidental
Expenses shall be held at 5:00 p.m., or as soon thereafter as practicable, on September 19, 2018,
at the City Council Chamber, 201 North "E" Street, San Bernardino, California. Should the City
Council determine to form the District, a special election will be held to authorize the issuance of
the bonds and the levy of the special tax in accordance with the procedures contained in
Government Code Section 53326. If held, the proposed voting procedure at the election will be a
landowner vote with each landowner who is the owner of record of land within the District at the
close of the Hearing, or the authorized representative thereof, having one vote for each acre or
portion thereof owned within the proposed District. Ballots for the special election may be
distributed by mail or by personal service.
SECTION 7. At the time and place set forth above for the Hearing, the City Council
will receive testimony as to whether the proposed Community Facilities District No. 2018-2 shall
be established and as to the method of apportionment of the special tax and shall consider:
(a) if an ad valorem property tax is currently being levied on property within
proposed Community Facilities District No. 2018-2 for the exclusive purpose of paying principal
of or interest on bonds, lease payments or other indebtedness incurred to finance construction
capital facilities; and
(b) if the capital facilities to be financed and constructed by Community Facilities
District No. 2018-2 will provide the same services as were provided by the capital facilities
mentioned in subsection (a); and
(c) if the City Council makes the findings specified in subsections (a) and (b) above,
it will consider appropriate action to determine whether the total annual amount of ad valorem
property tax revenue due from parcels within Community Facilities District No. 2018-2, for
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purposes of paying principal and interest on the debt identified in subsection (a) above, shall not
be increased after the date on which Community Facilities District No. 2018-2 is established, or
after a later date determined by the City Council with the concurrence of the legislative body
which levied the property tax in question.
SECTION 8. At the time and place set forth above for the Hearing, any interested
person, including all persons owning lands or registered to vote within proposed Community)
Facilities District No. 2018-2, may appear and be heard.
SECTION 9. Each City officer who is or will be responsible for providing the Facilities
within proposed Community Facilities District No. 2018-2, if it is established, is hereby directed
to study the proposed District and, at or before the time of the above-mentioned Hearing, file a
report with the City Council containing a brief description of the public facilities by type which
will in his or her opinion be required to meet adequately the needs of Community Facilities
District No. 2018-2 and an estimate of the cost of providing those public facilities, including the
cost of environmental evaluations -of such facilities and an estimate of the fair and reasonable
cost of any Incidental Expenses to be incurred.
SECTION 10. The District may accept advances of funds or work -in-kind from anyj
source, including, but not limited to, private persons or private entities, for any authorized
purpose, including, but not limited to, paying any cost incurred in creating Community Facilities
District No. 2018-2. The District may enter into an agreement with the person or entity
advancing the funds or work -in-kind, to repay all or a portion of the funds advanced, or to
reimburse the person or entity for the value, or cost, whichever is less, of the work -in-kind, as
determined by the City Council, with or without interest.
SECTION 11. The City Clerk is hereby directed to publish a notice (the "Notice") of the
Hearing pursuant to Section 6061 of the Government Code in a newspaper of general circulation
published in the area of proposed Community Facilities District No. 2018-2. The City Clerk is
further directed to mail a copy of the Notice to each of the landowners within the boundaries of
the District at least 15 days prior to the Hearing. The Notice shall contain the text or a summary
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of this Resolution, the time and place of the Hearing, a statement that the testimony of all
interested persons or taxpayers will be heard, a description of the protest rights of the registered
voters and landowners in the proposed district and a description of the proposed voting
procedure for the election required by the Act. Such publication shall be completed at least
seven (7) days prior to the date of the Hearing.
SECTION 12. The reasonably expected maximum principal amount of the bonded
indebtedness to be incurred by the District for the Facilities and Incidental Expenses is Five
Million Dollars ($5,000,000).
SECTION 13. Except to the extent limited in any bond resolution or trust indenture
related to the issuance of bonds, the City Council hereby reserves to itself all rights and powers
set forth in Section 53344.1 of the Act (relating to tenders in full or partial payment).
SECTION 14. This Resolution shall be effective upon its adoption.
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RESOLUTION OF THE MAYOR AND CITY COUNCIL OF THE CITY OF SAN
BERNARDINO, CALIFORNIA, DECLARING ITS INTENTION TO ESTABLISH
COMMUNITY FACILITIES DISTRICT NO. 2018-2 (VERDEMONT RANCH) OF THE
CITY OF SAN BERNARDINO TO AUTHORIZE THE LEVY OF A SPECIAL TAX TO
PAY THE COST OF ACQUIRING OR CONSTRUCTING CERTAIN FACILITIES, AND
TO PAY DEBT SERVICE ON BONDED INDEBTEDNESS
I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor and
City Council of the City of San Bernardino at a Joint Regular Meeting thereof, held on the 15th
day of A_ ugust 2018, by the following vote, to wit:
Council Members: AYES NAYS ABSTAIN ABSENT
MARQUEZ X
RICHARD x
MULVIHILL CS
Georgeanq Hanna, CMC, City Clerk
The foregoing Resolution is hereby approved this 15th day of Au ,ust 2018.
teee2e
R. Carey Daffernardino
, Mayor
City of San
Approved as to form:
Gary D. Saenz, City Attorney
Y
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BARRIOS
VALDIVIA
CNS)
SHORETT
K
k
NICKEL
RICHARD x
MULVIHILL CS
Georgeanq Hanna, CMC, City Clerk
The foregoing Resolution is hereby approved this 15th day of Au ,ust 2018.
teee2e
R. Carey Daffernardino
, Mayor
City of San
Approved as to form:
Gary D. Saenz, City Attorney
Y
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Real property in the City of San Bernardino, County of San Bernardino, State of California,
described as follows:
Assessor Parcel Nos.:
0348-111-51
0348-111-52
0261-031-10
0261-031-11
0261-062-11
0261-062-12
0261-062-13
0261-062-14
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ATTACHMENT B
Types of Facilities
To Be Financed by Community
Facilities District No. 2018-2 of the City of San Bernardino
The proposed types of public facilities and expenses to be financed by the District
include:
The construction, purchase, modification, expansion, rehabilitation and/or improvement
of drainage, water, sewer, library, park, roadway and roadway improvements, aquatic facilities,
and other public facilities of the City, including the foregoing public facilities which are included
in the City's fee programs with respect to such facilities and authorized to be financed under the
Mello -Roos Community Facilities Act of 1982, as amended (the "Facilities"), and all
appurtenances and appurtenant work in connection with the foregoing Facilities, including the
cost of engineering, planning, designing, materials testing, coordination, construction staking,
construction management and supervision for such Facilities, and to finance the incidental
expenses to be incurred, including:
a. The cost of engineering, planning and designing the Facilities;
b. All costs, including costs of the property owner petitioning to form the District,
associated with the creation of the District, the issuance of the bonds, the determination of the
amount of special taxes to be levied and costs otherwise incurred in order to carry out the
authorized purposes of the District; and
C. Any other expenses incidental to the construction, acquisition, modification,
rehabilitation, completion and inspection of the Facilities.
Capitalized terms used and not defined herein shall have the meaning set forth in the Rate
and Method of Apportionment of Special Taxes for the District.
WE
F)
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ATTACHMENT C
RATE AND METHOD OF APPORTIONMENT FOR
COMMUNITY FACILITIES DISTRICT NO. 2018-2 (VERDEMONT RANCH)
OF THE CITY OF SAN BERNARDINO
A Special Tax (all capitalized terms are defined in Section A, "Definitions", below) shall be
applicable to each Assessor's Parcel of Taxable Property located within the boundaries of the
City of San Bernardino Community Facilities District No. 2018-2 (Verdemont Ranch) ("CFD
No. 2018-2"). The amount of Special Tax to be levied in each Fiscal Year, on an Assessor's
Parcel, shall be determined by the City Council of the City of San Bernardino, acting in its
capacity as the legislative body of CFD No. 2018-2 by applying the appropriate Special Tax for
Developed Property, Approved Property, Undeveloped Property, and Provisional Undeveloped
Property that is not Exempt Property as set forth below. All of the real property, unless
exempted by law or by the provisions hereof in Section F, 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 meanings:
"Acre or Acreage" means the land area of an Assessor's Parcel as shown on an Assessor's
Parcel Map, or if the land area is not shown on an Assessor's Parcel Map, the land area shown on
the applicable final map, parcel map, condominium plan, or other recorded County parcel map or
instrument. The square footage of an Assessor's Parcel is equal to the Acreage multiplied by
43,560.
"Act" means the Mello -Roos Communities Facilities Act of 1982, as amended, being Chapter
2.5 (commencing with Section 53311) of Part 1 of Division 2 of Title 5 of the Government Code
of the State of California.
"Administrative Expenses" means the following actual or reasonably estimated costs directly
related to the administration of CFD No. 2018-2: the costs of computing the Special Taxes and
preparing the Special Tax collection schedules (whether by the City or designee thereof or both);
the costs of collecting the Special Taxes (whether by the City or otherwise); the costs of
remitting Special Taxes A to the Trustee; the costs of the Trustee (including legal counsel) in the
discharge of the duties required of it under the Indenture; the costs to the City, CFD No. 2018-2
or any designee thereof of complying with arbitrage rebate requirements; the costs to the City,
CFD No. 2018-2 or any designee thereof of complying with disclosure requirements of the City,
CFD No. 2018-2 or obligated persons associated with applicable federal and state securities laws
and 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. 2018-
2 or any designee thereof related to an appeal of the Special Tax; the costs associated with the
release of funds from an escrow account; and the City's annual administration fees and third
party expenses. Administration Expenses shall also include amounts estimated by the CFD
Administrator or advanced by the City or CFD No. 2018-2 for any other administrative purposes
of CFD No. 2018-2, including attorney's fees and other costs related to commencing and
pursuing to completion any foreclosure of delinquent Special Taxes.
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"Approved Property" means all Assessor's Parcels of Taxable Property: (i) that are included in
a Final Map that was recorded prior to the January 1St preceding the Fiscal Year in which the
Special Tax is being levied, and (ii) that have not been issued a building permit on or before June
1St preceding the Fiscal Year in which the Special Tax is being levied.
"Assessor's Parcel" means a lot or parcel of land designated on an Assessor's Parcel Map with
an assigned Assessor's Parcel Number.
"Assessor's Parcel Map" means an official map of the Assessor of the County designating
parcels by Assessor's Parcel Number.
"Assessor's Parcel Number" means that number assigned to an Assessor's Parcel by the
County for purposes of identification.
"Assigned Special Tax" means the Special Tax of that name described in Section D below.
"Backup Special Tax" means the Special Tax of that name described in Section D below.
"Boundary Map" means a recorded map of the CFD which indicates the boundaries of the
CFD.
"Bonds" means any obligation to repay a sum of money, including obligations in the form of
bonds, notes, certificates of participation, long-term leases, loans from government agencies, or
loans from banks, other financial institutions, private businesses, or individuals, or long-term
contracts, or any refunding thereof, to which Special Tax within CFD No. 2018-2 have been
pledged.
"Building Permit" means the first legal document issued by a local agency giving official
permission for new construction. For purposes of this definition, "Building Permit" may or may
not include any subsequent building permit document(s) authorizing new construction on an
Assessor's Parcel that are issued or changed by the City after the first original issuance, as
determined by the CFD Administrator as necessary to fairly allocate Special Tax to the
Assessor's Parcel, provided that following such determination the Maximum Special Tax that
may be levied on all Assessor's Parcels of Taxable Property will be at least 1.1 times maximum
annual debt service on all outstanding Bonds plus the estimated annual Administrative Expenses.
"Building Square Footage" or "BSF" means the square footage of assessable internal living
space, exclusive of garages or other structures not used as living space, as determined by
reference to the Building Permit for such Assessor's Parcel.
"Calendar Year" means the period commencing January 1 of any year and ending the following
December 31.
"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.
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"CFD" or "CFD No. 2018-2" means Community Facilities District No. 2018-2 (Verdemont
Ranch) established by the City under the Act.
"City" means the City of San Bernardino.
"City Council" means the City Council of the City of San Bernardino, acting as the Legislative
Body of CFD No. 2018-2, or its designee.
"Condominium Plan" means a condominium plan as set forth in the California Civil Code,
Section 1352.
"County" means the County of San Bernardino.
"Developed Property" means all Assessor's Parcels of Taxable Property that: (i) are included in
a Final Map that was recorded prior to the January 1St preceding the Fiscal Year in which the
Special Tax is being levied, and (ii) a Building Permit for new construction was issued on or
before June 1 St preceding the Fiscal Year in which the Special Tax is being levied.
"Exempt Property" means all Assessor's Parcels designated as being exempt from Special
Taxes as provided for in Section F.
"Final Map" means a subdivision of property by recordation of a final map, parcel map, or lot
line adjustment, pursuant to the Subdivision Map Act (California Government Code Section
66410 et seq.) or recordation of a Condominium Plan pursuant to California Civil Code Section
1352 that creates individual lots for which Building Permits may be issued without further
subdivision.
"Fiscal Year" means the period commencing on July 1St of any year and ending the following
June 30th.
"Indenture" means the indenture, fiscal agent 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 Category" means any of the categories listed in Table 1 of Section D.
"Maximum Special Tax" means the maximum Special Tax, determined in accordance with
Section D below, that can be levied by CFD No. 2018-2 in any Fiscal Year on any Assessor's
Parcel.
"Multifamily Property" means all Assessor's Parcels of Developed Property for which a
Building Permit has been issued for the purpose of constructing a building or buildings
comprised of attached Residential Units available for rental by the general public, not for sale to
an end user, and under common management, as determined by the CFD Administrator.
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"Non -Residential Property" or "NR" means all Assessor's Parcels of Taxable Property for
which a building permit(s) was issued for a non-residential use. The CFD Administrator shall
make the determination if an Assessor's Parcel is Non -Residential Property.
"Partial Prepayment Amount" means the amount required to prepay a portion of the Special
Tax obligation for an Assessor's Parcel, as described in Section G.2.
"Prepayment Amount" means the amount required to prepay the Special Tax obligation in full
for an Assessor's Parcel, as described in Section G.1.
"Proportionately" means for Taxable Property for Special Tax that is (i) Developed Property,
that the ratio of the actual Special Tax levy to the Assigned Special Tax is the same for all
Assessor's Parcels of Developed Property, (ii) Approved Property, that the ratio of the actual
Special Tax levy to the Maximum Special Tax is the same for all Assessor's Parcels of Approved
Property, and (iii) Undeveloped Property, Provisional Undeveloped Property, that the ratio of the
actual Special Tax levy per Acre to the Maximum Special Tax per Acre is the same for all
Assessor's Parcels of Undeveloped Property, Provisional Undeveloped Property.
"Provisional Undeveloped Property" means all Assessor's Parcels of Taxable Property that
would otherwise be classified as Exempt Property pursuant to the provisions of Section F, but
cannot be classified as Exempt Property because to do so would be reduce the Acreage of all
Taxable Property below the required minimum Acreage set forth in Sections F.
"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 Units.
"Residential Unit" or "RU" means a residential unit that is used or intended to be used as a
domicile by one or more persons, as determined by the CFD Administrator.
"Single Family Residential Property" means all Assessor's Parcels of Residential Property
other than Multifamily Property on an Assessor's Parcel.
"Special Tax" means any of the special taxes authorized to be levied within CFD No. 2018-2
pursuant to the Act to fund the Special Tax Requirement.
"Special Tax Requirement " means the amount required in any Fiscal Year to pay: (i) the debt
service or the periodic costs on all outstanding Bonds due in the Calendar Year that commences
in such Fiscal Year, (ii) Administrative Expenses, (iii) the costs associated with the release of
funds from an escrow account, (iv) any amount required to establish or replenish any reserve
funds established in association with the Bonds, (v) an amount equal to any anticipated shortfall
due to Special Tax delinquencies, and (vi) the collection or accumulation of funds for the
acquisition or construction of facilities authorized by CFD No. 2018-2 provided that the
inclusion of such amount does not cause an increase in the levy of Special Tax on Undeveloped
Property as set forth in Step Three of Section E., less (vii) any amounts available to pay debt
service or other periodic costs on the Bonds pursuant to the Indenture.
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"Taxable Property" means all Assessor's Parcels within CFD No. 2018-2, which are not
Exempt Property.
"Taxable Unit" means either a Residential Unit or an Acre.
"Tract(s)" means an area of land within a subdivision identified by a particular tract number on
a Final Map approved for the subdivision.
"Trustee" means the trustee, fiscal agent, or paying agent under the Indenture.
"Undeveloped Property" means all Assessor's Parcels of Taxable Property which are not
Developed Property, Approved Property, Provisional Undeveloped Property.
B. SPECIAL TAX
Commencing Fiscal Year 2019-2020 and for each subsequent Fiscal Year, the City Council shall
levy Special Taxes on all Taxable Property, up to the applicable Maximum Special Tax to fund
the Special Tax Requirement.
C. ASSIGNMENT TO LAND USE CATEGORY FOR SPECIAL TAX
Each Fiscal Year, beginning with Fiscal Year 2019-2020, each Assessor's Parcel within CFD
No. 2018-2 shall be classified as Taxable Property or Exempt Property. In addition, each
Assessor's Parcel of Taxable Property shall be further classified as Developed Property,
Approved Property, Undeveloped Property or Provisional Undeveloped Property.
Assessor's Parcels of Developed Property shall further be classified as Residential Property or
Non -Residential Property. Each Assessor's Parcel of Residential Property shall further be
classified as a Single Family Residential Property, or Multifamily Property. Each Assessor's
Parcel of Single Family Residential Property shall be further categorized into Land Use
Categories based on its Building Square Footage and assigned to its appropriate Assigned
Special Tax rate.
D. MAXIMUM SPECIAL TAX
1. Developed Property
The Maximum Special Tax for each Assessor's Parcel of Single Family Residential Property
in any Fiscal Year shall be the greater of (i) the Assigned Special Tax or (ii) the Backup
Special Tax.
The Maximum Special Tax for each Assessor's Parcel of Non -Residential Property or
Multifamily Residential Property shall be the applicable Assigned Special Tax described in
Table 1 of Section D.
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a. Assigned Special Tax
Each Fiscal Year, each Assessor's Parcel of Single Family Residential Property, Multifamily
Property, or Non -Residential Property shall be subject to an Assigned Special Tax. The
Assigned Special Tax applicable to an Assessor's Parcel of Developed Property for Fiscal
Year 2019-2020 shall be determined pursuant to Table 1 below.
TABLE 1
ASSIGNED SPECIAL TAX FOR DEVELOPED PROPERTY
Assigned
Special Tax
Taxable Building Square Per Taxable
Land Use Categog Unit Footage Unit
1. Single Family Residential Property RU Less than 2,500 sal. ft $2,567
2. Single Family Residential Property RU
2,500 sq. ft to 2,800 sq. ft $2,708
3. Single Family Residential Property RU
2,801 sq. ft to 3,100 sq. ft $2,779
4. Single Family Residential Property_RU
Greater than 3,100 sq. ft $2,892
5. Multifamily Property Acre
N/A $9,997
6. Non -Residential Property Acre
N/A $9,997
On each July 1, commencing July 1, 2020, the Assigned Special Tax rate for Developed
Property shall be increased by one percent (1.00%) of the amount in effect in the prior Fiscal
Year.
b. Mulfiple Land Use Categories
In some instances an Assessor's Parcel of Developed Property may contain more than one
Land Use Type. The Maximum Special Tax levied on an Assessor's Parcel shall be the sum of
the Maximum Special Tax for all Land Use Categories located on the Assessor's Parcel. The
CFD Administrator's allocation to each type of property shall be final.
c. Backus Special Tax
The Backup Special Tax for an Assessor's Parcel within a Final Map classified or to be
classified as Single Family Property shall be $2,739 per unit. This Backup Special Tax has
been established based on the land use configurations shown on the Final Map. In the event
any portion of the Final Map is changed or modified, the Backup Special Tax for all
Assessor's Parcels within such changed or modified area shall be $9,997 per Acre.
In the event any superseding Final Map is recorded as a Final Map within the Boundaries of
the CFD, the Backup Special Tax for all Assessor's Parcels within such Final Map shall be
$9,997 per Acre.
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The Backup Special Tax shall not apply to Multifamily Residential Property, or Non -
Residential Property.
On each July 1, commencing July 1, 2020, the Backup Special Tax rate shall be increased by
one percent (1.00%) of the amount in effect in the prior Fiscal Year.
2. Approved Property
The Maximum Special Tax for each Assessor's Parcel of Approved Property expected to be
classified as Single Family Property shall be the Backup Special Tax computed pursuant to
Section D.Lc above.
The Maximum Special Tax for each Assessor's Parcel of Approved Property expected to be
classified as Multifamily Residential Property or Non -Residential Property shall be $9,997 per
Acre.
On each July 1, commencing July 1, 2020, the Maximum Special Tax rate for Approved
Property shall be increased by one percent (1.00%) of the amount in effect in the prior Fiscal
Year.
3. Undeveloped Property and Provisional Undeveloped Propem that is not Exempt'
Properry pursuant to the provisions of Section F
The Maximum Special Tax for each Assessor's Parcel of Undeveloped Property and
Provisional Undeveloped Property that is not Exempt Property shall be equal to the product of
$9,997 multiplied by the Acreage of such Assessor's Parcel.
On each July 1, commencing July 1, 2020, the Maximum Special Tax rate for Undeveloped
and Provisional Undeveloped Property shall be increased by one percent (1.00%) of the
amount in effect in the prior Fiscal Year.
E. METHOD OF APPORTIONMENT OF THE SPECIAL TAX
Commencing Fiscal Year 2019-2020 and for each subsequent Fiscal Year, the City Council
shall levy Special Taxes on all Taxable Property in accordance with the following steps:
Step One: The Special Tax shall be levied Proportionately on each Assessor's Parcel of
Developed Property at up to 100% of the applicable Assigned Special Tax rates in
Table 1 to satisfy the Special Tax Requirement.
Step Two: If additional moneys 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 Approved Property at up to 100% of the Maximum
Special Tax applicable to each such Assessor's Parcel as needed to satisfy the
Special Tax Requirement.
Step Three: If additional moneys are needed to satisfy the Special Tax Requirement after the
first two steps have been completed, the Annual Special Tax shall be levied
Proportionately on each Assessor's Parcel of Undeveloped Property up to 100%
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of the Maximum Special Tax applicable to each such Assessor's Parcel as needed
to satisfy the Special Tax Requirement.
Step Four: If additional moneys are needed to satisfy the Special Tax Requirement after the
first three steps have been completed, then the Special Tax on each Assessor's
Parcel of Developed Property whose Maximum Special Tax is the Backup Special
Tax shall be increased Proportionately from the Assigned Special Tax up to 100%
of the Backup Special Tax as needed to satisfy the Special Tax Requirement.
Step Five: If additional moneys are needed to satisfy the Special Tax Requirement after the
first four steps have been completed, the Special Tax shall be levied
Proportionately on each Assessor's Parcel of Provisional Undeveloped Property
up to 100% of the Maximum Special Tax applicable to each such Assessor's
Parcel as needed to satisfy the Special Tax Requirement.
Notwithstanding the above, under no circumstances will the Special Taxes levied in any Fiscal
Year against any Assessor's Parcel of Residential Property as a result of a delinquency in the
payment of the Special Tax applicable to any other Assessor's Parcel be increased by more than
ten percent (10%) above the amount that would have been levied in that Fiscal Year had there
never been any such delinquency or default.
F. EXEMPTIONS
The City shall classify as Exempt Property, in the following order of priority, (i) Assessor's
Parcels which are owned by, irrevocably offered for dedication, encumbered by or restricted in
use by the State of California, Federal or other local governments, including school districts, (ii)
Assessor's Parcels which are used as places of worship and are exempt from ad valorem
property taxes because they are owned by a religious organization, (iii) Assessor's Parcels which
are owned by, irrevocably offered for dedication, encumbered by or restricted in use by a
homeowners' association, (iv) Assessor's Parcels with public or utility easements making
impractical their utilization for other than the purposes set forth in the easement, (v) Assessor's
Parcels which are privately owned and are encumbered by or restricted solely for public uses, or
(vi) Assessor's Parcels restricted to other types of public uses determined by the City Council,
provided that no such classification would reduce the sum of all Taxable Property to less than
22.53 Acres.
Notwithstanding the above, the City Council shall not classify an Assessor's Parcel as Exempt
Property if such classification would reduce the sum of all Taxable Property to less than 22.53
Acres. Assessor's Parcels which cannot be classified as Exempt Property because such
classification would reduce the Acreage of all Taxable Property to less than 22.53 Acres will be
classified as Provisional Undeveloped Property, and will be subject to Special Tax pursuant to
Step Five in Section E.
G. PREPAYMENT OF SPECIAL TAX
The following additional definitions apply to this Section G:
"CFD Public Facilities" means $2,300,000 expressed in 2019 dollars, which shall increase by
the Construction Inflation Index on July 1, 2020, and on each July 1 thereafter, or such lower
amount (i) determined by the City Council as sufficient to provide the public facilities under the
authorized bonding program for CFD No. 2018-2, or (ii) determined by the City Council
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concurrently with a covenant that it will not issue any more Bonds to be supported by Special
Tax levied under this Rate and Method of Apportionment.
"Construction Fund" means an account specifically identified in the Indenture or functionally
equivalent to hold funds, which are currently available for expenditure to acquire or construct
public facilities eligible under CFD No. 2018-2.
"Construction Inflation Index" means the annual percentage change in the Engineering News -
Record Building Cost Index for the city of Los Angeles, measured as of the Calendar Year which
ends in the previous Fiscal Year. In the event this index ceases to be published, the Construction
Inflation Index shall be another index as determined by the City that is reasonably comparable to
the Engineering News -Record Building Cost Index for the city of Los Angeles.
"Future Facilities Costs" means the CFD Public Facilities minus public facility costs available
to be funded through existing construction or escrow accounts or funded by the Outstanding
Bonds, and minus public facility costs funded by interest earnings on the Construction Fund
actually earned prior to the date of prepayment.
"Outstanding Bonds" means all previously issued Bonds issued and secured by the levy of
Special Tax 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 Special Tax.
1. Prepayment in Full
The Maximum Special Tax obligation may be prepaid and permanently satisfied for (i)''
Assessor's Parcels of Developed Property, (ii) Assessor's Parcels of Approved Property or
Undeveloped Property for which a Building Permit has been issued, (iii) Approved or
Undeveloped Property for which a Building Permit has not been issued, and (iv) Assessor's
Parcels of Public Property or Property Owner's Association Property that are not Exempt
Property pursuant to Section F. The Maximum Special Tax obligation applicable to an
Assessor's Parcel may be fully prepaid and the obligation to pay the Special Tax for such
Assessor's Parcel permanently satisfied as described herein; provided that a prepayment may be
made 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
Special Tax obligation for such Assessor's Parcel shall provide the CFD Administrator with
written notice of intent to prepay, and within 5 business days of receipt of such notice, the CFD
Administrator shall notify such owner of the amount of the non-refundable deposit determined to
cover the cost to be incurred by the CFD in calculating the Prepayment Amount (as defined
below) for the Assessor's Parcel. Within 15 days of receipt of such non-refundable deposit, the
CFD Administrator shall notify such owner of the Prepayment Amount for the Assessor's Parcel.
Prepayment must be made not less than 60 days prior to the redemption date for any Bonds to be
redeemed with the proceeds of such prepaid Special Taxes.
The Prepayment Amount (defined below) shall be calculated as follows (capitalized terms are
defined below):
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The Prepayment Amount shall be determined as of the proposed prepayment date as follows:
Confirm that no Special Tax delinquencies apply to such Assessor's Parcel.
2. For an Assessor's Parcel of Developed Property, compute the Maximum Special Tax
for the Assessor's Parcel. For an Assessor's Parcel of Approved Property or Undeveloped
Property for which a Building Permit has been issued, compute the Maximum Special Tax
for the Assessor's Parcel as though it was already designated as Developed Property, based
upon the Building Permit which has been issued for the Assessor's Parcel. For an Assessor's
Parcel of Approved Property or Undeveloped Property for which a Building Permit has not
been issued, Public Property or Property Owner's Association Property to be prepaid,
compute the Maximum Special Tax for the Assessor's Parcel.
3. Divide the Maximum Special Tax derived pursuant to paragraph 2 by the total amount
of Special Taxes that could be levied at the Maximum Special Tax at build out of all
Assessor's Parcels of Taxable Property based on the applicable Maximum Special Tax for
Assessor's Parcels of Developed Property not including any Assessor's Parcels for which the
Special Tax obligation has been previously prepaid.
4. Multiply the quotient derived pursuant to paragraph 3 by the principal amount of the
Outstanding Bonds to determine the amount of Outstanding Bonds to be redeemed with the
Prepayment Amount (the "Bond Redemption Amount").
5. Multiply the Bond Redemption Amount by the applicable redemption premium, if any,
on the Outstanding Bonds to be redeemed (the "Redemption Premium").
6. Determine the Future Facilities Costs.
7. Multiply the quotient derived pursuant to paragraph 3 by the amount determined
pursuant to paragraph 6 to determine the amount of Future Facilities Costs for the Assessor's
Parcel (the "Future Facilities Amount").
8. Determine the amount needed to pay interest on the Bond Redemption Amount from
the first bond interest and/or principal payment date following the current Fiscal Year until
the earliest redemption date for the Outstanding Bonds on which Bonds can be redeemed
from Special Tax prepayments.
9. Determine the Special Taxes levied on the Assessor's Parcel in the current Fiscal Year
which have not yet been paid.
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Bond Redemption Amount
plus
Redemption Premium
plus
Future Facilities Amount
plus
Defeasance Amount
plus
Administrative Fees and Expenses
less
Reserve Fund Credit
Equals:
Prepayment Amount
The Prepayment Amount shall be determined as of the proposed prepayment date as follows:
Confirm that no Special Tax delinquencies apply to such Assessor's Parcel.
2. For an Assessor's Parcel of Developed Property, compute the Maximum Special Tax
for the Assessor's Parcel. For an Assessor's Parcel of Approved Property or Undeveloped
Property for which a Building Permit has been issued, compute the Maximum Special Tax
for the Assessor's Parcel as though it was already designated as Developed Property, based
upon the Building Permit which has been issued for the Assessor's Parcel. For an Assessor's
Parcel of Approved Property or Undeveloped Property for which a Building Permit has not
been issued, Public Property or Property Owner's Association Property to be prepaid,
compute the Maximum Special Tax for the Assessor's Parcel.
3. Divide the Maximum Special Tax derived pursuant to paragraph 2 by the total amount
of Special Taxes that could be levied at the Maximum Special Tax at build out of all
Assessor's Parcels of Taxable Property based on the applicable Maximum Special Tax for
Assessor's Parcels of Developed Property not including any Assessor's Parcels for which the
Special Tax obligation has been previously prepaid.
4. Multiply the quotient derived pursuant to paragraph 3 by the principal amount of the
Outstanding Bonds to determine the amount of Outstanding Bonds to be redeemed with the
Prepayment Amount (the "Bond Redemption Amount").
5. Multiply the Bond Redemption Amount by the applicable redemption premium, if any,
on the Outstanding Bonds to be redeemed (the "Redemption Premium").
6. Determine the Future Facilities Costs.
7. Multiply the quotient derived pursuant to paragraph 3 by the amount determined
pursuant to paragraph 6 to determine the amount of Future Facilities Costs for the Assessor's
Parcel (the "Future Facilities Amount").
8. Determine the amount needed to pay interest on the Bond Redemption Amount from
the first bond interest and/or principal payment date following the current Fiscal Year until
the earliest redemption date for the Outstanding Bonds on which Bonds can be redeemed
from Special Tax prepayments.
9. Determine the Special Taxes levied on the Assessor's Parcel in the current Fiscal Year
which have not yet been paid.
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10. Determine the amount the CFD Administrator reasonably expects to derive from the
investment of the Bond Redemption Amount and the Redemption Premium from the date of
prepayment until the redemption date for the Outstanding Bonds to be redeemed with the
Prepayment Amount.
11. Add the amounts derived pursuant to paragraphs 8 and 9 and subtract the amount
derived pursuant to paragraph 10 (the "Defeasance Amount").
12. Verify the administrative fees and expenses of the CFD, including the cost of
computation of the Prepayment Amount, the cost to invest the Prepayment Amount, the cost
of redeeming the Outstanding Bonds, and the cost of recording notices to evidence the
prepayment of the Maximum Special Tax obligation for the Assessor's Parcel and the
redemption of Outstanding Bonds (the "Administrative Fees and Expenses").
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 erect
after the redemption of Outstanding Bonds as a result of the prepayment from the balance in
the reserve fund on the prepayment date, but in no event shall such amount be less than zero.
14. The Prepayment Amount is equal to the sum of the Bond Redemption Amount, the
Redemption Premium, the Future Facilities Amount, the Defeasance Amount and the
Administrative Fees and Expenses, less the Reserve Fund Credit.
15. From the Prepayment Amount, the Bond Redemption Amount, the Redemption
Premium, and Defeasance Amount shall be deposited into the appropriate fund as established
under the Indenture and be used to redeem Outstanding Bonds or make debt service
payments. The Future Facilities Amount shall be deposited into the Construction Fund. The
Administrative Fees and Expenses shall be retained by the CFD.
The Prepayment Amount may be sufficient to redeem other than a $5,000 increment of Bonds.
In such event, the increment above $5,000 or an integral multiple thereof will be retained in the
appropriate fund established under the Indenture to be used with the next redemption from other
Special Tax prepayments of Outstanding Bonds or to make debt service payments.
As a result of the payment of the current Fiscal Year's Special Tax levy as determined pursuant
to paragraph 9 above, the CFD Administrator shall remove the current Fiscal Year's Special Tax
levy for the Assessor's Parcel from the County tax roll. With respect to any Assessor's Parcel for
which the Maximum Special Tax obligation is prepaid, the City Council shall cause a suitable
notice to be recorded in compliance with the Act, to indicate the prepayment of Maximum
Special Tax obligation and the release of the Special Tax lien for the Assessor's Parcel, and the
obligation to pay the Special Tax for such Assessor's Parcel shall cease.
Notwithstanding the foregoing, no Special Tax prepayment shall be allowed unless the amount
of Maximum Special Tax that may be levied on all Assessor's Parcels of Taxable Property after
the proposed prepayment will be at least 1.1 times maximum annual debt service on the Bonds
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that will remain outstanding after the prepayment plus the estimated annual Administrative
Expenses.
Tenders of Bonds in prepayment of the Maximum Special Tax obligation may be accepted upon
the terms and conditions established by the City 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
City Council.
2. Prepayment in Part
The Maximum Special Tax obligation for an Assessor's Parcel of Developed Property,
Approved Property or Undeveloped Property may be partially prepaid. For purposes of
determining the partial prepayment amount, the provisions of Section G.1 shall be modified as
provided by the following formula:
PP = ((PE —A) x F) +A
These terms have the following meaning:
PP = Partial Prepayment Amount
PE = the Prepayment Amount calculated according to Section G.1
F = the percent by which the owner of the Assessor's Parcel(s) is partially
prepaying the Maximum Special Tax obligation
A = the Administrative Fees and Expenses determined pursuant to Section G.1
The owner of an Assessor's Parcel who desires to partially prepay the Maximum Special Tax
obligation for the Assessor's Parcel shall notify the CFD Administrator of (i) such owner's intent
to partially prepay the Maximum Special Tax obligation, (ii) the percentage of the Maximum
Special Tax obligation such owner wishes to prepay, and (iii) the company or agency that will be
acting as the escrow agent, if any. Within 5 days of receipt of such notice, the CFD
Administrator shall notify such property owner of the amount of the non-refundable deposit
determined to cover the cost to be incurred by the CFD in calculating the amount of a partial
prepayment. Within 15 business days of receipt of such non-refundable deposit, the CFD
Administrator shall notify such owner of the amount of the Partial Prepayment Amount for the
Assessor's Parcel. A Partial Prepayment Amount must be made not less than 60 days prior to the
redemption date for the Outstanding Bonds to be redeemed with the proceeds of the Partial
Prepayment Amount.
With respect to any Assessor's Parcel for which the Maximum Special Tax obligation is partially
prepaid, the CFD Administrator shall (i) distribute the Partial Prepayment Amount as provided in
Paragraph 15 of Section G.1, and (ii) indicate in the records of the CFD that there has been a
Partial Prepayment Amount for the Assessor's Parcel and that a portion of the Special Tax
obligation equal to the remaining percentage (1.00 - F) of Special Tax obligation will continue
on the Assessor's Parcel pursuant to Section E.
H. TERMINATION OF SPECIAL TAX
For each Fiscal Year that any Bonds are outstanding the Special Tax shall be levied on all
Assessor's Parcels subject to the Special Tax. The Special Tax shall cease not later than
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the 2059-2060 Fiscal Year, however, Special Tax will cease to be levied in an earlier
Fiscal Year if the CFD Administrator has determined (i) that all the required interest and
principal payments on the CFD No. 2018-2 Bonds have been paid; (ii) all authorized
facilities of CFD No. 2018-2 have been acquired and all reimbursements to the developer
have been paid, (iii) no delinquent Special Tax remain uncollected and (iv) all other
obligations of CFD No. 2018-2 have been satisfied.
I. MANNER OF COLLECTION
The 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. 2018-2 may collect Special Tax 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 delinquent Assessor's Parcels as permitted
by the Act.
J. APPEALS OF SPECIAL TAXES
Any taxpayer may file a written appeal of the Special Taxes on his/her Assessor's Parcel(s) with
the CFD Administrator, provided that the appellant is current in his/her payments of Special
Taxes. During pendency of an appeal, all Special Taxes previously levied must be paid on or
before the payment date established when the levy was made. The appeal must specify the,
reasons why the appellant claims the Special Tax is in error. The CFD Administrator shall'
review the appeal, meet with the appellant if the CFD Administrator deems necessary, and advise',
the appellant of its determination. If the CFD Administrator agrees with the appellant, the CFD
Administrator shall grant a credit to eliminate or reduce future Special Taxes on the appellant's
Assessor's Parcel(s). No refunds of previously paid Special Taxes shall be made.
The CFD Administrator shall interpret this Rate and Method of Apportionment and make
determinations relative to the annual levy and administration of the Special Taxes and any
taxpayer who appeals, as herein specified.
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