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HomeMy WebLinkAbout5/2/2018 - STAFF REPORTS - 5C �OFFpLMS. O V N • x R �C 97 k �•09ATEa T c441FOR��P City Council Staff Report Date: May 2, 2018 NEW BUSINESS Subject: CONSIDERATION OF SCIP PUBLIC FINANCING FOR THE RESIDENTIAL DEVELOPMENT PROJECTS KNOWN AS CANYON VIEW AND VIBE From: David H. Ready, City Manager Initiated by: Marcus L. Fuller, Assistant City Manager SUMMARY This item allows the City Council to consider a request to allow public financing through the Statewide Community Infrastructure Program ("SCIP") for certain public improvements and development impact fees associated with two previously approved residential developments identified as the "Canyon View" (Vesting Tentative Tract No 36969), and "Vibe" (Tentative Tract No. 36689) projects. RECOMMENDATION: Provide direction to staff as appropriate. BACKGROUND: The City Council last adopted a policy regarding public financing for new development projects in 2002. The 2002 policy implemented certain requirements for the City's establishment of an Assessment District or Mello-Roos Community Facilities District, (a "Special District"), for development projects. Generally, the requirements stated were: • Public facilities to be financed must provide major infrastructure improvements that significantly benefit the general public; • Development project must have significant financial benefit to the City; • $2,000,000 minimum financing amount; • The development must have a property value to lien ratio of at least 4:1 after considering the value of the financed public improvements and considering any prior or pending special taxes • The maximum amount of special taxes to be levied, together with general property taxes and any other special taxes or assessments cannot exceed 2% rmm NO. � � City Council Staff Report May 2, 2018- Page 2 SCIP Funding Request— Canyon View/Vibe Projects A copy of the City's policy adopted in 2002 is included as Attachment 1. The City last formed a Special District to finance public improvements and development impact fees for a residential project on December 1, 2004, when the City Council established Assessment District No. 164 for the Mountain Gate II development. On November 2, 2005, the City subsequently established Community Facilities District ("CFD") 2005-1 for public safety services as a requirement for approval of all new residential projects located on "fee" land. Similarly, on November 7, 2007, the City established CFD 2007-1 for public safety services as a requirement for approval of all new residential projects located on allotted and leased Tribal land. The maximum tax rate that can be levied by the City for public safety services via CFD 2005-1 or 2007-1 is $500 annually per property. The current tax levy is $425. On October 1, 2014, the City Council adopted Resolution No. 23671 authorizing the City to join the Statewide Community Infrastructure Program ("SCIP"), and to accept applications from property owners, conduct special assessment proceedings, and levy assessments within the City. The SCIP is coordinated by the California Statewide Communities Development Authority ("CSCDA"), a joint powers authority sponsored by the League of California cities and the California State Association of Counties. The SCIP was instituted by CSCDA in 2002 to allow private property owners in participating cities and counties to finance the construction of public improvements or payment of development impact fees as a special assessment to be levied on the property tax roll. A private property owner developing a project in a participating agency has the ability to request approval from that agency to pay for public improvements and development impact fees through the SCIP, which is financed by the issuance of tax- exempt bonds by the CSCDA. Subsequently, in those cases, CSCDA will impose a special assessment on the property owner's tax bill to repay the portion of the bonds issued to finance the cost of the public improvements and/or development impact fees. In its action from 2014, the City Council authorized the City to be a participating agency in the SCIP through CSCDA. The SCIP is an alternative public financing tool to a Special District formed and approved by the City Council for a specific property. The advantage of the SCIP is that the City avoids all of the administration responsibility in establishing a Special District, and avoids the liability for the tax-exempt bonds used to finance the public improvements or development impact fees through that Special District. CSCDA assumes all responsibility and liability for the tax-exempt bonds and annual debt payments levied on the tax roll. A copy of the October 1, 2014, staff report and Resolution No. 23671 is included as Attachment 2. Since the City Council's authorizing actions taken in 2014, only one commercial project — the Arrive Hotel — has taken advantage of the SCIP. In that case, certain public improvements (utility undergrounding, water lines, and street improvements) and 002 City Council Staff Report May 2, 2018 - Page 3 SCIP Funding Request—Canyon View/Vibe Projects development impact fees (sewer connection and storm drainage fees) were financed through the SCIP. A general discussion of public financing of residential projects previously occurred in January and March 2017. At that time, the City Council requested additional information regarding the SCIP, whether it has been used for residential projects, and how the financing is beneficial to developers in reducing the cost of housing units sold. According to the City's Financial Advisor, Suzanne Harrell, the California Debt and Investment Advisory Commission ("CDIAC") is provided with data on every bond issued, and information was retrieved from 2009 to February 2018, the latest available public financing issuances for commercial and residential projects (excluding homeowner solar panel financings through the HERO program), as shown in the following summary: Year Special Tax CUD") Special Assessment District 2009/10 51 16 2010/11 21 14 2011/12 34 9 2012/13 36 14 2013/14 50 17 2014/15 49 18 2015/16 173 33 2016/17 129 35 2017/18 101 41 Total 644 167 Of the CFD Bonds issued since FY 2015/16, approximately two-thirds, or 266, were issued to refinance outstanding bond issues. Of the Assessment District Bonds issued since FY 2015/16, approximately 35%, or 40, were issued to refinance outstanding bond issues. Regarding the SCIP, staff has determined that the City of Palm Springs is the only City within the Coachella Valley that has taken action to participate in the SCIP, with only one other agency (the Coachella Valley Water District) participating as well. Statewide, there are only 70 public agencies participating in the SCIP; as of July 2011, there were 482 incorporated cities and 58 counties within the state of California for a total of 540 public agencies. Staff has also determined that since 2011, the following 19 cities and 4 counties have used the SCIP for residential projects: Brentwood Placer County Chula Vista Rocklin El Dorado Rohnert Park Elk Grove Roseville Fairfield Sacramento 003 City Council Staff Report May 2, 2018 - Page 4 SCIP Funding Request— Canyon View!Vibe Projects Folsom Sacramento County Gardena San Diego Hercules San Juan Bautista Lincoln Santa Rosa Manteca Sonoma County Murrieta West Sacramento Oakley However, since July 2015, 26 cities and school districts within Riverside County have utilized traditional Community Facilities Districts ("CFDs") or Assessment Districts outside of the SCIP administered by the state, to primarily allow for financing of public school fees. Of the 171 bonds issued in Riverside County since July 2015, 123 were issued to refinance existing bonds and 48 were issued for new facilities and fees. Recently, the City received a request from Rhonda Neely, Vice President of Summit Land Partners, the "Developer" of the "Canyon View' residential project located on E. Palm Canyon Dr. at Matthew Dr., to allow the Developer to pursue public financing through the SCIP to pay for certain public improvements and development impact fees associated with Vesting Tentative Tract No 36969. The City has received a similar request from Armada Real Estate Group, LLC, the "Developer" of the "Vibe" residential project located at Tahquitz Canyon Way and Farrell Drive (now under construction), to allow that developer to pursue public financing through the SCIP to pay for certain development impact fees associated with Tentative Tract No 36689. STAFF ANALYSIS: "Canyon View"(Tract No. 36969) The "Canyon View" project is a proposed subdivision of 80 single family homes located on the south side of E. Palm Canyon Drive at Matthew Drive, as shown the aerial view (Figure 1) and conceptual plan (Figure 2) on the next page. 004 City Council Staff Report May 2. 2018 - Page 5 SCIP Funding Request— Canyon View/ Vibe Projects 4 - b E • 04 x - •i e ` rid F 1 •' y�•q y... y '�"� � "�-/� �.�1C11 :L... Figure 1 — "Canyon View" Aerial View . k �W. yF.� y��� •M CA.yygy DAV( I L-* L - • : I MAMEW NM ' T Figure 2 — "Canyon View" Conceptual Plan City Council Staff Report May 2, 2018- Page 6 SCIP Funding Request—Canyon View/Vibe Projects On July 5, 2017, the City Council approved the Canyon View project, and agreed to defer the obligation to construct off-site street improvements (widening of E. Palm Canyon Drive, a landscaped median in E. Palm Canyon Drive, and overhead utility undergrounding along E. Palm Canyon Drive). These deferred obligations will become obligations of the future property owners within the Canyon View project. On February 13, 2018, the Developer of Canyon View submitted a formal request for the City's approval to allow public financing of the Canyon View project; a copy of the Developer's request is included as Attachment 3. As outlined in the letter, the Developer intends to finance the following: 1. City Building Impact Fees (i.e. sewer fees, park fees, drainage fees) in the amount of $938,853 2. Desert Water Agency Fees in the amount of$976,080 3. Public Improvements related to E. Palm Canyon Drive, Matthew Drive, and Linden Way in the amount of$375,081 4. Desert Water Agency water line improvements in the amount of $428,409 The total fees and improvements in the Developer's funding request total $2,718,423. The City's Financial Advisor, Suzanne Harrell, has reviewed the request in accordance with the City's established public financing policy — with a need to maintain not more than 2% effective property tax rate. As shown in the financial analysis, it will be required to reduce the amount to be financed by $173,000 to ensure the overall property tax rate remains at not more than 2% pursuant to the City's policy. The net funding is shown below: Fees: Sewer $ 274,800 Drainage 103,653 Park 560,400 Parking - Water Fees (DWA) 976,080 Subtotal $1,914,933 Improvements: Street $ 375,081 Offsite - Water 428,409 Reduction to Reduce Tax Rate* (173,000) Subtotal $ 630,490 Total $2,545,423 „ v City Council Staff Report May 2, 2018 - Page 7 SCIP Funding Request—Canyon View/Vibe Projects Relevant in the financial review is the matter of the deferred improvements (E. Palm Canyon Drive median and widening, and overhead utility undergrounding) — which is estimated by the Developer at $2,387,273. The Council's prior approval to defer these improvements to an indefinite time in the future implies that the City may determine these improvements are warranted at some future date, and require those property owners to finance the cost. This imposes a need to consider establishing a separate City CFD (the "Overlay CFD") now to allow the City to finance on behalf of the future property owners the cost of these deferred improvements that would be constructed at some future point in time. Absent establishing the Overlay CFD or alternatively suitable financing mechanism now, it will not be possible to ensure that the City will have an adequate ability to fully fund construction of the deferred improvements. The project is also required to annex into the City's public safety CFD, which would add another layer of taxing authority over the new single family homes in the Canyon View project. Since the City's sewer fee is also collected on the tax bill, although not a property tax, it is taken into account in the property tax rate analysis. The estimated property tax rates resulting from the public financing, inclusive of the Overlay CFD for deferred public improvements and the City's public safety CFD, is shown below. Ad Valorem Ad Valorem Public Sewer Other Proposed Phase SCIP CFO Total Tax with Size(SFJ Price Tax Rate Tax Safety CFD Fees Fixed SCIP Total Tax Tax Rate Overlay Overlay Tax Rate Smallest 2,132 635,000 1,25176% 7,949 425 240 23 2,538 11,174 1.76% 1,526 12,700 2.00% Largest 2,634 785,000 1.25176% 9,826 425 240 23 2,538 13,052 1,66% 2,686 15,738 2.00% Can Levied Fixed Can be levied Increase to on Tax Amount for to pay for $500 Bill 30'rears; Deferred Includes Improvements annual Escalates 2% admin Annually Based on 2019 Cost The resulting property tax rate is at the maximum allowed of 2%. The Overlay CFD, using these tax rates, is sufficient to fund the deferred improvements today. The City's Financial Advisor has advised that the recommended Overlay CFD for the deferred public improvements at these tax rates (which increase annually by 2%) may not generate the required revenue if the capital costs were not financed until some future date. For example, if the City were to "call the covenant" and trigger construction of the deferred improvements in 10 years, the currently estimated total cost of $2,387,273 will have escalated over time and bond interest rates will have increased. If the costs escalate by an estimated 4% per year for 10 years, the costs will have increased to $3.4 million by 2028. Assuming the bond interest rate increased to 7% from the current 4.5%, the special taxes levied in the Overlay CFD would only generate $2.3 million if bonds were issued in 2029. This would leave a shortfall of $1.1 million for the deferred improvements. 007 City Council Staff Report May 2, 2018- Page 8 SCIP Funding Request—Canyon View!Vibe Projects Alternatively, if the City were to start collecting the tax immediately and accumulating the tax for the future improvements, the City would have collected approximately $1.7 million in taxes over 10 years toward the $3.4 million escalated costs in the year 10 example. Then the bonds issued in year 10 would raise almost all of the required funding. Another important point to consider is that if the City establishes the Overlay CFD for the deferred improvements and commences to collect the taxes to ultimately finance the cost of the deferred improvements, but the City chooses not to construct the deferred improvements, the City will be required to reimburse all of the property owners the taxes paid. Even if no Overlay CFD is established, it is not really practical to try to collect the cost of the deferred improvements from homeowners 10 years from now. As it stands, the deferred improvements are approximately $30,000 per home in today's dollars, and at a 4% cost escalation, would be $42,000 per home in 10 years. Therefore, the recommendation is to allow the deferred improvements to be financed up front together with the fees and other improvements and constructed now. Otherwise, there will be no guaranty that funding for the deferred improvements would be available or sufficient. "Vibe}"(Tract No. 36689) The "Vibe" project is a proposed subdivision of 72 single family homes and 91 condominium units located on the south side of Tahquitz Canyon Way, east of Farrell Drive, as shown the aerial view (Figure 3) and conceptual plan (Figure 4). W _ Yi R,p a+R.jifi� 1 t ■■ �' ttr yy •' •+.a•?`_,yip. � � t► • ;�tt.9° , + 0. eLt,^w.�,i, 'JF ++,,.A}i Lt�1*w� ,j •I'"' "'�'r YII' Ibi Olt POLO u `ix+•ajR t•Ry+.• Rf R ♦.a. • • ,•w':� R a•.' t I�MYaI:. • • i •,, Figure 3 — "Vibe" Aerial View City Council Staff Report May 2, 2018- Page 9 SCIP Funding Request—Canyon View!Vibe Projects TM KM CANYON WAY-. .. ., LEGEND ucwn DOG PARK 1 � � J IIIII ' POOL I , J f ®.t n (lillj g - e / • � - i =f' I 111 l • DOG PARK 2 BAWTo ROAD COMMUNn PAR, WMPPEn VE PLAZA Figure 4 — "Vibe" Conceptual Plan The Developer of the Vibe project intends to finance the following City Building Impact Fees: • Sewer - $489,000 • Drainage - $241,248 • Park - $567,240 The Developer is requesting public financing in the amount of $1,297,488 through an Assessment District formed by CSCDA through the SCIP. The City's Financial Advisor, Suzanne Harrell, has reviewed the request in accordance with the City's established public financing policy — with a need to maintain not more than 2% effective property tax rate. As shown in the financial analysis on the next page, the proposed public financing results in effective total tax rates of 1.5% which is less than the maximum 2% pursuant to the City's policy. 009 City Council Staff Report May 2, 2018- Page 10 SCIP Funding Request—Canyon View/Vibe Projects VIBE Ad Ad Public Sewer Other Valorem Valorem Safety Fixed Proposed Total Tax Size (SF; Price Tax Rate Tax CFD Fees Fees SCIP Tax Rate Avg SFR 2,609 715,347 1.25176% 8,954 425 240 23 790 10,432 1.46% Avg Cluste 1,902 520,330 1.25176% 6,513 425 240 23 790 7,991 1.54% Can Levied Fixed Increase on Tax Amount for to$500 Bill 30 Years; includes annual admin Recommendation The request for public financing for the Canyon View project requires further consideration in light of the future cost and financing of the deferred improvements. The City's Financial Advisor has reviewed the City's standard form covenant agreement, and advises that it may be impractical to enforce on a large subdivision once the subdivision has converted into individual home ownership. These covenant agreements are historically used on individual lots to defer street improvements or undergrounding of utilities for individual, single family home construction. Staff is aware of only one instance where a covenant was used to defer utility undergrounding for a subdivision (the "Pedregal" project on N. Palm Canyon Dr. at Tram Way); however, that project was not constructed. The Council previously agreed to defer certain street improvements and utility undergrounding along E. Palm Canyon Drive for the Canyon View project. Deferral imposes on staff a need to ensure if these improvements are required in the future, the City has the legal ability and financial capacity to ensure the total cost is paid by the future homeowners. Therefore, if the City Council wants a guarantee there is sufficient funding for the deferred improvements, the only way to achieve that is to require the deferred improvements to be financed upfront at today's costs and bond interest rates. Otherwise, if the City determines that the deferred improvements are necessary in the future, there could be a short fall in available funding from a CFD formed today based on a 2% tax rate of current home prices. Approval of public financing for the Canyon View project inclusive of the deferred improvements will establish tax rates at the maximum tax rate of 2%. The request for public financing for the Vibe project is relatively straightforward, and is a policy decision of the Council. Resulting tax rates will be less than the maximum 2% allowed, but higher than the typical property tax rate of 1.3% or less. 010 City Council Staff Report May 2, 2018- Page 11 SCIP Funding Request—Canyon View/Vibe Projects In making a recommendation on these particular requests related to the Canyon View and Vibe projects, staff notes that the benefit of allowing public financing is the City's receipt of the total development impact fees for the project in a lump sum at the beginning of the project. The City receives development impact fees paid out incrementally over time with each individual building permit during build-out of the projects. Financing these fees generates a lump sum payment to the City of the total fees, meaning that in this case the City would receive a lump sum payment of park fees in the amount of $560,400 from Canyon View and $567,240 from Vibe for a total of $1,127,640 in new park fees. This revenue would immediately be made available as additional budget for the City's Downtown Park. Conversely, approval of the public financing would add additional property tax burdens to the residential buyers (see tables on Pages 7 and 10). If Council directs staff to proceed with public financing on the Canyon View project, subsequent Council actions will be required to adopt Resolutions authorizing the formation of a SCIP CFD and/or City CFD. If Council directs staff to proceed with public financing on the Vibe project, no further action by Council will be required, as the Council's prior action from 2014 authorized the City Manager to execute necessary agreements with CSCDA associated with formation of Assessment Districts through SCIP. ENVIRONMENTAL IMPACT: The requested City Council action is not a "Project" as defined by the California Environmental Quality Act (CEQA). Pursuant to Section 15378(a), a "Project" means the whole of an action, which has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment. The requested action is to consider authorizing public financing for payment of development impact fees, and is exempt from CEQA pursuant to Section 15378(b), in that a "Project" does not include: (5) Organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment. Oil City Council Staff Report May 2, 2018- Page 12 SCIP Funding Request—Canyon View/Vibe Projects FISCAL IMPACT: Approving the request for public financing associated with the "Canyon View" and "Vibe" projects will not result in any financing costs to the City. The CSCDA is responsible for administering, financing, and levying the special assessments. SUBMITTED Marcus L. Fuller, MP , P.E., P.L.S. David H. Ready, Assistant City Manager/City Engineer City Manager Attachment: 1. 2002 Policy on Public Financing of New Development Projects 2. October 1, 2014, staff report and Resolution 23671 3. "Canyon View' Project Request Letter 012 Attachment 1 013 i i I i i SPECIAL ASSESSMENT AND COMMUNITY FACILITY DISTRICT FINANCING PROGRAMS STATEMENT OF POLICIES AND PROCEDURES FOR NEW DEVELOPMENT PROJECTS I i i APRIL 2002 I I I i i I 014 _ ..--...- ._. - :i I. CITY OF PALM SPRINGS Special Assessment District and Community Facilities Financing Programs TABLE OF CONTENTS Section Page 1. Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1-2 2. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-3 3. General Policy Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3-4 4. Minimum Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-5 5. Special Districts Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 6. Eligible Public Facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-6 7. Value-to-Lien . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-7 8. Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7 9. Special Tax Formula . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-9 10. Terms and Conditions of Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9-10 11. District Cost Deposits and Reimbursements . . . . . . . . . . . . . . . . . . . L . . .10-12 12. Origination Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12 13. Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12-13 j14. Use of Consultants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13 15. Acquisition Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13-14 16. Disclosure to Purchasers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14 17. Property Owner Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14 18. Land Use Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14 19. Joint Financing Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15 20. Treatment of Delinquencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15 015 ......- - 21. Exceptions to These Policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15 22. Application Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15-16 i 23. Special Assessment District Formation Proceedings . . . . . . . . . . . . . . . . . .16-17 24. Mello-Roos Community Facilities District Formation Proceedings . . . . . . . . .17-19 25. Special Districts Flow Chart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20 26. Mello-Roos Flow Chart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21 27. Chart - Allowable Uses of Assessment Laws . . . . . . . . . . . . . . . . . . . . . . . . .22 28. District AppIication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22-25 i i 1 i ii oi � 1. BACKGROUND ` Since the City was incorporated in 1938 there have been over 150 assessment districts formed by property owners for various public improvements in Palm Springs. Typical improvements are for streets, sewers, storm drains, neighborhood street lighting, parkways maintenance or other improvements in the public right-of-way. Those types of property owner initiated projects will continue to occur as needs arise in neighborhood situations when the "petition" the City for the improvements. The first California legislature in 1850 authorized special assessments in the act providing for the incorporation of cities. The legislature authorized the paving of streets and the construction of sewers, making the cost thereof payable by the owners of fronting properties. The Assessment Acts since 1850 have been widely used and enhanced. The current enabling legislative Acts of 1911, 1913, 1915, 1972 and 1982 are the basis of current Assessments and Community Facilities Districts,with the expenses of the Districts being passed on to the benefiting properties. State law also provides funding sources for certain governmental operational and maintenance expenses. The most recent trend in private development techniques is for California developers to ,I approach governmental agencies and request financing assistance via Community Facilities Districts (C.F.D.'s). These are commonly called "Mello-Roos" districts. In 1982 Henry Mello and Mike Roos,two California Legislators,authored the Mello-Roos Community Facilities Act. This act was more or less a direct result of government financing shortfall problems that arose after the passage of Proposition 13(the Jarvis/Gann California Initiative that became law in 1978). The Proposition 13 property tax cuts and limits to future tax increases began to severely restrict local governments' ability to build infrastructure and public facilities. The following are examples of the types of improvements or funding allowable under Mello-Roos (C.F.D.'s): 0 Streets, sidewalks, Bridges etc. 0 Sewers, Storm Drains, Flood Control i 0 Traffic Signals, Street Lighting 0 Water, Electric, Gas Utilities 0 Parking Lots o Pedestrian Malls o Parks and Parkways o Recreation Facilities (Public) 0 Schools, Libraries o Transportation and related public improvements I �i I i 1 017 REASON FOR SPECIAL DISTRICTS POLICY `I The City has received requests from private developers who wish to form Mello-Roos C.F.D.'s in Palm Springs. When staff received the requests we contacted other cities/agencies in California to find out how others handled the process. We contacted some 24 municipalities or County agencies to obtain pro and con input and obtain copies of their written policies. Generally the agencies with the most experience established written policies to control the process and avoid financial losses. Note that those cities we contacted generally prefer to use Mello-Roos C.F.D.'s only on commercial/industrial projects because of the many property owner complaints they have received on past residential single family(subdivision)type districts. Residents don't like the term "Special Tax" on their annual tax rolls and there have been many problems with disclosure. This has generally not been a problem for high-end commercial/industrial projects. One of the first California public agencies to prepare a written policy and procedure on Mello-Roos and Acquisition Districts was the County of Riverside. Since then many other cities/agencies have adopted variations of the concepts originated by the County. In nearly all of the adopted policies we received from other agencies,the basic formats are similar to our proposed policy. 2. DEFINITIONS Unless the context otherwise requires, the terms employed in the following policies shall have the meaning specified below: "A.D." means Assessment District under the Improvement Acts of 1911, 1913 or 1915. j "Bonds"mean bonds authorized an issued under the Mello-Roos Community Facilities Act of 1982 or the Municipal Improvement Act of 1911 and the Improvement Bond Act of 1915. "C.F.D." means Community Facilities District under the Mello-Roos Community Facilities Act of 1982. "City" means the City of Palm Springs. "District" means a Community Facilities District formed under the Mello-Roos Community Facilities Act of 1982 or an Assessment District formed under the Improvement Act of 1911 or the Municipal Improvement Act of 1913. "Public Facilities" means improvements authorized to be constructed or acquired under j the Mello-Roos and Municipal Improvement Acts including, but not limited to, fees for capital facilities imposed by public agencies as a condition to approval of the development encompassed by the district or as a condition to service the district. "Value" or "Fair Market Value" means the amount of cash or its equivalent which property would bring if exposed for sale in the open market under conditions in which neither buyer nor seller could take advantage of a difficulty of the other and both have 2 018 knowledge of all of the uses and purposed to which the property is adapted and for which it is capable of being used and of the enforceable restrictions upon uses and purposes. 3. GENERAL POLICY STATEMENT The City does not wish to encourage assessment district or community facilities district financing but will consider its implementation in certain circumstances which are clearly beneficial to the City. Developer Initiated Districts: The City encourages the development of upscale commercial, mixed-use, and high wage producing industrial property. The City Council will consider the use of community facilities districts ("C.F.D.'s") or special benefit assessment districts ("Assessment Districts") to assist these types of development. Where, in the City Council's opinion the public facilities or other regional amenities of a residential development represents a significant public benefit, Assessment District financing may also be considered to assist such a residential development. Mello-Roos C.F.D.'s will not be permitted for residential development districts due to many current industry problems associated with single family ownerships in those districts. The City will, however, consider the use of 1913 and 1915 Act "Acquisition" districts for residential development type districts. Neighborhood Initiated Districts: Neighborhood assessment districts requested by existing property owners will continue to be processed on a case-by-case basis when the residents petition the City for the improvements. Those would be for typical street, sewer, storm drain and street lighting under the 1911, 1913 and 1915 Acts or Landscape and Lighting Maintenance under the 1972 Act. Those neighborhood districts will not be subject to up front fees or cash deposits associated with developer requested districts primarily addressed in this policy and procedure documenf. City Initiated Districts: Assessment Districts and Mello-Roos C.F.D.'s initiated by the City will not be governed by the development requirements addressed in the Special District Policy and Procedures. 4. MINIMUM REQUIREMENTS For a private development project to qualify for City-assisted financing via an Assessment District(1911, 1913,or 1915 Act)or Community Facilities District(Mello-Roos C.F.D.), the following minimum criteria is required: I. BENEFIT - That the proposed public facilities to be financed must meet a public need: i i 3 019 A. The proposed project shall provide major infrastructure improvements that significantly benefit the general public, and/or B. The project shall provide significant financial benefit to the City. The determination of benefit will be at the sole discretion of the City of Palm Springs. 2. QUALIFICATIONS AND FINANCIAL STATUS A. The proposed development project must be consistent with the City's General Plan and secure appropriate land use approvals from the City to allow for the implementation of the ultimate development of the area. B. The project must be reviewed and approved by the Special Districts Committee and the City's Financial Advisor must determine that the project is a sound investment for the City. C. Bond Sale Minimum - That the total proposed bond sale, including construction and all incidental costs, be at least $2,000,000 or greater for reasons of cost effectiveness. In special circumstances City Council may approve lesser bond amounts by formal action. 3. AGREEMENT - That the following elements have been properly completed: i A. Application - (Development Projects)- To be completed by developer. B. Petition- Signed by sufficient property owners. C. Boundary Map - Submitted by developer's engineer. D. Cash Deposit - Costs deposited up-front by developer to cover City and City consultant costs during the formation process. This would be ! sufficient to cover all City administrative costs prior to the Public Hearing and Bond Sale process. E. Agreement-Executed in a form satisfactory to the City and consistent with this policy and special district proceedings. 5. SPECIAL DISTRICTS COMMITTEE Special Districts committee will be established to review all proposed Assessment District and Communities Facilities Districts (Mello-Roos)projects. The committee shall consist of at least the following staff: City Manager Assistant City Manager Finance Director City Engineer Director of Planning & Building 4 020 Director of Economic Development City Attorney Resources Consultants to the City: Bond Counsel (May be City Attorney) .Assessment Engineer Special Tax Consultant (May be Assessment Engineer) Financial Advisor Appraiser Bond Underwriter Trustee/Paying Agent (Bank) Market Absorption Study Consultant 6. ELIGIBLE PUBLIC FACILITIES Facilities to be financed must be public facilities for which the City, or a public agency as determined appropriate by the City, will be the owner or will have normal operating and maintenance responsibility. The types of facilities eligible to be financed are: A. Streets, Roads and Infrastructure All public roads and facilities to be maintained by the City, including streets, curbs and gutters, sidewalks, sewers, storm drains, street lights, traffic signals and other public facilities within the City right-of-way B. Utilities and Drainage Facilities As permitted by law, provided they are located within an eligible road(as defined in "A") or within public right-of-way or easements, or otherwise provide significant public benefit. C. City and Regional Public Facilities As permitted under the Mello-Roos Community Facilities Act, such as parks, freeways, schools, libraries and fire stations. D. Development Fees City sewer connection fees, City/County drainage fees, CVAG/County Transportation Uniform Mitigation fees(TUMF)and Palm Springs Unified School district fees. The City has final determination as to any facility's eligibility for financing, as well as the prioritization of facilities to be included within a financing district. Use of bond proceeds for grading and right-of-way acquisition will be reviewed by the City and Bond Counsel i on a case-by-case basis. 7. VALUE-TO-LIEN RATIO 5 021 The district(or improvement area) property value-to-lien ratio should be a least 4:1 after calculating the value of the financed public improvements to be installed and considering any prior or pending special taxes or improvement liens. A project may be approved with a ratio between 4:1 and a minimum of 3:1 if the ratio is recommended by the City's Financial Advisor, Appraiser and Bond Counsel. Acceptance by the City of the value-to- lien ratio will be dependent upon an appraisal with recommendations from bond counsel, financial advisor and the underwriter with consideration of the project and diversification of land ownership. The value-to-lien ratio shall be determined based upon an appraisal of the proposed district. The appraisal shall be coordinated by, under the direction of, and addressed to the City. All costs associated with the preparation of the appraisal report shall be paid by the applicant through the advance deposit mechanism. The appraisal shall be conducted in accordance with criteria established by the City, based upon the recommendations received by the underwriter and financial advisor designated by the City. In every case, the appraisal shall reflect nationally recognized appraisal standards and employ all, or a combination of. a discounted cash flow, bulk sale comparables, raw land value as is, and project build-out values. Upon receiving an appraisal if the district wide value-to-lien ratio is 4:1 or greater, the district shall not require letters of credit or other security to secure payment of the special taxes to be levied annually on properties within the district. However, letters of credit or other security may be required for individual parcels within a district that have a value-to- lien ratio of less than 4:1. The City will require a market absorption study, and will retain a consultant to prepare a report to verify market absorption assumptions and projected sales prices of the properties which may be subject to the maximum special tax or assessment in the district. 8. SECURITY For new developments,the applicant or property owner must demonstrate its financial plan and ability to pay all assessments and/or special taxes before full build-out has taken place. I Additional security such as credit enhancement may be required by the City in certain instances. The City's Financial Advisor shall review and recommend all proposed credit enhancements to determine appropriateness and eligibility for the district. If the City requires letters of credit or other security, the credit enhancement shall be ( issued by an institution in a form and upon terms and conditions satisfactory to the City. All fees payable on the letter of credit or other security shall be the sole responsibility of the district applicant or developer, not the City or district. Any security required to be provided by the applicant shall be discharged by the City upon the opinion of a qualified appraiser retained by the City, that a value-to-lien ratio of 4:1 has been retained. A project may be approved with a ratio between 4:1 and a minimum of 3:1 if the ratio is recommended by the City's Bond Counsel, Underwriter, the Financial Advisor and Appraiser. The final determination will be made by the City, not by the developer's consultants. 9. SPECIAL TAX FORMULA i i 6 022 The maximum amount of special taxes to be levied on any parcel of property within a community facilities district, in any given fiscal year to pay debt service bonds, together with the general property taxes and other special taxes and assessments levied on such parcel, shall not exceed an amount equal to two-percent(2%) based on the full cash value of the parcel estimated at the time of sale and consistent with the market absorption study for all homes. Special tax allocation formulas or methodologies with respect to the levy of special taxes to pay for public facilities will specify maximum amounts of special tax for all categories of taxable property which will be used for private residential purposes. The dollar amount wi ll 11 be established no later than the date on which the parcel is first subject to the levy of special taxes because of its use for private residential purposes. The maximum special tax shall establish for undeveloped land tax rates corresponding to the adopted land use designation for each parcel. Undeveloped land shall not be taxed at a rate below that of developed properties of the same land use designation for a period exceeding seven years from the formation of the C.F.D. The maximum special tax formula shall adhere to the following requirements: A. The maximum special tax shall include the annual costs incurred by the City to administer the district, including consultant costs. B. The special tax formula shall not include escalator rates allowing annual tax increases above the maximum special tax established upon district formation. C. The maximum special tax shall establish for underdeveloped land tax rates corresponding to the adopted land use designations on each parcel. Undeveloped land shall be taxed at rates equal to developed properties of the same land use designation. D. The City shall have discretion to allow a special tax in excess of the established limits for any land within the C.F.D. which are designated as commercial or findustrial. E. For residential districts, once issuance of building permits commences, the City will not take any actions to modify the established tax formula. F. A backup special tax to protect against changes in densities resulting in insufficient annual special tax revenues to pay annual debt service and administrative expenses shall be required. The City shall retain a special tax consultant to prepare a report which: A. Recommends a special tax for the proposed C.F.D. B. Evaluates the special tax proposed to determine its ability to adequately fund identified public facilities, City administrative costs, services (if applicable)and other related expenditures. Such analysis shall also address the resulting aggregate tax burden of all proposed special taxes plus existing special taxes, ad valorem taxes and assessments on the properties i within the C.F.D. The rate and method of special tax apportionment shall I 7 023 be designed to ensure sufficient revenues are produced in case of final development at lower densities than anticipated. C. Consultants shall not have performed an aggregate of $250.00 worth of E services for any owner in the proposed district within the twelve months prior to retention and shall perform no work for any owner during the term of retention in order to avoid any conflict of interest to the Fair Political Practices Commission and Section 87100 of the California Government Code. 10. TERMS AND CONDITIONS OF BONDS All terms and conditions of the bonds shall be established by the City. The City will control, manage and invest or direct the management and investment of all district issued bond proceeds. Each bond issue shall be structured to adequately protect bond owners and to not negatively impact the bonding capacity or credit rating of the City through the special taxes or assessments, credit enhancements, foreclosure covenant, and special reserve. Unless otherwise authorized by the City, the following shall serve as bond requirements. A. A reserve fund equal to an amount of ten percent (10%) or maximum annual debt service or 125% of average annual debt service, whichever is less shall be established. B. The special taxes or special assessment shall be levied for the first fiscal year following sale of the bonds for which they may be levied. Interest shall not be funded (capitalized) beyond the earliest interest payment date for which sufficient special tax revenues will be available for payment of interest. C. The repayment of principal shall begin on the earliest principal payment date for which sufficient special tax revenues can be made available. D. Beginning with the commencement of the repayment of principal, annual debt services shall be level. The City will consider an increasing annual debt service for commercial and/or industrial districts only, but such increases shall not exceed two percent (2%,) per year for the term of the bonds. E. The maximum special tax shall be established to assure that the annual revenue produced by levy of the maximum special tax shall be equal to at I least 110% of the average annual debt service. F. Prior to the issuance of the bonds,the City shall authorize its bond counsel to commence and process to final judgement an actio establishing the validity of the proceedings, special tax and issuance of bonds, unless advised to the contrary by such bond counsel. G. In instances where multiple series of bonds are to be issued, the first series shall include public facilities of highest priority to the City, as determined by the City. 8 024 ........_..._._ H. All statements and materials related to the sale of special assessment or community facilities district bonds shall emphasize and state that neither the good faith, credit nor the taxing power of the City is pledged to security or repayment of the bonds. The sole source of revenues to secure bond owners are special taxes, annual assessments or foreclosure proceedings. 11. DISTRICT COST DEPOSITS AND REIMBURSEMENTS All City and consultant costs incurred in the evaluation of district applications and the establishment of districts will be paid by the applicant by advance deposit increments. The City shall not incur any non-reimbursable expenses for processing and administering assessment districts or C.F.D.'s. Expenses not chargeable to the district shall be directly borne by the applicant. Each application for formation of an assessment district of C.F.D. shall be accompanied by an initial deposit in the amount determined by the City to fund initial staff and consultant costs associated with district review and implementation. if additional funds are needed to off-set costs and expenses incurred by the City, the City shall make written demand upon,the applicant for such funds and the applicant shall comply with each demand within seven(7) calendar days of receipt of such notice. If the applicant fails to make any deposit of additional funds for the proceedings, the City may suspend all proceedings until receipt of such additional deposit. The deposits shall be used by the City to pay for costs and expenses incurred by the City incident to the proceedings relating to the district. Typical district costs prior to the sale of bonds, to be funded by the applicant by the advance deposit mechanism, may be 5% to 10% of the estimated project expenditures. Expenses vary with the complexity of the project. Expenses to be funded typically include: required notification, printing, publication, assessment engineering, special tax report, bond counsel, appraisals, market absorption study, traffic study, miscellaneous tests and studies, financial advisors, city staff administration and design engineering. i DEPOSITS AND FEES: A. Development Districts: (Initiated by Private Developers): 1. Application Fee - $10,000.00 (non-refundable) deposited with Initial Special District Application. (See application process.) 2. Deposit-An advance deposit to cover all anticipated City and City consultant costs to be incurred prior to Bond Sale. Amount to be determined prior to district formation based on size and scope of the proposed project. I B. Neighborhood Districts: (Initiated by existing Property Owners): 1. Non-development type districts formed by existing property owners for traditional 1911, 1913, and 1915 Act A.D.'s or 1972 Act 9 025 N Maintenance Districts will be exempt from the above deposits and fees. C. City Initiated Districts: Special Districts initiated by the City will be exempt from the above fees and deposits. The district shall refund any unexpended portion of the deposits upon the following conditions: A. The district is not formed; i B. Bonds are not issued and sold by the district; C. The proceedings for formation of the district or issuance of bonds is disapproved by the City; or D. The proceedings for formation of the district or issuance of bond is abandoned in writing by the applicant. Except as otherwise provided herein, the applicant shall be entitled to reimbursement for all reasonable costs and expenses incident to the proceedings and construction of the public facilities as provided under the Mello-Roos Community Facilities Act of 1982 or the j Municipal Improvement Act of 1911 or 1913 and the Improvement Bond Act of 1915, provided that all such costs and expenses shall be verified by the City as a condition of reimbursement. The applicant or property owner shall not be entitled to reimbursement from bond proceeds for any of the expenses specified as follows: A. In-house administrative and overhead expenses incurred by the applicant; B. Interest expense incurred by the applicant on deposits advanced or expended during the proceedings and construction of public facilities; and C. Any other costs and expenses incurred by the applicant which are not otherwise authorized for reimbursement under the Mello-Roos or Improvement Acts. The City shall not accrue or pay any interest on any portion of the deposit refunded to the j applicant or the costs and expenses reimbursed to the applicant or property owner from any funds other than the proceeds of bonds issued by the district. 12. ORIGINATION FEE (For Development Type Districts) For any developer-requested improvement district in which the improvements are to be financed by issuance of assessment district bonds, bonds may be authorized and issued by authority of City Council under the provisions of the 1911 Act, the 1913 Act, 1915 Act or the 1982 Mello-Roos Community Facilities Act. 10 046 For any such issuance, an Origination Fee of two (2) percent of the amount of the total bond issue (unless otherwise approved by City Council) shall be paid to the City's Assessment District Reserve Fund to be used exclusively for the financing of assessment districts as authorized by the City Council. Such fee shall be paid out of the proceeds of the sale of bonds, and shall be in addition to any other applicable fees, charges or incidental expenses. The fee will be reviewed on an annual basis and may be adjusted by Council action due to inflation or other economic changes. The Origination Fee does not apply to non-developer type neighborhood districts formed by existing property owners for typical 1911, 1913, 1915 Act Districts or 1972 Act Maintenance Districts or City initiated districts. 13. AGREEMENTS Agreements will be prepared incidental to district proceedings in a form satisfactory to the City and consistent with these policies. These agreements shall include,but not be limited to: 3 A. Reimbursement Agreements. B. Covenants, Conditions, Restrictions and Easements (C.C.&R's) C. Agreements with any other public agency entitled to receive any portion of the bond proceeds or entitled to own and operate any of the public facilities financed by bond proceeds. As a condition to the issuance and sale of bonds, all of the agreements specified shall be duly approved and executed by the parties thereto. Prior to execution of any agreements,such agreements shall be reviewed by the Special Districts Committee, Bond Counsel and the City Attorney, and approved by the City Council. Such approval by the City Attorney shall be indicated thereon. 14. USE OF CONSULTANTS The City shall have the sole discretion as to selection of consultants and determination of fees and expenses of all consultants necessary for the formation of the district and the issuance of bonds, including the underwriter(s), bond counsel, financial advisor, assessment engineer, appraiser,trustee,paying agent,market absorption study consultant, and the special tax consultant after reasonable consultation with the applicant. Prior consent of the applicant shall not be required in the determination by the City of the consulting and financing team. The City shall also be responsible for determining the structure of the bonds to be issued, including the method of sale (negotiated or competitive), the need for bond ratings, investment of bond proceeds, and all other terms and conditions incidental to structuring and closing an assessment or community facilities bond issue. No firm may serve as both design engineer or engineer of work and assessment engineer or special tax consultant on the same district pursuant to Section 87100 of the Government Code. i 11 0 ?7 15. ACQUISITION PROVISIONS The City generally supports acquisition districts to limit financial exposure and administrative efforts by the City. The City shall have final determination as to whether it will allow the financing of public facilities through acquisition, and will grant rare exceptions where an overriding justification exists concerning public benefit, safety or health. Such waiver shall be subject to City Council approval. In the event the acquisition provisions of the Municipal Improvement Act of 1913 or the Mello-Roos Act are utilized, the City, at its sole discretion, will determine the facilities to be acquired and the method of determining reasonable acquisition costs. A funding and acquisition agreement shall be required and approved by the City Council prior to the adoption of the resolution of intention to form the district. Bidding and prevailing wage requirements are extensive,and will be addressed during the preparation of the funding and acquisition agreement. The City has determined (pursuant to Section 53329.5(c) of the Government Code) that the public interest will not be served by allowing property owners to elect to enter into agreements with the City to perform construction work after the publication by the City of the notice of the award of the contract for such work. The City Council will make such a determination in the resolution of intention regarding the formation of a community facilities district. 16. DISCLOSURE TO PURCHASERS The applicant or property owner will be required to demonstrate to the satisfaction of the City that there will be full disclosure of the assessment or Mello-Roos special taxes and any other special tax, assessment or other liens on individual parcels to existing and future property owners, including interim purchasers and sales to merchant builders. In addition to all requirements of law, the City shall require the applicant to provide disclosure of such information as the City deems appropriate to the purchasers of property within the district with respect to the existence of the district, maximum and/or backup special taxes to be levied within the district facilities to be constructed, the foreclosure process and the terms and conditions of bond issued on behalf of the district. Such disclosure statement shall include homebuyer notifications requiring signature of the (attached) Disclosure Statement prior to home purchases, as well as notification of subsequent home purchasers through the C.C.&R.'s via a covenant that runs with the title of each individual parcel of E property. (See Exhibit "B"). All project advertising, recorded media advertising, signage and other advertising shall disclose that the project includes Mello-Roos Community Facilities District (C.F.D.) Municipal bond financing for the public improvements. If a Mello-Roos Community Facilities District is formed, the City will file and record a Notice of Special Tax Lien, as required by Streets and Highways Code Section 3114.5. The City shall prepare a disclosure form guideline to be used by special district developers. All initial sales will require that an original signed and dated disclosure form must be submitted to the City from each new property owner. 17. PROPERTY OWNER SUPPORT I 12 0 '? 8 In the instance of multiple property owners, the district applicant shall be required to produce letters evidencing other property owners' support for the scope and establishment of the district as an attachment to the district application. The district must have concurrence of a substantial percentage of the other property owners to be included in the proposed district, unless there is an overriding need for the public facilities, or the i applicant is willing to separately fund the facilities on the non-participating property(s). 18. LAND USE APPROVALS Proposed district properties must possess a land use determination such that proposed development land uses and specific facility requirements can be adequately assessed. The City will accept application for assessment and/or Mello-Roos financing for residential properties only when they are included in an approved development plan. 19. JOINT FINANCING POLICY In certain cases a development may wish to enter into joint financing agreements with other agencies or utility companies in order to include certain fees or costs in the incidental expenses and bond sale of a special district. The City and its related Districts will not enter into a Joint Financing Agreement with regard to a community facilities district or a Utility Agreement(pursuant to Section 10110 of the Streets & Highways Code) with regard to a non-City initiated special assessment district unless the project meets the City's minimum Special Districts Policy and Procedures requirements. An administrative review will be made by the City's Special Districts Committee of all non-City initiated community facilities districts or special assessment districts subject to minimum requirements. Only those requests not satisfying the minimum requirements would be brought before the Special Districts Committee for special consideration. 20. TREATMENT OF DELINQUENCIES The City ill develop a foreclosure covenant to be signed by all developers and property owners within a private development special district. The foreclosure covenant will address (1)the amount of the delinquency; (2)the duration of the delinquency; and(3)the condition of the reserve fund. The specific details of the covenant will depend upon the size and duration of the bond issue along with the concentration of the special tax base at the time of bond issuance. The purpose of the policy is to foreclose when necessary to protect the credit quality of the bonds and to hold the property owners accountable to terms addressed in the covenant. 21. EXCEPTIONS TO THESE POLICIES The City may find in limited and exceptional instances that a waiver to any of the above stated policies is reasonable given identified special City benefits to be derived from such waiver. Such waivers are granted only by action of the City Council and based upon specific public purpose and/or health and safety findings. 22. APPLICATION PROCESS 13 i 029 Early communication with the City is encouraged to assist applicants in evaluating the feasibility of available financing programs and to discuss program procedures. 1. Pre-Application Conference: Applicant meets with City to discuss the proposed project and application procedures. 2. Application Submission: Applicant submits an initial application and a $10,000 non-refundable application fee for review by City Staff. 3. Project Review: Applicant and City staff meet to discuss initial application, including any issues raised and further information that might be required. If necessary, applicant submits revised application. 4. Application Processing: Upon City determination that application is complete, staff prepares a staff report which forwards the request for district formation and project financing and staff recommendation to the City Council. 5. City Council Consideration: The City Council grants or denies the application, selects consultants(if approval is granted) and either approves contracts or directs staff to negotiate contracts, authorizes staff to receive the selection and directs staff to collect the applicant's deposit. 6. Project Initiation: Staff submits consultant contracts, reimbursement agreements and other similar items for City Council consideration. 7. Project Implementation: Applicant,staff and consultants meet to determine preliminary project schedule and begin work necessary to initiate district formation. 23. SPECIAL ASSESSMENT DISTRICT FORMATION PROCEEDINGS 1913 Act Assessment Districts Assessment district proceedings under the Municipal Improvement Act of 1913 normally provide for the construction of improvements by the City and the financing of such improvements with improvement bonds,which are secured by a fixed lien on the benefited property. In certain instances, if authorized by the City, the developer may construct the improvements(or portion thereof)which would be acquired by the City as provided in the proceedings. This procedure requires the developer to enter into an Acquisition and Financing Agreement with the City and to pay all administrative and consultant costs which may be incurred. The formation proceedings are subject to, and contingent upon satisfaction of all environmental zoning and land use regulations. 1. Initiation of Proceedings. The district is initiated by an applicant or landowner petition for City Council action. Upon initiation, the design engineer prepares plans, specifications and cost estimates of the proposed public improvements. The assessment engineer begins preparing the Engineer's Report, including the assessment diagram, assessment roll, 14 030 description of improvements and preliminary cost spread. The EIR consultant begins processing the appropriate environmental documentation for the public improvements. 2. Presentation of Report. Upon completion of the preliminary engineering work, the City Council adopts a resolution of intention to form the assessment district, approves the Engineer's Report, calls for construction bids, authorizes the future sale of bonds, sets the date, time and place for I the public hearing and directs assessment notices to be mailed. 3. Bid Process. Finance Department receives construction bids. Assessment Engineer modifies the assessment roll and Engineer's Report and notifies property owners of revised assessments. 4. Public Hearing. City Council holds public hearing at which written protests are presented and public testimony is taken. If no protests have been received, or if the City Council determines to overrule such protests, City Council approves district formation, awards bids, orders construction work, confirms the assessments, directs Treasurer to mail assessment bills and approves the bond sale. 5. Cash Collection Period. Treasurer may receive cash payments during the 30 days following confirmation if property owners elect to pay off the assessment or portion thereof prior to the issuance of bonds. i 6. Authorize Issuance of Bonds. City Council determines the balance of unpaid assessments and provides for the issuance of bonds to be secured thereby. 7. Sale of Bonds. Bonds are issued in exchange for the cash proceeds of the sale, which are held by the City or its fiscal agent (or paying j agent/registrar) and utilized for the purposes described in the Engineer's ! Report. 24. MELLO-ROOS COMMUNITY FACILITIES DISTRICT FORMATION PROCEEDINGS A Community Facilities District ("C.F.D.") is a legally constituted governmental entity created for the purpose of financing public facilities and services. It is similar in effect to an assessment district except that the resulting security for debt in an assessment district is a fixed lien,while under a C.F.D. it is a special tax. A C.F.D. may finance a broad range of facilities, including facilities which benefit an area in a general way as opposed to benefiting specifically identified properties as required in an assessment district. The formation proceedings are subject to, and contingent upon satisfaction of all j environmental, zoning and land use regulations. 1. Initiation of Proceedings. Proceedings must be instituted when a written request is made by a petition signed by ten percent(10%)of the registered voters (or ten percent (10%) of the landowners by area if less than twelve (12) registered voters)within the proposed C.F.D. The written request or 15 031 petition shall be accompanied by payment of a fee determined by the City Council to be sufficient to pay for costs incurred in conducting the proceedings. The Local Agency Formation Commission("LAFC")has no jurisdiction over the formation of or annexation of territory to, or detachment of, territory from a C.F.D. 2. Resolution of Intention. Within ninety (90) days of the receipt of a written request or petition, the City Council must adopt a resolution of intention to establish a C.F.D., stating the name of the proposed C.F.D., the types of facilities or services to be financed and that, except where funds are otherwise available, a special tax to pay for such facilities and services will be annually levied. The resolution of intention shall also fix a time and place for a public hearing between thirty(30)and(60)days after the adoption of the resolution of intention, describe the method of levy and apportionment of the special tax and describe the proposed voting procedure. In addition, the resolution may specify conditions under which the obligation to pay the special tax may be prepaid and permanently satisfied. The City Council directs its responsible officers to study the proposed district and to file a report at or before the public hearing describing the proposed public facilities and services and an estimate of costs. 3. Public Hearing. Protests against the establishment of the C.F.D., the extent of the C.F.D. or the furnishing of specified types of public facilities or services may be made orally or in writing by interested persons or taxpayers. If fifty percent (50%) or more of the registered voters, or six (6) registered'voters, whichever is more, residing within the proposed C.F.D. or the owners of one-half(112) or more of the area of land in the proposed C.F.D. file written protests against the establishment of the C.F.D.,the proceedings are abandoned. If the protests are directed toward certain types of facilities or services, or against a specified special tax, those specific items may be eliminated from the resolution forming the C.F.D. The l�iearing may be continued for up to thirty (30) days withqut special findings and up to six (6) months if the City Council makes specified findings. i 4. Resolution of Formation. If the City Council decides to establish the C.F.D., it shall adopt a resolution of formation containing similar information as contained in the resolution of intention. 5. Election. If the City Council determines to form the C.F.D., it submits the question of whether special taxes should be levied to an election of the voters (or land owners if less than 12 registered voters) of the proposed C.F.D. Combined with the tax proposition, there may be a proposition on the question of incurring bonded indebtedness. The tax, in order to be levied, must be approved by two-thirds (2/3) of the votes cast and thereafter levied by adoption of an ordinance of the City Council. The Act provides that the election shall be at the next general election or at a special election to be held between 90 and 180 days following the close of the protest hearing. The election time limits may be shortened by the 16 unanimous consent of the qualified electors within the proposed district and the concurrence of the election official conducting the election. 6. hnprovement Bonds. A C.F.D. may be created solely to provide the services permitted by statute. However, most C.F.D.'s have been created specifically for the purpose of levying special taxes to service bonded indebtedness incurred by the C.F.D. in order to finance the construction of facilities. The proceedings to authorize and incur bonded indebtedness ' usually parallel the proceedings for formation of the C.F.D. and the authorization to levy the special tax, although the bond proceedings should be conducted separately and at a later date. The proceedings to authorize bonded indebtedness involve a resolution of intention, public hearing and election, all conducted in a manner very similar to proceedings to form the C.F.D. and levy the tax. C.F.D. bonds may be sold competitively or through negotiated sale and may bear fixed or variable interest rates. In some cases, specified facilities may be provided by a C.F.D. for only a portion of the land within the C.F.D. In that event, the Act provides for the formation of improvement areas for which separate elections are conducted and to which a specified special tax applies. 1 I I i i I 17 j i i 033 City of Palm Springs CITY COUNCIL STUDY SESSION MARCH 13, 2002 DISCUSS REVISED POLICY& PROCEDURES FOR: SPECIAL ASSESSMENT and. COMMUNITY FACILITY DISTRICT (CFD) MUNICIPAL BOND FINANCING PROGRAMS (Originally Adopted by Council Resolution No.17774 in January, 1992) POLICY: = OP t POLICY: c v A. MUNICIPAL BONDS can be Issued for - A.(Same as current policy), Public Im roe ents for developrrrent ells-Roos Co mu 9 Facili D'stricts projects, providing fnancing assistance to CFDs and Assessment Distrirts are qualifying.private developments in City. approved bond financing method, In City. B. ELIGIBLE DEVELOPMENTS! Commercial B. Commercial, Industrial and Resldential and Industrial Developments can use CFD developments can use CFD bond financing. I fnancfna. 1 C.4:1 VALUE TO LIEN RA_10:The ratio can C.(Same-no changes).Note: -1 ratio is only be as low as 3:1 (wlcredit enhancements)if allowed if additional security Is provided by recommended by City's Financial Advisor, letter of credit or other form of credit Market Absorption.Analyst and Bond Counsel, enhancement to increase value to lien ratio. D. ELIGIBLE PUBLIC IMPROVEMENTS: D. (Same), but add Eligible Develo ment Fees: 1. Streets, Roads &Infrastructure 1.Sewer Connection Fee 2. Utilities &Drainage Facilities 2. Drainage Fees 3. City& Regional Public Facilities 3.TUMF Fees(geed financing agreement) (Parks, Park ing Lots, Schools, Libraries, etc.) 4.School Fees(need financing agreement) E.SPECIAL TAX FORMULA: Shall not exceed E:-Maximum Special Taxes shall not exceed of appraised Fair Market Value of property 2%of appraised Fair Market Value of property, and not exceed 2a/4 of appraised property Including combined general property taxes values,including ad valorem taxes, and CFD special taxes: Allow undeveloped (Undeveloped and developed lands are taxed land to be taxed at lower rate than at equal rates). developed land for a period up to 7 years. F. DEVELOPER DEPOSIT: Non-refundable F. (Same policy), but increase amount to $6,000 deposit pays for City administration $10,000 for initial City administration costs to costs during Initial formation process.A 4-pg. assist with CFD formation process. application Is completed by developer. Note the developer must also fund new Real Estate Appraisal Report&'Market Absorption Study. H:D noM%palu\DomnwMFD Pdicy,CC6wdySe3$bn.3.13-02.fmiD,wpd Rev. lz�o3 034 ij i CITY OF- PALM SPRINGS ASSESSMENT DISTRICT POLICIES City Council Adopted Land Secured Financing Policies And in 1992 Amended Policies in 2003 to include Residential Projects Policy Goals: • Encourage Development • Set Minimum Lien to Value Standards of 4 to 1 at time of Mond issue • Set Maximum Property Tax Rate at 2%0 of Home Sale Price WW Existing Assessment Districts: • AD 165 (Commercial) �• AD 167 (SFR/Commercial) • AD 168 (Andreas Hills) + AD 161 (Mountain Gate) Typical Improvements/Fees Financed: • Water and Sewer Fees • Development impact Fees • Undergrounding Utilities • Landscaping Benefit to Homeowner Lowers down payment requirement while costing approximately the same over a 30 year mortgage LE 035 Attachment 2 030 I 4pp�Mse V u ryourto' CITY COUNCIL STAFF REPORT DATE: OCTOBER 1, 2014 PUBLIC HEARING SUBJECT: AUTHORIZING THE CITY TO JOIN THE STATEWIDE COMMUNITY INFRASTRUCTURE PROGRAM; AUTHORIZING THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY TO ACCEPT APPLICATIONS FROM PROPERTY OWNERS, CONDUCT SPECIAL ASSESSMENT PROCEEDINGS AND LEVY ASSESSMENTS WITHIN THE TERRITORY OF THE CITY OF PALM SPRINGS; APPROVING FORM OF ACQUISITION AGREEMENT FOR USE WHEN APPLICABLE; AND, AUTHORIZING THE CITY MANAGER TO EXECUTE ALL DOCUMENTS RELATED TO THE AGREEMENTS FROM: David H. Ready, City Manager BY: Community & Economic Development Department SUMMARY This resolution approves the City of Palm Springs' participation in the Statewide Community Infrastructure Program ("SCIP"), which is sponsored by the California Statewide Communities Development Authority ("CSCDA"). The statute requires the City Council hold a public hearing to take public testimony on SCIP and bonds to be issued by CSCDA, and consideration of a resolution making the findings and authorizing City participation in SCIP. RECOMMENDATION: 1. Open the public hearing. 2. Adopt Resolution No. "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM SPRINGS AUTHORIZING THE CITY TO JOIN THE STATEWIDE COMMUNITY INFRASTRUCTURE PROGRAM; AUTHORIZING THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY TO ACCEPT APPLICATIONS FROM PROPERTY OWNERS, CONDUCT SPECIAL ASSESSMENT PROCEEDINGS AND LEVY ASSESSMENTS WITHIN THE TERRITORY OF THE CITY OF PALM SPRINGS; APPROVING FORM OF ACQUISITION AGREEMENT FOR USE WHEN APPLICABLE;" and 037 ITEM NO. Statewide Community Infrastructure Program ("SCIP") October 1, 2014 Page 2 3, AUTHORIZE THE CITY MANAGER TO EXECUTE ALL DOCUMENTS RELATED TO THE ABOVE AGREEMENTS. Background: CSCDA is a joint powers authority sponsored by the League of California Cities and the California State Association of Counties. The member agencies of CSCDA include approximately 356 cities and 57 counties throughout California, including the City of Palm Springs (the "City"). SCIP was instituted by CSCDA in 2002 to allow owners of property in participating cities and counties to finance the payment of development impact fees payable by property owners receiving development entitlements or building permits. The program has since been expanded to include financing of public capital improvements directly. If a property owner chooses to participate, the selected public capital improvements and the development impact fees owed to the City will be financed by the issuance of tax- exempt bonds by CSCDA. CSCDA will impose a special assessment on the owner's property to repay the portion of the bonds issued to finance the fees and the cost of public capital improvements. The benefits to the property owner include: • Only property owners who choose to participate in the program will have assessments imposed on their property. • Instead of paying cash for public capital improvements and/or development impact fees, the property owner receives low-cost, long-term tax-exempt financing of those fees, freeing up capital fqr other purposes. • The property owner can choose to pay off the special assessments at any time. For home buyers, paying for the costs of public infrastructure through a special assessment is superior to having those costs "rolled" into the cost of the home. Although the tax bill is higher, the amount of the mortgage is smaller, making it easier to qualify. Moreover, because the special assessment financing is at tax- exempt rates, it typically comes at lower cost than historic mortgage rates. • Owners of smaller projects, both residential and commercial, can have access to tax-exempt financing of infrastructure. Before the inception of SCIP, only projects large enough to justify the formation of an assessment or community facilities district had access to tax-exempt financing. The benefits to the City include: • As in conventional assessment financing, the City is not liable to repay the bonds issued by CSCDA or the assessments imposed on the participating properties. • CSCDA handles all district formation, district administration, bond issuance and bond administration functions. A participating city can provide tax-exempt financing to property owners through SCIP while committing virtually no staff time to administer the program. 038 Statewide Community Infrastructure Program("SCIP") October 1, 2014 Page 3 • Providing tax-exempt financing helps participating cities and counties cushion the impact of rising public capital improvements costs and development impact fees on property owners. • The availability of financing will encourage developers to pull permits and pay fees in larger blocks, giving the participating city immediate access to revenues for public infrastructure, rather than receiving a trickle of revenues stretched out over time. As part of the entitlement negotiation process, the possibility of tax-exempt financing of fees can be used to encourage a developer to pay fees up front. • In some cases, the special assessments on successful projects can be refinanced through refunding bonds. Savings achieved through refinancing will be directed back to the participating city for use on public infrastructure, subject to applicable federal tax limitations. The proposed resolution authorizes CSCDA to accept applications from owners of property within the City to apply for tax-exempt financing of public capital improvements and development impact fees through SCIP. It also authorizes CSCDA to form assessment districts within the City's boundaries, conduct assessment proceedings and levy assessments against the property of participating owners. It approves the form of an Acquisition Agreement, attached to the resolution as Exhibit B, that provides the terms and conditions under which financing for public capital improvements will be provided and to establish the procedure for disbursement of bond proceeds to pay for completed facilities. The proposed resolution also authorizes miscellaneous related actions and makes certain findings and determinations required by law. Attached to the resolution as Exhibit A is a "Form of Resolution of Intention to be Adopted by CSCDA". This is for informational purposes and does not require action by the Council. FISCAL IMPACT Selected public capital improvements and certain development impact fees owed to the City may be financed by the issuance of tax-exempt bonds by CSCDA thorough this program. This does not create any financial obligation on the part of the City. Conversely, the availability of financing will encourage developers to pull permits and pay fees in larger blocks, giving the City immediate access to revenues for public infrastructure, rather than receiving a trickle of revenues stretched out over time_ r J n SAnityVa Oconomic , Director of David H. Ready, City M m Development Attachments: 1. SCIP Resolution 2. Public Hearing Notice 039 RESOLUTION NO. 23671 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM SPRINGS, CALIFORNIA, AUTHORIZING THE CITY TO JOIN THE STATEWIDE COMMUNITY INFRASTRUCTURE PROGRAM, AUTHORIZING THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY TO ACCEPT APPLICATIONS FROM PROPERTY OWNERS, CONDUCT SPECIAL ASSESSMENT PROCEEDINGS, AND LEVY ASSESSMENTS WITHIN THE TERRITORY OF THE CITY OF PALM SPRINGS, AND APPROVING THE STANDARD FORM ACQUISITION AGREEMENT FOR USE WHEN APPLICABLE. WHEREAS, the California Statewide Communities Development Authority (the "Authority") is a joint exercise of powers authority the members of which include numerous cities and counties in the State of California, including the City of Palm Springs (the"City"); and WHEREAS, the Authority has established the Statewide Community Infrastructure Program ("SCIP") to allow the financing of certain development impact fees (the "Fees") levied in accordance with the Mitigation Fee Act (California Government Code Sections 66000 and following) and other authority providing for the levy of fees on new development to pay for public capital improvements (collectively, the "Fee Act") through the levy of special assessments pursuant to the Municipal Improvement Act of 1913 (Streets and Highways Codel Sections 10000 and following) (the "1913 Act") and the issuance of improvement bonds (the "Local Obligations") under the Improvement Bond Act of 1915 (Streets and Highways Code Sections 8500 and following) (the "1915 Act") upon the security of the unpaid special assessments; and WHEREAS, SCIP will also allow the financing of certain public capital improvements to be constructed by or on behalf of property owners for acquisition by the City or another public agency (the "Improvements"); and WHEREAS, the City desires to allow the owners of property being developed within its jurisdiction ("Participating Developers') to participate in SCIP and to allow the Authority to conduct assessment proceedings under the 1913 Act and to issue Local Obligations under the 1915 Act to finance Fees levied on such properties and Improvements, provided that such Participating Developers voluntarily agree to participate and consent to the levy of such assessments; and WHEREAS, in each year in which eligible property owners within the jurisdiction of the City elect to be Participating Developers, the Authority will conduct assessment proceedings under the 1913 Act and issue Local Obligations under the 1915 Act to 040 Resofution No. 23671 Page 2 finance fees payable by such property owners and improvements and, at the conclusion of such proceedings, will levy special assessments on such property within the territory of the City; WHEREAS, there has been presented to this meeting a proposed form of Resolution of Intention to be adopted by the Authority in connection with such assessment proceedings (the "ROI"), a copy of which is attached hereto as Exhibit A, and the territory within which assessments may be levied for SCIP (provided that each Participating Developer consents to such assessment) shall be coterminous with the City's official boundaries of record at the time of adoption of each such ROI (the "Proposed Boundaries"), and reference is hereby made to such boundaries for the plat or map required to be included in this Resolution pursuant to Section 10104 of the Streets and Highways Code; and WHEREAS, there has also been presented to,this meeting a proposed form of Acquisition Agreement (the "Acquisition Agreement"), a copy of which is attached hereto as Exhibit B, to be approved as to form for use with respect to any Improvements to be constructed and installed by a Participating Developer and for which the Participating Developer requests acquisition financing as part of its SCIP application; and WHEREAS, the City will not be responsible for the conduct of any assessment proceedings; the levy or collection of assessments or any required remedial action in the case of delinquencies in such assessment payments; or the issuance, sale or administration of the Local Obligations or any other bonds issued in connection with SCIP; and WHEREAS, pursuant to Government(Code Section 6586.5, notice was published at least five days prior to the adoption of this resolution at a public hearing, which was duly conducted by this Council concerning the significant public benefits of SCIP and the financing of the Improvements and the public capital improvements to be paid for with the proceeds of the Fees. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PALM SPRINGS, CALIFORNIA, DOES HEREBY RESOLVE AS FOLLOWS: SECTION 1. The City hereby consents to the conduct of special assessment proceedings by the Authority in connection with SCIP pursuant to the 1913 Act and the issuance of Local Obligations under the 1915 Act on any property within the Proposed Boundaries; provided, that (1) Such proceedings are conducted pursuant to one or more Resolutions of Intention in substantially the form of the ROI; and (2) The Participating Developers, who shall be the legal owners of such property, execute a written consent to the levy of assessment in connection with SCIP by the 041 Resolution No.23671 Page 3 Authority and execute an assessment ballot in favor of such assessment in compliance with the requirements of Section 4 of Article XIIID of the State Constitution. SECTION_2. The City hereby finds and declares that the issuance of bonds by the Authority in connection with SCIP will provide significant public benefits, including without limilation, savings in effective interest rate, bond preparation, bond underwriting and bond issuance costs and the more efficient delivery of local agency services to residential and commercial development within the City. SECTION 3. The Authority has prepared and will update from time to time the "SCIP Manual of Procedures" (the "Manual"), and the City will handle Fee revenues and funds for Improvements for properties participating in SCIP in accordance with the procedures set forth in the Manual. SECTION 4. The form of Acquisition Agreement presented to this meeting is hereby approved, and the (Mayor] is authorized to execute and the City Clerk is authorized to attest the execution of a completed Acquisition Agreement in substantially said form and pertaining to the Improvements being financed on behalf of the applicable Participating Developer. SECTION 5. The appropriate officials and staff of the City are hereby authorized and directed to make SCIP applications available to all property owners who are subject to Fees for new development within the City and/or who are conditioned to install Improvements and to inform such owners of their option to participate in SCIP; provided, that the Authority shall be responsible for providing such applications and related materials at its own expense. The staff persons listed on the attached Exhibit C, together with any other staff persons chosen by the City Manager from time to time, are hereby designated as the contact persons for the Authority in connection with the SQIP program. SECTION 6. The appropriate officials and staff of the City are hereby authorized and directed to execute and deliver such closing certificates, requisitions, agreements and related documents, including but not limited to such documents as may be required by Bond Counsel in connection with the participation in SCIP of any districts, authorities or other third-party entities entitled to own Improvements and/or to levy and collect fees on new development to pay for public capital improvements within the jurisdiction of the City, as are reasonably required by the Authority in accordance with the Manual to implement SCIP for Participating Developers and to evidence compliance with the requirements of federal and state law in connection with the issuance by the Authority of the Local Obligations and any other bonds for SCIP. To that end, and pursuant to Treasury Regulations Section 1.150-2, the staff persons listed on Exhibit C, or other staff person acting in the same capacity for the City with respect to SCIP, are hereby authorized and designated to declare the official intent of the City with respect to the public capital improvements to be paid or reimbursed through participation in SCIP. 042 Resolution No. 23671 Page 4 SECTION 7. This Resolution shall take effect immediately upon its adoption. The City Clerk is hereby authorized and directed to transmit a certified copy of this resolution to the Secretary of the Authority. I ADOPTED THIS 1ST DAY OF OCTOBER, 2014. David H. Ready, City r ATTEST: es Thompson, City Clerk CERTIFICATION STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss. CITY OF PALM SPRINGS ) I, JAMES THOMPSON, City Clerk of the City of Palm Springs, California, hereby certify that Resolution No. 23671 was adopted by the Palm Springs City Council at a regular meeting held on the 1" of October, 2014, by the following vote: AYES: Councilmember Foat, Councilmember Lewin, Councilmember Mills, Mayor Pro Tern Hutcheson, and Mayor Pougnet. NOES: None. ABSENT: None. ABSTAIN: None. mes Thompson, City Clerk 1 rho/po f4 043 Resolution No 23671 Page 5 EXHIBIT A TO THE RESOLUTION FORM OF RESOLUTION OF INTENTION TO BE ADOPTED BY CSCDA RESOLUTION OF INTENTION OF THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY TO FINANCE IMPROVEMENTS AND/OR THE PAYMENT OF DEVELOPMENT IMPACT FEES FOR PUBLIC CAPITAL IMPROVEMENTS IN THE PROPOSED ASSESSMENT DISTRICT NO. (COUNTY OF RIVERSIDE, CALIFORNIA), APPROVING A PROPOSED BOUNDARY MAP, MAKING CERTAIN DECLARATIONS, FINDINGS AND DETERMINATIONS CONCERNING RELATED MATTERS, AND AUTHORIZING RELATED ACTIONS IN CONNECTION THEREWITH WHEREAS, under the authority of the Municipal Improvement Act of 1913 (the "1913 Act"), being Division 12 (commencing with Sections 10000 and following) of the California Streets and Highways Code, the Commission (the "Commission") of the California Statewide Communities Development Authority (the "Authority") intends to finance, through its Statewide Community Infrastructure Program, the payment of certain development impact fees for public capital improvements as described in Exhibit A attached hereto and by this reference incorporated herein (the "Fees") and to finance certain public capital improvements to be constructed by or on behalf of the property "Improvements"), owners and to be acquired b the City or another local agency the Im rovements ( ) cQ Y tY 9 Y ( P ), all of which are of benefit to the property within the proposed Assessment District No. (County of Riverside, California) (the "Assessment District"); and WHEREAS, the Commission finds that the land specially benefited by the Fees and the Improvements is shown within the boundaries of the map entitled "Proposed Boundaries of Assessment District No. (County of Riverside, California)," a copy of which map is on file with the Secretary and presented to this Commission meeting, and determines that the land within the exterior boundaries shown on the map shall be designated "Assessment District No. (County of Riverside, California)". NOW, THEREFORE, BE IT RESOLVED that the Commission of the California Statewide Communities Development Authority hereby finds, determines and resolves as follows: 1. The above recitals are true and correct, and the Commission so finds and determines. 2. Pursuant to Section 2961 of the Special Assessment Investigation, Limitation and Majority Protest Act of 1931 (the "1931 Act"), being Division 4 (commencing with Section 2800) of the California Streets and Highways Code, the 044 Resolution No. 23671 Page 6 Commission hereby declares its intent to comply with the requirements of the 1931 Act by complying with Part 7.5 thereof. 3. The Commission has or will designate a registered, professional engineer as Engineer of Work for this project, and hereby directs said firm to prepare the report containing the matters required by Sections 2961(b) and 10204 of the Streets and Highways Code, as supplemented by Section 4 of Article XIIID of the California Constitution. 4. The proposed boundary map of the Assessment District is hereby approved and adopted. Pursuant to Section 3111 of the California Streets and Highways Code, the Secretary of the Authority is directed to file a copy of the map in the office of the County Recorder of the County of Riverside within fifteen (15) days of the adoption of this resolution. 5. The Commission determines that the cost of the Fees and Improvements shall be specially assessed against the lots, pieces or parcels of land within the Assessment District benefiting from the payment of the Fees and the provision of the Improvements. The Commission intends to levy a special assessment upon such lots, pieces or parcels in accordance with the special benefit to be received by each such lot, piece or parcel of land, respectively, from the payment of the Fees and the provision of the Improvements. 6. The Commission intends, pursuant to subparagraph (f) of Section 10204 of the California Streets and Highways Code, to provide for an annual assessment upon each of the parcels of land in the proposed assessment district to pay various costs and expenses incurred from time to time by the Authority and not otherwise,reimbursed to the Authority which result from the administration and collection of assessment installments or from the administration or registration of the improvement bonds and the various funds and accounts pertaining thereto. 7. Bonds representing unpaid assessments, and bearing interest at a rate not to exceed twelve percent (12%) per annum, will be issued in the manner provided by the Improvement Bond Act of 1915 (Division 10, Streets and Highways Code), and the last installment of the bonds shall mature not to exceed thirty (30) years from the second day of September next succeeding twelve (12) months from their date. 8. The procedure for the collection of assessments and advance retirement of bonds under the Improvement Bond Act of 1915 shall be as provided in Part 11.1, Division 10, of the Streets and Highways Code of the State of California. 9. Neither the Authority nor any member agency thereof will obligate itself to advance available funds from its or their own funds or otherwise to cure any deficiency which may occur in the bond redemption fund. A determination not to obligate itself shall not prevent the Authority or any such member agency from, in its sole discretion, so advancing funds. 045 Resolution No. 23671 Page 7 10. The amount of any surplus remaining in the improvement fund after payment of the Fees, acquisition of the Improvements and payment of all claims shall be distributed in accordance with the provisions of Section 10427.1 of the Streets and Highways Code. 11. To the extent any Fees are paid to the Authority in cash with respect to property within the proposed Assessment District prior to the date of issuance of the bonds, the amounts so paid shall be reimbursed from the proceeds of the bonds to the property owner or developer that made the payment. [End of Form of Resolution of Intention] III I I 046 Resolution No,23671 Page 8 EXHIBIT B TO THE RESOLUTION FORM OF ACQUISITION AGREEMENT CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY STATEWIDE COMMUNITY INFRASTRUCTURE PROGRAM ACQUISITION AGREEMENT BY AND BETWEEN CITY OF PALM SPRINGS AND [DEVELOPER] I I Dated as of 20 047 Resolution No. 23671 Page 9 ACQUISITION AGREEMENT Recitals A. The parties to this Acquisition Agreement (the "Agreement") are the CITY OF PALM SPRINGS, (the "Local Agency"), and [DEVELOPER], a [here indicate type of legal entity) the "Developer'). 9 tI+1 ( B. The effective date of this Agreement is 20_. C. The Developer has applied for financing of certain public capital improvements (the "Acquisition Improvements") and capital facilities fees though the Statewide Community Infrastructure Program ("SCIP") administered by the California Statewide Communities Development Authority (the "Authority") and such application has been approved by the Local Agency. D. Under SCIP, the Authority intends to issue bonds to fund, among other things, all or a portion of the costs of the Acquisition Improvements, and the portion of the proceeds of such bonds allocable to the cost of the Acquisition Improvements to be constructed and installed by the Developer, together with interest earned thereon prior to such acquisition, is referred to herein as the "Available Amount". E. SCIP will provide financing for the acquisition by the Local Agency of the Acquisition Improvements and the payment of the Acquisition Price (as defined herein) of the Acquisition Improvements from the Available Amount. Attached hereto as Exhibit A are descriptions of the Acquisition Improvements, which descriptions are subject to modification by written amendment of this Agreement, subject to the approval of the Authority. F. The parties anticipate that, upon completion of the Acquisition Improvements and subject to the terms and conditions of this Agreement, the Local Agency will acquire such completed Acquisition Improvements with the Available Amount, G. Any and all monetary obligations of the Local Agency arising out of this Agreement are the special and limited obligations of the Local Agency payable only from the Available Amount, and no other funds whatsoever of the Local Agency shall be obligated therefor. H. In consideration of Recitals A through G, inclusive, and the mutual covenants, undertakings and obligations set forth below, the Local Agency and the Developer agree as stated below. i I 048 Resolution No. 23671 Page 10 Agreement ARTICLE I DEFINITIONS; ASSESSMENT DISTRICT FORMATION AND FINANCING PLAN Section 1.01. Definitions. As used herein, the following capitalized terms shall have the meanings ascribed to them below: "Acceptable Title" means free and clear of all monetary liens, encumbrances, assessments, whether any such item is recorded or unrecorded, and taxes, except those items which are reasonably determined by the Local Agency Engineer in his sole discretion not to interfere with the intended use and therefore are not required to be cleared from the title. "Acquisition Improvements" shall have the meaning assigned to such term in Recital C and are described in Exhibit A. "Acquisition Price" means the amount paid to the Developer upon acquisition of all of the Acquisition Improvements as provided in Section 2.03_ "Actual Cost" means the cost of construction of all of the Acquisition Improvements, as documented by the Developer to the satisfaction of the Local Agency, as certified by the Local Agency Engineer in an Actual Cost Certificate. "Actual Cost Certificate" shall mean a certificate prepared by the Developer detailing the Actual Cost of all of the Acquisition Improvement to be acquired hereunder, as devised by the Local Agency Engineer pursuant to Section 2.03. "Agreement" means this Acquisition Agreement, dated as of 20_ "Assessment District" means the assessment district established by the Authority pursuant to SCIP which includes the Developers property for which the Acquisition Improvements are being funded. "Authority" means the California Statewide Communities Development Authority. "Available Amount" means the amount of funds deposited in the Developer Acquisition Account by the Authority pursuant to SCIP, together with any interest earnings thereon. "Code" means the Streets and Highways Code of the State of California. "Developer'° means [Developer], a [here indicate type of legal entity]. "[Developer] Acquisition Account" means the account by that name established by the Authority pursuant to SCIP for the purpose of paying the Acquisition Price of the 049 Resolution No. 23671 Page 11 Acquisition Improvements. "Local Agency" means the City of Palm Springs. "Local Agency Engineer" means the Director of Public Works of the Local Agency (the "Director") or the designee of the Director, who will be responsible for administering the acquisition of the Acquisition Improvements hereunder. "Project" means the land development program of the Developer pertaining to the Developer's property in the Assessment District, including the design and construction of the Acquisition Improvements and the other public and private improvements to be constructed by the Developer within or adjacent to the Assessment District. i "SCIP" means the Statewide Community Infrastructure Program of the Authority. "SCIP Requisition" means a requisition for payment of funds from the [Developer] Acquisition Account in substantially the form attached hereto as Exhibit B. "SCIP Trust Agreement" means the Trust Agreement entered into by the Authorityand the SCIP Trustee in connection with the financing for the Acquisition 9 q Improvements. "SCIP Trustee" means Wells Fargo Bank, National Association, as trustee under the SCIP Trust Agreement. "Title Documents" means, for each Acquisition Improvement acquired hereunder, a grant deed or similar instrument necessary to transfer title to any real property or interests therein (including easements) necessary or convenient to the operation, maintenance, rehabilitation andl improvement by the Local Agency of that Acquisition Improvement (including, if necessary, easements for ingress and egress) and a Bill of Sale or similar instrument evidencing transfer of title to that Acquisition Improvement (other than said real property interests) to the Local Agency, where applicable. Section 1.02.Participation in SCIP . Developer has applied for financing thorough SCIP of the Acquisition Improvements, and such application has been approved by the Local Agency. Developer and Local Agency agree that until and unless such financing is completed by the Authority and the Available Amount is deposited in the Developer Acquisition Account, neither the Developer nor the Local Agency shall have any obligations under this agreement. Developer agrees to cooperate with the Local Agency and the Authority in the completion of SCIP financing for the Acquisition Improvements. Section 1.03.Deposit and Use of Available Amount . (a) Upon completion of the SCIP financing, the Available Amount will be deposited by the Authority in the [Developer] Acquisition Account. 050 Resolution No. 23671 Page 12 (b) The Authority will cause the SCIP Trustee to establish and maintain the [Developer] Acquisition Account for the purpose of holding all funds for the Acquisition Improvements. All earnings on amounts in the [Developer] Acquisition Account shall remain in the [Developer] Acquisition Account for use as provided herein and pursuant to SCIP. The amounts in the [Developer] Acquisition Account shall be withdrawn by the Local Agency in accordance with SCIP procedures upon completion of the Acquisition Improvements within 30 days (or as soon thereafter as reasonably practicable) of receipt by the Local Agency of the certification of the Local Agency Engineer required by Section 2.03 of this Agreement, and subject to satisfaction of all other conditions precedent to such acquisition pursuant to Section 2.04 of this Agreement, to pay the Acquisition Price of such completed Acquisition Improvements, as specified in Article ll,hereof, Upon completion of all of the Acquisition Improvements and the payment of all costs thereof, any remaining funds in the [Developer] Acquisition Account (less any amount determined by the Local Agency as necessary to reserve for claims against such account) (i) shall be applied to pay the costs of any additional improvements eligible for acquisition with respect to the Project as approved by the Authority and, to the extent not so used, (ii) shall be applied by the Authority as provided in Section 10427.1 of the Code to pay a portion of the assessments levied on the Project property in the Assessment District. Section 1.04. No Local Agency Liability; Local Agency Discretion; No Effect on Other Agreements. In no event shall any actual or alleged act by the Local Agency or any actual or alleged omission or failure to act by the Local Agency'with respect to SCIP subject the Local Agency to monetary liability therefor. Further, nothing in this Agreement shall be construed as affecting the Developer's or the Local Agency's duty to perform their respective obligations under any other agreements, public improvement standards, land use regulations or subdivision requirements related to the Project, which obligations are and shall remain independent of the Developer's ano the Local Agency's rights and obligations under this Agreement. ARTICLE II DESIGN, CONSTRUCTION AND ACQUISITION OF ACQUISITION IMPROVEMENTS Section 2.01.Letting and Administering Design Contracts. The parties presently anticipate that the Developer has awarded and administered or will award and administer engineering design contracts for the Acquisition Improvements to be acquired from Developer. All eligible expenditures of the Developer for design engineering and related costs in connection with the Acquisition Improvements (whether as an advance to the Local Agency or directly to the design consultant) shall be reimbursed at the time of acquisition of such Acquisition Improvements,. The Developer shall be entitled to reimbursement for any design costs of the Acquisition Improvements only out of the Acquisition Price as provided in Section 2.03 and shall not be entitled to any payment for design costs independent of or prior to the acquisition of Acquisition Improvements. 051 Resolution No. 23671 Page 13 Section 2,02. Letting and Administration of Construction Contracts. State law requires that all Acquisition Improvements shall be constructed as if they were constructed under the direction and supervision of the Local Agency. In order to assure compliance with those provisions, except for any contracts entered into prior to the date hereof, Developer agrees to comply with the guidelines of the Local Agency for letting and administering said contracts. The Developer agrees that all such contracts shall call for payment of prevailing wages as required by the Labor Code of the State of California. Section 2.03.Sale of Acquisition Improvements. The Developer agrees to sell to the Local Agency the Acquisition Improvements to be constructed by Developer (including any rights-of-way or other easements necessary for the operation and maintenance of the Acquisition Improvements, to the extent not already publicly owned) when such Acquisition Improvements are completed to the satisfaction of the Local Agency for an amount not to exceed the lesser of (i) the Available Amount or (ii) the Actual Cost of the Acquisition Improvements. Exhibit A, attached hereto and incorporated herein, contains a list of each Acquisition Improvement. At the time of completion of each Acquisition Improvement, the Developer shall deliver to the Local Agency Engineer a written request for acquisition, accompanied by an Actual Cost Certificate and executed Title Documents for the transfer of the Acquisition Improvement, where necessary. In the event that the Local Agency Engineer finds that the supporting paperwork submitted by the Developer fails to demonstrate the required relationship between the subject Actual Cost and the related Acquisition Improvement, the Local Agency Engineer shall advise the Developer that the determination of the Actual Cost (or the ineligible portion thereof? has been disallowed and shall request further documentation from the Developer. If such further documentation is still not adequate, the Local Agency Engineer may revise the Actual Cost Certificate to delete any disallowed itemp, and such determination shall be final and conclusive. In the event that the Actual Cost is in excess of the Available Amount, the Local Agency shall withdraw the Available Amount from the [Developer] Acquisition Account and transfer said amount to the Developer. In the event that the Actual Cost is less than the Available Amount, the Local Agency shall withdraw an amount from the [Developer] Acquisition Account equal to the Actual Cost, and shall transfer said amount to the Developer. Any amounts then remaining in the [Developer] Acquisition Account shall be applied as provided in Section 1.03. In no event shall the Local Agency be required to pay the Developer more than the amount on deposit in the [Developer] Acquisition Account at the time such payment is requested. Section 2.04,Conditions Precedent to Payment of Acguisition Price. Payment by the Local Agency to the Developer from the [Developer] Acquisition Account of the Acquisition Price for an Acquisition Improvement shall be conditioned first upon the determination of the Local Agency Engineer, pursuant to Section 2.03, that such Acquisition Improvement is all complete and ready for acceptance by the 052 Resolution No. 23671 Page 14 Local Agency, and shall be further conditioned upon prior satisfaction of the following additional conditions precedent: (a) The Developer shall have provided the Local Agency with lien releases or other similar documentation satisfactory to the Local Agency as evidence that the property which is subject to the special assessment liens of the Assessment District is not subject to any prospective mechanics lien claim respecting the Acquisition Improvements. (b) The Developer shall be current in the payment of all due and payable property taxes and installments for the special assessments of the Assessment District on property owned by the Developer or under option to the Developer. (c) The Developer shall certify that it is not in default with respect to any loan secured by any interest in the Project- (d) The Developer shall have provided the Local Agency with Title Documents needed to provide the Local Agency with title to the site, right-of-way, or easement upon which the subject Acquisition Improvements are situated. All such Title Documents shall be in a form acceptable to the Local Agency (or applicable governmental agency) and shall convey Acceptable Title. The Developer shall provide a policy of title insurance as of the date of transfer in a form acceptable to the Local Agency'Engineer insuring the Local Agency as to the interests acquired in connection with the acquisition of any interest for which such a policy of title insurance is not required by another agreement between the Local Agency and the Developer. Each title insurance policy required hereunder shall be in the amount equal to or greater than the Acquisition Price. Section 2.05.SLIP Requisition. Upon a determination by the Local Agency Engineer to pay the Acquisition Price of the Acquisition Improvements pursuant to Section 2.04, the Local Agency Engineer shall cause a SCIP Requisition to be submitted to the SCIP Trustee and the SCIP Trustee shall make payment directly to the Developer of such amount pursuant to the SCIP Trust Agreement. The Local Agency and the Developer acknowledge and agree that the SCIP Trustee shall make payment strictly in accordance with the SCIP Requisition and shall not be required to determine whether or not the Acquisition Improvements have been completed or what the Actual Costs may be with respect to such Acquisition Improvements. The SCIP Trustee shall be entitled to rely on the SCIP Requisition on its face without any further duty of investigation. ARTICLE III MISCELLANEOUS Section 3.01. Indemnification and Bold Harmless. The Developer hereby assumes the defense of, and indemnifies and saves harmless the Local Agency, the Authority, and each of its respective officers, directors, employees and agents, from 053 Resolution No. 23671 Page 15 and against all actions, damages, claims, losses or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from or alleged to have resulted from the acts or omissions of the Developer or its agents and employees in the performance of this Agreement, or arising out of any contract for the design, engineering and construction of the Acquisition improvements or arising out of any alleged misstatements of fact or alleged omission of a material fact made by the Developer, its officers, directors, employees or agents to the Authority's underwriter, financial advisor, appraiser, district engineer or bond counsel or regarding the Developer, its proposed developments, its property ownership and its contractual arrangements contained in the official statement relating to the SCIP financing (provided that the Developer shall have been furnished a copy of such official statement and shall not have objected thereto); and provided, further, that nothing in this Section 3.01 shall limit in any manner the Local Agency's rights against any of the Developer's architects, engineers, contractors or other consultants. Except as set forth in this Section 3.01, no provision of this Agreement shall in any way limit the extent of the responsibility of the Developer for payment of damages resulting from the operations of the Developer, its agents and employees. Nothing in,this Section 3.01 shall be understood or construed to mean that the Developer agrees to indemnify the Local Agency, the Authority or any of its respective officers, directors, employees or agents, for any negligent or wrongful acts or omissions to act of the Local Agency, Authority its officers, employees, agents or any consultants or contractors. Section 3.02.Audit. The Local Agency shall have the right, during normal business hours and upon the giving of ten days' written notice to the Developer, to review all books and records of the Developer pertaining to costs and expenses incurred by the Developer (for which the Developer seeks reimbursement) in constructing the Acquisition Improvements. Section 3.01 Cooperation. The Local Agency and the Developer agree to cooperate with respect to the completion of the SCIP financing for the Acquisition Improvements. The Local Agency and the Developer agree to meet in good faith to resolve any differences on future matters which are not specifically covered by this Agreement. Section 3.04.General Standard of Reasonableness. Any provision of this Agreement which requires the consent, approval or acceptance of either party hereto or any of their respective employees, officers or agents shall be deemed to require that such consent, approval or acceptance not be unreasonably withheld or delayed, unless such provision expressly incorporates a different standard. The foregoing provision shall not apply to provisions in the Agreement which provide for decisions to be in the sole discretion of the party making the decision. Section 3.05.Third Party Beneficiaries. The Authority and its officers, employees, agents or any consultants or contractors are expressly deemed third party beneficiaries of this Agreement with respect to the provisions of Section 3.01. It is expressly agreed that, except for the Authority with respect to the provisions of Section 3.01, there are no third party beneficiaries of this Agreement, including without limitation 054 Resolution No. 23671 Page 16 any owners of bonds, any of the Local Agency's or the Developer's contractors for the Acquisition Improvements and any of the Local Agency's, the Authority's or the Developer's agents and employees. Section 3.06.Conflict with Other Agreements. Nothing contained herein shall be construed as releasing the Developer or the Local Agency from any condition of development or requirement imposed by any other agreement between the Local Agency and the Developer, and, in the event of a conflicting provision, such other agreement shall prevail unless such conflicting provision is specifically waived or modified in writing by the Local Agency and the Developer. Section 3.D7. Notices. All invoices for payment, reports, other communication and notices relating to this Agreement shall be mailed to: If to the Local Agency: City Manager City of Palm Springs 3200 Tahquitz Canyon Way P.Q. Box 2743 Palm Springs, California 92262 If to the Developer: [Developer] [Address to Come] I I Either party may change its address by giving notice in writing to the other party. Section 3.08.Severability. If any part of this Agreement is held to be illegal or unenforceable by a court of competent jurisdiction, the remainder of this Agreement shall be given effect to the fullest extent reasonably possible. Section 3.09.Governing Law. This Agreement and any dispute arising hereunder shall be governed by and interpreted in accordance with the laws of the State of California. Section 3.10.Waiver. Failure by a party to insist upon the strict performance of any of the provisions of this Agreement by the other party, or the failure by a party to exercise its rights upon the default of the other party, shall not Constitute a waiver of such party's right to insist and demand strict compliance by the other party with the terms of this Agreement. 055 Resolution No. 23671 Page 17 Section 3.11.Singular and Plural; Gender. As used herein, the singular of any word includes the plural, and terms in the masculine gender shall include the feminine. Section 3.12.Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original. Section 3.13.Successors and Assigns. This Agreement is binding upon the heirs, assigns and successors-in-interest of the parties hereto. The Developer may not assign its rights or obligations hereunder, except to successors-in-interest to the property within the District, without the prior written consent of the Local Agency, Section 3.14.Remedies in General. It is acknowledged by the parties that the Local Agency would not have entered into this Agreement if it were to be liable in damages under or with respect to this Agreement or the application thereof, other than for the payment to the Developer of any (i) moneys owing to the Developer hereunder, or (ii) moneys paid by the Developer pursuant to the provisions hereof which are misappropriated or improperly obtained, withheld or applied by the Local Agency. In general, each of the parties hereto may pursue any remedy at law or equity available for the breach of any provision of this Agreement, except that the Local Agency shall not be liable in damages to the Developer, or any assignee or transferee of the Developer other than for the payments to the Developer specked in the preceding paragraph. Subject to the foregoing, the Developer covenants not to sue j for or claim any damages for any alleged breach of, or dispute which arises out of, this Agreement. [THE REST OF THIS PAGE INTENTIONALLY LEFT BLANK] i 056 Resolution No. 23671 Page 18 IN WITNESS WHEREOF the parties p have executed this Agreement as of the day and year written above. CITY OF PALM SPRINGS By ATTEST: City Manager City Clerk By [DEVELOPER], a [here indicate type of legal entity] By (Signature) (Print Name) I I 057 Resolution No, 23671 Page 19 EXHIBIT A TO THE ACQUISITION AGREEMENT DESCRIPTION OF ACQUISITION IMPROVEMENTS AND BUDGETED AMOUNTS ACQUISITION IMPROVEMENTS BUDGETED AMOUNTS 1. $ 2. 3. 4. I I 058 Resolution No. 23671 Page 20 EXHIBIT B TO THE ACQUISITION AGREEMENT FORM OF SCIP REQUISITION To: Bond Logistix LLC SCIP Program Administrator 777 S. Figueroa St., Suite 3200 Los Angeles, California 90017 Attention: Daniel Chang Fax: 213-612-2499 Re: Statewide Community Infrastructure Program The undersigned, a duly authorized officer of the CITY OF PALM SPRINGS hereby requests a withdrawal from the [DEVELOPER]ACQUISITION ACCOUNT, as follows: Request Date: [Insert Date of Request] Name of Developer: [Developer] Withdrawal Amount: [Insert Acquisition Price] Acquisition Improvements: [Insert Description of Acquisition Improvement(s) from Ex. A] Payment Instructions: [Insert Wire Instructions or Payment Address for Developer] The undersigned hereby certifies as follows: 1. The Withdrawal is being made in accordance with a permitted use of such monies pursuant to the Acquisition Agreement, and the Withdrawal is not being made for the purpose of reinvestment. 2. None of the items for which payment is requested have been reimbursed previously from other sources of funds. 3. If the Withdrawal Amount is greater than the funds held in the [Developer] Acquisition Account, the SCIP Program Administrator is authorized to amend the amount requested to be equal to the amount of such funds. 4. To the extent the Withdrawal is being made prior to the date bonds have been issued on behalf of SCIP, this withdrawal form serves as the declaration of official intent of the CITY OF PALM SPRINGS, pursuant to Treasury Regulations 1.150-2, to reimburse with respect expenditures made from the Developer Acquisition Account listed above in the amount listed above. CITY OF PALM SPRINGS By : Title: 059 Resolution No_23671 Page 21 EXHIBIT C TO THE RESOLUTION CITY OF PALM SPRINGS CONTACTS FOR SCIP PROGRAM Primary Contact Name: Mr. John Raymond Title: Director of Community and Economic Development Mailing Address: P.O. Box 2743, Palm Springs, California 92263-2743 Delivery Address: 3200 E. Tahquitz Canyon Way, Palm Springs, California 92262 E-mail: john.raymond@palmspringsca.gov Telephone: 760-323-8259 Fax: Secondary Contact Name: Title: Mailing Address: Delivery Address (if different): I E-mail: Telephone: Fax: [Add additional contacts as needed] 060 Resolution No. 23671 Page 22 CERTIFICATION OF RESOLUTION I I, the undersigned, the duly appointed and qualified City Clerk of the City of Palm Springs, do hereby certify that the foregoing Resolution No. was duly adopted at a regular meeting of the City Council of the City of Palm Springs duly and regularly held at the regular meeting place thereof on the day of 2014, of which meeting all of the members of said City Council had due notice and at which a majority thereof were present. An agenda of said meeting was posted at least 72 hours before said meeting at , a location freely accessible to members of the public, and a brief description of said resolution appeared on said agenda. I have carefully compared the foregoing with the original minutes of said meeting on file and of record in my office, and the foregoing is a full, true and correct copy of the original resolution adopted at said meeting and entered in said minutes. Said resolution has not been amended, modified or rescinded since the date of its adoption and the same is now in full force and effect. I Dated: , 2014 [ 1 City Clerk City of Palm Springs I I By: [Seal] 061 Attachment 3 062 April 23, 2018 Mr. Marcus L. Fuller, MPA, PE, PLS Via email and overnight delivery Assistant City Manager City of Palm Springs 3200 E. Tahquitz Canyon Way Palm Springs, CA 92262 Re: Canyon View—Case#5.1384-PDD-381 Request for SCIP Financing Dear Marcus: Per our recent conversations, enclosed please find the below-listed updated exhibits supporting our request for SCIP financing of certain fees and eligible improvements for the subject property. These analyses demonstrate a combined maximum effective tax rate of 2% should this project's deferred improvements also be financed in the future. 1. Exhibit A—Summary of Builder SCIP fees & improvements plus CFD Deferred Improvements; 2. Exhibit B—Line item cost detail for Builder SCIP Street and Water Improvements; 3. Exhibit C— Line item cost detail for CFD ,Deferred Improvements; 4. Exhibit D—Tax Rate Summary; 5. Exhibit E —SCIP Projected Assessment and Bonded Indebtedness; and, 6. Exhibit F—CFD Projected Special Taxes and Bonded Indebtedness. Thank you for scheduling this item before the flay 2nd City Council hearing. As you know, we have previously provided the SCIP application signed by the applicant. We understand that you will be seeking Council authorization to countersign this application in accordance with the City's existing SCIP Participation Agreement. If I can provide further information, please do not hesitate to contact me. Sincerely, Rhonda Neely Vice President cc: David Ready Tabitha Richards Donald Povieng Suzanne Harrell Kuda Wekwete Enclosures Summlt _6ne+Partners 4SO 1 hirt, c .r J St ,w 200 Hf,,Yonrt f.a I •GA •92G6s mL y)19 5900 Fnx 949 S I inrul,c coc, 063 EXHIBIT A SUMMARY Builder SCIP Fees and Improvements and CFD Deferred Improvements April 23.2018 CANYON VIEW-Case#5.1384-PDD-381 DU'. 80 NET AC. 1325 Estimated Estimated Unit Price Oly Total I BUILDER SCIP 1 Fees A City of Palm Springs(Lead Agency. Sewer Facility DU 3,000 80 240,000 Sewer Main LF 16 2.175 34,800 Park DU 7,005 80 560,400 Drainage AC 8.214 13.25 108,836 Subtotal-PS Fees 944,1 B. Desert Water Agency Connection Charge LF 70 1,938 135,660 Water Main Tie-In Fee EA 2 20,000 40,000 1"Supplemental Imported Water DU 2.250 84 189,000 1-1/2 Supplemental Imported Water DU 25,210 2 50,420 1"Backup Facility Charge DU 6,375 84 535,500 1-112"Backup Facility Charge EA 12,750 2 25,500 Subtotal-DWA Fees 976,080 Total-Fees 1,920,116 2, Public Street&Water Improvements(See Exhibit B) A. City of Palm Springs i. E.Palm Canyon[NOT widening] LS 72,144 1 72,144 ii Matthew Drive LS 148,221 1 148,221 iii. So Linden Way LS 68,159 1 68,159 Subtotal-Palm Springs Street Improvements 288,524 B. Desert Water Aoencv i In-Tract Water System LS 329,545 1 329,545 Subtotal-DWA Public Water Improvements 329,545 Total-Public Street&Water Improvements 618,069 3. Contingency&Consulting(on hard costs) % 618,069 18% 111,252 Sublolal-Contingency&Consulting 111,252 111,252 GRAND TOTAL-BUILDER SCIP 2,649,437 II. DEFERRED IMPROVEMENTS CFD(See Exhibit C) 1. Public Street&Utility Improvements A. City of Patin Springs i.East Palm Canyon Widening LS 452,129 1 452,129 I East Palm Canyon Landscacped Median LS 439,747 1 439,747 Subtotal-Palm Springs Street Improvements 891,876 B. Uhlitiv Companies&City of Palm Springs i. Underground Overhead Utilities LS 1,131,237 1 1,131,237 Subtotal-Underground Overhead Utilities 1,131.237 Total-Deferred Improvements 2,023,113 2. Contingency&Consulting % 2,023,113 18% 364,160,34 Subtotal-Contingency&Consulting 364,160 364,160 GRAND TOTAL-DEFERRED IMPROVEMENTS CFD 2,387,273 III. COMBINED BUILDER DEFERRED IMPROVEMENTS Total-Builder SCIP 2,649.437 Total-Deferred Improvements CFD 2,387,273 (1 i GRAND TOTAL-COMBINED BUILDER SCIP i DEFERRED IMPROVEMENTS CFD 5,036,710 (1)Final amounts to be determined during formation 064 EXHIBIT B Line Item Detail Builder SCIP Public Streets and Water Improvements Apri123 2010 CANYON VIEW-Case 85.1384-PDDJ81 uantit Unit Price. Ext Total A. City of Palm Springs i. East Palm Canyon Drive,L=-/-1252' R'PCC Colored Sidewalk,W=12' 13,472 SF 3 75 50,520 Access Ramp Erhancemant w7Truncated Durres 2 EA 650.00 1,300 Tralfic Ccrtrol 1 LS 2 500 00 2,500 Dirt Balance Sidewalk.i 0.1 13,472 SF 0.65 8.757 Parkway Landscaping E Palm Canyon Drive 3,297 Sp 2 75 9.067 Subtotal-E Palm Canyon 72,144 ii.Matthew Orive,L=1318' Sawcul&Remove Existing AC 5,200 SF 2,50 13,000 Cut-lo-Subgrade 659 CY S.OD 3.205 6"Curb&Gutter 664 LF 14.51 9.628 0"Curb at Arizona Crossing 536 LF 12 50 6,700 4"PCC Sidewalk.W=4.5' 5,769 SF 325 18,749 Sawcul&Remove Ewsling 5'PCC Cross Ginter 1 LS 9,500.00 9.500 3"AC/6"A8124"Compacted Native 23,706 SF 205 48,597 Extend 6"PCC Arizona Crossing,W=12' 300 SF 15.00 4,500 Grind and Overlay Existing AC.W=2' 2636 SF 2.00 5.272 Replace Traffic Signal Loops 6 EA 400.00 2,400 Misc.Signing&SlrippmU 1.452 LF 2.00 2,934 6"PCC Cross Gutter at Entries 1,407 SF 650 9.146 Traffic Contra] 1 LS 2,500.00 2.500 Did Balance Parkway.i 0 1 U.W=7' 0200 Sr 0.15 1.330 Survey Monuments 5 EA 25000 1.290 Raise Valve Covers 11 EA 30000 3,3W Raise Sewer Manhole Covers 7 EA 400 2,800 Access Ramp Enhancement wfTruncated Domes 3 EA i,100.00 3,300 Subtotal Matthew Drive 148,221 III,So.Linden Way,L=620i Grind Existing AC 1.240 SF 200 2400 Cut-le.-Subgrado 189 Cy 5.00 945 6"Curb&Gutter 620 LF 1450 8.990 Remove&Replace Existing Arizona Crossing 124 SF 2500 10600 Sawcut&Remove Existing 6"PCC Cross Gutter 1 LS 9,50000 9,Sea 2.5"ACMAB124"Compacted Native 10,230 SF 165 16,860 4'PCC Sidawatk/Bike Path,W=4.5' 3,928 SF 325 12.766 Din Balance Parkway 3010' VV=12' 6992 SF 915 1049 Viso Signing B Sirippi rig 1 LS 2000 CO 2,000 Traffic Control I LS 1.50000 1500 Survey Monuments 2 EA 25000 5C0 Raise Valve Covers 1 EA 30000 300 Access Ramp Enhancement w7Tmncaled Domes 1 EA 65000 650 Sublotal-So.Linden Way 68,159 Subtotal-Palm Springs Street Improvements 288,524 B. Desert Water Agency Quantity Unit Pro. Total i. In-Tract Water System 8'PVC Mainline wlBedding and Backlill 3,102 LF 30.00 93060 &Gata Valve Epoxy Lined&Coaled,Includes I Raise 23 EA 2,15000 49,450 1'Domestic Service&Box 60 EA E4000 67200 P'Service at Dog Park(2 Ea),Park and Sculpture Park 4 EA 84000 3.360 Dry Well al Service 4 EA 1,000.00 4,000 1-10"Irrigation Service 8 Box,wish Adjustment 2 EA 2,500.00 5,000 Fire Hydrant Assembly Complete 12 EA 5.650.DO 57,800 1"Alr Vac 1 EA 2,87500 2,875 2"Blowoff Assembly 12 EA 1,850 CO 22,200 Tie into Existing Line&Connect.Hot Tap(by DWA) 2 EA 6.500 CO 13.000 Sawcul,Remove&Replace Existing AC 80 SF 20.00 1,600 Traffic Control 1 LS 1.500.00 Ind w-SD Chlorination 8 Testing 3.102 LF - Inct above 329,545 Subtotal-DWA Public Water Improvements 329,545 TOTAL-SCIP Eligible Public Street&Water Improvements(prior to Contingency&Consultants) 613,069 EXHIBIT C Line Item Detail Deferred CFO Improvements April 23,2018 CANYON VIEW-Case#5.1384-POD-381 Quantity Unit Price Exl Total A. Cily of Palm Springs I. East Palm Canyon Widening Sawcut&Remove Existing Cross Gutter 830 SF 5.00 4,150 Sawcut&Remove Existing AC(Grind) 1,390 SF 1.25 1,738 6"Curb&Gutter 1,298 LF 14.50 18,821 6"PCC Cross Gutter 900 SF 7.40 6,660 4"AC/12"AB/24"Compacted Native 22,203 Sr 3.92 87,036 4"PCC Colored Sidewalk,W=8' 9,094 SF 3.75 34,103 Access Ramp Enhancement wfTruncated Domes 2 EA 1,100.00 2,200 Traffic Control 1 LS 20,000.00 20,000 Dirt Balance Parkway,f 0.10',W=12'-14' 16,874 SF 0,15 2,531 Dirt Balance Flood Control Channel Easement,W=60' 68,280 SF 0.15 10.242 Additional Lanes on East Palm Canyon-Allowance 1 Allow 37,026.00 37,026 Relocate Traffic Signal at East Palm Canyon/Gene Autry 1 Allow 200,000.00 200,000 Misc.Signing&Striping 1,298 LF 2.00 2,596 Parkway Landscaping,W=4',E Palm Canyon Drive 5,192 SF 2,75 14,278 Street Trees,E.Palm Canyon Drive,24"Box 43 EA 250.00 10,750 452,129.86 ii.Landscaped Median Mobilization 431,125 0.02 8,622 Sawcut&Remove Existing AC(Grind) 22,445 SF 2.75 61,724 Cut-to-Suhgrade 1,250 CY 22,50 28,125 Construct 8"Median Curb 3,130 LF 16.50 51,645 Balance Median 19,500 SF 2.50 48,750 Install 2"PVC Irrigation Lateral Including 4"Sleeving 1 LS 2,50000 2.500 Sawcut,Remove&Replace Existing AC 8,400 SF 1559 150.955 Irrigation System Controller 1 EA 10,000.00 10,000 4"Colored Concrete at Left-Turn Pocket 640 SF 4.25 2,720 Patch AC at Median Curb 3.130 SF 5.40 16,902 Landscape Median 18,712 SF 350 65,492 Traffic Control 1 LS 9,811.00 9,511 Signing&Striping 1 LS 2,500.00 2.500 439,746 Subtotal-Palm Springs Street Improvernints 891,876 B. Utility Companies&City of Palm Springs I. Underground Overhead Utilities 1,554 LF 72T95 1.131,237 1,131,237 TOTAL-CFD or SCIP Eligible Deferred Improvements(prior to Contingency&Consultants( 2.023,114 066 EXHIBIT D TAX RATE SUMMARY Canyon View Project Proposed SCIP Assessment District Financing up to$2.65 million in improvements/fees Unit Tylle Avg. Avg. No.of Ad Valorent Overlapping Sq.Ft. Price Units Taxes(S)[1] Assessments[21 SCIP AD(31 Tax Rate Product 1 2,132 $648,000 3 $8,111 $675 $2,692 1.77% Product 2 2,269 $688,000 2 $8,612 $675 $2,692 1.74% Product 3 2,290 $714,000 16 $8,938 $675 $2,692 1.72% Prod uct4 2,359 $734,000 19 $9,188 $675 $2,692 1.71% Product 5 2,416 $750,000 23 $9,388 $675 $2,692 1.70% Product 2,634 $801,000 17 $10,027 $675 $2,692 1.67% Total NA I NA 1 80 1 NA NA NA NA [1]Assumes an existing tax rate of approximately 1 25% [2]Includes a CuyNvide special taN For public safety aF$425 per unit per year,Palm Spdnes Sesser Charge aF$140 per unit per year,and other assessments totaling$9.60 per Unit per year. [3]Assumes on average coupon rate of 4.50"/u over 30}ears.Note:Current SCIP bond issuances have an average coupon of less than 4.0011X,- Based on call e rates,the proposed SC8'assessment would finance$2.5 million of[fie$2 65 millmr projected in improvements and fees. Canyon View Project Proposed SCIP Assessment District Financing up to$2.65 million in improvements/fees through SCIP &$2.39 million in deferred Improvements with a CFD Proposed Unit Type Avg. Avg. No.of r Overlapping r firinfiraverrients Product 2,132 $648,000 3 $8,111 $675 $2,692 $1,479 2.00n/o Product 2,269 $688,000 2 $8,612 $675 $2,692 $1,778 Product 2,290 $714,000 16 $6,938 $675 $2,692 $1,776 1.97% Product 2,359 $734,000 19 $9,188 $675 $2,692 $2,122 2.00% Product 5 2,416 $750,000 23 $9,388 $675 $2,692 $2,242 2.00% Product 2,634 $801,000 17 $10,027 $675 $2,692 $2,624 2.00% Total NA NA 80 NA NA NA NA NA [I]See Table above. [2]Assumes that CFD taxes escalate by 2%per year,and bonds are issued in 2019 to finance improvements.Bonds are assumed to have an average coupon of 4.5%since the entire project will he built out at the time of issuance. 067 EXHIBIT E- SCIP - PROJECTED ASSESSMENT/ INDEBTEDNESS ©DAVID TAUSSIG a ASSOCIATES.INC. PROJECTED ASSESSMENT AND BONDED INDEBTEDNESS FOR DRAFT CAPACIY ANALYSIS#1 CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY 412 012 01 5 PROPOSED ASSESSMENT DISTRICT SUMMIT LAND,LLC.-CANYON VIEW LAND USE ASSUMPTIONS BOND ASS U NPTIONS SERIES rI IFFIIFSP SERIESC AS.SFSSMENT ASSUMPTONS EUILDOUT PERIOD(TEMS FPOM 2019)111 C 60110 YEAR 2019 NA NA AVERAGE RESICENTAL ASSESSMENT(PER UNIT, 5259" AVERAGE COUPON 4.50.4 NA NA AVE RAGE NON-RESIDENTIAL ASSES SMENT.PER SC FT) 1A BOND TERM[YEARS) 30 NA NA UNDEVELOPED ASSESSMENT(PER ACRE: 11 COSTS CF ISSUANCE I DISCOUNT 8,89% NA NA OTHER AGSESSMENTS(PER ACRE) ACREAGE SUMMARY III RESERVE FUND F24% NA NA %ANN UAL ASSESS MEN-INCREASE GROSS ACREAGE-TOTI SITE loon CAPITALIZED INTEREST-SERIESA 4 ait% NA NA LESS'FSTIMATEQ F%FMPT ACR A- '1N CAPITALIZEDIMEREST-SERIESB NA NA NA ESTIMATEONFTi"ABLEA6REAGE 1802 CAPITALIZED INTEREST-SERIESC NA NA NA GROSS ACREAGE-RESIDENTIAL 18.8E MINIMUM DEBT SERVICE COVERAGE OTHER ASSUMPTIONS CROSSACREAGE-NON-RESNENThL 1.18 GROSS DEBT SERVICECOVERAGE 10000% REINVESTMENT INTEREST RATE li+� NFT DEBT SF.RVICECOVERAGF 100 il'S DISCOUNT RATE FOR NPV ANALYSIS y pp=y EST.NET TAXABLE ACREAGE-PESIOENTAL 19.BJ ADMINISTRATION E%FENSE INFLATION PATE EST.NETTAtABLEACREAGE-NON-RESIDENTIAL 000 MNIMUMVALLIE-TO.UEN 2c0o 166d INITIAL YEAR ADMINI$TF0.NON EY.PENSF 5?0, 1 SUMMARY OF ASSESSMENT COMPUTATIONS AVERAGE ESTIMATED ESTIMATED PROCEED PROPOSED ANNUALASSESSMENT(FY201G 20201 UNITSr BASE FINISHED LOT BONO AMOUNT AMOUNT ASSESSMENT AD TOTAL E TAR. IOTAL ESSMENT GATEGOaIES E.T.R. ASS SO -IT PRICE t vAUE (PER UNNISG.FT A FR UNITISO.FT RER UNITIES.FT TR. EXCLUDING AD 1?' INCLUDING Af GLASS DETACHED PROPERTY 80 S744463 519]]1B5 S39.I- G31,472 $2,892 036% 131% t7C5: NOTES( 9T R-F&.rPl RIM MAJOR CONCLUSIONS p)S...e P"p,v PIpp-ss TOTAL BONDED INDEBTEDNESS s3,v0,000 RESIDENTIAL ASSESSMENT S6,010p16 I2!BaseC aoPo.AV'Yte+bo1Io/ ,RAe, ,oI nerpfrEplln9 P.Amn,. SERIES 2019 $3,130,000 NON-RESIDENTIAL ASSESSMENT E0 SERIES NA 10 UNDEVELOPEO ASSESSMENT 0 SERIES NA 50 TOTAL A95E59M1tErvi 50,010,0)E TOTAL BOND FINANCED FACILITIES $2.517,786 TOTAL DEBT SERVICE B ADMINISTRATION 5.5,]86,225 SERIES ?019 $2,517,,789 MISCELLAN EOUS REVENUES 4376,149I SERIES NA 50 PAY-AS.YOU-GO FACLRIES SO SERIES NA 10 TOTAL NFT DEBT SERVICE SS^.12.3Th NPV OF PAY-AS-YOU-GO FACILITIES 50 NPV OF UNDEVELOPED ASSESSMENT SO TO VI cc EXHIBIT F CFD- PROJECTED SPECIAL TAXES/ INDEBTEDNESS ID DAVID TAUSSIG&ASSOCIATES,INC. PROJECTED SPECIAL TAXES AND BONDED INDEBTEDNESS FOR DRAFT CAPACITY ANALYSIS#1 PROPOSED CITY OF PALM SPRINGS COMMUNITY FACILITIES DISTRICT m2enD7., (CANYON VIEW) SUMMIT LAND,LLC. Escalating Debt Sewlae and Special Taxes LAND USE ASSUMPTIONS BOND ASSUMPTIONS SERIFSA S RIES F. RFRIESC SPECIAL TAX ASSUMPTIONS DUILDOUT PERIOD(YEARS FROM 2019)[11 0 E ONO'EAR 2019 NA NA AVERAGE RESIDENTIAL SPECIAL TAX(PER UNIT{ r� AVERAGECOU�ON 4LCN, NA NA AVERAGE NON.RESDENTIAL SPECIAL TAX fPER SO,FTI Nc. BOND TERMjYEARS) 30 NA NA UNC EVELOPED IONNNUM SPFC M,TAY I"EF AC:2E) i10,DiC COSTSOE ISSUANCE/DISCOUNT &1 NA NA 'A ANNUAL TAX TER ACRE' i1n 01g ACREAGE SUMMARY O RESERVEFUNp 441% NA NA q;ANNUAL SPECIAL TAX INCREASF LFS PSCREAGEETOTAL SRF 2000 CAPITALIZED INTEREST.SERIES A 441% NA NA ESTIMATED NTPDFKABLE ACREAGE 6ill32 CA ITALI?ED INTEREST-SERIESE NA NA NA ESTIMATED NET T/yggLE ACREAGE 18.32 CAP'.iALI?ED INTEREST-SFRIESC NA Na NA GROSS ACREAGE.RESIDENTIAL 1882 MINIMUM DEBT SERVICE COVERAGE OTHER ASSUMPTIONS GROSS ACREAGE NON-PESIOENTIN_ 1.18 GROSS DEBT SERVICE COVERAGE 'TO 1-4 REINVESTMENT INTEPESTRATE 075';; NET DEBT SERVICE COVERAGE 11081% Gr COUNTRATEFORNPVANALYSIS EO_/ EST NET TAXABLE ACREAGE-RESIDENTIAL 1B B2 ACMNISTRATION EXPENSE INFLATIO N RATE _ EST.NET TAXABLE ACREAGE-NOIN�RESIDENTIAL 000 MINIMUM VALUE-TO-UEN 1135 INITIAL YEAR ADMINISTRATION EXPENS 3'1C C.00a0 0 SUMMARY OF TAX COMPUTATIONS LOWEST ESTIMATED ESTIMATED PROCEED PROPOSED ASSIGNED SPECIALTAx I FY 2019.2020, UNITS, EASE FINISHED LOT BOND AMOUNT AMOUNT SPECIAL TAX CFD TOTAL E.T.R. TOTAL ET.R. SPECIAL TAX CLASS SOFT PRICE['I VP EPRUNITISO.FTJ [PER UNRISO FT I f1tR VNITIS0 FT 1 ET.R, FZCLUDIND CFD RI tNCLUOING CFO CI,ASSI DETACHED PROPERTY 11.2.500 SFI 17 SB01D00 $320,400 S4E,26D 136,271 52.62i 0:EA, 167° -1 CC4 CLAS52 DETACHED PROPERTY;],410-1.499 SF) 23 115D000 5300000 S39,54D E3/001 S2245 0.30% -7>N 2611%, CLASS3 DETACHED PROPERTY 12,320-:409SF) 19 $73,030 S293,6D0 S37,432 229.349 52,125 029% 1 7-:% 2CC% CLI DETACHED PROPERTY 12,230.2,319 OF) 16 568E,000 S275,200 S31"iD IN 50E 5'.,121 026% .24% 2.00% CLASS DETACHED PROPERTY I�223C SF) 569E DT0 525^200 S25,099 SIC AF' SI482 NOTES• ETR_Errc,.TA=Rmr MAJOR CONCLUSIONS (1J Smmx Pmjsl PIFIMS'A1 TOTAL BONDED INDEBTEDNESS $3.050.000 RESIDENTIAL SPECIAL TAXE5 15 Lw169 r2IBrlrU PI maAnry rer Nils fI,suDpcf POPrM AAO ne:gAorrnq P', SERIES 2019 S3,050,000 NON-RESIDENTIAL SPECIAL TAXES Eo SERIES NA $C UNDEVELOPED SPECIAL TAXES SERIES[ NA JD TOL S PECLIL TAXES 19 TA 55,541,LSJ TOTAL BOND FINANCED FACILRIES $2.301.349 TOTAL DEBT SERVICE&ADMINISTRATION 16,395823 SERIES 2019 S2,391,349 MISCELLANEOUS REVENUES I5454.171) SERIES D NA SERIES Na Sn PwY.AS-YOU-GO FACILITIES so 10 TOTAL NET DEBT SERVICE $5.941653 NPV OF PAY-45-v0V-GO FACILITIES so NPV OF UNDEVELOPED SPECIALTAXES 10 L� Cindy Berardi From: Rhonda Neely <rneely@summitllc.com> Sent: Monday, April 30, 2018 1:00 PM To: Marcus Fuller Cc: David Ready; Geoff Kors;JR Roberts; Lisa Middleton; Christy Holstege; Robert Moon; Cindy Berardi; CityClerk Subject: May 2nd City Council - Request to remove Canyon View from agenda Marcus - Please consider this Summit's request that you remove our Canyon View project from the May 2nd City Council agenda. We take exception to the staff report's recommendation that our project's deferred improvements be financed and constructed now, based on the analysis by the City's consultant, Suzanne Harrell of Harrell & Company Advisors. This recommendation directly contradicts the City Council's approval of this project on July 5, 2017 and is unacceptable. We have had numerous conversations with our own consultant, David Taussig &Associates who has a significant difference of opinion with Ms. Harrell's assumptions. Experienced in the formation of over 1,500 special districts and funding programs over the past 32 years with bond authorizations exceeding $50 billion, our consultant, David Taussig & Associates, is a highly respected leader in the public finance industry whose recommendations are worthy of consideration. In approving the Canyon View project, the City Council's stated intent in deferring certain improvements was that they be accomplished on an area-wide basis in order to take advantage of economies of scale, rather than burden just the 80 homes in Canyon View. It was never their intent that the Canyon View project would construct the deferred improvements, as further evidenced by the covenant wording provided by the City to Summit. We would like to reconvene in a working session as soon as possible to discuss this issue further prior to being rescheduled before the City Council. Please advise as to when you would be available. Rhonda Rhonda Aleelj,, Vice President Summit Lind Partners, LLC i 430 Thirty Second Street, 4200 Neilport Beuch, CA 92663 Direct: 949-5 J 4-6936 rneely asummitllc.com S,,&Jtr